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In Wal-Mart's Image
September 14, 2009 2:00 AM   Subscribe

How Wal-Mart's values are shaping America's economy -- and why this is a very bad thing:
Around the time that the young Sam Walton opened his first stores, John Kennedy redeemed a presidential campaign promise by persuading Congress to extend the minimum wage to retail workers, who had until then not been covered by the law. Walton was furious. Now the goddamn federal government was telling him he had to pay his workers the $1.15 hourly minimum. Walton's response was to divide up his stores into individual companies whose revenues didn't exceed the $250,000 threshold. Eventually, though, a federal court ruled that this was simply a scheme to avoid paying the minimum wage, and he was ordered to pay his workers the accumulated sums he owed them, plus a double-time penalty thrown in for good measure. Wal-Mart cut the checks, but Walton also summoned the employees at a major cluster of his stores to a meeting. "I'll fire anyone who cashes the check," he told them.
posted by acb (259 comments total) 44 users marked this as a favorite

 
Now that we've rolled back the trade union victories of the early 20th century, maybe we can start rolling back civil rights and suffrage. Man, I'm starting to think the 1960s were America's glory years.
posted by crapmatic at 2:25 AM on September 14, 2009 [13 favorites]


Ahhh the crumblings of empire. It isn't destined though, you guys can reject your slavish devotion to screwing each other over to make a buck and come join the rest of the developed nations in taking care of each other.

Just saying.
posted by Samuel Farrow at 2:42 AM on September 14, 2009 [53 favorites]


That kinda talk could get you killed in the more fundamentalist Christian areas of the U.S.
posted by stavrogin at 2:49 AM on September 14, 2009 [15 favorites]


Capitalism, I presented to you your own Achilles' Heel: Blind, Asshole greed.
posted by From Bklyn at 2:56 AM on September 14, 2009 [15 favorites]


stavrogan: I feel pretty safe as last time I was in the Southern States someone asked me whether New Zealand was near Vietnam. Apparently their brother had been to Vietnam...
posted by Samuel Farrow at 3:04 AM on September 14, 2009


But socialism is demeaning to human dignity!
posted by WPW at 3:19 AM on September 14, 2009 [6 favorites]


Wal-Mart pays its workers nothing at all when they can get away with it.
posted by Clay201 at 3:20 AM on September 14, 2009 [13 favorites]


Yeh the effect of Wal-Mart both on the national economy and local is a fascinating topic. But they also impact the global economy, something that is little appreciated (i.e. think about where Wal-Mart sources most of it's goods?)

While a lot of economists look at Wal-Mart I'm familiar with some work done by Basker, from the University of Missouri. He's extensively studied Wal-Mart, and has published academic papers on the effects of such a giant on the US retail landscape. Some of the more interesting tidbits I've got links to :

Basker maintains (and distributes) a fairly comprehensive set of data detailing store locations since 1972 [ .csv ].

Of course as a listed company Wal-Mart has regulatory responsibility to it's shareholders; here you can find SEC filings back to 1992

The folks at Good Jobs have been trying to create a database of all subidies received by Wal-Mart [ .pdf ]; their document entitled Shopping for Subsidies: How Wal-Mart Uses Taxpayer Money to Finance it's Never Ending Growth is worth a read, if for no other reason to understand what type of back room wrangling goes on when this company tries to enter a new market. The types of subsidies Wal-Mart receives are very eye opening: The folks at Good Jobs conclude Wal-Mart is in an economic class by itself.

After all of this if you're curious what image Wal-Mart tries to present to the public, here are their annual reports from 1972 to 2009. Needless to say, you will notice a contrast between what Wal-Mart says and what Wal-Mart does.

Fascinating topic; not only Americans love / hate relationship with Wal-Mart but the impact on the global economy.
posted by Mutant at 3:23 AM on September 14, 2009 [45 favorites]


One of the arcing points made in the article is that Wal Mart is actively working to preserve an economically stratified economy, with the motivation being that if everyone had more disposable income, they wouldn't shop at Wal Mart.

I love a good conspiracy, but this is ludicrous. The only people that Wal Mart cares about keeping poor are their own employees. Most people will shop where goods are cheapest, especially for household items that aren't Veblen Goods. I've been to Wal Mart, and while many of the patrons are wretched, many are not and are simply willing to put up with the Wal Mart atmosphere to obtain products at the cheapest price. Sure some people won't shop there because they don't like the labor practices, but most Americans could give a shit.

There's so much to dislike about the company, and they do help to perpetuate the situation of the working poor. But it's through simple shady labor practices and pressure on their suppliers to adopt similar practices, not some elaborate Protocols of the Elders of Wal Mart plan to shape the greater economy.
posted by Mayor Curley at 3:32 AM on September 14, 2009 [10 favorites]


Not everything Wal-mart does is pure evil. (Purity being difficult in our world.) Here's an article about how Wal-mart uses its buying power and supply chain to enforce sustainable production practices (for instance in fisheries.) Wal-mart can frequently enforce standards through private contracts that would be impossible under international regulatory regimes. After all, if you're going to rule the world, there's incentive not to ruin it.
posted by anotherpanacea at 4:09 AM on September 14, 2009 [4 favorites]


Oh, and a self-link: a sufficiently advanced capitalism is indistinguishable from socialism.
posted by anotherpanacea at 4:14 AM on September 14, 2009 [8 favorites]


Samuel, I was just joking. Although, lately, a lot of Christians here would start screaming "Socialist!" at you for saying things like that.
posted by stavrogin at 4:25 AM on September 14, 2009


anotherpanacea, it seems by your analysis Wal-Mart is closer to a form of state capitalism, which isn't really socialism at all (since the defining feature of socialism is worker ownership).
posted by WPW at 4:30 AM on September 14, 2009


...state capitalism, which isn't really socialism at all (since the defining feature of socialism is worker ownership)

Wouldn't that mean that all real socialism is anarcho-syndicalism?
posted by acb at 4:41 AM on September 14, 2009


Since all attempts at socialism devolve into state capitalism, I've elided the difference. If it matters to you, you can call it that, but then you're left with the claim that there's no actually existing socialism. Or else you're left with the assumption that any company that runs an ESOP is socialist. This would include Wal-mart, by the way.
posted by anotherpanacea at 4:44 AM on September 14, 2009


re: Wal-Mart's Image, i thought that was pretty well established in wall-e (and idiocracy) and it's not like they're unaware of that reputation...

btw, here's a look at walmart vs. costco's labour practises: "In a country where the retail industry has been convulsed over the past decade by the rise of Wal-Mart and rival discounters, Costco's discount warehouse club is part of the revolution. But unlike Wal-Mart, whose low-cost labour model has provoked increasingly vocal criticism, Costco has managed to remain competitive while providing its workers with the highest wages and best healthcare plans available anywhere in the US retail industry," cf. burgerville (USA)

also, in a slight defence, i'm not sure that the walmartisation of, say, health care (or banking, or china, for that matter) is such a bad thing :P as comrades marx and engels say in the communist manifesto:
Constant revolutionising of production, uninterrupted disturbance of all social conditions, everlasting uncertainty and agitation distinguish the bourgeois epoch from all earlier ones. All fixed, fast-frozen relations, with their train of ancient and venerable prejudices and opinions, are swept away, all new-formed ones become antiquated before they can ossify. All that is solid melts into air, all that is holy is profaned, and man is at last compelled to face with sober senses his real conditions of life, and his relations with his kind.
cheers!
posted by kliuless at 4:45 AM on September 14, 2009 [4 favorites]


Yeah, I realised as soon as I pressed post that what I consider to be a "defining feature" is utterly disputable so that part of my comment is a matter of opinion. But I would still say that state capitalism isn't really socialism; or is at least a debased form of it.
posted by WPW at 4:45 AM on September 14, 2009


Ahem. Schumpeter. Ahem. (seriously, you're all saying what the guy was saying 70 years ago).
posted by qvantamon at 5:17 AM on September 14, 2009


All fixed, fast-frozen relations...
Marx and Engels were obviously referring to Birds Eye here.
posted by Abiezer at 5:50 AM on September 14, 2009 [1 favorite]


Shortly after Wal-mart lost some court cases for not paying overtime to their employees, and for discriminating against women, I sent a letter (self link), to their corporate offices then after getting some of the worst service in my life I sent an individual store manager a letter. (self link),

They responded to neither. I didn't shop at Wal-Mart for over a year after the second letter.
posted by cjorgensen at 6:38 AM on September 14, 2009


My Wal-Mart link farm:
Workers Assail Night Lock-Ins
Court Upholds NLRB in Wal-Mart Meatcutters Case
NLRB tackles Wal-Mart over firing
Court Rules in Wal-Mart Unionizing Case
National Labor Relations Board v. Wal-mart Stores, Inc.
NLRB dismisses Wal_mart claim based on "novel theory "
NLRB Finds Wal-Mart Guilty of Union-Busting/
Wal-Mart Settles U.S. Suit About Overtime
Wal-Mart Loses Unpaid Overtime Case
Wal-Mart to pay $54 million to settle suit over unpaid work
The price of Wal-Mart coming to town
Not always lower prices
How Do You Deal with the Entry of a New Wal-Mart Supercenter into Your Town?
Hidden Cost Of Wal-Mart Jobs
posted by Kirth Gerson at 6:40 AM on September 14, 2009 [19 favorites]


Clay201: "Wal-Mart pays its workers nothing at all when they can get away with it."

What a bunch of assholes. What is the Mexican minimum wage?
posted by Mitheral at 6:40 AM on September 14, 2009


I haven't shopped at Wal-Mart in over 8 years. And I live a mile from one. It's less convenient to go to the Target in town, but I do it happily.
posted by grubi at 6:47 AM on September 14, 2009 [4 favorites]


God I hate wal-mart. Why you ask? I use to work for them. >:>(

About 8 months of my second year of college was spent there. I was 20 and stupid. I put up with plenty of crap from that place. Everyone who worked there on an hourly basis was a gossiping, miserable person from the lowest toilet scrubber to the department managers. I honestly hated that job. Everything about it. It started out as a 20 hour a week part time college job and turned into a 40+ a week full time POS job all for minimum wage. Hard work was never rewarded. One time when I cleaned up my area (spotless cleaned mind you) I was rewarded by my fellow employees coming up to me saying "Why the hell are you working so hard. You are making the rest of us look bad!" then one of the managers gave me a push broom and told me to sweep the parking lot. Imagine having to clean a lot that fits 500+ cars with a flipping push broom?!? Then I got yelled at for NOT being in my area and I got yelled at AGAIN when I didn't finish sweeping the park lot. After that I switched to receiving. One night, I was inside the truck sending boxes of consumer crap down the line. I noticed my line was jammed up. I got out of the truck to see what was up and everyone that should have been unloaded my line was taking a smoke break. I unloaded it myself and then same old same old happened... employees yelled at me for, of all things, being lazy and not having my line full and the managers yelled at me for not doing my job. The last straw did not come from being on the job but from college when one of my professor's gave me a mercy D. The rest of my grades were not much better, 2 Cs and a B. Grant it I'm not the smartest person in the world, my GPA was always 2.8 to 3.25ish range, but because of my college job my GPA dropped over .5 points that semester. Later on that night... 15 minutes before my shift I walked up to my shift manager and told him that I was quitting. As I left I thanked him for helping me realize just how important my college education was.

Since then (several years ago) I have probably walked into a wal-mart about 4-5 times. I know how they treat their employees. I know how miserable everyone is that works there. AND I would gladly spend an extra 2-3$ down the road at a locally owned store than give wal-mart a penny of my hard earned scratch.

Wal-mart is capitalism at it's worst.
posted by Mastercheddaar at 6:57 AM on September 14, 2009 [45 favorites]


grubi: I'm right there with ya, except I also don't go to Target when I can help it. Costco every 4-6 weeks, otherwise it's all local, small shops where the money is staying as local as possible and where the employees know me by sight, even though I don't shop for much outside what subsistence requires.

Wal-Mart is pretty much evil, and I cannot believe the hostile response I get from people who learn that I simply never shop there. "But their prices on X are so good!" they say over and over. It's a kind of one-dimensional thinking which disallows for more cogent conversation.
posted by hippybear at 7:04 AM on September 14, 2009 [1 favorite]


For me, the de-lionization of Sam Walton was one of the most fascinating aspects of the article, and definitely makes me want to read the Lichtenstein book. In many parts of the south, Walton is heralded as a prime example of good old fashioned capitalism mixed with good old fashioned American can-do-ism, unassailable proof that if you work hard and provide folks with a good service, you'll succeed.

My parents love to repeat the (possibly apocryphal) story about Walton walking into one of his stores, dressed in denim overalls, a flannel shirt, and mud-caked work boots. He noticed the customer service desk was in desperate need of more associates to handle the long line, so he ambled up to the harried clerk and suggested the same. The clerk, not recognizing the company CEO, responded, "What's it to you, old man?" ... and was out of a job before the hour was up. The tale is told without a single hint of irony or acknowledgement of nuance; rather, it's served up (and consumed) as Walton fighting the good fight of What's Wrong With Retail Today, My God, with just a dash of I Miss The Good Old Days Of Real Customer Service.

Having been steeped in that mindset for most of my childhood, it's really quite shocking to learn that the genteel grandpa of that story was in reality a pretty ruthless and greedy asshole.
posted by shiu mai baby at 7:05 AM on September 14, 2009 [10 favorites]


No wal-mart thread is complete without this video. The University of Minnesota's Thomas Holmes Movie of Wal-Mart Store Openings, illustrating each store opening in the United States from 1962 to 2004
posted by lazaruslong at 7:26 AM on September 14, 2009 [1 favorite]


"Wal-Mart is pretty much evil...."

"It's a kind of one-dimensional thinking which disallows for more cogent conversation."


Repeated for emphasis.
posted by anotherpanacea at 7:27 AM on September 14, 2009 [2 favorites]


The University of Minnesota's Thomas Holmes Movie of Wal-Mart Store Openings, illustrating each store opening in the United States from 1962 to 2004

It's like watching cancer metastasize.
posted by blucevalo at 7:36 AM on September 14, 2009 [3 favorites]


Wal-Mart rips off the Girl Scouts.
posted by Sailormom at 7:38 AM on September 14, 2009


Wal-mart is capitalism at it's worst.
Or, capitalism at its best. Depending on one's point of view.
posted by Thorzdad at 7:55 AM on September 14, 2009 [3 favorites]


Wal-Mart/Sam's Club imports a lot of stuff into Puerto Rico that would otherwise be unobtainable there. (I'm primarily talking about food.) We shopped there nearly exclusively.
posted by Michael Roberts at 7:57 AM on September 14, 2009


hippybear: One of the best things to happen to retail in Tallahassee (where i live) in the last two years is our first Costco. I sometimes need to buy in bulk and I refuse to go to the local Sam's Club. As soon as Costco opened, my wife and I signed right up and it's one of our three most oftenly shopped stores in town (the others being target and Publix).


Cleanliness, employee happiness, and hard work are the best way to get my money, more so than simply "low prices." Cheap has two meanings.
posted by grubi at 8:01 AM on September 14, 2009 [3 favorites]


Fighting Walmart seems like fighting the ocean over your sandcastle.
posted by notmtwain at 8:02 AM on September 14, 2009 [1 favorite]


"Walton also summoned the employees at a major cluster of his stores to a meeting. "I'll fire anyone who cashes the check," he told them."

Well, it's good to know that he was an asshole from the very beginning and not someone who was slowly corrupted by power.

Mayor Curley : One of the arcing points made in the article is that Wal Mart is actively working to preserve an economically stratified economy, with the motivation being that if everyone had more disposable income, they wouldn't shop at Wal Mart... Most people will shop where goods are cheapest,

It's only a single datapoint, but I can confirm this; I have some relatives who are wealthy in a way that I will never be, and they frequently shop at discount places like Walmart and Sam's Club. They are pretty pragmatic folk and will pay the cheapest possible price whenever possible. This is probably one of the many reasons they are rich and I am not.

grubi : I haven't shopped at Wal-Mart in over 8 years. And I live a mile from one. It's less convenient to go to the Target in town, but I do it happily.

Yeah, I'm in the same boat. Target is a bit more out of the way, I'm sure it's got it's own collection of horror stories, but when I shop there, at least I don't feel like I'm shoveling coal into hell's furnace.

"But unlike Wal-Mart, whose low-cost labour model has provoked increasingly vocal criticism, Costco has managed to remain competitive while providing its workers with the highest wages and best healthcare plans available anywhere in the US retail industry,"


Damn, the nearest Costco is 27 miles away from me. That sucks, because knowing this, I'd be happy to give them a bit more business.

The thing I find most frustrating about Walmart is that they are uniquely positioned to effect real change in our world in positive ways; if they wanted to they could push much harder on the green initiative they launched a while back, and because of their buying power they could force businesses who do trade with them to require certain human rights criteria are met. But it seems like the obsessive drive to wring out every last penny will probably preclude anything like this from coming out their doors.

Which is a pity. With the amount of power they hold, they could do some seriously interesting things to make the world a better place.
posted by quin at 8:03 AM on September 14, 2009 [3 favorites]


Wal-Mart is pretty much evil, and I cannot believe the hostile response I get from people who learn that I simply never shop there. "But their prices on X are so good!" they say over and over. It's a kind of one-dimensional thinking which disallows for more cogent conversation.
I usually counter that one with a suggestion that they check the serial numbers or product codes. Often the lower price is because they put the same brand name on an inferior version of the product than you'd buy elsewhere.
posted by Karmakaze at 8:09 AM on September 14, 2009 [1 favorite]


grubi: I agree completely, although I have learned over the years that the prices at Costco are not always a great as you might think. Sure, that cardboard crate of canned diced tomatoes is convenient, but when you double check, you're paying around $1/can, a price which is easily beat by nearly any grocery store if you shop the sales.

Still, for many things, there is no alternative to Costco. When they decide that a book is worth carrying, it will be sold at a very low price. Same for DVDs and video games and audio CDs. Some of their paper products are a fantastic deal (toilet paper, for example), while others are shockingly overpriced compared to other outlets. Bags of coffee beans are cheap, a lot of the cheese and butter is cheap... Staples for stocking the pantry are pretty well-priced. We don't buy much of the pre-fab food items, but the stuff we do get there, we buy because we've done the research and know we're getting the best possible bang for our buck.

Costco has an interesting economy of scale, too. Like Wal-Mart, they are able to dictate to suppliers exactly what they want and how they want it packaged and palletized. Unlike Wal-Mart, Costco will NOT tell a supplier that they want to see the quality of the product degraded in order to achieve a lower price point. (Ever wonder why you don't see many Rubbermaid products in Wal-Mart these days? Because Rubbermaid refuses to use thinner, cheaper plastic in their products simply to be on Wal-Mart shelves.) Often items sold under the Kirkland label are really identical to brand-name products only with a different wrapper, although discovering exactly who is supplying the products can be a bit of a challenge.

Add in all the other, sort-of strange services from Costco (new cars? flooring, curtains, and countertops? tires? gasoline?) and there is a lot to be said for paying the few bucks a year it costs to get a membership. Heck, couple that with one of their AmEx cards, and some intelligent shopping will pay for itself and more with the cashback program.

I'm not a shill for Costco, but we've been a member there for years and years, and they help keep all our expenses under control without us feeling like we're doing damage to the community at large while we do it.
posted by hippybear at 8:12 AM on September 14, 2009 [5 favorites]


I hope to see a study done on the psychological impact of repeated Walmart shopping. The one time I went into one of their "Superstores", it was a frighteningly huge space with awful florescent lighting and miserable employees and aggressive shoppers and in the end it felt like paying to be hit on the head with a brick. I can't imagine going there on a regular basis and not walking out with some form of PTSD.
posted by cmonkey at 8:17 AM on September 14, 2009 [5 favorites]


God I hate wal-mart. Why you ask? I use to work for them. >:>(

Man, I had an almost identical experience working for an indie video store during my freshman year of college--right down to being told that I shouldn't clean (in this case the completely unsanitary and disgusting bathroom, which someone had peed all over, and probably hadn't been cleaned in a decade) because I was making the other employees look bad. Several of my co-workers would often work unpaid shifts to "help out", despite the fact that they'd been working there for years for only a buck more than minimum wage (without raises). Employees were made to close alone at night--the store was in a bad area of town, and a friend of mine had to call the cops once because some guy was pounding on the windows and screaming--because the boss wouldn't pay for two employees to close together.

I understand that part of what's worse about Wal-mart is the scope, but there are employers that take advantage of employees in both corporations and independently owned stores. Spending "an extra 2-3$ down the road at a locally owned store" doesn't guarantee that your money is going to support better labor practices.
posted by PhoBWanKenobi at 8:20 AM on September 14, 2009 [2 favorites]


Because this amuses me on average once per day: The People of Wal-Mart
posted by Fezboy! at 8:21 AM on September 14, 2009 [2 favorites]


Damn, the nearest Costco is 27 miles away from me. That sucks, because knowing this, I'd be happy to give them a bit more business.

That's about the same distance as the nearest Costco to us, although we're actually in a small town outside the local city so it's mostly highway driving. But because Costco is mostly about purchasing bulk quantities, it is fairly simple for us to assemble a list of items we want from there over the course of 4-6 weeks, and then fulfill that list in a single visit, often stopping for the inexpensive gasoline (usually about 10 cents lower than market), and then coming back home well-stocked for the next month or so. When we lump that trip to town with a few other errands, the savings from the purchases plus the consolidation of trips means we come out well ahead of less-well-planned, more frequent trips to a store which is closer to us.
posted by hippybear at 8:22 AM on September 14, 2009


I like the fact that while they are sometimes over-busy (which workplace isn't?) Costco employees seem to be... happy? They smile, joke with one another, make eye contact with the shopper... Even though I'm only shopping for a family of two, I still prefer Costco to my local megamart.
posted by pointless_incessant_barking at 8:26 AM on September 14, 2009 [1 favorite]


There is no way in hell I'll set foot in a Walmart ever again. I don't care how cheap their shit is, I will not destroy my society by supporting those evil fuckers. Any money I save now is going to cost ten-fold on our children.

No person of good conscience can shop at Walmart, not once they've done the minimal amount of research required to learn about Walmart's employee and supplier practices.

When you shop Walmart, you support a dismal future.
posted by five fresh fish at 8:29 AM on September 14, 2009 [5 favorites]


In some ways, the story of WalMart is Jurassic Park come to life. But instead of dinosaurs, they've created a class of Americans totally dependent on them and the possibility that some random mutation will change things is kept well under control.
posted by tommasz at 8:40 AM on September 14, 2009 [2 favorites]


I usually counter that one with a suggestion that they check the serial numbers or product codes. Often the lower price is because they put the same brand name on an inferior version of the product than you'd buy elsewhere.

There is a difference between "price" and "value." I'd rather buy someone's used items for the same price as they'd cost new at Wal-Mart, because the used items are of better quality.

Still, though, I assume where Wal-Mart pays off is in the generic consumables market: prescription drugmakers can't skimp on quality, but Wal-Mart can negotiate their prices downwards. Certain things like generic paper towels and aluminum foil don't really offer significantly less value for your dollar vs. what you can buy elsewhere for more money. Groceries became measurably more expensive in 2008, and I assume that Wal-Mart was well-positioned to keep costs down. Once you start buying tools, electronics, and appliances there, you're probably setting yourself up for trouble.

have some relatives who are wealthy in a way that I will never be, and they frequently shop at discount places like Walmart and Sam's Club. They are pretty pragmatic folk and will pay the cheapest possible price whenever possible.

I find that the upper-middle class people I know tend to prefer Costco. Some of this is based simply on the choices that Wal-Mart makes when it comes to location: odds are that if you're wealthy, you live a lot closer to a Costco than to a Wal-Mart.
posted by deanc at 8:41 AM on September 14, 2009


anotherpanacea: "Oh, and a self-link: a sufficiently advanced capitalism is indistinguishable from socialism."

Mind: blown. Imagine showing this to the teabaggers.

Granted, Walmart did back the employer mandate (obligatory Glenn Beck freak out complete with Nazi Germany reference). And Whole Foods just got "buycotted" by some conservative groups who liked that CEO John Mackey said that he was against a public option or employer mandate, meaning they now shop there.

The times really are changing. Is Walmart becoming your local Marxist hippie shop, and Whole Foods becoming the store for REAL AMERICANS™ who want the best product at the lowest price from a company that actually "gets" capitalism? Or is the rhetoric just imploding in on itself as reality grows more complex?
posted by mccarty.tim at 8:42 AM on September 14, 2009 [2 favorites]


shiu mai baby: "it's really quite shocking to learn that the genteel grandpa of that story was in reality a pretty ruthless and greedy asshole."

Just speaking in general, those things are not mutually exclusive. It's entirely possible that in private life the guy could have been a fine, upstanding fellow, and yet still exploited his employees during the day like a medieval lord putting the screws to a bunch of peasants. People compartmentalize, and the results are often very strange to behold. I've met otherwise-nice people who were brutal and ruthless at work, and good managers who were raging assholes in their personal lives. It goes both ways.

Personally, I think of Wal-Mart in much the same way that I've always thought of the railroads in fascist Italy: there's a sense in which you have to appreciate the slick, well-oiled efficiency with which it operates, doing exactly what it's supposed to do. It's not possible for me to read about their supply chain or distribution network and not be impressed with just how good they are at importing, moving, and selling boatloads of cheap crap. But when you take a step back and look at the end result of all that beautiful, terrible efficiency, and take a hard look at exactly how they're wringing every last cent out of their suppliers, suddenly they're a lot tougher to love. It's like realizing that the only reason the trains run on time is because there's somebody standing with a gun, proverbial or otherwise, to the engineer's head. The results may be nice—prompt trains, lots of cheap Chinese crap—but it comes at a huge cost which is not readily apparent to the casual user, waiting there on the platform or in the checkout line.
posted by Kadin2048 at 8:46 AM on September 14, 2009 [2 favorites]


Echoing some of Hippy Bear's sentiments. My friend used to work for General Mills. They engineer their popular food products specifically for Wal-Mart, to make them cheaper. I asked my friend, how much cheaper/shittier can you make Hamburger Helper? The answer: you don't want to know.
posted by killy willy at 8:49 AM on September 14, 2009 [14 favorites]


Wal-Mart as economic driving force, Johannesburg as the image of the town of the future (as per Neil Blomkamp), probably with an underclass working and, due to need, shopping at the Wal-Marts...

Welcome back to the 19th century.

Makes you want to shoot an Archduke or something.
posted by mephron at 8:51 AM on September 14, 2009 [5 favorites]


Spending "an extra 2-3$ down the road at a locally owned store" doesn't guarantee that your money is going to support better labor practices.
posted by PhoBWanKenobi at 8:20 AM on September 14 [+] [!]


This is true. But at least my money isn't going to greedy Wal-mart. AND a local business owner will pay their city and state taxes which in turn helps better my community. In my area, this is another reason I hate wal-mart, they operated within my city limits. The mayor or whoever gave them several years without taxing them or reducing the taxes (it was something along those lines). In the last year of receiving these benefits, wal-mart packed up their bags and moved a mile down the road to the next township because they could not tax them as much. Throughout this whole time, this wal-mart would do their whole "Good for the community" bullshit and how they create jobs. Now the only thing that remains in their old building is a bunch of dust with several empty buildings around it. Wal-mart kills businesses. Like I said Capitalism at it's worst.
posted by Mastercheddaar at 8:53 AM on September 14, 2009 [3 favorites]


deanc: "I find that the upper-middle class people I know tend to prefer Costco. Some of this is based simply on the choices that Wal-Mart makes when it comes to location: odds are that if you're wealthy, you live a lot closer to a Costco than to a Wal-Mart."

I think the membership is also a factor. It's one of those cases where you have to be rich to be cheap. If you can afford a big freezer to hold all that bulk food and to pay a yearly membership for savings you'll recoup over the year, you'll save money. But if you're living paycheck to paycheck, it's hard to justify spending $50 a year for bulk foods you probably don't have room for.
posted by mccarty.tim at 8:55 AM on September 14, 2009 [3 favorites]


"Why the hell are you working so hard. You are making the rest of us look bad!"

Ha! That's pretty much the mantra of every union construction job I've ever done.
posted by LakesideOrion at 9:00 AM on September 14, 2009


Fighting Walmart seems like fighting the ocean over your sandcastle.

Precisely why I build my sandcastle above Walmart's tideline.
posted by HyperBlue at 9:03 AM on September 14, 2009


There is no way in hell I'll set foot in a Walmart ever again. I don't care how cheap their shit is, I will not destroy my society by supporting those evil fuckers. Any money I save now is going to cost ten-fold on our children.

No person of good conscience can shop at Walmart, not once they've done the minimal amount of research required to learn about Walmart's employee and supplier practices.


I'm glad you have that luxury.

I live in a city where the Wal-mart is pretty much the only game in town. Groceries are the only exception to that. If you want something that is not available at the grocery store, and don't want to give your money to walmart, it's a 45 minute drive to the nearest city of a size to have any store bigger than a gas station/c-stop.
posted by ArgentCorvid at 9:03 AM on September 14, 2009 [4 favorites]


I find that the upper-middle class people I know tend to prefer Costco. Some of this is based simply on the choices that Wal-Mart makes when it comes to location: odds are that if you're wealthy, you live a lot closer to a Costco than to a Wal-Mart.

Well, sure. Everyone who has a membership prefers Costco. But sometimes you just need a pen and not 30 pens, for example. I buy lots of things from Costco, and recoup my membership just in two months worth of diapers. But a family of three (and only two eating solid food) can't buy much produce at Costco. I can't even buy crackers there because they'll go stale long before I finish them.

I don't shop at Wal Mart because I find their labor practices abhorrent, but there isn't one nearby anyway so it's a pretty empty gesture. But I do go to a terrible local supermarket chain with patrons right out of a Fellini movie because it's dirt cheap (Market Basket), and I know plenty of people with more means than I who brave it as well. In most circumstances, nobody wants to pay more than they have to regardless of their socioeconomic position.
posted by Mayor Curley at 9:14 AM on September 14, 2009 [1 favorite]


MeFites hate Wal-Mart? No fucking way! I would never have guessed.

Now, if you'll excuse me, I'm going to go toast my bagel in a $20 toaster that's 100 times more efficient and 100 times safer than the one my mother has.
posted by Cool Papa Bell at 9:17 AM on September 14, 2009


Fighting Walmart seems like fighting the ocean over your sandcastle.

Or one can build their sandcastle somewhere else. Away from the ocean.
posted by rough ashlar at 9:17 AM on September 14, 2009 [1 favorite]


Axiom one: all attempts at socialism devolve into state capitalism

Axiom two: all attempts at conservatism devolve into socialism. See axiom one.

Axiom three: the only possible route we have to save the planet is objectivism. Don't be a sheeple, Google Ron Paul.
posted by PeterMcDermott at 9:24 AM on September 14, 2009


I'm going to go toast my bagel in a $20 toaster that's 100 times more efficient and 100 times safer than the one my mother has.

100 times you say?

Is that in a fact based world?
posted by rough ashlar at 9:27 AM on September 14, 2009


Don't be a sheeple, Google Ron Paul.

And do it because someone else told you to, dammit!
posted by hippybear at 9:29 AM on September 14, 2009 [7 favorites]


Now, if you'll excuse me, I'm going to go toast my bagel in a $20 toaster that's 100 times more efficient and 100 times safer than the one my mother has.

Wait, you mean you actually spent $20 for a toaster that'll consistently make decent toast instead of a $10 Wal-Mart toaster that'll randomly give you burnt toast or lukewarm bread, with no real in-between?

There's a proverb, "You get what you pay for." Wal-Mart's magical economy bending powers don't make this untrue.
posted by explosion at 9:40 AM on September 14, 2009 [1 favorite]


Now, if you'll excuse me, I'm going to go toast my bagel in a $20 toaster that's 100 times more efficient and 100 times safer than the one my mother has.

And Wal-Mart has what to do with today's toasters being better than toasters 50 years ago? Um...nothing. The only thing Wal-Mart has to do with cheap toasters today is making them cheap. They do this by strongarming manufacturers to use thinnner, lower-quality plastics, installing fewer heating elements, etc.

And, btw, your claim itself is somewhat specious. I have my mother's 1950's toaster and it makes far better toast than some cheap plastic piece-o-crap sold today.
posted by Thorzdad at 9:42 AM on September 14, 2009 [2 favorites]


The quality level= disposabilty of most of the stores items it sells, mixed in with the fact that few if any of these items come from the states; to me; purchasing like this is supporting a slow domestic suicide. The dollar a person saves today grows to become job losses in time.

A trip to a few antique stores can yield better products that will last for decades, and the cost is usually a fraction of what a new POS purchase would be. Dishes, furniture, tools, lamps, and other assorted classic stuff all made when quality was line one. However, shopping at the Wal-mart is brainless; so off we go, buying products that are exactly what the word cheap actually means.

And it goes to follow that shopping there is directly supporting the way their employees are treated. Cheaply.
posted by buzzman at 9:46 AM on September 14, 2009


Don't be a sheeple, Google Ron Paul.

Saying "Don't be a sheeple!" is about the quickest way you could think of to make me want to avoid googling Ron Paul.
posted by blucevalo at 9:49 AM on September 14, 2009 [1 favorite]


It should not be surprising that Wal-Mart's growth model is somewhat unsustainable. Once you've tapped out all the available poverty in the USA that makes up your employee and customer base, you have to either change your business model in search of new customers, or you have ensure a steady supply of new available hand-to-mouth customers and potential employees. Sam's Club was an attempt at cannibilizing Costco's customer base, but by many accounts they're less successful at it, since no one wants to pay $50/year to buy Wal-Mart products in bulk.

If they're willing to become a stable, dividends-paying company with a strong presence in the USA, they'll do fine and the US will be ok. If they expect regular growth and expansion throughout the US, then that's really not going to happen unless the standard of living in the US dramatically declines. And even then, without getting conspiratorial, it's a fair point to mention that when Wal-Mart comes to your town, its southern culture and perception of business and worker relations comes along with it.
posted by deanc at 9:51 AM on September 14, 2009


I manage a small, independent office machine dealership. I price my goods at a reasonable markup and generally don't have much of a problem selling, despite the e-tailers and big-box stores selling at or just above my cost as a dealer. We have a loyal customer base, largely because we provide excellent, personal service. We're doing quite well, even in this economy.

It bothers me when people will come in and show me an online ad or a sale flyer from a warehouse store offering the same product at a lower price, and then want me to sell for the same price. If I can, I will, but without the personal service we usually deliver. You'll get it in a box, that's it. Not set up, not tested, not with a demo of how to get the most out of it, not delivered and installed wherever you want it, and not with me as a local tech support resource.

There are all too many people who really think they're "supporting local business" by coming in and haggling me down to the online price, and then still feel they are entitled to the same level of customer service that our paying customers receive. They think that hey, since they bought it locally, not at a warehouse store, they should automatically get our best level of service, because they're doing us a favor by buying from us in the first place. They think I should be glad that "hey, at least I moved a box", even if they haggled me down to a margin of just a few percent. They don't realize that there are real costs involved in "moving boxes", from ordering to freight to warehousing to restocking to finally making the sale.

Thankfully, there are still plenty of people who are quite happy to pay a small premium for personal, local service. They realize that there is a difference between price and value. But sadly, Walmart and the low-price mentality are breeding a growing group of people who only care about getting goods at the lowest possible price, no matter what the cost.
posted by xedrik at 9:51 AM on September 14, 2009 [13 favorites]


It's entirely possible that in private life the guy could have been a fine, upstanding fellow, and yet still exploited his employees during the day like a medieval lord putting the screws to a bunch of peasants. People compartmentalize, and the results are often very strange to behold. I've met otherwise-nice people who were brutal and ruthless at work, and good managers who were raging assholes in their personal lives. It goes both ways.

Oh, I totally agree with you, Kadin2048; my point is that the people who love Wal-Mart and who think Sam Walton hung the moon are, generally speaking, either unwilling or incapable of holding a nuanced position on the man or his market. The idea that he would threaten to fire anyone who cashed their state-mandated overtime check would be anathema to them, and quite possibly disregarded entirely as a smear job at the hands of the librul elitists or something.
posted by shiu mai baby at 9:54 AM on September 14, 2009 [1 favorite]


if only there was a better way of measuring well-being/customer satisfaction (instead of, you know, making money)
posted by kliuless at 9:57 AM on September 14, 2009


Has there been an analysis of whether WAL*MART's prices are actually lower, on average, than other stores? Granted, they must sell some things cheaply to bring customers in, but I wonder if they really sell things that much cheaper, or if they simply use their volume to buy things cheaply, expand to new territory to push out competition, and then sell at whatever price they like.
posted by Blazecock Pileon at 10:04 AM on September 14, 2009


purchasing like this is supporting a slow domestic suicide.

From Mr. Smith about Restraints upon the Importation from Foreign Countries of such Goods as can be Produced at Home :

By preferring the support of domestic to that of foreign industry, he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention.

posted by rough ashlar at 10:06 AM on September 14, 2009


That excerpted paragraph looks like it was lifted word for word from Ellen Ruppel Shell's Cheap which also details the rise of Wal-Mart, Woolworth's, Korvette's and other discount stores.
posted by destro at 10:08 AM on September 14, 2009


I watched Wal-Mart move into a little town I was in — it's rare that South Park episodes come to life, but it was just like that. In the distance, if you were very quiet, you could hear the death rattles of mom-and-pop businesses croaking. A couple of grocery stores died first, then the sole music store in town, followed by a pair of bookstores. The hardware stores hung on a bit longer.

I go back every few months on a visit. Main Street now consists of nothing but stores who in no way sell anything which overlaps with Wal-Mart, if the storefronts aren't closed. Meanwhile, Wal-Mart, parked on a big lot on the edge of town where the land was cheap, is open twenty-four/seven.

They've got a CostCo coming up near me. I may be able to do away with Wal-Mart entirely now. I've been feeling a bit conflicted about blowing gasoline and time looking for items at Any Place But Wal-Mart and occasionally having to hit Wal-Mart anyway; this should ease matters.
posted by adipocere at 10:17 AM on September 14, 2009


And Wal-Mart has what to do with today's toasters being better than toasters 50 years ago?

There are reasons that prices fall while quality rises. If you don't understand how mercantile pressures -- the ability to focus un-godly numbers of eyeballs on products -- can affect price and product quality, I can't help you, and we can't really have a discussion.
posted by Cool Papa Bell at 10:20 AM on September 14, 2009


Walmart is going to topple eventually. Some companies take a long time to do it, but from Sears to Montgomery Wards, the leaders eventually get passed by.

One slight dent in Walmart might be the current negative economic environment. They've positioned themselves as the place you shop when you don't have much money, and have done well in these times when lots of people don't have much money.

When the economy picks up though, some of their customers might stop shopping there because of the "cheap" branding. Supposedly something similar happened to Pepsi after the depression.
posted by drezdn at 10:22 AM on September 14, 2009


btw, here's the issues paper from the Commission on the Measurement of Economic Performance and Social Progress and stiglitz's writeup...

also see:
-A measure remodelled
-GDP RIP
-"economists should adopt a more realistic model of what makes humans happy"
-"Genuine Progress Indicator"
-Happiness as a tool for valuing public goods
-Maybe Medicare really is communist
posted by kliuless at 10:25 AM on September 14, 2009 [1 favorite]


I wonder if they really sell things that much cheaper, or if they simply use their volume to buy things cheaply, expand to new territory to push out competition, and then sell at whatever price they like.

If they did the last part of that equation, that'd be the very definition of an illegal monopolistic practice.

But there's lots of data, both formal and anecdotal, that show Wal-Mart does have lower prices. That said, they do it not just on purchasing power (which has various negative effects), but also on superb logistics management. They just know how to get the shit to the stores.
posted by Cool Papa Bell at 10:28 AM on September 14, 2009


Thankfully, there are still plenty of people who are quite happy to pay a small premium for personal, local service. They realize that there is a difference between price and value.

I understand this, and I somewhat lament the fact that small, more independent retailers are failing when faced with the competition of the warehouse model. However, when I shop at a warehouse I'm not expecting service. I know I'm not paying for service. I don't need it, so I don't want to pay for it. Heck, I'm not even paying for delivery! Often, this service is not of value to me.

Sometimes it is. In which case I'll be happy to pay for it. But only if "service" means something like "product knowledge that I can't get from Google in thirty seconds". It's really hard to tell, sometimes, if the salesperson I'm talking to is the real deal, or I'm just paying extra to pay a commission for no actual value.
posted by RikiTikiTavi at 10:30 AM on September 14, 2009 [1 favorite]


Meanwhile, Wal-Mart, parked on a big lot on the edge of town where the land was cheap, is open twenty-four/seven.

Oh, and this! Business hours are *huge* for me. If I'm working the entire time you're open, and the other store is open when I'm free--I'm not going to take time off work just to buy from the local guy. Note that if I take time off work I'm essentially paying [even] more.

If the "service" part of the local business meant "open at my convenience", then--heck yeah, I'll pay for that. But being open all/odd hours is expensive and difficult (and usually not profitable--otherwise they'd do it regularly), and I don't fault smaller retailers for not catering to my every whim. They may not get the sale, though.
posted by RikiTikiTavi at 10:35 AM on September 14, 2009 [1 favorite]


The idea that he would threaten to fire anyone who cashed their state-mandated overtime check would be anathema to them, and quite possibly disregarded entirely as a smear job at the hands of the librul elitists or something.

Alternatively, some people might believe it and see it as an example of tough-minded conservative virtue. ("God bless Sam Walton for having stood up to the liberal commies who were trying to undermine the great American way!")
posted by acb at 10:48 AM on September 14, 2009 [1 favorite]


But being open all/odd hours is expensive and difficult (and usually not profitable--otherwise they'd do it regularly), and I don't fault smaller retailers for not catering to my every whim. They may not get the sale, though.

I remember trying to go to a Costco on a Saturday evening because they supposedly had the thing I was looking for at the best price. When I got there, they were closed. The nerve of them! I was actually upset that they would close at 4pm on a Saturday. Didn't they want people's business? Were they stupid?

Then my girlfriend pointed something out to me. This also meant that no employee there had to work a Saturday evening or a Sunday. As a five year veteran of the Wal-Mart slavepens, this thought enticed me. How nice it must be to work there! My rage subsided and I checked another item off of my Wal-Mart deprogramming list. I felt chagrined for quite a while after that.

But, yeah, I really wanted a bookcase before the weekend was over so I got one at Big Lots. Still need to work on that impulsiveness.
posted by cimbrog at 10:52 AM on September 14, 2009 [1 favorite]


Minimum wage? Sounds commie to me.
posted by Bovine Love at 10:58 AM on September 14, 2009


There are reasons that prices fall while quality rises.

Post hoc ergo propter hoc.

In fact, quality often falls -- esp. since, to a manufacture, a great deal of engineering may be done to allow a *lower* build quality that requires less labor to accomplish. This is why many cases are snap-together, not bolted or screwed, because paying an expensive engineer to design the case happens one, but paying a line worker to shove the case together happens millions of times.

If increasing quality increases weight, then it won't be done, because shipping costs money, and heavier parts move slower in assemble, or cost more to move -- see automotive lines for an example of that.

Indeed, the most compelling example of how wrong your assumption is: Why are there tiers of products? If lower prices led to higher quality, then Kia would have driven Lexus out of business almost instantly. Apple Computers, of course, never had a chance of surviving, and so on.

IOW: The Market disagrees with you.
posted by eriko at 10:58 AM on September 14, 2009 [2 favorites]


You'll get it in a box, that's it. Not set up, not tested, not with a demo of how to get the most out of it, not delivered and installed wherever you want it, and not with me as a local tech support resource.
I think most people realize that "free delivery" isn't really "free." You're willing to go that extra mile for your customers willing to pay a premium price. At the same time, customers are willing to go the extra mile for themselves in order to save a few dollars.

Related to that, and following up with the point made by eriko, quality falls to a level that the public is willing to accept. Sometimes (eg, with cars) a market player is able to convince the public to accept a higher level of quality. More often, though, the market realizes that the profit-maximizing point is finding the minimum amount the public will accept and flooding the market with it to put it into the hands of as many people as possible. Thus, what used to be a niche specialty product becomes a mass-market item. More to the point, like "service", people realize that they don't really care about the value of "quality" as they thought they did.

There are some people (such as myself) who would rather do without something rather than settling for an inferior quality item. There are a lot more people who consider it worth their while to have a poor-quality item with very little "personal service" than to not have that item at all. I can't really blame them for that-- it's a pretty fair calculation to make.
posted by deanc at 11:07 AM on September 14, 2009


Just wanted to point out that it is possible for a low-price retailer to treat their workers decently--Aldi, with prices 20% lower than Walmart, provides excellent health insurance and pays way above the retail average.

Walmart doesn't have to act the way they do to keep prices down. There are choices, and they can make different choices and still be an effective competitor.
posted by aerotive at 11:23 AM on September 14, 2009 [4 favorites]


To a certain extend these types of stores were the start of the phenomenon of the "disaggregation" of the bundle of product and service that everthing you buy consists of. Essentially every product you buy is the product/basic service itself and then layer upon layer of extra service on top of that. Big box/no service stores just started the "execution only" retail model that the internet has taken to a new level. In theory, this should be great for consumers as they can then assign a value to the different parts of the bundle and then shop appropriately -- so for example a crappy shopping environment with no service is fine when buying commodity staples, but you might want knowledgeable sales staff and a long term support relationship when buying office technology. The problem is that if too few people place the same value as you do on a particular part of the bundle then the shops offering it (read: small local personal businesses) die off and you're stuck with the lowest common denominator.

I've been wondering how people should value choice vs price in these situations... in the perfect economics world in my head, small shop-lovers should in fact be paying Wal Mart shoppers to switch to the local shop, just to keep it alive...
posted by patricio at 11:31 AM on September 14, 2009


I laughed so hard I cried at the peopleofwalmart.com link. Oh. My. Lord. Middle America, what the heck is up?

I knew they were bad to their employees but I never knew how bad. I'm not into unions at all, but Walmart seems to me to be a place that could really do with some unionization!
I will never shop at that store again. (I've only done so twice, but thats it.)
posted by aacheson at 11:34 AM on September 14, 2009


Am I the only person not in love with costoco? I have nowhere to store the multiple cubic yards of toilet paper they sell. I have no cupboards large enough to contain the 12 lb box of cheerios. And, per pound, it's not any cheaper than going to a grocery store. Plus the store is a zoo. I go there once or twice a year (why do I have a membership even? long story) and it's like a drinking binge - it sounded good beforehand but I feel like shit when I leave.
posted by GuyZero at 11:54 AM on September 14, 2009 [1 favorite]


I'm going to go toast my bagel in a $20 toaster that's 100 times more efficient and 100 times safer than the one my mother has.

You're not seriously implying the only inexpensive toaster I can buy is at Wal-Mart, are you?

The difference in prices between Wal-Mart and Target is negligible, and is worth whatever couple of bucks it might be on large purchases to not go to the Big Blue Hell. Sure, some folks have literally no choice -- but those of us who have a choice should be aware of better alternatives.

(And, I've done some digging: I've found nothing on Target like there is out there for Wal-mart. Complaints exist, to be sure, but Wal-Mart is in a class of its own, issue-wise.)
posted by grubi at 11:55 AM on September 14, 2009


People who shop WalMart should also be aware that while you might find Product X is indeed cheaper at WalMart than The Other Store, it's because it is not the same product.

Manufacturers release the same product at different "tiers" of quality. The WalMart product will use cheaper parts, will have tested out as "sketchy", will be the Monday-morning/Friday-afternoon shiftwork product, etcetera. The WalMart product is, in every sense of the word, cheaper: it'll be the crappiest of the crap.

The end result of course is that the product won't last as long. Which is perfectly fine by WalMart, because you'll go right back there and buy another one. You'll happily spend twice as much over the long run, so long as you save a nickel each time.

Foot, meet bullet.
posted by five fresh fish at 12:06 PM on September 14, 2009 [6 favorites]


If lower prices led to higher quality, then Kia would have driven Lexus out of business almost instantly.

Except Kia and Lexus don't compete on price alone. So, you're making a conflation error and missing the bigger point. You're not looking at it through a mercantile lens, which provides both a cost-and-quality squeeze on manufacturers. Wal-Mart -- and Target, and Home Depot, and Lowes, etc. etc, they all do it -- is able to pressure manufacturers to lower cost and increase quality at the same time. When you own the point of sale, you get to make most of the rules.

If there were no such thing as dealership networks, if you bought your Kia and your Lexus at the same place, you'd see Kia quality rise and Lexus cost fall. You'd also see much more product segmentation to maximize profit margins, as you seem to partially understand. You don't see Miele vacuum cleaners being sold at Wal-Mart, for example.

You're not seriously implying the only inexpensive toaster I can buy is at Wal-Mart, are you?

No, you're making a different conflation error. The presence of big-box retailers like Wal-Mart have dramatically lowered costs of consumer goods because of their ability to lower profit margins and raise volume sales. Wal-Mart didn't start this trend -- you could say that Sears, Marshall Fields, et al, started it. They're just really f'n good at it.
posted by Cool Papa Bell at 12:17 PM on September 14, 2009 [1 favorite]


The only times I go to Walmart are when everything else is closed, and I need something immediately. I go maybe 3 times a year, tops. By doing so, I am rewarding Walmart for being open when nobody else is. (i.e., not because they're my top choice)

I prefer to reward for other reasons.

I am going to instill in my children an awareness of quality and of the interconnectedness of the economy. When I have kids, that is.
posted by bugmuncher at 12:18 PM on September 14, 2009


GuyZero, I joined Costco because even after the membership fee the optical department was cheaper.

I'll probably drop it after this year but in the meantime I've been eating blueberries by the pound (non-organic, unfortunately).
posted by small_ruminant at 12:24 PM on September 14, 2009


I go to Wal-mart when 1) I'm on the road and realize I've forgotten deoderant, a toothbrush and undies and the only store out there in the hotel-land sticks is Walmart, or 2) when I need gun cleaning supplies, because very few other places in the liberal Bay Area likes to sell them.
posted by small_ruminant at 12:27 PM on September 14, 2009


People who shop WalMart should also be aware that while you might find Product X is indeed cheaper at WalMart than The Other Store, it's because it is not the same product.

Yeah, no. The FTC says this is illegal if they're marked as being literally the same product. You'd run afoul of truth-in-advertising and fair-packaging laws.

For fun, I'd entered into Target's search box "samsung" and took the very first product mentioned. Then I took the serial number (LN40B530) and entered into three other search boxes. Results:

Wal-Mart
Target
Amazon
Best Buy

Wal-Mart and Target for the win!
posted by Cool Papa Bell at 12:30 PM on September 14, 2009


I will never shop at Wal-Mart again. Just last week I was shopping for a dehumidifier, and without really thinking about it I pulled into Wal-Mart. I was approaching the cash register when I realized what I was doing, put the thing down and went over to Canadian Tire instead.
posted by autodidact at 12:54 PM on September 14, 2009


Manufacturers release the same product at different "tiers" of quality. The WalMart product will use cheaper parts, will have tested out as "sketchy", will be the Monday-morning/Friday-afternoon shiftwork product, etcetera. The WalMart product is, in every sense of the word, cheaper: it'll be the crappiest of the crap.

Hmm.

Lately, I go to Walmart because it's the only place in town that sells both mid-level organic cat food (two brands, Newman's Own, and Natural Life) and basic groceries. My cat's become picky about my old favorite brand which I used to make a special trip to the pet store across town for, and this stuff beats Friskies or Iams, which is all I can get easily at the other local supermarkets, or even Target (I've checked). Heck, they beat PetSmart on this one. And, though I try not to buy produce from them, because it tends to be crappy, their dry goods are fine--they even sell DeBoles rice pasta (SO has celiac's, so that's nice), and I can get my favorite paper towels, Brawny Pick-a-Size, for cheaper there than what I can get at Big Lots.

I really fail to see how name brand rice pasta, paper towels, and cat food (with ingredients clearly marked) could possibly be "the crappiest of the crap."
posted by PhoBWanKenobi at 1:11 PM on September 14, 2009


GuyZero: Am I the only person not in love with costoco? I have nowhere to store the multiple cubic yards of toilet paper they sell. I have no cupboards large enough to contain the 12 lb box of cheerios. And, per pound, it's not any cheaper than going to a grocery store.

Diapers, my man. Diapers, baby formula, wipes. If you have another kid, you're going to make drunken phone calls to Costco begging her to take you back. And she will, for forty bucks.
posted by Mayor Curley at 1:11 PM on September 14, 2009 [1 favorite]


Am I the only person not in love with costoco?

Nope. Father away than a short drive to Restraunt Supply Depot. And, well there is always local service at CurbMart.
posted by rough ashlar at 1:24 PM on September 14, 2009


The presence of big-box retailers like Wal-Mart have dramatically lowered costs of consumer goods because of their ability to lower profit margins and raise volume sales.

I did a few hours of catalog research last year. What I discovered that that is actually not particularly true that costs are lower now. For most items, the modern inflation-adjusted price was often the same if not more than the 1950s/60s American-made, quality materials product, but with crappy construction and cheaper parts.


The FTC says this is illegal if they're marked as being literally the same product.

Yes. That's why the model number will be identical, save a letter stuck to the end, or some other crappy gambit like that. My point remains: there is a false economy to shopping based on price alone. To make a wise purchasing decision, one needs to consider other factors.
posted by five fresh fish at 1:49 PM on September 14, 2009 [2 favorites]


I laughed so hard I cried at the peopleofwalmart.com link. Oh. My. Lord. Middle America, what the heck is up?

Nothing says class like laughing at/mocking/ridiculing people whose lifestyles, appearances and choices in that regard are not our own.
posted by ambient2 at 2:03 PM on September 14, 2009 [7 favorites]


There's more to this than price, Cool Papa Bell. I know you've addressed the quality issue in a few comments.

When Wal-Mart opened in my home town years ago, I was horrified. At the time, my best friend from elementary school was the town paper's editor. A few months after it opened, Wal-Mart had put virtually every other local business to bed. It had no effect on, say, the taxidermy shop or the restaurants in the area. But the local JCPenney closed, for example. And that's a HUGE chain store.

The owner of the paper and my friend saw it coming a mile away; the concern was that the local paper would go out of business once all the advertising from competing businesses went away (as they surely would).

The owner and my friend met with the manager of the new Wal-Mart to try and entice a year's worth of full-page ads out of the guy, just to make sure the paper could stay in business without the supporting advertising revenue.

Well, the guy declined. There's still a newspaper there; it's an 8-sheet with 3 or 4 original articles in it, obits, that sort of thing. The rest of the paper is Associated Press content. The paper has maybe 8 employees, total.

My friend with a Journalism Bachelor's and English MA, who's traveled the world over and writes her own blog, is now a stay-at-home mom.

Last Christmas I went home and asked my family: Is there anywhere to get wrapping paper?

Wal-Mart.

What about gift tags? Christmas cards?

WAL-MART.

Is there... anywhere else to get these things?

NO.

It's not just the cost of item X. It's NOT just "oh, well, I paid $20 for it and can get another one at 3 a.m. if this breaks."

It's so, so much more than that.

And yet, more and more, all you hear is that Wal-Mart has everything and it's SO cheap...

Does it provide a competitive job for college graduates in rural areas? NO.
Does it support local publications that desperately need advertising revenue? NO.
Does it mean to improve, not dominate, the local small-town economy? NO.

Saving a few pennies here and there doesn't mean shit when your college-educated children can't find jobs and have to drive 2-3 hours, each way, to work. That's the reality of my home town now. The population is in decline, too.

There are people who have no choice but to shop there NOW, like ArgentCorvid. I'm sure it would be nice to have a choice, but some people don't. But before there was Wal-Mart, there were options.

All I know is, Wal-Mart is price-dropping small-town America to death. Cool for you, you saved $10! I hope you're aware that the $10 you saved was at the cost of thousands and thousands of American jobs... jobs that had health benefits and a clear career path, too, like the newspaper job my friend no longer has. It's not just competing sales businesses that suffer, it's the community overall.
posted by Unicorn on the cob at 2:31 PM on September 14, 2009 [18 favorites]


Remember the good ol' days, when the Wal-Mart promise was that they would only stock their shelves with American made products, and they went out of their way to aggressively develop US manufacturers of items they could only otherwise find from overseas suppliers?

It was about the time that they stopped advertising that policy that I stopped shopping there.
posted by hippybear at 2:42 PM on September 14, 2009


I agree with everything you say, Unicorn, but at the same time, the Wal-Mart came because the locals wanted it, the local stores closed because the townsfolk chose to shop there, and Wal-Mart is thriving because they continue to choose to shop there (and, as you say, because they have very little choice).

I think looking at the reasons that all of those choices were made is a sounder idea in the long term than blaming Wal-Mart. Wal-Mart shares the blame, for sure, but somewhere along the line enough people in that town decided that saving a dollar was worth the sacrifices that come with it, or were ignorant to the sacrifices that saving that dollar meant.

I'm reasonably confident that were it not Wal-Mart, something else would have done this eventually. The Evil Mall killed our nice downtown when I was a kid, and now Wal-Mart is killing the mall, which has in the interim become something people will be nostalgic for, just like they were nostalgic for downtown when the mall killed it.

People have to start thinking about everything you talked about in your last few paragraphs. Casting Wal-Mart as the evil empire is an easy half-truth, but we're doing it to ourselves in the end.
posted by Shepherd at 2:54 PM on September 14, 2009 [2 favorites]


Casting Wal-Mart as the evil empire is an easy half-truth, but we're doing it to ourselves in the end.

I can understand your point, but I think it leaves out the deliberate obfuscation which many corporations engage in when it comes to providing information about themselves to the public they hope will be their patrons. Just as a democracy requires a fully-informed electorate before it becomes truly democratic, so does a capitalist marketplace require a fully-informed consumer base before the supposed invisible hand begins to exert the sort of control lauded by those who laud such things. But both politicians and corporations use the non-disclosure of information or outright misinformation in order to manipulate those they hope will surrender their (votes / dollars) into doing so, often against their own better interest. That the theoretical Fourth Estate is now in the pocket of so many megacorps only means that the truth is less likely than ever before to be made known until any corporate malfeasance reaches a level where it can no longer be overlooked by the casual observer. And by that time, it is often too late to save (a local economy / a political system) from the destruction which can then be blamed on the citizen shoppers rather than on the power structures which enticed them into acting illogically in the first place.
posted by hippybear at 3:11 PM on September 14, 2009 [3 favorites]


Cool Papa Bell: "Wal-Mart
Target
Amazon
Best Buy

Wal-Mart and Target for the win!
"

Looks to me like Amazon has free shipping, while Wal-Mart and Target don't. Plus, no sales tax on Amazon purchases in most states.

That said, Best Buy's price was pretty high, but I've always considered them to be the Chaotic Evil to Wal-Mart's Lawful Evil.
posted by mccarty.tim at 3:23 PM on September 14, 2009


Hippybear stated eloquently what my comment left out; that Wal-Mart comes to town, promising new jobs and cheaper prices, and briefly, they may be right.

But in the long run, the cost is higher than the savings, as it were. Also, it's not as though the town gets to VOTE if Wal-Mart is coming. That whole "the locals wanted it" statement has nothing to do with it; rather, it's an issue of where there's cheap, available land and little competition (and certainly not competition that can withstand the Wal-Mart machine).

Also, Shepherd, the Mall has multiple stores, yes? So did downtown?

Well, Wal-Mart replaced over 20 businesses. That's not exactly apples to apples, is it?
posted by Unicorn on the cob at 3:57 PM on September 14, 2009


Maybe the presence of Wal-Mart is really just a symptom of other problems. You can't just have an economy that revolves around selling consumer goods to each other and advertising in each others' newspapers. Small towns were economically teetering, and a small disruption like Wal-Mart will send them into a tailspin. The bigger problem is that Wal-Mart faces a perverse incentive: its continued growth depends upon the existence of vulnerable small-towns to prey upon.
posted by deanc at 4:18 PM on September 14, 2009 [3 favorites]


"Why the hell are you working so hard. You are making the rest of us look bad!"

LakesideOrion Ha! That's pretty much the mantra of every union construction job I've ever done.

That's interesting because the mantra of the union construction job I had was if you want to work for a living you need to be good and efficient i.e., work quickly. Guys who did not work hard did not get picked for the next job.
posted by mlis at 4:31 PM on September 14, 2009 [5 favorites]


Following up on the supplier quality issue: The Man Who Said No to Wal-mart.
posted by lalex at 4:39 PM on September 14, 2009 [2 favorites]


Maybe the presence of Wal-Mart is really just a symptom of other problems.

In the area of their greatest growth and deepest penetration, the rural and exurban south, Wal Mart is in part a symptom of the underdevelopment of the retail sector there. Having lived for a time in the pre-Wal-Mart exurban south (exurban at the time anyway), it was pretty gross. High prices, small selections, indifferent or surly service, layouts that only made sense if you ingested the entire LSD supply of North America, and if you didn't like it you could spend an hour or more on the road getting into the city and back, so fuck you.

If you think about it, Wal-Mart as a shopping venue isn't too different from K-Mart or Sears or similar, though of course it's quite different as an intermediary purchaser of consumer goods. If K-Mart or Sears had come in to your average shitty little southern town, they would have blown the local stores right out of the water too. The only difference is that Sears and K-Mart and so on never came to town, and Wal-Mart did.
posted by ROU_Xenophobe at 4:40 PM on September 14, 2009 [1 favorite]


Yeah, ROU_Xenophobe, that'd be true except I just said Wal-Mart caused JCPenney to close. That's a chain closing a chain, so it's not JUST little stores we're talking about.

It's practically every other specialty or general store in town, including all the grocery stores, as well as tangential businesses (like the newspaper as well as the local florists).

I'm sure if they'd come into town and said we'll create 60 new jobs that will eventually put 90 people out of work within a year, people would have acted differently. It's only after we've seen the effects of Wal-Mart over the course of wider market penetration and their abuses have been documented (in the many, many comments upthread linking to concrete, empirical evidence beyond people's personal experiences) that we realize the insidiousness of Wal-Mart as a business model.

But please, let me get out of the way of all the Wal-Mart apologists. Yay, ruthless monopolization! Congratulations, Wal-Mart:

China’s entry into the World Trade Organization was supposed to improve the U.S. trade deficit with China and create good jobs in the United States. But those promises have gone unfulfilled: the total U.S. trade deficit with China reached $235 billion in 2006. Between 2001 and 2006, this growing deficit eliminated 1.8 million U.S. jobs (Scott 2007). The world’s biggest retailer, U.S.-based Wal-Mart was responsible for $27 billion in U.S. imports from China in 2006 and 11% of the growth of the total U.S. trade deficit with China between 2001 and 2006. Wal-Mart’s trade deficit with China alone eliminated nearly 200,000 U.S. jobs in this period.

Now. You guys were saying?
posted by Unicorn on the cob at 5:06 PM on September 14, 2009 [1 favorite]


that'd be true except I just said Wal-Mart caused JCPenney to close

And how many stores for how many miles around did JC Penney put out of business when it opened?
posted by ROU_Xenophobe at 5:51 PM on September 14, 2009


Good question, ROU_xenophobe... and that, I can't answer.

I feel strongly about this and you're not going to change my mind, nor I yours, at least not now.

But I hope you're not just making this argument for the sake of arguing, because I don't see how you can even put yourself in the Devil's Advocate position on something as reprehensible as Wal-Mart. I guess if I felt that people should cannibalize each other socially in an attempt to gather the most profit, I could see your point of view. I associate that sort of mindset with sadism, not capitalism. I draw the bottom line where it begins to incur widespread human suffering, i.e. 200,000 jobs sacrificed so I can sell lead-tainted toys from China and poisonous dog food to my customers.

It'd be hard for me to stand by and defend something like Wal-Mart, but bloviation is the sport of choice here on Metafilter. I only have one dog in this fight; it's the underdog, and in this case, it's people I know that are forced to buy things at a store that cost them their own jobs.
posted by Unicorn on the cob at 6:00 PM on September 14, 2009 [1 favorite]


So some people like Wal-Mart and some people don't. Well, I'm glad we've got that cleared up.

I'm thinking there might be another way to look at this. What if Wal-mart closed tomorrow? One would think that this would create a vacuum for goods and services. And certainly people would be quick to seize that opportunity. I'm wondering how much man power it would take to bring the goods and services offered by Wal-mart back to a community.

Specifically, I'm wondering how many jobs would be created if any given local Wal-mart closed. How would the creation of those jobs stimulate or the opposite of stimulate the local economy?

What ratio of Wal-mart jobs to post Wal-mart closing jobs would be seen as too large a disparity for Wal-mart's presence to be tolerated in a given community.

Hypothetically, if 4 jobs were created for every Wal-mart job lost, would people then be willing to pay 25.00 dollars more for their monthly grocery bill? Would low, low prices be as necessary if everyone who wanted a job could have one?

What are the numbers which would motivate people to rethink their purchasing decisions? Can numbers ever do this?
posted by SinisterPurpose at 6:33 PM on September 14, 2009


That whole "the locals wanted it" statement has nothing to do with it; rather, it's an issue of where there's cheap, available land and little competition (and certainly not competition that can withstand the Wal-Mart machine).

Yes, and after it opened, nobody came, because they all treasured the character of your town and knew that this was fool's gold being offered, and the Wal-Mart shut down a few months later due to lack of -- oh hang on, that's not what happened at all.

But please, let me get out of the way of all the Wal-Mart apologists.

Am I counted among those numbers? Because believe me, I'm no fan of Wal-Mart. I largely agree with you about its effects on local economies and the fact that, on balance, it is Not A Good Thing.

But.

You know Wal-Mart is bad and I know Wal-Mart is -- well, the reflection of something bad -- and yet Wal-Mart continues to exist. Somehow, you being angry on the Internet isn't stopping it. Astonishing, I know, that your commenting on MetaFilter isn't bringing the behemoth to its knees.

I only have one dog in this fight; it's the underdog, and in this case, it's people I know that are forced to buy things at a store that cost them their own jobs.


Yes, and if you managed to magically make it vanish tomorrow, your beloved town wouldn't come back. The variety of stores and vendors wouldn't miraculously reappear. The ol' soda fountain wouldn't re-open, and the charming stationery store wouldn't unshutter.

Because somebody would just open something a fuck of a lot like Wal-Mart again.

Because there's no reason that the people in your town wouldn't fall for it again.

The point is that people need to be better educated about economics, and community, and how the "low low prices" cost a lot more than they think they do.

Sears begat JC Penney begat Wal-Mart and this activity will always exist. There will always be some ruthless entrepreneur out there looking for the best way to game the system, make tons of money, and strip-mine everything he/she can with no thought to the long game or the well-being of the people he/she exploits.

So, if you can accept the fact that Wal-Mart, or something Wal-Mart-like, was and is inevitable... which I believe firmly is true... we have to do a better job at convincing people why Wal-Mart is a bad idea than to just say Wal-Mart is bad. Because if we just shout angrily at Wal-Mart on MetaFilter until it vanishes, Mal-Wart will rise in its place, and do the same thing, and when Mal-Wart falls, Wal-Tram will spring from its ashes, and so on and so forth.

Wal-Mart was just an evil waiting to happen. If Sam Walton hadn't done it when he had, somebody else would have a few years later. Blaming him for a culture that values a dollar over a neighbour doesn't rectify the fact that the culture, at the end of the day, values the dollar more.

People are choosing Wal-Mart. Maybe they're being deceived into so doing, as hippybear suggests, but if so, Wal-Mart's been fooling people for over 40 years. That's a hella long time to pull such a gross, obvious deception, and if they haven't figured it out after four decades, that means there's something wrong with how these folks are viewing Wal-Mart, and "low low prices," and a fundamental disconnect between their understanding of economics, community, and trade.

What you want is a world where Wal-Mart doesn't exist. What you need is a world where nobody wants a Wal-Mart.

That's where the work is. If you can convince people that supporting their local business is more important than saving a buck on a toaster, Wal-Mart won't need your emnity. It'll need your pity, and about six feet of dirt.
posted by Shepherd at 6:57 PM on September 14, 2009 [2 favorites]


And that's exactly why we are both commenting so vociferously, I think, Shepherd; too bad we can't get more people to read Metafilter and understand the power of their buying dollar. I think fundamentally, on some level, we agree here.

I guess I wish I could do something about it and I can't except by avoiding patronizing the place and warning others. Which in a way is what I'm doing right here, right now.

You're saying that this is inevitable; I'm saying it can be reversed, too, hopefully. I guess I'm a hopeless optimist.
posted by Unicorn on the cob at 7:02 PM on September 14, 2009


Those are great questions, SinisterPurpose.

Perhaps it's not that you and I should see a marked increase in prices, but that the ultrawealthy 1% who control nearly 50% of the wealth should be taxed more appropriately. That wealth largely rests on the backs of the front-line labourers, ie. WalMart store employees.

It's about time that the Waltons provided full health insurance and wages that are above poverty line, and so on. If they're not going to do it voluntarily as a corporation then we need to tax them heavily. Their immense profits are the result of negligence to their employees: that means "we've" got to carry that load, which means "we" should be sending them the bill.

When the government allows its largest corporations to engage in unfair practices it is dismiss in its duties: it is failing to protect its citizens.

It's about time that the unequal power structure of WalMart was recognized and addressed.
posted by five fresh fish at 7:10 PM on September 14, 2009


How's that going for you up there in Canada, five fresh fish? We're sort of fumbling on it down here in the US, but then you knew that.
posted by hippybear at 7:33 PM on September 14, 2009


But I hope you're not just making this argument for the sake of arguing, because I don't see how you can even put yourself in the Devil's Advocate position on something as reprehensible as Wal-Mart

I don't like Wal-Mart. I've bought things there... maybe eight times in the past ten years or so? It's a gross, unpleasant place to be.

My only thing, honestly, is that the nostalgia for "mom and pop" stores annoys me a little bit at least in the southern context -- I have no idea how they worked in Yankeeland. But down south, when you think of "mom and pop" stores in the exurban or rural south, what you should think of is not a charming boutique with a friendly owner who really helps you out, but something closer to the predatory-pricing grocery stores in the hood.

The idea that they make better jobs in the area frankly doesn't appeal to me very strongly, because even accepting that it makes those jobs for purposes of argument, those jobs are being extracted from the welfare of the vastly overwhelming majority of people of the area who don't work in those stores, and probably in a Pareto-inferior way.
posted by ROU_Xenophobe at 8:13 PM on September 14, 2009


But down south, when you think of "mom and pop" stores in the exurban or rural south, what you should think of is not a charming boutique with a friendly owner who really helps you out, but something closer to the predatory-pricing grocery stores in the hood.

I hate Wal-Mart as much as the next person, but this is the truth.

When it is a twenty-mile drive to even the grocery store that was built in an abandoned convenience store, the man who owns that grocery store can charge what prices he wants. Wal-Mart is a terrible, terrible blight, but I remember when going to the grocery store was a big deal because it was sixty miles round-trip.

My mother still doesn't understand why I don't keep food in the house, because to her my habit of running five minutes down the road every day to the grocery store is asking to be trapped in my house with no food in a blizzard* and forced to live on paper towels for the three weeks I would be snowed in is sheer foolhardiness. When the grocery store is that far away, you have to spend more anyway just to make sure you have enough food to last out any events like that. Spending more on top of that just because you have to buy your food at hood prices is difficult.

Even though the man who owned that convenience store grocery store always gave me a lollipop and still asks after me, I can understand why my parents shop at Wal-Mart. I hate it, but I understand it.

*while this kind of thing happens at great intervals in the mountains, it's not that common. we pride ourselves on being excessively neurotic in my family.
posted by winna at 9:15 PM on September 14, 2009


How's that going for you up there in Canada, five fresh fish? We're sort of fumbling on it down here in the US, but then you knew that.

The union battles made it to the Supreme, I think. At any rate, IIRC, the union won and WalMart closed the store.

There are a number of worker protection laws that they haven't been able to dodge. I don't think WalMart is quite as grim up here as it is down there. OTOH, I still can't abide shopping there, as I'm convinced enough that the longterm cost is not in my best interests.
posted by five fresh fish at 9:34 PM on September 14, 2009


Wal-Mart and Target for the win!
posted by Cool Papa Bell at 3:30 PM on September 14 [+] [!]


But for just $10 more, I can get it from Amazon with free shipping and a really good return policy - they automatically pay for shipping to return if there is any thing wrong with it.

So Amazon for the win. Are they evil to their employees and distributors too?
posted by jb at 9:41 PM on September 14, 2009


"I don't think WalMart is quite as grim up here as it is down there."

I don't think it's as cheap, either. As in inner-city dweller Wal Mart is pretty much invisible to me, because they always build the stores in car-hells on the edge of town - but the few times I have been inside one I didn't see anything that couldn't be purchased for the same price or better at Zellers or Canadian Tire. They're gigantic in size, but with aisle upon aisle of the same weird house brands and not much selection.
posted by Kevin Street at 11:52 PM on September 14, 2009


I live in the land of the Wal Mart corporation.

I call the place slightly north of where I live the land of the evil triumvirate. That would be Wal Mart, Tyson, and JB Hunt. All the corporate offices are there. The university where I work has a business college named after the Walton family, a poultry science department funded by Tyson, and a relatively new building named after JB Hunt. We know where our pay comes from and it chafes a lot of us.

Since I live in the land of the corporation, I also have to deal with the annual shareholders' meeting that takes place at this university. It lasts less than a week, but it's awful. Those people, who we refer to as WalMartians, take over the campus with their ID badges and self-importance. The stadium and campus swarm with events and special concerts. Parking is a nightmare. People who work at the university are asked to park a long way from campus and take the buses in, during the summer, when the buses run much less frequently, and you have to plan at least an extra 45 minutes to get to the job on time. Forget going to our favorite restaurants or bars. Football season is bad enough, but nothing like this. These people act like they own the town. Keep in mind that "shareholder" ranges from any of the Walton clan to the lowliest checkout person or greeter who owns one teensy bit of stock, and they come here to stay in dorms on their yearly vacation to party down.

About a decade ago, when I was a newly single mother and had to buy diapers for two kids and food and whatever else I needed to start my brand new household, I pretty much had to go to Wal Mart. We sure don't have a Costco here. At the time when I was struggling with the newness of being alone with my pair of babies, I'd load them into the car, and go shopping. That also happened to be around the time of the annual shareholders' meeting that year, of which I was ignorant at the time.

So there I was, with my babies in the cart, only one strapped in the seat and the other in the main portion of the cart (yeah, against all rules of safety and good taste, because I was desperately redneck like that), and the diapers, and food, and whatever else we needed. Just trying to get what we had to and get the hell out of that place that I'd hated for decades already, regardless of what town or city I'd lived in previously.

And then there were the shareholders. The people who organized the big meeting would include tours of the local Wal Marts, so there they'd all be with the IDs on lanyards wandering around and blocking the aisles when I was trying to get shit done as quickly as possible. You know, before a kid needed a diaper change or started to have a freakout.

It was like being part of a zoo display. The obviously wealthy shareholders had very obviously never even set foot in a Wal Mart before. The shareholders who worked in the stores decided against the tours in order to sleep in or get seconds at the breakfast buffet or something. It was always the ones with money who came to gawk.

So, there I was with my healthy, clean, lovely babies. Newly divorced. Frightened. Exhausted. Doing the absolute best I could at the time.

And feeling like a bug pinned under a microscope. Bombarded with the constant audio-visual propaganda that fills those places. And wondering how I was going to manage living at all.

For the entertainment of those fat bastards, who looked at me with that pity/disdain/disgusted combination.

Yeah, I'm still bitter about it.

Sorry for the rant, but damn, it still pisses me off, even after a decade.
posted by lilywing13 at 2:31 AM on September 15, 2009 [5 favorites]


But for just $10 more, I can get it from Amazon with free shipping and a really good return policy - they automatically pay for shipping to return if there is any thing wrong with it.

So Amazon for the win. Are they evil to their employees and distributors too?


Or you can get it shipped to your local Walmart for free and return it there, too, if there's something wrong with it. Also for free. For ten dollars less.
posted by PhoBWanKenobi at 5:03 AM on September 15, 2009


$10 isn't worth the 1/2 hour to 1 hour bus to get to the nearest Wal-mart. I can get Amazon at my P.O. Box around the corner. Also, I don't trust Wal-mart shipping or returns - my aunt works with at a distributor, and they get all sorts of crap back from Wal-mart. Once, a PS2 box filled, not with a PS2, but kitty litter.
posted by jb at 6:45 AM on September 15, 2009


$10 isn't worth the 1/2 hour to 1 hour bus to get to the nearest Wal-mart. I can get Amazon at my P.O. Box around the corner. Also, I don't trust Wal-mart shipping or returns - my aunt works with at a distributor, and they get all sorts of crap back from Wal-mart. Once, a PS2 box filled, not with a PS2, but kitty litter.

All right, I'm just saying that they do offer free shipping options as well. I don't like Walmart's labor practices (though I think, really, that it's the government's job to be the watchdog for employees, because, as I said upthread, many employers of all sizes take advantage of employees given the option), but there seems to be really weird, selective data selection for the arguments here. No matter how evil, Walmart does offer free shipping options, and for those who live close to a store, that would make buying there the cheapest option.
posted by PhoBWanKenobi at 6:55 AM on September 15, 2009


A word on Kaldor-Hicks optimality: let's say you can lower the cost of an item by $20/year for 10,000 people but 90 people will lost their jobs paying $20,000/year. The job losers lose $1,800,000/year, while the purchasers gain $2,000,000. This is what we call a good move: in aggregate, we've gained $200,000. Of course, the gains are small per family, and the losses are large for the few who suffer them, but as a society, we're better off, and we can take our gains and spend them on job retraining and unemployment insurance and there's still some left over.

The idea is that the economy is better in aggregate and we worry about distributional problems at the state level through taxation and the welfare institutions. It hasn't always worked out that way, but that's the theory and it can be very effective if executed correctly. Our experience over the last three decades shows that it works out more often then not: while income inequality is at an all-time high, we've also been decreasing the rates of domestic childhood undernutrition, to the point that we're worried about childhood obesity! At the margins, all those different decisions that add $20/year to a family's budget make the difference between poor people breaking even or failing to put food on the table.

It also helps that those jobs don't just disappear, they move to China, where they help people who had been living on less than the local equivalent of a dollar a day move up to the middle class, making the local equivalent of five or ten dollars a day and avoiding poverty-related mortality from easily preventable diseases like diarrhea, asthma, or malaria. Many of Wal-Marts detractors seem to genuinely favor protectionism, and if we're going to spread the moral acrimony on as thickly as has been done in this thread that's a grossly irresponsible, jingoistic, and just plain selfish position to take.
posted by anotherpanacea at 7:04 AM on September 15, 2009 [2 favorites]


Ack: missed a zero. It should be "lower the cost of an item by $20/year for 100,000 people"
posted by anotherpanacea at 7:09 AM on September 15, 2009


I've never really been a CostCo shopper, but my father-in-law dragged me along last time he went. Pretty much all of the packaged food-stuff at CostCo, (cereal, tuna, crackers, etc.) were significantly more expensive than the same exact quality food at Aldi. Plus Aldi is 5 minutes away instead of 45, and you also get the benefit of not having 5 times as much as you need. The produce section sucked; it was tiny and everything in it came in double- or triple-size packages, which meant it would spoil if I bought any of it. The cheese and bread prices were decent, for non-Kraft non-Wonder, but not amazing, nor is the quality anything special. Aldi is cheaper for similar quality, Wegman's is more expensive for much higher quality. The meat selection was terrible, in my opinion, as the prices were as high as what I pay at the normal grocery store, except that the normal grocery store I can choose hormone-free, medication-free whole chicken for the same price that CostCo had for chicken of unknown provenance. The special order, large quantities of meat they had had better prices, but still no provenance of the history of the meat. And, anyway, I don't have a chest freeze, yet.

Not to mention, the place was an absolute zoo. Some guy sidled up while I was looking down-aisle, and tried to steal my cart! I honestly could not imagine a grown man attempting to purloin a shopping cart, but there you have it.

In summary: CostCo blows. Sorry, but if you stock your pantry there, you are over paying on a whole lot of things by 50-100%. I didn't price compare paper goods or baby goods, so those might not be so bad, but the boxed foods and the cans of vegetables and frozen whatnots, and all that, way cheaper at Aldi.
posted by paisley henosis at 7:23 AM on September 15, 2009


Just for a data point, the Aldi I shop at is hiring right now, and offering 11.25$ starting wage, full time, with benefits. This is the second time they've put up a sign that they were hiring in the last 6-12 months. It is a good job.
posted by paisley henosis at 7:26 AM on September 15, 2009


paisley: this is why you check prices before you buy. My wife is a strategic shopper and as a result, we save loads every trip. Costco, Publix, or Target: we do well when shopping.

As for the other shoppers, a brisk "Fuck off!" works for me.
posted by grubi at 8:17 AM on September 15, 2009


except that the normal grocery store I can choose hormone-free, medication-free whole chicken for the same price that CostCo

Minor FYI: it's not legal to sell chicken with hormones or antibiotics in the U.S. Beef, on the other hand, may have hormones or antibiotics.
posted by amuseDetachment at 8:47 AM on September 15, 2009


Err that's just hormones (could've sworn it was antibiotics, too, but I buy organic stuff anyways so I don't pay attention to those labelings that much ... )
posted by amuseDetachment at 8:49 AM on September 15, 2009


It also helps that those jobs don't just disappear, they move to China, where they help people who had been living on less than the local equivalent of a dollar a day move up to the middle class, making the local equivalent of five or ten dollars a day and avoiding poverty-related mortality from easily preventable diseases like diarrhea, asthma, or malaria. Many of Wal-Marts detractors seem to genuinely favor protectionism, and if we're going to spread the moral acrimony on as thickly as has been done in this thread that's a grossly irresponsible, jingoistic, and just plain selfish position to take.

This is what I came here to say. All of you talking about jobs being destroyed need to realise that from a utilitarian point of view, buying Chinese goods is better than buying American. That is, if you want to maximise global happiness, buy goods made in the poorest country you can. Unless you somehow think that the loss of a few million jobs in the US outweighs the lifting of hundreds of millions of Chinese out of dire poverty. (of course, if you are an American then it would make sense for you to think this.)
posted by atrazine at 9:07 AM on September 15, 2009


paisley henosis: I understand what you're saying about Costco and its prices. If you read my earlier post about the store, I say pretty much that you have to be an intelligent shopper there.

What is this Aldi of which you speak? Or Wegmans? Neither of them are anywhere near where I live. I could easily start throwing out statistics about non-national chains in this discussion as well, but it seems that we are trying to focus on those chains which have a national reach and not some regional group which doesn't extend west much beyond Kansas (Aldi) or even outside of the original northern colonies (Wegmans).
posted by hippybear at 9:18 AM on September 15, 2009


Hippybear, I can't speak about Aldi, but, to paraphrase Ben Frank, Wegmans is proof that God loves us and wants us to be happy.

It's a grocery chain based predominantly in the northeastern US that (for me, anyway) is the perfect hybrid between chi-chi high-quality food market and and your average chain grocery store. Their prepared foods are exceptional; their cheese counter is the best you'll find outside of Murray's in NY; and they bake really, really awesome breads on-site. On the value side, their prices for regular everyday items are competitive with the far more pedestrian places like Giant and Acme, and their store-branded line of generic products is mostly terrific. Oh, and they make a big effort to deal with locally-grown produce, at least in the summertime, which is also a plus.

The really awesome thing about Wegmans, though, is that they are consistently ranked in the top ten on Fortune's Best Companies to Work For list, as they treat their employees very, very well and provide excellent benefits. Their employees are generally really nice people, not surly, and you can tell that they're pretty happy with their jobs, as a whole.

/wegman's love
posted by shiu mai baby at 10:19 AM on September 15, 2009 [1 favorite]


Wegmans is the platonic form of the supermarket, an absolute nova of awesome.

Also too and as well, I have never, ever, even once, seen a grocer's apos'trophe or emphasis "quotes" in a Wegmans.
posted by ROU_Xenophobe at 11:04 AM on September 15, 2009 [1 favorite]


hippybear: What is this Aldi of which you speak? Or Wegmans? Neither of them are anywhere near where I live. I could easily start throwing out statistics about non-national chains in this discussion as well, but it seems that we are trying to focus on those chains which have a national reach and not some regional group which doesn't extend west much beyond Kansas (Aldi) or even outside of the original northern colonies (Wegmans).

Huh. Aldi is actually a German chain, so I assumed when they came to the US, they came to all of it. I see them pretty frequently wherever I travel, so I never question it. But, then, I never really travel west, either. It literally never occurred to me that it wasn't coast-to-coast. Wegmans I know is regional.

ROU_Xenophobe: I have never, ever, even once, seen a grocer's apos'trophe or emphasis "quotes" in a Wegmans.

You're right, of course. I don't know why I put it in there.

amuseDetachment: Err that's just hormones (could've sworn it was antibiotics, too, but I buy organic stuff anyways so I don't pay attention to those labelings that much ... )

Yeah, but a whole organic chicken is the better part of 20$. There is a regional poultry farm that sells vegitarian fed, no hormones ever, no antibiotics ever, and at least one other thing, like fake-organic chicken, and it is only a little more expensive than crap like Tyson or Purdue. It is a fantastic money-saver, for us.

Sorry for the shot-gun reply.
posted by paisley henosis at 12:23 PM on September 15, 2009


Nothing says class like laughing at/mocking/ridiculing people whose lifestyles, appearances and choices in that regard are not our own.

Well yes, but haughtily; perhaps, with a pipe and some claret.
posted by LD Feral at 12:49 PM on September 15, 2009


You're right, of course. I don't know why I put it in there.

I DIDN'T MEAN IT LIKE THAT! I didn't notice that you'd written "Wegman's," which I did too until I thought for a second.

I only meant that unlike any other grocery store I've been in, they always have fresh grapes rather than "fresh" grape's, etc etc.
posted by ROU_Xenophobe at 1:20 PM on September 15, 2009


which I did too until I thought for a second

FWIW, that's not intended to be snotty either.
posted by ROU_Xenophobe at 1:21 PM on September 15, 2009


Walmart grew to be the Walmart we now know by advertising itself as the retailer that sourced its products from American companies. At that time (in the 80's), other retailers were buying from places like China. Walmart filled the consumer desire for products made in the U.S.A. and became the massive retailer that it is now. "Made in the USA!" was the company's marketing cry. (I have no cite for this because it's an observation from personal experience and my google-fu is failing me).

Now that it's a huge corporation that can crush the competition, Walmart is going back on that premise and is sourcing from places like China (I've read rumors that Sam Walton was the one preventing Walmart from sourcing from other countries). The switch from American-sourced products to Chinese*-sourced products, when it started, was done quietly (and, IMHO, deceptively). This practice undercuts American companies, putting them out of business and putting people on unemployment (and, in some really bad cases, welfare).

For those of you who say that the movement of jobs from America to China is good because it means that China's poorest can have jobs and rise to middle class standing: bunk. What that really means is that there are Americans who no longer have jobs and who will sink into poverty. The placement of wealth is changing: it's moving from America to China. In my very American outlook, no good can come of that.


* I've 'singled out' China here, but I realize the products on Walmart's shelves come from other countries as well.
posted by LOLAttorney2009 at 1:57 PM on September 15, 2009


Wait, you're comparing living on American welfare to starving in the third world?
posted by anotherpanacea at 2:04 PM on September 15, 2009 [1 favorite]


I think what he's saying is that the standard of living for Chinese peasants must go up, which means the standard of living for American low-middle class folk must go down.

Which, of course, entirely ignores that fact that a 10% of the population has 90% of the wealth. If there's anyone that needs to be giving up some money in support of fairness to others, it's the ultrawealthy.
posted by five fresh fish at 4:09 PM on September 15, 2009


Or in other words, private profits and public costs. It's like Wall Street. A giant vacuuming sound of lower and middle class wealth being hoovered into the pockets of the USA's and China's ultra-elite.
posted by five fresh fish at 4:11 PM on September 15, 2009


Why does ROU_Xenophobe hate me?

Excuse me, everyone, I'm going to go have a little cry now.






*sniffle*
posted by paisley henosis at 4:53 PM on September 15, 2009


...or, in Canada, where the most recent numbers I could find show that 10% of the population control 75% of the wealth. I wonder how that's changed in the past 3 years. Toward greater equity?
posted by hippybear at 4:56 PM on September 15, 2009


Oops. that should be 20% of the population. Bad me.
posted by hippybear at 4:57 PM on September 15, 2009


Why does ROU_Xenophobe hate me?

You don't even know what you did, do you?
posted by ROU_Xenophobe at 5:08 PM on September 15, 2009


The numbers are still appalling. I don't think the ultra-wealthy can solve the world's problems by giving up their staggering wealth, but I know that they could certainly make things a lot easier for their fellow citizens, and at very little actual cost to themselves.
posted by five fresh fish at 7:19 PM on September 15, 2009


For those of you who say that the movement of jobs from America to China is good because it means that China's poorest can have jobs and rise to middle class standing: bunk. What that really means is that there are Americans who no longer have jobs and who will sink into poverty. The placement of wealth is changing: it's moving from America to China. In my very American outlook, no good can come of that.

Right, but simple utilitarian calculation tells us that the net happiness effect of one American worker moving from a manufacturing job to a much lower paid retail job while a Chinese peasant gets the factory job is positive. This is because the standard of living increment for the Chinese guy is so enormous.

Nonetheless, your "very American outlook" is totally a legitimate position. We naturally care more for people around us than we do for very different people far away.
posted by atrazine at 9:33 PM on September 15, 2009


Still, the implication that global economics is a zero-sum game is a bit false, isn't it? China has plenty of people to support their own manufacturing base, and the implication that they MUST do so at the expense of the American economy and individual life-earning potential seems like it doesn't hold much water to me.
posted by hippybear at 9:38 PM on September 15, 2009


the implication that they MUST do so at the expense of the American economy and individual life-earning potential seems like it doesn't hold much water to me.

Look, hippybear, I'm totally sympathetic to your concerns. The whole point is that it's not a zero-sum game, that there can be aggregate improvements. But there are distributional challenges, and there's only so much we can do to smooth out inequities without hampering the net gains we as a species need. So when you say that free trade "seems like it doesn't hold much water to me," I just want you to recognize that you're making an argument from faith. Not evidence, not science, but faith.

It offends your moral sensibilities that the universe is unjust, (It offend mine, too!) and so you have chosen to ignore history and best practices and conclude that experts (economists, political scientists, activists, professionals in the field of international development) who have devoted their lives to this question are wrong, and that your gut is right. I salute the purity of your intentions but I think you know that we live in world where faith doesn't get you very far. It's certainly not a good way to resolve questions bearing on the survival of the roughly 26,500 children who die every day around the globe from easily preventable poverty-related diseases.
posted by anotherpanacea at 4:38 AM on September 16, 2009


Um... Wow. That was needlessly insulting and pedantic. Did that save any children from dying?

I didn't really say that free trade doesn't hold water, did I? I think what I said was that saying that the ONLY WAY for China to improve their collective lot was by damaging the economies of other countries was a false assumption.

If you want to bring discussion of poverty-releated childhood deaths into this discussion, please do so. But do it in an honest manner and not as a lashing out at someone who said something completely different from what you are attacking.
posted by hippybear at 7:31 AM on September 16, 2009


Seriously? You stopped shopping at Wal-Mart because they started giving jobs to people who weren't Americans. There's a name for people like that: nationalists.

China didn't bomb you, they sold you some stuff cheap. On what planet does that make them the bad guys?
posted by anotherpanacea at 8:14 AM on September 16, 2009


The planet is overpopulated by about four billion people. Giving up all the jobs in the USA will do diddly-squat to improve their circumstances. It is literally impossible for everyone on this planet to live a middle-class American lifestyle.
posted by five fresh fish at 8:30 AM on September 16, 2009


Anotherpanacea, yeah, it's NOT a zero-sum game. It's not just the financial aspect; you guys are so happy to boil this down to a pie chart or a set of logistics.

It's that Wal-Mart, in its effort to wring the most profit from the cheapest labor gives us:

DVD players that burst into flames

Defective cribs that kill children

Dog treats tainted with melamine

Lead-tainted toys that our children put in their mouths.

Profit over the safety of its consumers in order to make a fast buck is what Wal-Mart wants, not to raise the Chinese peasant class out of economic virtual slavery. It's blocking laws that would require it to disclose where its food products come from.

In theory, I can agree with many here; as a financial model, Wal-Mart makes sense. If you look at the recalls of dangerous Chinese goods, it's happened at least 1-3 times per year for the past three years, minimum, and that's with me only searching for about 15 minutes.

So, you know, please don't make out Wal-Mart to be the savior of the Chinese people. They may be the largest importer of Chinese goods into America, but that's NOT a good thing if it is harming its target consumers in order to make a profit. You guys are NOT seeing anything more than numbers; I'm concerned with the human cost here, not the financial.
posted by Unicorn on the cob at 8:35 AM on September 16, 2009


In case my point isn't crystal clear: several times over the past few years Wal-Mart has been forced to recall Chinese products that killed or harmed consumers. However, virtually no penalties were levied against those Chinese manufacturers, nor has Wal-Mart slowed in its import of Chinese goods, a vast amount of which have been tainted in some way (even if nobody was killed).

So on planet earth, that makes Wal-Mart the bad guys... in MY opinion, based on this history. I don't want my niece or nephew to die so they can increase their profit margin, and frankly, I don't think it's worth the financial gain. Sorry.
posted by Unicorn on the cob at 8:55 AM on September 16, 2009


The planet is overpopulated by about four billion people. Giving up all the jobs in the USA will do diddly-squat to improve their circumstances.

No. This is so, so wrong. Since 1978, China has gone from having 60% of its population living on less than the local equivalent of a dollar a day to having 10% living under those circumstances. That's what building all our cheap crap means to them: not the big McMansion, but getting 2100 calories a day, clean water, and shelter.

you guys are so happy to boil this down to a pie chart or a set of logistics.

Yes, I will boil it down to numbers, because you're absurdly comparing some product recalls to bringing 500,000,000 people out of poverty.

Here are some more numbers:

1.4 million die each year from lack of access to safe drinking water and adequate sanitation
2.2 million children die each year because they are not immunized
2.5 billion people are forced to rely on biomass—fuelwood, charcoal and animal dung—to meet their energy needs for cooking.
Indoor air pollution resulting from the use of solid fuels claims the lives of 1.5 million people each year, more than half of them below the age of five: that is 4000 deaths a day. To put this number in context, it exceeds total deaths from malaria and rivals the number of deaths from tuberculosis.

That's what the Chinese have managed to drag 50% of their population out of. The fact that some Americans lost their jobs in the process is unfortunate, but overall, as a nation, we profited from helping the Chinese drag 500 million people out of poverty over the last thirty years. We got cheap stuff and their children got to survive past the age of 5. The way I look at it, that's a good deal.

virtually no penalties were levied against those Chinese manufacturers

Well, the boss of the factory that sold those toys to Mattel committed suicide to satiate your blood lust, but I guess you'd rather just drive all those worker's families back into extreme poverty.
posted by anotherpanacea at 3:20 PM on September 16, 2009


anotherpanacea: I take it that you feel China would not have been able to fulfil the goal of bringing its citizens out of poverty on the basis of manufacturing and selling cheap crap to themselves? Isn't that how the USA did it — focused on selling to citizens, instead of exporting?
posted by five fresh fish at 7:11 PM on September 16, 2009


No, we sold our crap to Europe using the Marshall plan.
posted by anotherpanacea at 7:57 PM on September 16, 2009


People have a right not to shop at a store which purposely buys things from other countries where the people aren't paid a living wage. No one objects to imports from Canada, Britain, France or Germany. Because you know that those countries are not undercutting your own by treating the workers terribly. Sometimes you have situations like skilled technical workers in India - they are paid very well for the local economy, but still are cheaper than North American or European workers. But this is not the case for Chinese manufacturing - Chinese manufacturers do not provide similar conditions or equivalent wages as first world manufacturers do. If they undercut first world production while providing similar conditions, then I would agree with you that it is better not to be protectionist - that is using free trade to better our world society. But when free trade principles are used just to undermine conditions for workers all over the world, then they are a social ill.

Also, fff is right: the middle class in North America and Europe developed only because manufacturers paid their employees enough that they could actually purchase what they were manufacturing. It's the Ford model - he may have been a horrible anti-Semite, but he had business smarts and realised that he would sell many more cars if his own workers could afford to buy them. And he didn't just make his cars cheaper - he also paid twice the wage that other manufacturers did.
posted by jb at 7:40 AM on September 17, 2009


But mostly I hate Wal-mart for what was exactly described in the article - not importing manufactured goods, but subverting the law to hurt the workers in North America - intimidation and union busting.

Also, they screw their distributors - see the above comment about kitty litter. They return empty boxes to distributors and don't pay their bills.
posted by jb at 7:43 AM on September 17, 2009


Bullshit. Manufacturers in Europe depended on colonial mercantilism. The primary purpose for invading and occupying other countries was to open new markets to manufactured goods while gaining commodities at artificially low prices through enslaved labor. See, for instance, the relationship between India and British textiles. The goal is to force one country to produce agriculture at a low price and trade exclusively with the colonial monopole for manufactured goods at an artificially high price.

Another example is the triangle trade: cotton and sugar come from the Americas to Europe, where they're subjected to industrial processes to produce textiles and rum, which are shipped to Africa and exchanged for slaves, which were shipped at great loss of life and dignity to the Americas to produce commodities "cheaper than cheap" because the labor didn't need to be paid or even survive.

In light of that, your complaint and botched history serves an ideological agenda driven by the intuition that out-group Asians don't have a right to be our equals. Apparently the Chinese didn't realize that they're supposed to be peasants, not competitors.

The absurd thing is that you think you have a right to deny someone survival so that you can receive what you call a living wage, which is really just code for a comfortable middle class existence at someone else's expense.

Marx was right: rent-seekers are the scum of the earth.
posted by anotherpanacea at 7:56 AM on September 17, 2009


So my refusal to shop at Wal-Mart is because I hate Chinese people? You are really stretching people's arguments here.
posted by small_ruminant at 8:23 AM on September 17, 2009


Of course not. It's due to a very human emotion: solidarity for folks 'like you.' The problem is that, though you're guided by a very positive empathy, you're in fact hurting those who most deserve your sympathy and concern. I do understand the impulse, but it's guided by an mistake in calculation: you see the harms, but not the benefits. It's shortsighted, but we're all shortsighted sometimes. If you're willing to change, then great! We all make mistakes on the basis of good intentions and bad information. I won't hold it against you, I promise: I used to think the same way.

If you're not willing to change after being shown your mistake, then something worse is going on. Maybe it's xenophobia, maybe it's indifference, maybe it's jingoism, maybe it's racism. That's not all bad: my grandfather's a stone-cold racist, who says despicable things every so often, but otherwise he's a lovely human being. I can't get through to him because he doesn't have a high school education and spent his life working in a factory. If you don't have his disadvantages, I don't see how you can justify your ignorance.

Frankly, your individual boycott isn't hurting Wal-Mart at all, and it's certainly not hurting the Chinese, especially since you're still buying Chinese goods from Target or Costco. But surely you can't be comfortable with the notion that the only way you can be made to do the right thing is through strategic misinformation? As a culture, we've basically had to trick people into thinking that Wal-mart's the bad guy so that the educated class has somebody to hate that's symbolic but irrelevant. I think that self-deception is a bit of a national embarrassment. That said, my embarrassement isn't worth much compared to all those Chinese kids who get to survive past the age of five because of your ignorance, so maybe I shouldn't sweat it.
posted by anotherpanacea at 8:40 AM on September 17, 2009


I realize I've slightly contradicted myself. I wrote "you're in fact hurting those who most deserve your sympathy and concern," but I also wrote, "your individual boycott... hurting the Chinese."

I'll have to think about that (I should have thought before I pushed post....) but I suspect there are two ways to resolve the tension: either you're advocating hurting those who most deserve your sympathy and concern, or else our conversation is irrelevant because individual consumer choices aren't going to hurt or help the Chinese. I lean towards the former, because our conversation takes place in the context of growing unemployment here in the US, and it might be part of a larger voter movement towards protectionism, which would be wrong and bad... but hardly your fault.
posted by anotherpanacea at 8:48 AM on September 17, 2009


Grar. "your individual boycott... isn't hurting the Chinese."
posted by anotherpanacea at 8:50 AM on September 17, 2009


Bullshit. Manufacturers in Europe depended on colonial mercantilism.

Of course they did. But you didn't read my comment.

My comment was that the MIDDLE CLASS (that is, the manufacturing working class who can live like only the professional middle class and above did before) in the first world was created because manufacturers began to pay a decent wage to their employees. Before this, the vast majority of people in the first world lived much as people do today in the developing world, including China. The manufacturers in China are getting by just fine - but the majority of people in China will not progress unless they are paid well enough that they can afford the goods they produce. Prosperity is based on paying a decent wage to your employees.

As for worrying about people just trying to survive - do you hate African people? Because people in Africa are so much worse off than they are in China, so therefore it is immoral to buy manufactured goods from China rather than Africa.

People have a right to make buying choices to support their own morals. I happily buy things manufactured overseas because yes, manufacturing is very important to the developing world. I also wish to see more deals whereby imports from countries with better labour practices are given advantages so that they can afford to spend those extra pennies - such as clothing imports from Cambodia, rather than Bangladesh. Because I want to see the profits of those manufactures go to the workers, not just the elites.

I also happily refuse to shop at retailers who use underhanded and occassionally illegal means to force down to wages of their own employees with the sole purpose to increase their own profit, and who screw distributors and manufacturers who produced things in my country, again solely for the purposes of their own profit.

How about we buy things from China, but pay them as much as someone in the United States, at least in the same purchasing power? Or develop the consumer market in China, so that they can manufacture for themselves, and we can manufacture for ourselves, and stop killing our planet with excessive use of oil for transportation?
posted by jb at 9:05 AM on September 17, 2009


Your historical summary of the reform era is a bit off, to say the least, there anotherpanacea. The greatest strides in reducing infant mortality were made during the 'socialist era', including during the Cultural Revolution - the overall rate has continued to decline since but this masks a growing rural-urban divide, as reform also brought the collapse of rural healthcare. Hopefully the newly-announced health insurance system and reforms will go some way to reducing that.
The other side is that the bulk of poverty reduction was achieved through regional infrastructure schemes, the household responsibility system in agriculture and the early success of the TVEs which often showed a residual loyalty to the local collective but is a sector that changed radically in the mid-1990s. From that point on (as FDI really began to come in) - the point when Chinese exports to the US became one of the core features of global trade - real wage rises were suppressed (which finally began to change only in the past year or so as people no longer found the draw of urban employment worth the hassle) and the GINI index went through the roof, i.e. this aspect of the Chinese economy (production for export to the US) has done less for living standards than it has to enrich a local elite and foreign investors, and that's to leave aside the whole host of other negative impacts of reform - mafia-isation, precariousness, accelerated environmental degradation and pillage of collective resources.
That's also a crude summary of course and all the issues have been the subject of intense debate, but the bottom line is you're making broad-brush assertions that are contentious at the very least.
posted by Abiezer at 9:09 AM on September 17, 2009 [3 favorites]


Your historical summary of the reform era is a bit off, to say the least, there anotherpanacea.

What's off about it? In 1978, 60% of all Chinese lived on less than a dollar a day. In 2005, 90% of all Chinese lived on more than $1.25 a day. It's not a detailed sketch, but it's not contentious: I'm even including the increase in the poverty line from purchasing-power parity of $1 to $1.25.

What's more, there's a difference between Foreign Direct Investment and export-driven industrialization, though they are closely related at this point. FDI was dependent on financial market liberalization, while the Chinese have been major trading partners since trade normalization in 1980. As your own article makes clear, the TVEs flourished under normalized trade relations with the US: "The sustained growth of TVEs, especially in the coastal region, has been in part attributed to the export-oriented strategy." (Zhang, 82) That's why they grew so fast (25% a year, allegedly) starting in 1980. By 1986, the TVEs were bringing in US $4.5 billion from exports, and that's how China funded its escape from the third-world.

Here's how I see the other issue, of recent real wage suppression. I don't think it's a contentious story, but maybe you'll disagree. The Cultural Revolution ended in 1976. China spent two decades developing capacity and trading heavily with the US. When they saw what we did to Thailand and Korea in 1997 using hedge fund engineered exchange rate attacks, they decided to hoard dollars as protection from Western economic warfare. That suppressed real wages, but it looks to have been a good decision because they can now force the US to be hospitable or have its debt dumped. Meanwhile, they're building the equivalent of a small city every month and have developed a major cushion of foreign currency. Admittedly, this has meant that the aspirations of the Chinese middle-class have been put on hold, but it's insulated the poor against the global financial crisis, so they are still much better off than they were in 1978.
posted by anotherpanacea at 1:48 PM on September 17, 2009


people in Africa are so much worse off than they are in China, so therefore it is immoral to buy manufactured goods from China rather than Africa.

I suspect you have no idea what you're talking about, but you're half right. It's immoral to subsidize American agriculture so that African farmers can't compete here. You know who agrees with me? Oxfam:
If Africa, East Asia, South Asia, and Latin America each increased their share of world exports by just one per cent, the resulting gains could lift 128 million people out of poverty.
posted by anotherpanacea at 2:10 PM on September 17, 2009


What's off about it?

Well, begin with poverty reduction figures; you say "It's not a detailed sketch, but it's not contentious." It's definitely broadly agreed that the growth in the economy post-78 has reduced absolute poverty but, for example, here's one look at some of the issues that disguises - a massive rise in inequality and thus relative poverty. As you can imagine this is one major cause of discontent and a factor in the nostalgia for the pre-reform era that is quite prevalent.
The point with the TVEs is that early spurt of growth that was part of the big rise in real incomes in rural areas (where most of the poor were then) pre-dated the later pattern of China-US trade co-dependence, although it of course did play a part in its formation. By the time the model became really entrenched, the pattern of industrialisation had changed and in particular that linkage between community and industry that the TVEs in some part retained. (Not everywhere; one model leftist here hold up is Nanjie Village). IIRC must less of the earnings of the early TVEs was captured by the central state (or even the provinces) and this was one of the driving factors behind reigning them in, and turning to FDI-funded models of enterprise including limited companies, joint ventures etc.
And that last point about the real wage suppression - of course, one way it's been characterised is that Chinese people earn money doing some pretty shitty work, the authoritarian state creams of the excess and lends it to the US (not mentioning the portion pocketed by rent-seeking elites) or blows it on prestige infrastructure projects that have only tangential benefits if any to the quality of ordinary people's lives.
Again, not claiming that any of the above is the full story, but just that as I said it's a far more complex picture than you set out.
posted by Abiezer at 2:14 PM on September 17, 2009


Oh me lord - 'reining them in' that should be.
posted by Abiezer at 2:25 PM on September 17, 2009


I agree with you that there are major challenges in the difference between relative v. absolute poverty and Gini coefficient issues, as far as they go. But there's nothing contentious in saying that it's real poverty that kills you and your children prematurely: relative poverty just makes you feel bad about yourself and forces you to take shitty jobs (some of which will kill you, but not nearly as fast as absolute poverty.)

I also agree that elites in China abuse their power with some regularity (though nothing like elites in the West) and that they sometimes waste money on prestige (though it's not clear how much costly signals like the Olympics are really worth: we'll see.) But I do think it's important to note that the Chinese have done something very good for themselves in indebting the US to them. That's a bill we'll be paying off for decades, and it's securing the future of their country. I mentioned in another thread that it's very much like what we did with Europe after WWII: loaned them money to preserve our industrial supremacy. It worked for us, and I'll bet it'll work for the Chinese, too. They'll have plenty of problems around political reform and relative inequality to deal with, but, let's be honest: those are luxury problems. Their children aren't going to be dying of diarrhea anymore.

The point with the TVEs is that early spurt of growth that was part of the big rise in real incomes in rural areas (where most of the poor were then) pre-dated the later pattern of China-US trade co-dependence.

I think I've effectively refuted you on this point. The growth of the TVEs was dependent on exports from the start, which is why they're concentrated in the Eastern coastal areas. If you see it differently, I think we'll have to drill down into the data/arguments a bit.
posted by anotherpanacea at 2:49 PM on September 17, 2009


Anotherpanacea: I'd like to say that I have nothing against the Chinese people, and I absolutely want them to have the same standard of living that anyone in a developed country that even has a middle class these days enjoys.

Yes, I quoted statistics about our trade deficit with China. I'd be fine with that if the goods were of any quality whatsoever, or if any of the things you're saying about Wal-Mart being able to single-handedly lift the Chinese people out of a substandard of living were true. I'd also shut up if the products were of any quality or variety, or if the employees were paid a competitive wage, or if the general management of the company was focused on, say, green initiatives, profit sharing, excellent health care options, or other incentives that gave its employees a reason to be anything but miserable and slightly unproductive. Wal-Mart fails on all accounts.

I have something against a corporate entity that forces its Chinese manufacturers to deliver goods while treating their workers in China like crap. I have something against a company that is spreading what it's done to small-town America across China or ANY country, period. I would love to have information at my fingertips showing how Wal-Mart has screwed over competitors in Brazil, Germany, Canada, ANY country, not just the U.S. I'd love to know how many jobs were lost in each country as it penetrated the market over a couple of years; maybe that would sound less "jingoist" to you?

Let me state emphatically now that I don't like ANY company that actively outsources the cheapest labor possible while abusing its workers anywhere in the world while delivering poorly made products that repeatedly harm its consumer base and does so under false advertising pretenses, such as claiming to be "American made" (which Wal-Mart has, and still does, to a degree) and forcing its own vendors to sometimes go out of business.

It's really sweet of you to selectively read my comments and compare me to your grandfather, though. Or maybe you're calling anyone who doesn't like Wal-Mart racist? I can't tell. I certainly have no stake in personally insulting you. I have a stake in helping people understand that Wal-Mart is not an admirable company and that what they're doing globally is wrong.

I have a problem with Wal-Mart in that they sought out the cheapest labor market possible, which for the past few years has been China, but it won't stay that way for long. In order to maintain cheap prices and retain Wal-Mart's business as a buyer, Chinese workers are doing things like fortifying dog food with melamine to keep Wal-Mart's contracts. Because once the Chinese get a decent standard of living and their labor laws catch up to basic Western standards and are enforceable, costs will go up. Then Wal-Mart WILL move on to a cheaper, poorer nation and exploit the people there, too.

If you think I'm after blood lust, you're wrong. WRONG. I'll tell you exactly what I want: I want monolithic corporations to stop putting human lives at risk for profit while surreptitiously destroying or harming its customer base. PERIOD. Wal-Mart is the largest retailer IN THE WORLD. Therefore, its exploiting power is exponentially greater than all the other companies quoted upthread combined.

So you can spare me the xenophobia comments and racism accusations. I'm saying that Wal-Mart is EVIL. All of this talk about racism and spouting comments depicting Wal-Mart as the second coming of UNICEF is ridiculous; you're using it to obfuscate the original argument, which was: Wal-Mart is awesome vs. Wal-Mart is FUCKING EVIL.

If you want to turn this into a thread about Chinese economics, go right ahead. I'm sure you are far more qualified than me to discuss that. I refuse to take this into a personal insult-off, though. If you want to be embarrassed by my ignorance, that's fine; if you can cite sources showing that Wal-Mart has improved the lives of the Chinese people overall rather than exploiting them on top of all the other horrible crap they pull, I'll shall stand corrected. What I see is that Chinese workers this year are being paid 51 cents an hour and living in abhorrent conditions.
posted by Unicorn on the cob at 2:52 PM on September 17, 2009 [1 favorite]


And if you don't mind a PDF file and some lefty jargon (though far less than most), this article from Aufheben gives a run down of the various conflicts and in particular class conflicts attending reform. Of relevance to our argument here:
China’s immense economic transformation has involved terrible human and environmental costs. Of course, its apologists point to the fact that economic growth has allowed the average level of consumption to rise. They point to the growing Chinese middle class whose standard of living is comparable to their Western counter-parts and would have been inconceivable ten or twenty years ago. And they point to the 200 million peasants whose money incomes are now above the international levels defining absolute poverty.
Yet in less than a generation China has moved from one of the most egalitarian societies in the world to one of the least egalitarian. Although tens of millions of people have become substantially better off in material terms, the position of hundreds of millions have become worse. The ‘iron rice bowl’, which provided a minimum level of income security, free health care and education, has been smashed. Although people have more money, they have to spend more as state benefits in kind have been withdrawn. As we shall see, in the rustbelt regions of northeast China the devastation of old industries have thrown tens of millions out of work leaving them dependent on meagre benefits and on the precarious casual employment they can find. Millions of peasants have been driven off their land with little or no compensation. While in the booming factories of the south tens of millions of migrant workers are obliged to work extraordinary long hours in often atrocious conditions. At the same time, thousands of miners and construction workers are killed in work accidents every year because basic health and safety standards are ignored. If this was not enough, then the relentless drive to expand capital has meant that scant regard has been paid to the impact on the environment.
They don't put in in these terms, but it's often remarked (and probably by me elsewhere on MeFi as I tend to repeat myself!) that the famously feisty peasantry of China didn't rise up against Party rule during the Cultural Revolution, although governance had broken down in many areas and open armed conflict was taking place between Red Guard factions (i.e. the prior restrictiveness of the totalitarian regime was , but the 90s and onward have been characterised by an increasing number of 'mass incidents' and strikes. The social movement of 1989 that in the West is seen as for democracy was as much a reaction to the consequences of reform, for example.
posted by Abiezer at 2:55 PM on September 17, 2009


Sorry; I shall stand corrected and Wal-Mart's Chinese workers, etc.
posted by Unicorn on the cob at 2:55 PM on September 17, 2009


Oh, wait: you've got a rural poor v. urban factory distinction running, too. I think I see the issue. I thought our disagreement was only on absolute v. relative poverty, but you're filtering it through the plight of the rural poor.

Well, for this it seems important that the Chinese are urbanizing so damned fast. They didn't really improve the lot of the rural poor very much, instead they've been urbanizing them, and it's better (in China at least) to be urban poor than rural poor, from the perspective of the health and survival effects of poverty, i.e. malnutrition, indoor air pollution, clear water, shelter, and electricity.
posted by anotherpanacea at 2:55 PM on September 17, 2009


I think I've effectively refuted you on this point. The growth of the TVEs was dependent on exports from the start, which is why they're concentrated in the Eastern coastal areas.
Looks like a misunderstanding - my point isn't that the TVEs weren't involved in export or dependent on them, but that their role in generating substantial rises in rural incomes pre-dated the current China-US trade relationship that has generated the massive foreign exchange reserves (although they played a part in its formation) and in so far as their ownership and taxation was reformed, it reduced the role they played in generating benefits for ordinary Chinese workers.
posted by Abiezer at 3:01 PM on September 17, 2009


instead they've been urbanizing them, and it's better (in China at least) to be urban poor than rural poor
Well, again that's very problematic given the household registration system. People have gone to the cities to work but have been excluded from any benefits whilst there, including the right to bring their family with them or have their children educated, hence you get the phenomenon of rural villages filled with the elderly caring for their grandchildren while the parents are away working. And actually the increasing concern is with growing urban poverty (link to my old mag again), as with the dismantling of the work units and subsidies for many basic necessities it is actually regarded by many as better to be rural poor, as you at least get a land allocation. Several smaller cities finally began to liberalise their household registration requirements but found less than expected take-up of the scheme for this reason - it was behind the difficulty attracting workers noted in that Business Week article I posted in my first comment too, for instance.
posted by Abiezer at 3:08 PM on September 17, 2009


their role in generating substantial rises in rural incomes pre-dated the current China-US trade relationship that has generated the massive foreign exchange reserves (although they played a part in its formation) and in so far as their ownership and taxation was reformed, it reduced the role they played in generating benefits for ordinary Chinese workers.

I see. I thought your original point was that exports had only played a role in poverty-alleviation starting in the mid-90s. That means that our real disagreement, if there even is one, is about whether holding down the yuan's exchange rate and re-investing dollars back into US Treasuries has been good or bad for the least advantaged in China, and perhaps whether we ought to use relative or absolute poverty alleviation as our metric.

My understanding is that it was that hoarding dollars was a necessary defensive move. You seem to disagree. Yet you seem to have a good deal of knowledge about the region, so I'm wondering, do you understand how Long Term Capital Management and other hedge funds arbitraged currency exchange rates? Holding currency pegs like the yuan's requires a supply of the reserve currency, in this case dollars. China wanted to a big cushion to prevent suffering the fate of the Thai baht. That was clearly their motivation, rather than simply wage suppression. By 2005, it went from being a defensive strategy to a foreign policy strategy. I'd be interested to hear arguments as to why it was unnecessary, though.
posted by anotherpanacea at 3:13 PM on September 17, 2009


And to spam on a bit, wanted to address this: I thought our disagreement was only on absolute v. relative poverty, but you're filtering it through the plight of the rural poor.
It's a bit more than this - my personal sense is that most of the reduction in absolute poverty was the result of the state finally ceasing to actively prevent the capacity of Chinese people, particularly farmers, to earn their own living and this came mostly with the break-up of the rural communes and the allocation of land to individual households. Subsequently economic development took the path of low-end industrialisation geared for export and given the massive suppressed economic potential of China this of course delivered GDP growth, but at a massive social cost and with nothing to say it was the only possible way forward in the early 80s or subsequently - hence I'm saying the history of Reform and Opening is contentious, and is contested in many an interminable debate in China.

On preview: My understanding is that it was that hoarding dollars was a necessary defensive move. You seem to disagree... I'm no macro-economist (though I have read Chinese macro-economists who do disagree and could dig them out if you're interested) and do understand that this is the fiscal prudence that China is often praised for (and I believe a practice supposedly entrenched in government thinking with the experience of the Asian financial crisis in the late 90s). It's that I tend to side with those who dislike the entire course that reform has taken - the introduction of neo-liberal ideas and trickle-down economics - and from what I understand, there have been various points over the course of the past thirty years where a slower path to overall GDP growth could have been taken that would not have had a major negative impact on general living standards (as I said, they stagnated after an initial burst that I think was mainly rebound) and would not have left China particularly exposed to the vicissitudes of the global economy - after all, it was growing from a period of isolation and low income and progress would have been felt, but the massive wealth that has enhanced state power and made a few very wealthy (more billionaires than anywhere now) would not have been generated - i.e. the motivation of the very clever macro-economic planners at central level has indeed been to defend the Chinese economy, but a particular model of economy that they also chose to shape, and did not have to be the way it is.
Hope that's sufficiently vague! Can back it up if needed.
posted by Abiezer at 3:27 PM on September 17, 2009


No, that's good, and in the meantime I've been reading the excellent articles you linked from China Development Brief (your old magazine, you say?) and I have a better sense of where you're coming from.

On your view, if I have it correctly, the major public health problems of Chinese poverty were resolved before 1980, in the agrarian reforms. However, that seems to be falsified by the data, which shows that 60% were living under $1/day PPP in 1978. My view is that export-driven industrialization is what made that leap out of absolute poverty possible, and I think the data backs me up, because agrarian reform was aided by the partial industrialization of agriculture through the production of farm tools and machinery by the TVEs, which were funded by exports. That's how you get enough food to fill everyone's bowl: the export money is seed for the local development.

I recognize that there have been major social costs, but the benefit in supplying human needs adequately seems to have justified those costs. Insofar as alternative development paths would have taken longer to address absolute poverty levels, it seems like the growth in power in the central state is also justifiable, though difficult to stomach, I'm sure. Frankly, I think it's going to be fun to watch the Chinese people chip away at that power over the next decade: just look at the failure of Green Dam. That said, 10% of the Chinese are still living on less that PPP$1.25, so even with all that success there are still a lot kids dying before the age of 5 for no good reason. We could talk about the costs of clean water in this context, as well.

Mostly, though, I'm just pleased to have a disagreement where no one uses the word 'evil' in all-caps.
posted by anotherpanacea at 3:47 PM on September 17, 2009


On your view, if I have it correctly, the major public health problems of Chinese poverty were resolved before 1980, in the agrarian reforms. However, that seems to be falsified by the data, which shows that 60% were living under $1/day PPP in 1978. My view is that export-driven industrialization is what made that leap out of absolute poverty possible, and I think the data backs me up, because agrarian reform was aided by the partial industrialization of agriculture through the production of farm tools and machinery by the TVEs, which were funded by exports. That's how you get enough food to fill everyone's bowl: the export money is seed for the local development.
I'd go further - that the overall economic development post-1949 in China was surprisingly successful given some of the frankly crackers twists and turns in policy. We then have the situation in the late 70s when Deng takes power where there is still widespread poverty (though, to repeat, compared with the starting point in 1949 and with other large agrarian nations such as India there's also much to praise despite it all) and at this point and many subsequent points directions could have been taken that would have delivered similar reductions in absolute poverty with far lower social costs. Of course, that gets into the world of alternative history a touch and is only of limited relevance to where we are today.
On the macro-economists who have other things to say, one who sprang to mind is Han Deqiang, who's quite a trenchant leftist and nationalist. Can't find much in English by him on forex reserves (will have a look in Chinese later) but he was publishing various jeremiads at the time of China's accession to the WTO and there's a translation of an interview with him here, unfortunately not directly relevant to the arguments but you get a flavour of some local dissent at least. Another noted economist who is at least sceptical about reform is Wen Tiejun and I'll see if I can find anything he's written on the subject. Wang Hui, another important left thinker, touches on some of the issues in the linked piece, but again given the paucity of what's out there in English it's again not all directly relevant.
posted by Abiezer at 4:07 PM on September 17, 2009


anotherpanacea: Mostly, though, I'm just pleased to have a disagreement where no one uses the word 'evil' in all-caps.

And I'm glad you were able to have a disagreement without condescendingly calling abiezer racist and telling him you were embarrassed by his ignorance after pulling selective data from his comments. Too bad you can't treat me with the same respect; my disagreement is with anyone defending Wal-Mart, not you personally.
posted by Unicorn on the cob at 4:16 PM on September 17, 2009


Unicorn on the cob: As I persuaded myself earlier, your anti-China feelings are irrelevant: Wal-Mart may be the biggest importer of Chinese goods, but that's just because they're the biggest retailer. If you want to shop somewhere else, that's fine: you'll likely be buying goods made abroad. So long as you're willing to jettison your "Buy American" rhetoric, it makes no difference to me where you shop.

I've already written at length as to why I don't think Wal-mart is as troublesome as you make them out to be. But here's one more try: think, for a minute, about why it might matter more to alleviate absolute poverty than relative inequality. If you can do that, then I think you'll at least be able to understand my view. Until you can understand your interlocutors' reasons, how can you hope to persuade them?
posted by anotherpanacea at 4:35 PM on September 17, 2009


Abiezer, the first article looked interesting but was behind a pay wall for me, though I can check it again when I'm back at work: we may be able to get it through the library.

The second article, by Wang Hui, is very good I think. I especially like the insight that the decentralization of power didn't reduce the amount of meddlesome intervention, but rather allowed local authorities to be much more dominating because they were there in the same village or town with the people they were bossing around.

I hope you'll understand that I don't disagree with the goals that Wang Hui outlines at the end, and I share the concern with radical privatisation and FDI. Certainly it ought to have been possible to forgo corrupt privatization of state-owned enterprises, though this has long troubled developing democracies. The fact that market-based rhetoric is often used to justify that kind of theft is really depressing. Any time you want to drop me an article like the ones you've been linking here, I'll be all ears! Thanks for the great discussion.
posted by anotherpanacea at 4:57 PM on September 17, 2009


Anotherpanacea: I don't have anti-China feelings. In fact, the last comment I made pointed out that the Chinese are being exploited as much as anyone is in this situation. It seriously boggles my mind that I posted a link to Chinese union workers' reports of being abused (i.e., being paid 60 percent of the minimum wage in China and being forced to work 7 days a week, mandatory overtime, and 12 to a room) and you can paint me as being anti-China... but maybe you just think my links aren't worth clicking on. I don't know.

I wish you'd actually read what I wrote, but that's okay. I just don't want to buy poorly-made and possibly dangerous, poisonous goods that were made by exploiting others simply to save a few dollars. Where they were made is irrelevant to me.

I also haven't spouted any "Buy American" rhetoric. However, Wal-Mart sold its products for almost three decades under that false promise; I feel it's wrong, because I'm pretty sure you and I agree that isolationist attitudes like that are harmful to the global economy.
Somehow, you understood everything that everyone else posted and continue to misunderstand me.

We totally agree on this point, though: you do need to understand your interlocutor's reasons before you can persuade anyone that they are wrong. I'm just a bit freaked out that you are using pieces of what I've posted to paint me as an ignorant racist and all the factual data links I've posted are somehow invalid.

It would be nice to have trade parity with China rather than a staggering deficit, but I suspect that is impossible.
posted by Unicorn on the cob at 5:05 PM on September 17, 2009


Enjoyed it too - spent many years arguing nitty-gritty aspects of reform and its consequences and it's really been a while since I've sat back and tried to give a comprehensive overall account, which I really ought to clarify. The big background tends to be such a given in conversations here that I don't debate it often (though could find plenty of differing views here if I sought them out).
Managed to dig up a few articles on concerns over forex policy (another leftist economist Zuo Dapei has a bit to say, for example) but can only find stuff in Chinese. No doubt we'll get future opportunities to revisit the argument, or I could add a few summary points here. Maybe later, as supposed to be working.
posted by Abiezer at 5:13 PM on September 17, 2009


I wish you'd actually read what I wrote... Somehow, you understood everything that everyone else posted and continue to misunderstand me.

Well, up above you suggested:

"if you can cite sources showing that Wal-Mart has improved the lives of the Chinese people overall rather than exploiting them on top of all the other horrible crap they pull, I'll shall stand corrected."

I don't know if you've noticed, but Abiezer and I have been debating that very question. Though we seem to disagree on some of the details, in broad outline I think we're on the same page, and the answer is that producing goods for export has improved the lives of the Chinese to the tune of lifting 500,000,000 of them out of abject poverty, the kind where you don't get enough food and your kids die young. In light of that, let's treat your question as asked and answered, shall we?

all the factual data links I've posted are somehow invalid.

After a while, I'll admit I stopped clicking your links. That's because you've not offered me one horror or evil bad enough to outweigh eliminating abject poverty for 500,000,000 people. I'm all for "they could do better" arguments, and I happen to think that improvements are possible. But when you start with demonization, you're saying, "Scrap the whole thing. It's EVIL." And what you need to understand is that you're advocating substantially harming the lives of a whole bunch of people who never did anything but work at low wages in execrable conditions to make sure you and yours could have the junk you want at a price you can afford.
posted by anotherpanacea at 5:50 PM on September 17, 2009


Though we seem to disagree on some of the details, in broad outline I think we're on the same page, and the answer is that producing goods for export has improved the lives of the Chinese to the tune of lifting 500,000,000 of them out of abject poverty, the kind where you don't get enough food and your kids die young.
Looks like I need to set out my position more clearly - I agree that the historical fact is that industrialisation for export generated GDP growth which resulted in consequent benefits in reducing absolute poverty, but I don't think it was the only or best way to achieve that or even the main factor in poverty reduction; I mentioned 'the household responsibility system in agriculture' in my first post above - to quote the classic World Bank report referenced in one of the CDB articles I linked above:
Broad participation in reform-driven agriculture sector growth played the key role in the tremendous two-thirds reduction in absolute poverty during 1978-84. Rural per capita income grew at an average annual rate of 15% in real terms during this period, and increased a total of more than 130%. The failure to achieve further reductions in poverty during the second half of the 1980s, despite modest agricultural growth and very strong industrial growth, is more difficult to explain. A number of macroeconomic developments stymied efforts to reduce poverty during 1985-90: (i) sharply increased prices for grain and other subsistence goods adversely affected the real incomes of the majority of the rural poor; (ii) rapid growth of the working age population exceeded the expansion of employment opportunities, contributing to a worsening of rural underemployment; and (iii) economic growth was greater in the higher income coastal prcvinces than in the lower income inland northwestern and southwestern provinces. (p. xi)
posted by Abiezer at 6:37 PM on September 17, 2009


So you don't think increased access to tools and equipment had any impact? I'm happy to agree that breaking up the agricultural communes made a big difference, but I don't understand how you can discount the role of technology here. Keep in mind, we've got to distinguish incomes from benefits: incomes diverge, but if we're alleviating widespread absolute destitution, people are still doing better. In 1978, only 40% of the population could afford 2100 calories a day, clean water, non-biomass cooking, and shelter. In 2005, 90% could. Things might have improved quite a lot between Mao and Deng, but the biggest improvements came post-Deng. In the words of your own CDB, it's better to have dynamic inequality than equal (absolute) poverty.
posted by anotherpanacea at 6:57 PM on September 17, 2009


So you don't think increased access to tools and equipment had any impact? .... In 1978, only 40% of the population could afford 2100 calories a day, clean water, non-biomass cooking, and shelter.
I don't - my understanding is that the break-up reduced access to tools etc. initially, especially in the poorest areas (tiny farms often in upland areas etc. with no chance of paying for tech or inputs as an individual family - in fact, the reason why in some places people chose to remain as collectives) and that public goods such as clean water provision also broke down in many places due to lack of public funding. I worked in rural development in the field for some years and would accompany technicians to survey for gravity-flow water supplies in mountain areas - they said they used to visit these places regularly in the 70s but not after when public money stopped being allocated to these things post Reform.
You're making too much of a direct link between economic growth as it happened and the general goods that economic growth can provide I think - i.e. any number of other models of reform could well have delivered similar or better outcomes.
posted by Abiezer at 8:06 PM on September 17, 2009


Oh, and "In the words of your own CDB, it's better to have dynamic inequality than equal (absolute) poverty." We of course nowhere wrote that it was that simple - to put it crudely it's a move on from a kick in the balls to a slap in the face, which is 'better' if you're going to force the comparison but not a desirable outcome either. I advocate the friendly pat on the shoulder model.
posted by Abiezer at 8:12 PM on September 17, 2009


You're making too much of a direct link between economic growth as it happened and the general goods that economic growth can provide

I'm not trying to, and I certainly don't want to. I want to know how, exactly ordinary Chinese people who began Deng's reign living in villages started getting enough to eat when before they had not. It seems like a pretty crucial question to answer. I thought we had resolved it. If we haven't, let's keep at it!

any number of other models of reform could well have delivered similar or better outcomes.

Two things to say about this: first, how do we know? Did other countries of China's basic demographics and geopolitical position achieve a similar development path? (Here, I think the answer is clearly no, but I'm interested in the parallels. Korea maybe?) Second, even if we can now prove such a path was possible, did decision-makers in the 70s have access to good reasons to believe that these alternatives were better? If so, why'd they choose the wrong path?
posted by anotherpanacea at 8:49 PM on September 17, 2009


Okay, anotherpanacea. I completely understand what you're saying, I think, and I agree with you on the broader points.

But you seem to be saying that the Chinese people started having a better standard of living post-1978 and attributing 100% of this to Wal-Mart alone.

Since Wal-Mart didn't begin investigating outsourcing its production to China until 1985, according to this source, I'd like to know how you equate all the economic growth in China and the greater standard of living there now to Wal-Mart and nothing else.

That link states pretty directly how Wal-Mart closed one American manufacturer after another and moved all the production to China. You think that's great; other sources I've found state that these workers are forced to work in pretty inhumane conditions, as cited here.

That may be wherein my confusion lies. I don't pretend to be a world economist, but I am educated and well-read and always eager to learn more, especially from subject matter experts with greater knowledge than my own. You and Abiezer are astute on the topic of Chinese economics, so I'm asking you: is Wal-Mart alone responsible for all the growth you're talking about? And if they are, don't you think the Chinese workers deserve a better standard of living than what's being reported by Chinese union reps and locals who were cited in the various sources I've linked?

I absolutely do want people to be able to lift themselves out of abject poverty; on that you and I agree 100%.

My own maternal grandparents picked cotton until they were 16 (grandmother) and 19 (grandfather), and then worked in factory jobs their entire lives once my Pappaw was out of the Navy (making Hollywood Vassarette undergarments and Curtis Mathes televisions, respectively, before those factories closed), so I'm not totally ignorant on the topic of going from an agrarian-based subsistence to the substantially better standard of living afforded by a job working on the line.

The Curtis Mathes plant closed around 1982, when I was 10. I remember the plant being a much different environment than the ones being described in all the Chinese union links.

Also, the products being made aren't just harming Americans, they are harming people of every nationality that are exposed to them... including the Chinese. I don't want the Chinese to be burying their children because of lead tainted toys, nor do I want their dogs to die from melamine poisoning. I think there is a better way that this can be done so nobody suffers and everybody wins, it's just not profitable.

That said, if Wal-Mart is 100% responsible for the higher standard of living in China today, this will be my final comment on the matter. I'm always happy to be proven wrong when it comes to issues like this; I'd much prefer that the greater good is being achieved, I've just never seen anything that would indicate that is what's happening when it comes to Wal-Mart specifically.
posted by Unicorn on the cob at 9:55 PM on September 17, 2009


I want to know how, exactly ordinary Chinese people who began Deng's reign living in villages started getting enough to eat when before they had not.
Well, initially through the jump in production that went with the incentive to produce more and practice better tillage etc. when working your own family's land allocation, coupled with a freeing up in decisions over what to plant and the permission to trade in rural markets. Income from off-farm work came later, and its availability and impact varied greatly between regions - as you can imagine the peri-urban areas and coasts fared vary differently from the hinterland. It is also worth emphasising that in fact big strides had been made in agriculture since 1949 and already much poverty had been reduced - you could argue (and I've read precisely this argument) that if the political campaigns had been set aside and the economic policies associated principally with Liu Shaoqi had been pursued consistently from the early 50s pursued even greater progress would have been made.
first, how do we know?
We don't of course, but it's hardly to ask for a departure into the realms of fantasy to imagine other possibilities.
Did other countries of China's basic demographics and geopolitical position achieve a similar development path?
There really are no parallels to China - perhaps India in some respects (big, agrarian) but then not in so many others. It's a continent, vastly populous, global centre of culture and economy through most of history, diverse demographically and geographically, burdened by a very particular history and so on and so on.
did decision-makers in the 70s have access to good reasons to believe that these alternatives were better? If so, why'd they choose the wrong path?
They had the bad luck to open to the West when Reagan and Thatcher and the crackpot Friedmanites were ruling the roost, so market reforms took on a particular brutal neo-liberal bent. If Sweden had been the major Western power, China would be laughing :D There were serious debates at the time - remember Deng came to power not directly after Mao but having displaced Hua Guofeng. He famously wanted to pursue 'whatever' policies Mao had decreed and this really is also one of the reasons the Deng line triumphed - having been through the extremes of politics ruling all there was a rebound to the pragmatists. At that point the vision wasn't a fully worked-out path to what came later and indeed a ot of what happened on the ground was fairly ad hoc with local initiatives taking advantage of what space had opened up - just as the rural land reforms that ended the collectives began as a daring experiment in one or two villages in Anhui and Sichuan.
posted by Abiezer at 10:16 PM on September 17, 2009


The other particular problem China has faced is resource poverty in key factors of production like arable land (about a ninth per capita of India's, though not with the problems of monsoon that India has) and water per capita (about 9 percent of global average IIRC) - something that has been a problem right back to the mid-late Qing if you believe Wen Tiejun.
posted by Abiezer at 10:24 PM on September 17, 2009


Abiezer: if the political campaigns had been set aside and the economic policies associated principally with Liu Shaoqi had been pursued consistently from the early 50s pursued even greater progress would have been made.

One thing I notice is you often celebrate pre-1978 reforms. But those reform has left 60% living under the poverty line. The poverty they alleviated was only the most extreme forms of destitution, and goal posts ought to be set at subsistence-without-malnourishment. Poverty has some pretty clear characteristics, and the post-1949 reforms hadn't eliminated them for the vast majority of Chinese.

My contention is that, without major trade with global markets, China would still be a largely agrarian nation, where inequalities would be less but the least advantaged, those at the bottom, would be much worse off. What's more, it would have created a set of problems around food distribution that was very vulnerable to economic shocks and natural disasters, which also tend to hurt the least advantaged most. If the biggest factor in absolute poverty is this vulnerability to shocks, then it might be fair to say that the early-80s market-style reforms actually did more to alleviate poverty-as-susceptibility than the later privatization plans, and that exports may have played a smaller role than I've described.

We should really be looking at Chinese imports during the 80s to resolve this question. It wasn't always US Treasuries: what absolutely essential things did Deng send out for rather than have made domestically? It certainly helped during the famine in 1960, right? China in the 80s was importing machinery for factories and construction, chemicals, and foreign know-how in the form of expat technicians and education abroad. Those are the seeds they purchased with light manufacture, and those are the seeds that appear to have sprouted. A less-export/import heavy development path would have had to forgo those seeds, literally re-inventing agricultural and industrial chemicals and equipment, plus the knowledge to use them. The import side of that has largely retracted in the last decade, I will admit, but the seeds had already done their work.

There really are no parallels to China

That's my sense as well, and India, with its massive linguistic and cultural pluralism and recent history of British colonialism, seems far from a good example.

Unicorn on the cob: That said, if Wal-Mart is 100% responsible for the higher standard of living in China today, this will be my final comment on the matter.

That's sophistry, and you know it. Nobody is 100% responsible for anything, least of all a retailer for its distributors. That's been your major complaint: Wal-Mart doesn't properly police its Chinese distributors. What's more, the 100% standard would require us to ignore the work of the Chinese themselves. Certainly internal politics and efforts plays some small part in their fate? Why does everything have to be black and white, good and evil, all or nothing? How about this: what if we ask if Wal-Mart has made China, on balance, better off?
posted by anotherpanacea at 5:27 AM on September 18, 2009


This is me putting on my Captain Obvious hat, but it's definitely worth it to provide a link to kliuless's freshly-posted FPP on Doing Business in China, as it's quite relevant to this conversation.
posted by shiu mai baby at 7:48 AM on September 18, 2009


One thing I notice is you often celebrate pre-1978 reforms. But those reform has left 60% living under the poverty line.
One thing I notice is you dismiss them and keep returning to this bald statistic as if took nothing to get there - poverty but no landlessness and starvation (the Great Leap really was an anomaly), massive drops in mortality and morbidity, and end to literal foreign imperialist domination, healthcare provision, leap in literacy and the construction of infrastructure and an industrial base - all achieved with no foreign capital (bar Soviet aid prior to the split) and no overseas colonies etc. - you're taking this snapshot at a point in history and implying it was some static failure.
Now, the sense in China was that economic development had been set aside for political goals during the CR, people were tired of that and wanted a return to focusing on improving livelihoods, and just as I argue that what happened post-78 could have been different you can certainly argue what happened before could also have been also (I would myself), but there we were.
In sum - it hadn't 'left' people under the poverty line so much as done quite well to reduce the problem to merely that.
My contention is that, without major trade with global markets, China would still be a largely agrarian nation, where inequalities would be less but the least advantaged, those at the bottom, would be much worse off.
Again, think you're entirely wrong on both counts here - China had industrialised massively pretty much entirely under her own steam in isolation from all but the socialist world, and to be 'least advantaged' now is actually worse - street children, return of indentured servitude, some sex trafficking - and subjectively felt to be worse as evidenced by the increase in rural insurrections and protests.
What's more, it would have created a set of problems around food distribution that was very vulnerable to economic shocks and natural disasters, which also tend to hurt the least advantaged most. This was certainly one of the severe flaws of the authoritarian bureaucracy - the Great Leap famines were mostly a criminal failure of distribution although sparked by actual natural disasters, but then you could as well argue that a return to pre-56 policy, which would have resembled what you say here - "it might be fair to say that the early-80s market-style reforms actually did more to alleviate poverty-as-susceptibility than the later privatization plans, and that exports may have played a smaller role than I've described."
Again, it touches on a lot of nitty-gritty specifics of how rural society was organised and the relationship between the regions and the centre etc. but it's not pie-in-the-sky to imagine TVEs more along the lines of that touted Nanjie model being also able to flexibly interact with national and global markets (Nanjie is the national leader in producing instant noodles I believe!) and generate income for both the local collective and state, and similarly other models of SOE reform.
China in the 80s was importing machinery for factories and construction, chemicals, and foreign know-how in the form of expat technicians and education abroad.
Yes, of course trying to re-invent the wheel in isolation would have been a tremendous waste of energy, but again I think engagement could have happened without the need for the drastic concessions to capital that were made - China by its sheer size if nothing else would have had sufficient appeal as a player in the global economy under even quite different terms.
posted by Abiezer at 10:06 AM on September 18, 2009 [1 favorite]


It occurs to me that much of this discussion has the underlying general idea that it is lower-class and middle-class Americans who have funded the Chinese peasants rise.

Which is disturbing, because at the same time American workers were losing jobs, their CEOs were making exponential gains in wealth.
posted by five fresh fish at 5:26 PM on September 18, 2009 [1 favorite]


I just want to say that my interest in China is due to the fact that nearly all of the global reduction in poverty over the last three decades has come from China alone. It's a curiosity and respect for the greatest poverty alleviation program in human history. I honestly think that figuring it out how that was done, and replicating it, is a noble task. If this were easy, if the Chinese model was uncontroversial, everyone would do it.

I think engagement could have happened without the need for the drastic concessions to capital that were made

Which of the actual concessions are you worried about? I'm not talking about privatizing the state owned enterprises: that was clearly a cash grab. As I see it, the worst offenses weren't concessions, they were corruption. Are you worried about the loss of price controls?

The other issue is that fewer exports means fewer imports, so trading tech exports for ag exports would have slowed the rate at which China could 'buy the wheel' rather than reinvent it.

poverty but no landlessness and starvation (the Great Leap really was an anomaly), massive drops in mortality and morbidity, and end to literal foreign imperialist domination, healthcare provision, leap in literacy and the construction of infrastructure and an industrial base - all achieved with no foreign capital (bar Soviet aid prior to the split) and no overseas colonies etc. - you're taking this snapshot at a point in history and implying it was some static failure.

I don't mean my analysis to take '78 as a static point: I understand that there were developments already under way. But these were not reforms capable of alleviating all the kinds of destitution felt by the rural poor, only the worst of them, especially starvation. It's good not to die of starvation, but there are many other ways that poor people suffer and die.

Just to be clear, living on under $1/day PPP means living on less than what a $1/day would buy in the US at that time, which means malnutrition, lack of sanitation, medical provision, etc. It's not cash earned, it's goods and services consumed. The standard is 2100 calories, clean water, basic medical care, and shelter. It allows for no "consumption" of education at all. When someone is living on less than $1 PPP, they're forgoing one or more of those things, and that has consequences.

If the land reforms were sufficient to increase GNP enough such that 1% of the population each year escaped the $1/day PPP levels of poverty, they'd still be massively successful, but there'd still be three times as many Chinese facing malnourishment or disease-ridden water today as there are with the market reforms and export-orientation. We have an obligation to dispel the worst kinds of poverty, and it's an obligation that can't be met at a leisurely pace.

China had industrialised massively pretty much entirely under her own steam in isolation from all but the socialist world

It had a very little heavy industry, and the vast majority of the population did not even notice the effects. I don't call that "massive industrialization," and you shouldn't either. Massive industrialization is two power plants a week and a city a month. Also, this might be just a nitpick, but I'm not sure why you're distinguishing Soviet 'aid' from other FDI: it certainly didn't come without strings. Wasn't the 59-61 famine largely a result of that relationship, especially when Mao scrapped all tech imports and started importing food exclusively?

to be 'least advantaged' now is actually worse - street children, return of indentured servitude, some sex trafficking

Well, sex trafficking, indentured servitude, and homelessness are clearly horrible. I'm not sure they're more horrible than being, say, a woman facing starvation during the Great Leap, though. One reason I favor the reforms as they occurred is that they're the best recipe for strengthening women's hand in the region. Women seem to flourish best through bourgeois-ification: literacy and economic independence are apparently the best defense women have from sexual violence, exploitation, and premature morbidity. It's not the man of the house who goes hungry when there's not enough to feed everyone, after all.
posted by anotherpanacea at 7:20 PM on September 18, 2009


Well, then we're miles apart; I think those things are worse, particularly given that they have become endemic in certain parts of the country rather than being anomalies, as the Great Leap famines were. The status of women has declined with the reforms, they coined the term 'feminisation of poverty' for a reason. More girls dropped out of school all together in the poorest areas when it stopped being free to go, sex work is once again one of the few options available to young rural women having been eliminated post '49.
China did industrialise massively; such infrastructure construction as the expansion of the rail networks had enormous impacts on people's lives. Again, you're stopping history at one point and saying why wasn't it better, when even despite some ridiculous policy turns, political campaigns and wars the picture is one of development and improvements in people's lives.
Just to be clear, living on under $1/day PPP means living on less than what a $1/day would buy in the US at that time, which means malnutrition, lack of sanitation, medical provision, etc. It's not cash earned, it's goods and services consumed. The standard is 2100 calories, clean water, basic medical care, and shelter. It allows for no "consumption" of education at all. When someone is living on less than $1 PPP, they're forgoing one or more of those things, and that has consequences.
Access to education, clean water and basic medical care were provided almost universally in pre-reform China, so you must be mis-interpreting your figures (you wouldn't be alone - you can follow some of the links there to see the long debate on ways to measure poverty) or they are wrong. If you imagine that 60% of the population had no access to those public goods in 1978, even allowing for the chaos of the CR (which passed many areas of the countryside by), you are sorely mistaken.
Having actually spent time working in the field in the remaining very poorest parts of China, I'm more than aware of what poverty looks like. In the most remote mountain villages we worked in, where girls no longer go to school and the school-house was dilapidated and the teacher wasn't paid and the water system broken, you would find that these goods and services fell into abeyance in the post-reform era, but had all been there before, albeit rough and ready.
I'm not sure why you're distinguishing Soviet 'aid' from other FDI
Because it was arrangement between two 'fraternal socialist nations' it quite obviously took a very different form to FDI; I'm not sure why you'd conflate them.
posted by Abiezer at 8:59 PM on September 18, 2009


An American visits the Beijing Wal-Mart, cf. IKEA
posted by kliuless at 6:39 AM on September 19, 2009


Another US brand in the spotlight: Chinese students go undercover to investigate Coca Cola
posted by Abiezer at 7:14 AM on September 19, 2009


I think those things are worse, particularly given that they have become endemic in certain parts of the country rather than being anomalies, as the Great Leap famines were.

30 million people died of starvation between 59 and 62. That's endemic. Still, I think you've ducked the question: which reforms, in particular, do you think drove women to sex work? I'd argue that the cause was decentralizing control and funding of education, combined with the one child model, which really hurt girls the most because they were held back from school or killed to make room for a boy. (The "missing women" problem: a disgustingly innocent euphemism.) It's pretty clear that basic medical availablility got worse in the 80s, but it wasn't very good before then, either.

Is it your contention that this can be blamed on market, price, or migration reforms? I don't think you've said.

so you must be mis-interpreting your figure

I'm well aware of the problem, which is why I compare $1 PPP in 1978 to $1/day PPP in 2005, but it doesn't disprove my claim. The World Bank's re-adjustment increased the poverty level to $1.25 PPP because it costs more than we thought to get the basket of goods necessary to survive. That means some people we thought were getting enough, aren't, not vice versa. Even the Chinese government admits that in 1978 60% of its people were going without enough "to eat and to wear." Your claims about universal access to $1/day PPP in 1978 just aren't credible. I'm especially suspicious on the clean water front: that said, things have only gotten worse with industrial pollution and development, and clean water access and sanitation are at the top of the Millennium Development Goals that I expect China to fail to meet.
posted by anotherpanacea at 7:46 AM on September 19, 2009


Also of interest given the argument above might be this piece, Mao, Rural Development, and Two-Line Struggle, by William Hinton, of Fanshen and Shenfan fame, who true to his leftist credentials makes a trenchant defence of cooperative agriculture and suggests that rather than disbanding it in '78 it should have been taken to the next level (includes a bit of high politics, is framed in very leftist terms as it was written for the Chinese preface to one of his books and has a criticism of the Liu Shaoqi line I mentioned above):
I think the lessons of the rural cooperative movement in China over thirty years thoroughly refute the notion that rural producers cooperatives are ultra-left, utopian, and lead in the long run to sharing poverty–”eating out of one big pot.” In the late seventies comprehensive studies carried out by the Central Committee’s Research Group on Agrarian Policy concluded that 30 percent of the collective villages were doing well, 40 percent faced serious problems but remained viable, while another 30 percent were doing very poorly and could not easily regroup. If these figures are true, and they match with limited observations made by me in a few localities that I knew best, then some 240 million peasants were truly prospering under collective arrangements, while another 320 million were at least holding their own. Such large numbers coping successfully hardly give support to a theory that agricultural production, by its very nature, is not suited to collective forms of ownership and management. If a further 240 million were faring badly it seems obvious that the cause was not a built-in mismatch between cooperation and agriculture but poor leadership, poor training, and poor policy implementation–pushing for higher levels prematurely, jumping stages, commandism, overcentralization, and other bureaucratic excesses...
The reform has, from the start, been a remarkably deft, well orchestrated and protracted campaign to do what all its covering rhetoric insists is not being done. Each stage begins by selecting some small, hard to defend weak link in the socialist policy or institution under attack and moves on to engulf and do away with the whole fabric that holds that link in place. The longer it goes on the clearer it becomes that what we are witnessing is no “feeling out” at all, but the inexorable unfolding of a grand design to tie China irretrievably into the capitalist system. And by what method? By transforming China into one vast free market hinterland, thus raising the question of who will be conqueror and who the conquered? For even a great dragon, it seems, cannot hope to match pearls with the Dragon God of the Sea and come out a winner.
posted by Abiezer at 7:57 AM on September 19, 2009


30 million people died of starvation between 59 and 62. That's endemic.
No, it was localised and due mainly to specific problems with the bureaucracy in those locations (although sparked by natural disasters) and the state in fact was able to mobilise relief (one of the agreed successes of post-49 agriculture had in fact been the re-creation of store granaries to ameliorate the effects of endemic famine in China similar to the old imperial system). The gross figure and causes have been inflated somewhat and the problems of the famine (not a rare occurrence in China) were played up as part of the Dengist faction's need to discredit its opponents. You can see those points made in another article on the CSG site, which has a bit too much special pleading for my tastes and understanding but again unpicks some of the other realities behind that bald statistic.
Still, I think you've ducked the question: which reforms, in particular, do you think drove women to sex work?
Well, obviously it's a function of the whole seismic shift in the structure and direction of society; a major factor was that they encouraged rent-seeking activities by various local interest groups and it was powerful actors such as these who were behind the boom in the trade from a standing start where it hadn't existed before - so bent local officials and famously the police and gendarmerie (People's Armed Police) were behind the trade in many places, which given the big profits involved was also part of what I've called the 'mafia-isation' of local government. Given the difficulty for women to access other off farm work as noted in the 'feminisation of poverty' link I gave above, particularly in the poor hinterlands, it's not surprising that many have turned to the higher risk but higher paid trade. Here's a translation of an interview with one young sex worker I translated for CDB ages ago:
'I only reached third grade, but my older brother is in his last year of middle school. His grades are better than mine. Two kids going to school put a really heavy burden on a family, and besides, my parents also favour my brother.

'Right now, I can only send back a little bit of the money I make because I don't want my family to get suspicious, since I told my parents I was helping in a restaurant over here. And if I gave everything I earn to my family, what would happen when I need money and my family can't give me anything? It's better if I hang on to it. When my brother goes to high school, I can support my family a little. It'll be a lot simpler when he leaves high school and gets into university because then he can borrow money.'
As you can see, her initial motivation was to seek off-farm work to support a family burdened by new cash expenses that didn't exist prior to reform (school fees) and when away from home, she fell into sex work as if offered the promise of more money that waitressing.
Your claims about universal access to $1/day PPP in 1978 just aren't credible.
I don't claim that, I claim that the figures were notoriously not designed to measure poverty in socialist societies given the way goods and services were provided and this has formed one of the substantial criticisms of them as a measure of poverty. Which there certainly was in China in 1978 - Zhou Enlai famously goes back to the old communist base are in Shaanxi and weeps to see how poor the people there still are despite thrity years of 'building the New China'. I have a number of criticisms of how that was conducted myself, but will mount a defence of it when it's being dismissed a little too lightly, as I think you are doing.
posted by Abiezer at 8:22 AM on September 19, 2009


Eek - spotting the above screed in Recent Activity realise I missed the link to the first-person by the young sex worker.
posted by Abiezer at 9:18 AM on September 19, 2009


the figures were notoriously not designed to measure poverty in socialist societies

It's not an income measure, it's a consumption measure, so it's equally well-suited to measuring socialist and capitalist poverty.

Digging around, I find a 50% literacy rate is often quoted for 1978. That belies the claim of universal education.

Regarding the politics of famine measurements, I'll go with Amartya Sen, whose work has some pretty deep econometric backing. In short, the data proves that this responsibility ought to be understood much closer to 70/30 human error than 70/30 natural disaster. Cf. entitlement theory.

I think we're largely in sync on prostitution: lack of access to education combined with lack of access to less grueling labor than farm work are what force women into the sex trade. Interestingly, that suggests that women find sex work preferable to farm work or being rendered 'surplus labor,' which is disturbing but credible.
posted by anotherpanacea at 9:23 AM on September 19, 2009


Yet it was Sen who famously compared China favourably to democratic India in terms of eradicating hunger. See what he says here (can dig up a link to his earlier work making the comparison if needed:
Now, in so far as private income is only one of the influences on the achievements in reducing poverty, the first thing I want to mention is that even though in the poverty discussion most of the concentration tends to be these days on what happened since economic reform. The fact is that there is a very major lesson in what happened in China previous to that. I am not commenting on the excesses of the Cultural Revolution, I am not talking about the Chinese famine (from) ’59 to ’61 in which 29.6 million people died. There were all kinds of mistakes.

But the fact is that China was still the global leader as a poor country expanding basic education at a level which was very hard to imagine, as well as basic health care. All kinds of things came like “barefoot doctors” and so on. But the spread of health care across the country was quite remarkable. By 1979, when the economic reform came, the Chinese life expectancy was already 68 years; the Indian life expectancy was 54 years, 14 years behind it.

There are really major lessons there, and I might say also one of the unsung contributions of the pre-reform educational and health care expansion is, I believe, the radical economic expansion that took place in the 1980s. After the economic reform, it would have been very hard without the base of elementary education which China had and India did not at that time, which is still a factor which bothers India badly.
It's not an income measure, it's a consumption measure, so it's equally well-suited to measuring socialist and capitalist poverty.
As I understand it, the criticisms do highlight how it fails to address consumption of collectively-provided goods. Can have a dig around if it's a major point.
Digging around, I find a 50% literacy rate is often quoted for 1978. That belies the claim of universal education.
Nope, it shows the illiterate adults who were sadly born too early to benefit from socialist education reforms - though there were attempts at adult education too.
posted by Abiezer at 10:10 AM on September 19, 2009


reading around on the various critiques of the World bank's methods for measuring poverty collected here, I was struck by the figures (in this PDF) that had 633.7m poor in China in 1981 as against 382.4m in India, which given the vastly better performance of China in terms of mortality, education and life expectancy noted above, perhaps hints at how the measure conceals those public goods that gave China an advantage in those regards. If you read the rest of that paper you can see longer technical arguments that point in that direction too.
posted by Abiezer at 12:17 PM on September 19, 2009


Further to the Great Leap famines, Prof. Utsa Patnaik makes some salient points (my emphasis):
The difference between endemic high death rate among the (mainly rural) poor, and what is identified by most academics as "famine deaths", seems to be the fact that the first involves the poor dying at a rate higher than the average for the population, but slowly, unobtrusively and over a longer period of time owing to being chronically under-nourished and therefore being subject to higher morbidity; this higher than average death rate being considered nothing 'out of the way' given the existing distribution of incomes.
The second, which is considered not normal or usual and is termed "famine deaths", involves a sudden rise in nutrition-deprivation and hence sudden rise in morbidity and death rate, usually among segments of the very same group which is poor as a 'normal' state of affairs. In short, a sudden upward deviation from the prevalent death rate is thought of as "famine death"...
When we look at the estimates of death rate and birth rate for China made by US scholars during the years 1959 to 1961, we find that the death rate rose sharply in a single year, 1960, by as much as 10.8 per thousand compared to 1959. But because China in the single preceding decade of building socialism, had reduced its death rate at a much faster rate (from 29 to 12 comparing 1949 and 1958) than India had, this sharp rise to 25.4 in 1960 in China still meant that this "famine" death rate was virtually the same as the prevalent death rate in India which was 24.6 per thousand in 1960, only 0.8 lower. This latter rate being considered quite "normal" for India, has not attracted the slightest criticism. Further, in both the preceding and the succeeding year India's crude death rate was 8 to 10 per thousand higher than in China. Of course, each economy has to be judged in relation to its own internal performance; and no doubt the rise in the death rate during the worst years of output shortfall is a bad blot for China on its otherwise very impressive record of rapid decline and good food security...
posted by Abiezer at 9:01 PM on September 19, 2009


I think you've successfully proven that there was great education and medical access pre-1978, and some other reading I've done seems to confirm that literacy levels rose precipitously in the twenty years before 1978, but that Patnaik article is bunk. Everybody dies, so when you're looking at famine deaths you're looking at a measure of premature deaths. Poor people have high premature mortality regardless of the overall state of the economy, so it's good to note that. In a sense, yes, a famine is like suddenly everybody is really, really poor, and as a result of that sudden loss of food those who are least advantaged are tipped over from ordinary poverty to fatal destitution. It seems likely that Sen's entitlement theory properly describes why people find themselves unable to lay their hands on food even when, as there apparently was in China at the time, there's enough food somewhere to feed everyone. Remember that Mao was importing food, so the breakdown wasn't in supplies, it was in distribution.

But the article you link isn't really about explaining famine, it's about the politics of the death numbers, and this argument about subtracting birth rates is simply bullshit: the 30 million number is premature deaths alone, and approximately the same number of births were postponed or lost. We do call the death of an unborn child a famine death when the child dies because her mother didn't get enough to eat. As I said, men are never the first to go hungry. Of course we should distinguish postponed births from lost births, but that's hard to measure because there's no record of conceptions, only of parturitions. Still, there's good reason to believe to be concerned about both, and to at least note in passing that not all "postponed" births are simply the result of tired, hungry families remaining abstinent. Google "in utero famine," for more troubling detail on this than I can stomach. I've been very pleased with most of the articles you've linked here, Abierzer, but this essay is propaganda of the "Holocaust denial" variety, and I don't think it has a place on the blue. It's light on evidence and long on attacks on others' "sophistry" designed to cover up its own sophistry, and full of quibbles that have no relationship to the facts. Look at the moment where Patnaik retreats to anecdote and just-so explanations. Gah.

On the socialist v. capitalist poverty metric, I don't think you understand the difference between a consumption metric and an income metric, though I've tried to specify it several times. I'm aware that the old $1/day PPP is flawed, which is the thrust of the article you linked, and I'm aware that use of national account data can be flawed. Hell, I'm even willing to throw in with Thomas Pogge on using GNP per capita rather than GDP per capita to measure inequality! However, you have given me no reason to believe that a household survey of consumption should be flawed.
posted by anotherpanacea at 6:38 AM on September 20, 2009


I don't think you understand the difference between a consumption metric and an income metric, though I've tried to specify it several times...you have given me no reason to believe that a household survey of consumption should be flawed.
I do, completely; I think you don't understand how those number were constructed - hence I highlight that India had fewer poor but worse outcomes.
The impression I have gleaned from reading about the 1981 figures, though I can't find an absolutely clear statement anywhere, is that it didn't count health, and education consumption etc., and several of the articles note that a major flaw was that it under-counted public goods versus private income, as if this wasn't to privilege one system of delivery (free market) against another (socialist). I'll resurrect the quotes I'd highlighted on this point if you can't see how that might at least be possibly the case.
that Patnaik article is bunk
It's certainly a tendentious piece, but look at the part I highlighted, where I believe her figures are right - that the worst famine years in China only slightly surpassed the death rate in India. That's the point of quoting her.
She's also not talking about 'unborn children' in the sense of lost actual pregnancies, but demographic absence extrapolated from estimated figures versus expected numbers of births - your 'we should distinguish postponed births from lost births' - you don't think it's political to include that in a bald figure of the numbers of deaths? It certainly tells us something about the severity of the famines and is a telling metric, but it's not the number of deaths.
Personally I'm not particularly interested in an unseemly haggling over figures as the fact of the famines is a terrible indictment of the authoritarian bureaucracy but you'd be a fool if you didn't think 'Black Book of Communism' style figures weren't entirely political. Witness how you say it 'is propaganda of the "Holocaust denial" variety' - you are subscribing to the view that China of the 1960s was engaged in a genocidal campaign against its own people in some odd hiatus from making every effort to feed them in the years before and after.
posted by Abiezer at 8:59 AM on September 20, 2009


The 1981 figures "didn't count health, and education consumption etc. in China" I should have written, to make that clear.
posted by Abiezer at 9:13 AM on September 20, 2009


you are subscribing to the view that China of the 1960s was engaged in a genocidal campaign against its own people

No, I'm not. But if the enserfment of a people leads to their demise, then it's appropriate to call that a man-made famine. Cf. the Ukrainian famine.

you don't think it's political to include that in a bald figure of the numbers of deaths?

We don't. That's the point. It's 30 million PLUS lost and postponed births. That's the sneaky and deceptive part of the article!

hence I highlight that India had fewer poor but worse outcomes.

India had fewer people. There's a difference between poverty rates with poverty numbers. Plus, the article you cited looks like it might be using 1981 income/price statistics, not consumption surveys. That said, that's one reason why China flourished and India has struggled, comparatively: better institutions. No one denies that China beat India: they've had the most successful poverty alleviation program in history!

The impression I have gleaned from reading about the 1981 figures, though I can't find an absolutely clear statement anywhere, is that it didn't count health, and education consumption etc.,

Consumption figures are based on a basket of goods: 2100/2150 calories (with proteins and fats,) clean water, medicine, education, shelter. A household survey asks: what did you eat this week? Where does your water come from? Did your children go to school? Can they read? What do you do when you're sick? We don't care if the goods consumed are supplied by a market or a state agency, all we care about is that they're consumed!

As I see it, your argument is that China hasn't actually done much to alleviate poverty in the last thirty years, that all the successes occurred under Mao and Hua, but were only reflected in the ideologically skewed statistics later, under Deng. Perhaps there's something to that: it's difficult to know. But at least in form it reminds me of Republicans who claim that all the growth in the nineties was due to Reagan's policies. The counterfactuals start to get pretty intricate.
posted by anotherpanacea at 9:40 AM on September 20, 2009


it's appropriate to call that a man-made famine.
Yes, and it was. I'd be interested in you setting out how you understand this man-made aspect as I think that might tell me something of where you're coming from - I've read and heard in person numerous accounts of people who lived through those years, including elderly cadres who have been part of the movement to counteract the opposite of the Western hostile accounts - the official Chinese cover-ups that dismissed or minimised the famines and its causes and I'm reasonably confident I have a good idea of what happened but would prefer to hear your version first.
A household survey asks: what did you eat this week? Where does your water come from? Did your children go to school?
Again, I know that and the impression I get is that this wasn't counted for the 1981 estimates - they didn't have that kind of household survey data. Am digging that bit out and will post when I find it.
As I see it, your argument is that China hasn't actually done much to alleviate poverty in the last thirty years, that all the successes occurred under Mao and Hua, but were only reflected in the ideologically skewed statistics later, under Deng.
Absolutely not - my argument is like Amartya Sen's above - that China had made enormous strides in poverty reduction and welfare provision by 1978 and was in a position to reform in any number of ways that could have built on that excellent foundation bought with no little pain and sacrifice (particularly by the rural poor who were systematically robbed by the system).
You've repeatedly portrayed where China was in 1978 as a failure and an indictment of what has gone before rather than the (albeit greatly troubled) success story that it was. You then make the assumption that the reforms in the form they took, and particularly the form of industrial development that brought Chinese factories into the global supply chain for Wal Mart, were they key to the great strides in poverty reduction made since, whereas history shows this wasn't the key to the alleviation of poverty - that had stagnated after initial advances due to reforms in other areas and what poverty that remained hardened and deepened in the years coinciding with the policies you praise. At the same time, those policies were part of a dismantling of successful aspects of the past, brought social polarisation and dislocation and have seen widespread discontent and open unrest, plus a whole host of other appalling social problems.
posted by Abiezer at 10:03 AM on September 20, 2009


Couple of bits I missed:
We don't. That's the point. It's 30 million PLUS lost and postponed births.
That genuinely is a very contestable figure - as I say I personally don't think haggling over headline numbers is the key to understand the criminal failures that occurred, but I would ask you to think about the political construction of indictments of the collective era in China.
No one denies that China beat India: they've had the most successful poverty alleviation program in history!
Yes, but to repeat, the point was they were beating them prior to those reforms.
posted by Abiezer at 10:13 AM on September 20, 2009


Looks like the answer to the surveys use is here: Data in transition: Assessing rural living standards in Southern China, but behind a paywall. Fiddling with Google gets this quote out: "The main survey instrument in rural areas is the Rural Household Survey (RHS) done by the State Statistical Bureau (SSB)."
The RHS is unpacked is described in the UNESCAP paper here. Key quote:
"The limitation of RHS in the poverty evaluation. 1) it is limited to measure income/expenditure poverty due to the shortage of social indicators. 2) It is limited in evaluating the impacts of anti-poverty programs. 3)It is limited in estimating the poverty incidence by county."
This has been the point I've been trying to make - there was a systematic underestimate of certain social goods under the old system.
I've actually conducted household survey questionnaires in the field in China myself, so it's been quite amusing having you constantly make assumptions about what I do or don't know about how the stats are compiled - I'm surprised you swallow them whole and build a case on such notoriously problematic measures.
posted by Abiezer at 10:42 AM on September 20, 2009


It's both unpacked and described! All in one handy hard-to-locate PDF.
posted by Abiezer at 10:48 AM on September 20, 2009


I've actually conducted household survey questionnaires in the field in China myself

I'm sure you do, but you don't seem to know how to interpret the data. Let's look at what your article says:

"RHS... includes some information on other subjects such as basic demographic characteristics, fixed assets, production and consumption, selling and purchasing, nutrition etc."

That's more than just an income/price index. It's not clear whether it includes community medical care or education, or not, but it's certainly avoided the worst problems of a pure national accounts analysis.

Also a very good claim, which goes a long way to explaining the problem with the Great Leap famine is this one:

A household that obtains few non-food commodity by sacrificing the basic food demand must be a poor one.

The same thing can be said for a country.

Now I've got a question for you: if China had already made great strides in poverty eradication in 1978, what was the true number of Chinese living in what you understand to be poverty? Was it 60%, as the Chinese and the World Bank both claim, or was it some smaller number, perhaps 30%? Or if food distribution, education, and medical care were all universal, perhaps it was some very small number like the current 10%? If so, what basket of goods were those 10%, 30%, or 60% missing in 1978, and what was keeping it from them if things were so good before Deng?

A lot of these issues were hashed out at the World Bank and between academics in the late 90s. Some metrics had to be improved, and that took time: the new metric of $1.25 a day wasn't really widely used until 2007! So this criticism has been in the air for some time, but always, the concern was that we were undercounting the poor, a claim that is hard to combat because there are so many costs you only notice when you're giving up meals to pay them. It's so easy to ignore the poor and if we're going to err we should err on the side of caution.

Your claim is the opposite: for ideological reasons, we overcount the poor of socialist nations. I'm perfectly willing to consider that possibility, in fact it makes intuitive sense, but you'll have to give me some justification for it, and so far the evidence you've supplied seems to demonstrate the reverse.
posted by anotherpanacea at 4:53 AM on September 21, 2009


It's not clear whether it includes community medical care or education, or not, but it's certainly avoided the worst problems of a pure national accounts analysis.
It didn't, as the part you quote should tell you - "basic demographic characteristics, fixed assets, production and consumption, selling and purchasing, nutrition etc." - none of that implies those services and they weren't counted because of the way they were provided by the collective. You can read later papers looking at how China first began allowing access to more detailed data to the international community, some of it as late as 2005. You half understand this yourself but don't seem to follow the implication - "a claim that is hard to combat because there are so many costs you only notice when you're giving up meals to pay them" - those goods and services things that people weren't having to give up anything up for.

Now I've got a question for you: if China had already made great strides in poverty eradication in 1978, what was the true number of Chinese living in what you understand to be poverty? Was it 60%, as the Chinese and the World Bank both claim, or was it some smaller number, perhaps 30%? Or if food distribution, education, and medical care were all universal, perhaps it was some very small number like the current 10%? If so, what basket of goods were those 10%, 30%, or 60% missing in 1978, and what was keeping it from them if things were so good before Deng?
You still return to this - the point isn't that people weren't poor or that China was perfect at that point, the point is that a lot less people were poor than in 1949, there was access to welfare services, education and other public goods, and that by comparison with better-resourced, non--socialist countries such as India, fewer people had died prematurely from starvation and there was less infant mortality, even despite appalling failures like the Great Leap famines. And it was on this basis that China, a country that had been a war-torn basket case in 1949, was able to make the massive strides it did in subsequent years.
Your claim is the opposite: for ideological reasons, we overcount the poor of socialist nations.
No, my claim is that we undervalued the very real successes of socialist countries for ideological reasons. If you don't think the World Bank had an ideological and pro-free market agenda, particularly in the period in question and the run up to it, I suggest you read some history.
posted by Abiezer at 6:12 AM on September 21, 2009


those goods and services things that people weren't having to give up anything up for.

But you've forgotten the definition of absolute poverty under contention: if you've got enough food and clean water, and you've also got access to medicine and education, you're not poor any longer! You're still relatively poor, but you're not destitute. You're not subject to the poverty-related death scenarios that kill most poor people in the third world: lack of immunization, lack of access to clear water, lack of food, lack of medical care, lack of non-polluting cooking fuel. You can't have it both ways: either the Chinese were poor or they weren't: either Mao fixed Chinese poverty and Deng screwed it up, or Mao and Hua got the ball rolling and Deng put it in the goal. I think you believe, and want to say, that real destitution had already been wiped out, and that the reforms were aimed at increasing wealth and the size of the middle class, but came at the expense of the poor. Thus, Deng's reforms were not poverty-alleviating, they were destitution-creating. But for some reason you're balking.

Perhaps it's because the claim that there was no poverty in China in 1978 is completely ludicrous. Yet that is the conclusion to which your argument leads.

Another possibility is that the Chinese in 1978 had education at the expense of food, medicine at the expense of food, had only sporadic access to clean water, and were still using asthma and TB-causing biomass to cook their scarce and undernourishing meals. Moreover, they were poorer than India while being simultaneously more productive, because instead of consuming what they produced, they were investing in the future at a higher rate at the expense of the present. In which case, those that survived were able to take advantage of the world created by the starvation deaths of their compatriots. But that would be an indictment of Maoism, and no one would advocate following a path that advocated poverty-as-poverty-alleviation, so it can't be right....
posted by anotherpanacea at 8:41 AM on September 21, 2009


Perhaps it's because the claim that there was no poverty in China in 1978 is completely ludicrous. Yet that is the conclusion to which your argument leads.
For about the fifth time, it's not my claim that there was no poverty. What I find ludicrous is that you think that a regime that had reduced mortality and morbidity, doubled life expectancy and provided more nutrition per capita to its people even as the population expanded enormously, at the same time as it slashed illiteracy and provided basic health care for the first time in history and grew an industrial economy at a rate of around 5 to 8 percent a year was somehow not working hard to address the massive poverty that had existed and continued to exist.
You're not subject to the poverty-related death scenarios that kill most poor people in the third world: lack of immunization, lack of access to clear water, lack of food, lack of medical care, lack of non-polluting cooking fuel.
Yes, that probably explains why a growing population of Chinese people were living so much longer, eating more, having less of their children die in infancy - what with the immunisation programme, public water supplies and health care provision.
I think you believe, and want to say...
You've done this through the entire debate - having been shown to be wrong on every point you've attempted to make, you've been reduced to telling me what I am saying! Come off it.
You've been shown to be wrong on every point you've tried to make, because you've clutched at those highly flawed World Bank figures - which measured consumption in a formula biased to private income which was lower in a collective economy - and ignored the entire historical context before and after - which is where I came in, at your erroneous summary of the post-1978 reforms and their impact.
posted by Abiezer at 9:14 AM on September 21, 2009 [1 favorite]


Just wanted to emphasise how wrong you are there!
posted by Abiezer at 9:16 AM on September 21, 2009


Apparently we've reached the "declare victory and withdraw with honor" stage of the conversation. I must say I'm disappointed: I've enjoyed the conversation and I think we've made real progress in identifying the development path that makes China so unique. I also think you've repeatedly claimed to have proven things that were shown to be wrong using your own documentation, and that your skepticism about statistics is more math phobia than ideological critique. But that doesn't mean you're not right about a lot of things, and I look forward to running into you in other threads on these topics.

somehow not working hard to address the massive poverty that had existed and continued to exist.

No one doubts that the central government was doing its best, and working damn hard. I'm certainly not accusing anyone of indolence and I'd be suspicious of claims of malice, although I'm open to charges of greed and venality. Nor is it a question of industriousness. Primarily, it's a question of efficiency. There's not much controversy in the claim that working hard at poorly chosen policies can have less-than optimal effects. To some extent, it's also a question of local corruption and incompetence as opposed to the central government's capacity for meaningful oversight. One thing you may find interesting: absolute poverty dropped from 60% to 45% in 1981 on the basis only of the most basic reforms in land, prices, and migration. That's how much difference slight policy changes can make, even without exports!

you've been reduced to telling me what I am saying! Come off it.

I'm only making an analytic claim. You can't have it both ways: either there was universal nutrition, clean water, education, and medicine, or there was some degree of destitution and absolute poverty. If everybody has food, shelter, clean water, education, and medicine, then nobody is poor. You keep on talking about "unmarried men," and I'm just reminding you that another word for that is "bachelor." I don't understand why you'd take offense at that definitional conclusion. I also don't understand why you refuse to even take a stab at a real poverty rate for that period.

you've clutched at those highly flawed World Bank figures - which measured consumption in a formula biased to private income which was lower in a collective economy

You keep saying this, but it's not true.

It would be good to get a hold of the Rural Household Surveys from 1986. It looks to have measured all the factors we're interested in: nutrition, and perhaps also education and medical consumption. (Contrary to your claim, it's quite possible that these would be covered by the article's 'etcetera.') At some point, I may write some of this up, at which point I'll hunt down the statistics. However, the World Bank's 1978 poverty estimate seems to have been based on national account data supplied by the Chinese government using governments' own numbers....

Unfortunately, that would invalidate both of our contentions, as it would then be neither a private income metric nor a consumption metric, but it does confirm that many basic life sustaining needs, somewhere in China, were going unmet by both private and public provision. The worst thing about national accounts data, again, is the tendency to undercount the poor. Though it's an estimate and there's a margin of error, 60% is likely an appropriate headline number for the year the reforms began. Nothing about that number denigrates the earlier achievements (nor softens the failures) under Mao, but it indicates how much farther there was to go.

So as not to end on an 'I told you so,' I thought that I'd summarize some things I've learned from our discussions, and some genuine questions that remain:

1. Chinese literacy rates grew by leaps and bounds in the sixties and early seventies. Questions: how widespread was primary school education? How much of "education" was actually ideological indoctrination or simple day care? Were there disparate literacy rates for boys and girls? If so, why?

2. China's "barefoot doctor" system ended in 1981, and likely severely undermined some of the advances in rural medicine that had been accomplished beforehand. As a result, health care provision for the rural poor likely declined under Deng. Questions: How much of a "bare foot" doctor's work was effective, and how much was mere placebo? Clearly immunizations and obstetrics were valuable contributions, but what about acupuncture?

Thanks again for the conversation. If you ever get hold of the 1986 RHS, let me know: I'd love to see what was asked.
posted by anotherpanacea at 4:46 PM on September 21, 2009


Apparently we've reached the "declare victory and withdraw with honor" stage of the conversation.
Nope, I can repeat myself until we're blue in the face as well as the site background.
I also think you've repeatedly claimed to have proven things that were shown to be wrong using your own documentation, and that your skepticism about statistics is more math phobia than ideological critique...
...I'm only making an analytic claim. You can't have it both ways: either there was universal nutrition, clean water, education, and medicine, or there was some degree of destitution and absolute poverty. If everybody has food, shelter, clean water, education, and medicine, then nobody is poor.

This is ludicrous again - having set up your false stall - that the World Bank figures show that people weren't benefiting for those public goods when they don't show that at all* - you claim that I'm trying to have it both ways. I'm not - I have said in every response that there was poverty, just not poverty as measured by the flawed index of an organisation set up under the Bretton Woods agreement alongside the IMF to promote a particular economic model of development with a clear ideological agenda oriented to the free market. I mention 'private income' not because I think this was what was measured in China (I didn't set this out clearly enough) but that that is what the model was designed to measure and they compared China to other nations via PPP using such a model. That this was an enormously flawed measure of poverty is the reason that the Bank itself changed the way it counted the poor several times, and other agencies came up with different measures such as the Human Development Index.
*("Contrary to your claim, it's quite possible that these would be covered by the article's 'etcetera.'" - not it's not, I know they didn't and i think you knwo it doesn't too - plus I've seen the sources in Chinese; if necessary I'll dig them out and translate them for you though the surveys I saw were on paper.)
1. Chinese literacy rates grew by leaps and bounds in the sixties and early seventies. Questions: how widespread was primary school education? How much of "education" was actually ideological indoctrination or simple day care? Were there disparate literacy rates for boys and girls? If so, why?

2. China's "barefoot doctor" system ended in 1981, and likely severely undermined some of the advances in rural medicine that had been accomplished beforehand. As a result, health care provision for the rural poor likely declined under Deng. Questions: How much of a "bare foot" doctor's work was effective, and how much was mere placebo? Clearly immunizations and obstetrics were valuable contributions, but what about acupuncture?

The whole system was shoddy in many ways, authoritarian in others, unfair to the rural population for national strategic reasons (creaming off the value of their production to fund industrial development). This is to set aside the larger history of other political campaigns, shifts in line, foreign wars and global events such as the Sino-Soviet split. But, as in several of your responses above, you're showing an Orientalist bent ('Holocaust denial'? 'enserfment'?) to your assessments - how much of what is taught in the schools of any nation is simple practical knowledge with no ideological, religious or other culturally normative content? You can read the literature to see the other attainments of the era; I think I've indicated above that in terms of gender outcomes it was definitely better than what followed for the rural poor - I say rural because these were the poor for the period under discussion.
How much of the barefoot doctor's work was effective? Enough so that it knocked the previous absence of any but occasional charity care from a principled TCM practitioner into a cocked hat, including an immunisation programme where none existed before.
Look at the list of improvements I set out above in terms of human development outcomes in reduced mortality, morbidity, longevity and the rest. Ask yourself if those tally with the picture you present. You're the one arguing alternative history if you don't have this as your basic understanding. In many way the pre-1978 achievements on poverty match those that came later considering the starting point. The tragedy is that they could well have been achieved faster and with less unnecessary suffering, but they happened none the less.
posted by Abiezer at 6:00 PM on September 21, 2009


Perhaps it's because the claim that there was no poverty in China in 1978 is completely ludicrous. Yet that is the conclusion to which your argument leads.

But it's not the conclusion that Abiezer is stating.

Arguments don't lead to conclusions - they are either stated or inferred. Neither is the case with Abiezer's point.

His point is that poverty reduction in China since 1949 has been a sixty year long process, and much of the early strides were made in an isolationist, socialist regime. And that since the opening of the Chinese markets, poverty has been further reduced on aggregate, but that those aggregates betray very significant disparities, and in particular that the poorest of the poor are not better off than they were before 1978. Not that there are more poor - there clearly aren't - but the poorest can get poorer even as the numbers of poor are reduced.
posted by jb at 8:32 AM on September 22, 2009


Thanks jb - I imagined everyone else had long removed this thread from their Recent Activity! That's a clear summary of my main point, and I think I'd also like to emphasise, as Sen points out in the quote above, that the foundation laid pre-1978 goes a long way to explaining what successes were achieved later.
posted by Abiezer at 9:58 AM on September 22, 2009


Nope, I can repeat myself until we're blue in the face as well as the site background.

Right, and an argument by assertion will be just as effective the fiftieth time as it was the first, which is not at all.

you're showing an Orientalist bent ('Holocaust denial'? 'enserfment'?) to your assessments

Where I come from, calling someone an "Orientalist" is just like calling someone a racist with a PhD. Yet neither of those uses are in any way related to "Orientalist" tropes so I'm assuming you're just being clueless. Nor were they inappropriate in context: lying about death statistics to mitigate deaths due to the policies of a totalitarian state is a close analogy to "Holocaust denial" and forcing people to work on collectivist farms while starving to death for the benefit of a local party boss is a lot like being a "serf."

the poorest of the poor are not better off than they were before 1978. Not that there are more poor - there clearly aren't

Abiezer has repeatedly asserted that pre-reform Chinese peasants had access to adequate nutrition, clean water, universal primary education, and universal medical provision. If that were true, it would mean that they no did not meet the criteria of absolute poverty. I won't keep explaining this, but if their access to education, clean water, and medical care was lost, then they went from not being poor to being poor. So, yes, that is the thrust of his argument: it is the conclusion that follows from his assumptions: more people became poor after the reforms than were poor before.

Of course, it's equally possible that most (say, 60%?) of people went without some of those goods before 1978, in which case they were worse off than Abiezer asserts. Since even he acknowledges that the collectivist farm system was tremendously bad for production, I'm flabbergasted that we're even having this discussion.
posted by anotherpanacea at 10:18 AM on September 22, 2009


Right, and an argument by assertion...
Such assertions as "it's equally possible that most (say, 60%?) of people went without some of those goods before 1978" - you have been shown that they didn't. Because you know nothing about the history of China and are forced to speculate wildly like this based on a single statistic, don't presume that's what anyone else is doing.
I won't keep explaining this...
Some good news at least.
...but if their access to education, clean water, and medical care was lost, then they went from not being poor to being poor.
No, again, your ignorance of anything about China but this one figure is showing. If they went from having those goods provided free or at very minimal cost in a collective to paying for these or foregoing them but their private income rose (as they were allowed to sell farm produce on the market and engage in more off-farm waged labour) then they were poor in a different way.
I don't even 'acknowledge that the collectivist farm system was tremendously bad for production'. It was the key to raising production in many areas - it failed due to the way the bureaucracy set its goals and implemented grain purchase quotas by force.
posted by Abiezer at 11:17 AM on September 22, 2009


Oops, forgot to add:
Nor were they inappropriate in context: lying about death statistics to mitigate deaths due to the policies of a totalitarian state is a close analogy to "Holocaust denial"
Failing to recognise the success of a system that saved many millions of lives rather than condemning vast populations to the famine-level endemic death rates prevailing in the great agrarian nations of Asia is tantamount to being an advocate of baby-killing. Which it would obviously be appropriate to accuse you of in the context of your cheer-leading for the breakdown of mother-and-child care and ending of rural immunisation programmes. Or we could talk like grown-ups with an interest in human development outcomes.
posted by Abiezer at 11:37 AM on September 22, 2009


Looking back on your early contributions to this thread, I thought they were very reasonable. You should look at them too, because at this point you're actively contradicting yourself, and you're being kind of a dick about it.

the bulk of poverty reduction was achieved through regional infrastructure schemes, the household responsibility system in agriculture...

It's definitely broadly agreed that the growth in the economy post-78 has reduced absolute poverty

my personal sense is that most of the reduction in absolute poverty was the result of the state finally ceasing to actively prevent the capacity of Chinese people, particularly farmers, to earn their own living and this came mostly with the break-up of the rural communes and the allocation of land to individual households.

What happened to that guy? I liked talking to him.
posted by anotherpanacea at 12:59 PM on September 22, 2009


Again, your ignorance showing: the household responsibility system brought the ability to choose crops and participate in markets, but that could have been achieved under the collectives if they had been reformed in other ways.
Same with the break-up of the communes - that was the way the state chose to stop some of its grosser interference, but it could have done that in ways that preserved the beneficial aspects of collective farming (this happened in some areas and had happened previously during the CR when commune members seized the opportunity presented to attack the bureaucracies and run things democratically; as you might imagine, it is far harder to pay for many inputs required for modern farming on a tiny family plot; efficiencies in this regard had been one of the ways the collectives raised yields.). I was acknowledging history as it happened (something you might try) - this is how those goods were achieved - not saying it was ideal or the only possibility.
What happened to that guy? I liked talking to him.
As time wore on I realised you were arguing from a priori assumptions apparently gleaned from the worst of the dubious CIA-funded Western Sinology that emerged in the decades when hands were being wrung about how 'we lost China' but otherwise zero knowledge of the country or its history.
You've bandied about offensive accusations, smugly tried to teach your grandmother to suck eggs and shifted the goal-posts and now at the end of it all, apparently I'm being a dick. Perhaps if you modified your own debating style, you wouldn't elicit this response.
posted by Abiezer at 1:25 PM on September 22, 2009


Perhaps if you modified your own debating style, you wouldn't elicit this response.

Perhaps... but at the cost of allowing myself to be persuaded by lots of things that aren't so out of the desire to be polite. I haven't made any offensive accusations and I don't see why you're bringing my grandmother into it (they're both dead, so stay classy) and the goal posts were always the same: alleviate absolute poverty, minimize inequality.

In any case, it's now clear that you're not actually an expert on Chinese history so much as an expert on the alternate reality you've built in your head. In that world, China did things the way you would have liked and it all always worked out exactly the way you said without any unforeseen accidents except that one pesky famine. Next you'll want to tell me all about the world in which Poland invaded Germany before Hitler got going or Columbus failed to discover the Americas and they developed without colonial influence. I'd love to live in those worlds, but it looks like I'm stuck in the reality we've got. Join me there when you've cooled down.
posted by anotherpanacea at 2:54 PM on September 22, 2009


but at the cost of allowing myself to be persuaded by lots of things that aren't so out of the desire to be polite.

One can hold one's ground without being condescending and insulting. Courtesy does not equal capitulation.

Arguments are more effective when they are presented in a way that doesn't piss people off so much that they won't listen at all.

so much as an expert on the alternate reality you've built in your head.

I mean, really? How is that furthering communication and the exchange of information?
posted by small_ruminant at 3:02 PM on September 22, 2009 [1 favorite]


It's not going to further communication. He's being rude. I've tried to be nice and he keeps on making personal attacks. I show him contradicting himself and he makes a personal attack. So then, yes, I responded in kind. Gosh... maybe if he modified his debating style he wouldn't elicit such a response!
posted by anotherpanacea at 3:07 PM on September 22, 2009


I don't see why you're bringing my grandmother into it (they're both dead, so stay classy)
It's a turn of phrase; no intended reference to your grandmother (or any real person); wasn't said with any offence intended.

I showed you how your summary of the post-78 reforms was mistaken - the reason I first commented
In any case, it's now clear that you're not actually an expert on Chinese history so much as an expert on the alternate reality you've built in your head. In that world, China did things the way you would have liked and it all always worked out exactly the way you said without any unforeseen accidents except that one pesky famine.
Desperate stuff.
I refer you once again to the the list of human development advances set out above. Were you here to praise all thing prior to 1978 I'd be happy to point on the numerous flaws and failings of the system and the many injustices. Don't pretend to be an expert on Chinese history; fortunately whilst debating you, having even a passing familiarity with it has put me at an enormous advantage.

posted by Abiezer at 3:19 PM on September 22, 2009


I show him contradicting himself...
You showed me your umpteenth misreading based on ignorance.
posted by Abiezer at 3:20 PM on September 22, 2009


And I've shown everyone my inability to control the em tag :(
posted by Abiezer at 3:22 PM on September 22, 2009


Well, I think this is a discussion that would be elevated significantly if one of you would just type the word evil in all caps.
posted by Unicorn on the cob at 3:53 PM on September 22, 2009 [2 favorites]


I'll tell you what, Abiezer. You point to the places where I actually said something that you contradicted. You boil my arguments down to something they're not, and I've gamely tried to show you that you're wrong.

You showed me your umpteenth misreading based on ignorance.

The exact same can be said of you. You contradicted claims I never made, or responded to one refutation with a defense of a different claim. And in the meantime you've been increasingly rude. I liked our chat for a long while, but your snideness and accusations of being a capitalist running dog are getting a bit much.

You don't even know what we're arguing about, apparently, and yet you're claiming to have won on the basis of some counterfactuals? In what world is that rigorous scholarship? Meanwhile, I've been asking for data and evidence, and you've failed to supply it time and time again, or dropping irrelevant links that disprove your own assertions. All while claiming without evidence that my data is corrupted by the imperialism of the World Bank! Gah.
posted by anotherpanacea at 3:54 PM on September 22, 2009


Actually, let me try one more time: what was the true number of people living in absolute poverty in 1978? Your claims to expertise rest on this question. I say it's in the neighborhood of 60%. You've yet to give a single scrap of evidence to the contrary!
posted by anotherpanacea at 4:01 PM on September 22, 2009


Your claims to expertise rest on this question.
Cue the dramatic music.
what was the true number of people living in absolute poverty in 1978?
That's the shift in the goal-posts we mentioned, isn't it? We began by addressing the ways in which you had mischaracterised the progress of reform since 1978; in the course of showing you how you had done that I've contended that the figure of 60 percent in absolute poverty is based on a flawed measure that undervalued public goods provided under the collective system. It's the basis of your argument, not mine. That was that China had made enormous advances in human development prior to 1978 and that the successes of the subsequent reforms built on those, and sadly also reversed certain of them too.
You don't even know what we're arguing about, apparently, and yet you're claiming to have won on the basis of some counterfactuals?
What's counterfactual about the extension of life expectancy, drop in mortality and morbidity, massive leap in literacy and growth in food availability for an greatly expanded population? Think carefully, your claims to any concern for human development outcomes depend on this question! (dunn dunn dunn)
posted by Abiezer at 4:44 PM on September 22, 2009


We began by addressing the ways in which you had mischaracterised the progress of reform since 1978

Wait, what? Where was I for this discussion? As I recall, we were addressing the role of exports in shrinking the number of absolute poor, and your own documents showed that TVEs relied on exports and imports in order to fuel the growth of per capita GDP. World Bank statistics drawn from Chinese numbers agree that the ranks of the poor shrunk by about a quarter (from 60% to 45%) on the basis of agricultural reforms in land, price, and migration: the rest of the shrinkage (from 45% to 10%) came after the transition to export-intensive light industry

I've contended that the figure of 60 percent in absolute poverty is based on a flawed measure that undervalued public goods provided under the collective system.

So what was the real number?

What's counterfactual about the extension of life expectancy, drop in mortality and morbidity, massive leap in literacy and growth in food availability for an greatly expanded population?

Err... that those things happened is a fact. The counterfactual you've offered is that it would have happened faster if other, collectivist policies had been pursued. That's why the poverty rate in 1978 matters so much, since it helps to resolve the question of why these things have leaped so significantly since then.

As has been pointed out to me via e-mail, I seem to have missed the point in this conversation when the you switched from being interested in the question to being interested in scoring points. Sorry about that. I'll try to pay better attention, next time.

I'll tell you what: you can have all the points. Now let's see what we can do about resolving the questions on the table.
posted by anotherpanacea at 5:54 PM on September 22, 2009


anotherpanacea - you can't put easy numbers on poverty, because even 'absolute' poverty is an arbitrary standard, and any attempt to measure it can have serious biases, as Abiezer has pointed out. All measures have problems, some more than others - Abiezer has stated that the World Bank measure in question seriously underestimates the importance of social services in poverty amelioration, so the 60% in China in 1978 really isn't directly comparable to somewhere else without the same services, like China in 2009. Poverty has been reduced, but we don't know by how much because of the problems in that measure, and also poverty has been changed in its character because it has become concentrated in different ways than it was in 1978. For many people things are much better; for some, they are much worse.

Throughout this discussion, you have been a bit obtuse and uncivil in your arguing. Much earlier, when we were discussing the original topic of the thread, people expressed a dislike of business practices which used international labour markets to set labour forces against one another and so contribute to a serious reduction in living standards in the first world. These practices did contribute to a rise of living standards in one developing country, but not a rise to anywhere near what the previous workers had had, and the reason for this practice is solely to increase the profit of the capitalists (whether in the US or in China). But you responded to these points to the effect that one must hate Chinese people, if one objects to seeing well-paid manufacturing jobs which shared the profits of the business with more people turn into poorly-paid manufacturing jobs that allowed the owners to keep more profit.

Now, as the discussion has gone onto recent Chinese economic history, you continue to misread and throw your own assumptions into Abiezer's comment. He brought in some grey to the issue - fully acknowledging that the post-1978 reforms have reduced the extent of poverty, but pointing out that they have not been all golden, and in particular there has been a serious growth in gender inequality and in rural-urban inequality. And while absolute poverty affects nutrition, most of the ill-effects associated with poverty (crime, powerlessness, stress and health effects, etc) are associated with relative poverty -- if relative poverty goes up even as abosolute poverty goes down, this can still have serious social implications.

I've been very impressed with Abiezer's comments - I've done several semesters of Chinese history in university, and have even TA'd it, and I happily bow before his superior knowledge of 20th century Chinese economy and society.
posted by jb at 6:16 PM on September 22, 2009 [1 favorite]


Wait, what? Where was I for this discussion?
Asking me why I thought you were off in your summary.
As I recall, we were addressing the role of exports in shrinking the number of absolute poor, and your own documents showed that TVEs relied on exports and imports in order to fuel the growth of per capita GDP.
You found the sentence; "The sustained growth of TVEs, especially in the coastal region, has been in part attributed to the export-oriented strategy." So - in part, in coastal regions. You could have instead quoted any of the following passages:
The first and foremost objective of rural enterprises was to support agriculture; where conditions permitted, they were allowed to contract work from urban industries and to engage in production for export.
Export by rural enterprises originated from a number of coastal provinces, notably Guangdong, in the late 1970s. Prior to 1980, there were only 1,500 rural enterprises whose products were exported. By 1986, the number of export-oriented TVEs increased to more than 11,000, and their export earnings reached 4.5 billion U.S. dollars, accounting for 16 percent of China's total exports
I.e. only 11,000 out of millions of TVEs nationwide by the point when the major drops in poverty occurred; the still small (though rapidly growing of course) percentage of China's still small export earnings (around ten percent of GDP max IIRC) in no way enough to account for those poverty reductions, and in many ways a warning sign about the increased disparity between regions they were going to play a part of, as a policy favouring export discriminates against inland regions.
the rest of the shrinkage (from 45% to 10%) came after the transition to export-intensive light industry
The rest of the shrinkage came from off-farm earnings, which in the period where the big drop in poverty occurred, weren't primarily export-oriented nationwide and, as I responded earlier:
"The point with the TVEs is that early spurt of growth that was part of the big rise in real incomes in rural areas (where most of the poor were then) pre-dated the later pattern of China-US trade co-dependence, although it of course did play a part in its formation."
Later "I agree that the historical fact is that industrialisation for export generated GDP growth which resulted in consequent benefits in reducing absolute poverty" because that is the fact during the whole period of reform it did have this effect; however, in the very same post I continued:
"I don't think it was the only or best way to achieve that or even the main factor in poverty reduction; I mentioned 'the household responsibility system in agriculture' in my first post above - to quote the classic World Bank report referenced in one of the CDB articles I linked above:
Broad participation in reform-driven agriculture sector growth played the key role in the tremendous two-thirds reduction in absolute poverty during 1978-84. Rural per capita income grew at an average annual rate of 15% in real terms during this period, and increased a total of more than 130%. The failure to achieve further reductions in poverty during the second half of the 1980s, despite modest agricultural growth and very strong industrial growth, is more difficult to explain. A number of macroeconomic developments stymied efforts to reduce poverty during 1985-90: (i) sharply increased prices for grain and other subsistence goods adversely affected the real incomes of the majority of the rural poor; (ii) rapid growth of the working age population exceeded the expansion of employment opportunities, contributing to a worsening of rural underemployment; and (iii) economic growth was greater in the higher income coastal prcvinces than in the lower income inland northwestern and southwestern provinces. (p. xi)"
This was my point about you giving the impression of misreadings - how you take that to be agreement is anyone's guess.
So what was the real number?
We don't know. The Chinese government has a number, it's substantially less than half that of the World Bank and likely equally as wrong. Why do you accept the World Bank numbers, given they've had to revise it and serious development agencies have had to develop other measures so they could address real poverty, not the Bank's then ideological agenda of promoting the free market.
The counterfactual you've offered is that it would have happened faster if other, collectivist policies had been pursued.
In the period before 1978. Good Lord.
I seem to have missed the point in this conversation when the you switched from being interested in the question to being interested in scoring points.
Dear oh dear. Still trying to set the terms of debate, which of course are never a unilateral issue, coupled with a bit of self-pity.
posted by Abiezer at 6:53 PM on September 22, 2009


I might add, I scored those easy points when I realised you're a high-school debater not someone interested in a discussion (for example, your tendentious cherry-picking of the sources I offered and 'helpful' summaries of the argument); since you're not even that good at your chosen medium of interaction, I thought I might as well get my digs in as well since it's how you've been performing the whole thread. Next time pick a subject you know something about, is my advice.
posted by Abiezer at 7:08 PM on September 22, 2009


This discussion is as inane as a Chinese fire drill now.
posted by five fresh fish at 7:48 PM on September 22, 2009


their export earnings reached 4.5 billion U.S. dollars, accounting for 16 percent of China's total exports

The failure to achieve further reductions in poverty during the second half of the 1980s... rapid growth of the working age population exceeded the expansion of employment opportunities, contributing to a worsening of rural underemployment;

Agricultural reform couldn't solve China's poverty alone, at least if the World Bank is to be believed, because there were more people than there was farm labor. So, on the question of the role of exports in poverty reduction, the answer appears to be: a little bit in the early 80s, a little bit more in the late 80s, and much, much more in the 90s. And they had to start somewhere.

The Chinese government has a number, it's substantially less than half that of the World Bank and likely equally as wrong.

Absolute poverty went from 30-60%, to 45%, to less than 10%. Well, that's interesting: it seems like the land reforms left about 450 million people in absolute poverty, and if the lower bound is accurate, it actually drove 150 million over the edge. But again, given the amount of arable land, it appears that agricultural reforms alone couldn't have accomplished what light industry did, and light industry for domestic consumption couldn't accomplish what exports and imports did. It's that last point that is still under contention, if I understand you correctly.

poverty has been changed in its character because it has become concentrated in different ways than it was in 1978.

That sounds right to me, though I think many of the problems you're describing have more to do with cities than with markets, per se. It's certainly a problem with markets that they tend to concentrate both wealth and suffering. There just doesn't seem to be anything better for solving distributional problems in a way that creates enough growth to improve the lot of the worst off so that only relative poverty is the issue.
posted by anotherpanacea at 9:39 PM on September 22, 2009


Agricultural reform couldn't solve China's poverty alone, at least if the World Bank is to be believed, because there were more people than there was farm labor. So, on the question of the role of exports in poverty reduction, the answer appears to be: a little bit in the early 80s, a little bit more in the late 80s, and much, much more in the 90s.
Well, while the basic case is that agriculture was never going to do the job alone, the picture's far more complicated and you're getting into a whole set of complex factors of the nitty-gritty of how reform unfolded. I'll try to address that to the best of my knowledge below, by unpicking that World Bank statement, in part because I think it supports my case about the overly pro-market bias of their analysis.
Your summation of the role of exports is nearly there, but "a little bit more in the late 80s, and much, much more in the 90s" is problematic - these were the periods when poverty reduction slowed down and even reversed (people fell back into poverty); by this point the export businesses were already making a few very rich and merely keeping those able to find work in them from being completely poor; they weren't doing anything for the poor. Subsequently, after Deng's 'Southern Tour' in 1992 when the export economy really boomed, some of the money brought into the national treasury was then spent on infrastructure projects, tax relief and other policies and it was only then and in this sense that it did much for poverty reduction, though of course providing jobs for many - at one of the worst rates of exploitation in the world in terms of value created by labour (labour intensive industries) versus value paid to the providers of that labour.
The Chinese government has a number
I should make clear that the Chinese figure was calculated under a different method to the World Bank's - they two measures show similar trends but you can't extrapolate using them together as (I think?) you have done.
But again, given the amount of arable land, it appears that agricultural reforms alone couldn't have accomplished what light industry did, and light industry for domestic consumption couldn't accomplish what exports and imports did. It's that last point that is still under contention, if I understand you correctly.
I think industrial development for primarily domestic consumption would have had a far greater impact on poverty reduction, even though they would have done less for the rapid rise of overall GDP - because by the time the boom came, it was no longer doing the absolute poor much good and was creating a keenly felt relative poverty - remember the social movement of 1989 - this was fuelled as much by discontent with reform and the attendant price rises and rampant corruption as anything else. The reforms that were needed were political. And it's notable that these remain the problems facing China today - a desperate need to get away from dependency on exports and always the knowledge that at some point political reform will have to come. And now those will have to happen when material expectations are much higher and the legitimacy of the regime far lower than in 1978.

So on to the long dull bit on the poverty of the World Bank's analysis. Their report states that "The failure to achieve further reductions in poverty during the second half of the 1980s, despite modest agricultural growth and very strong industrial growth, is more difficult to explain." In fact, there's been several cogent explanations of this offered by other analysts, but none of those fit the World Bank framework wherein marketisation is an unalloyed good thing, which is their real difficulty. They won't say that the reforms were a double-edged sword.
I say this because if you look at the first of their macro-economic factors - "sharply increased prices for grain and other subsistence goods adversely affected the real incomes of the majority of the rural poor" - it's set out their blithely as if the reforms in agriculture had no impact on the price rises in agricultural produce. Reform itself was the key macroeconomic factor here, and naturally selling scarce goods on the market pushed their prices up. But why didn't this also translate into adequately increased incomes for the rural poor, who should have been selling these same goods? Because the poor were in the hinterland areas furthest from markets and had little or no surplus to sell, yet were still obliged to buy grain every year in many cases to make up for seasonal shortfalls in their own supply. Also, the real earners were not grain but sideline crops for market such as vegetables, but again proximity to markets is key there and also having a sufficiency of staple foods to allow land and inputs to be invested in cash crops. Again, this excluded the poorest.
The situation is complicated by the continuation of a unified grain purchase and sales system in the earliest years of reform which was then transformed into a contracted quota system with the farmers - so the government was also intervening in prices, mostly by buying at a higher price than previously had been paid to the collectives but still lower than the market rate. This is quite a complicated issue which I'd rather leave as it would take some time to explain it it any detail, but the key strategic reasons why this was maintained were reasonable enough - national food security in a country feeding 22 percent of the world's population on 7 percent of the land with wide regional disparities and continued urban rationing being the major factor. It's also worth noting that in the poorest areas it supported the price paid to farmers as they had fewer other market options (neighbours couldn't afford each other's grain) and tended to produce rougher grains which anyway weren't as saleable. So it took the edge off the improved incomes for those seeing income growth in the coasts (and while not poor they weren't exactly rolling in cash at this point, to say the least) but not too harshly as there weren't quota for the real earners, market garden produce and other cash crops.
The second factor they give is "rapid growth of the working age population exceeded the expansion of employment opportunities, contributing to a worsening of rural underemployment;" - this has long been a problem (see the figures for the land to population ratio above) and definitely one way out was to provide employment opportunities elsewhere. It's never been managed and there's a reserve army of rural unemployed/under-employed in the tens of millions even today. It's the reason they never fully privatised the land, as aware that it is nigh on impossible to provide jobs for all these people and with no prospect of cash welfare, it was access to the land that kept these people from being utterly destitute and (combined with the household registration system) flooding into the cities and creating Latin American style slums (even then there was a big flood of semi-legal workers to the cities). But it also conceals a couple of other downsides of the break-up of the communes - in the past all these people had had an equal share in whatever welfare the collective provided, be it ever so meagre, now that land was contracted to households only the family was responsible for supporting them, including things like paying fees for health and education that were now not free. In later years as the period for land contracts has been extended, to encourage farmer's willingness to improve their land, it has meant that young people have no chance of having any land allocated and massive disparities between households whose number of persons has changed since the initial allocation. This has meant re-allocations in some places and that was also fraught. Anyway, the upshot is that for the first time since 1949, China will once again have large numbers of landless peasants, traditionally a harbinger of doom for a Chinese polity. It contributed to deepening poverty because again those in the hinterland were last in line for off-farm work. It hit women hard, it hit ethnic minorities hard (if you can't speak Mandarin, you can't get a job).
The Bank's last factor notes the regional disparities - again this is one of the negative impacts of reform. The relative poverty this contributed to had all the bad effects jb sets out so well in her post above. For example, as she hinted, crime exploded in this period, including violent crime.
So my contention is that the reforms in agriculture brought an initial burst of poverty reduction, but the key to that was not the markets but the end of the authoritarian interference and repression that had been the bane of the collective system and responsible for all its crimes and failings. Chinese farmers had some measure of autonomy again and put it to good use in the small space available. Once that rebound had played out, markets no longer did much directly for absolute poverty - that came indirectly through state action - and radically worsened relative poverty, particularly as the the loss of the goods the collectives had provided even despite their many flaws came to be keenly felt (when we used to survey poor families, medical fees were a key reason for farmer indebtedness, for example).
Err, I'm sure that's more than enough for now.
posted by Abiezer at 2:32 AM on September 23, 2009


Realised I've missed out another key point, which was about capital flows and how money continued to flow out of the countryside, but I'll not bother writing another screed just yet, which would get us on to the whole topic of 'The Three Rural Issues' (or 'three-dimensional ruralness' as the man who coined the Chinese phrase prefers the English to be) which have been one of the key development debates here since the mid-90s.
posted by Abiezer at 3:01 AM on September 23, 2009


I should make clear that the Chinese figure was calculated under a different method to the World Bank's - they two measures show similar trends but you can't extrapolate using them together as (I think?) you have done.

Well, together they supply a range of 30-60%, but as you've pointed out, as the World Bank and economists have tightened their measures of poverty, they've been able to focus on the consumption issues that actually distinguish poverty from non-poverty. We may not know much about 1978, but we know a bit more about 1981, and more still about 1985, especially since many of the features of the socialist economy that troubled the calculations were dissipating. (Commune-supported medical care, for instance.) I think that renders the lower bound unlikely: we'd have to conclude that the earliest agriculture reforms created more poverty even before the loss of welfare institutions like free medicine and education.

One thing we discussed earlier that seems important here is imports. By 1985, the export TVEs were producing about 3% of Chinese GDP. As you point out, that was a very small percentage of the TVEs: 11,000 "out of millions." So the income and labor flows are justified by the disproportionate contribution of export-oriented light industry. Price inflation and unequal growth both suggest the same thing: there was a more productive use for goods than in the rural counties.

And while GDP from exports wasn't contributing directly to poverty alleviation, it deepened the state's coffers for dealing with disasters and investing in future productive capacity, and here I think it's clear that there's been a persistent emphasis on finding productive work for the unemployed. The export revenues were sufficient to buy grain on the market to feed those working in the coastal TVEs, and leave a surplus of foreign currency for buying other things. The Chinese could have spent that excess on importing goods to make up the lost services of the communes, but this would have frozen development at that point. Instead, they imported education and technology, chemicals and machinery.

the key to that was not the markets but the end of the authoritarian interference and repression that had been the bane of the collective system and responsible for all its crimes and failings.

I don't think you can have an end to interference without markets. In general, China was a country that couldn't handle distributional problems at a national level and so left them to localities. For some this was good, for others bad. Markets help us to make distributional decisions, and this was a better distribution than a focus on what you call the 'hinterlands.' The Chinese government could have moderated the squeeze on farmers, but apparently they weren't able to organize a response that allowed direct transfer payments. It's not so hard to resolve the destitution that emerges when markets decide that a person isn't worth paying any longer: you tax the people who were made better off and spend it on the person made worse off. In this case, the Chinese government doesn't seem to have been able to do that well, but it's not exports that caused that problem, it was inadequate inter-provincial welfare institutions.

It's never been managed and there's a reserve army of rural unemployed/under-employed in the tens of millions even today.

The whole notion of migratory restrictions is sort of offensive, but the goal is laudatory. If goods and capital can move but workers can't there's bound to be this kind of regional disparity. However, I think it's pretty impressive that they avoided (to some extent) the slum model and instead have been building functional cities and then populating them with unemployed agricultural workers. Again, it's a bit offensive from the human freedom side of things, but as a social policy it's had the desired effect.

For example, as she hinted, crime exploded in this period, including violent crime.

Here I'd ask you if we can really be sure that crime exploded and that it wasn't just crime statistics that exploded. You've already discussed the way that many local parties came to be indistinguishable from organized crime: like the plight of women girls, crime in cities doesn't so much increase as become increasingly evident. Certainly there are more opportunities and more desperate strangers more closely packed together, but if the choice is rural unemployment or urban opportunity and risk, it seems clear that the right decision is to head to the city. It's a decision with downsides, but on balance it's the better decision.

Once that rebound had played out, markets no longer did much directly for absolute poverty - that came indirectly through state action - and radically worsened relative poverty, particularly as the the loss of the goods the collectives had provided even despite their many flaws came to be keenly felt (when we used to survey poor families, medical fees were a key reason for farmer indebtedness, for example).

As I said earlier, it seems like the development path China has pursued was to resolve the majority of absolute poverty without regard for inequality, and only now to start targeting the economic and political institutions that have exacerbated inequality and relative poverty. (In reality this started in the late nineties with various attempts to democratize locally.) Now that there's more than enough to go around, they can face the fact that markets and centralized state action can't solve every problem of inequality. Decentralization and democratization are simply better at that sort of problem. Contrast this with the socialist goal of distributing the less than adequate resources fairly equitably, and I there are clear reasons to prefer markets for poverty alleviation.

absolute poverty - that came indirectly through state action

Just one further comment on this aspect: many of the state actions that were needed in the late 80s and 90s were actually only responses to other state actions, like the corruption of local party bosses or distributional shortfalls due to migratory restrictions. There's probably an inevitable pull and push between local and centralized forms of authority in any large federalized republic, so I don't think this was avoidable, but it also doesn't seem like an indictment of markets per se that some non-market interventions require other non-market interventions to rectify.
posted by anotherpanacea at 6:10 AM on September 23, 2009


"like the plight of women and girls"
posted by anotherpanacea at 6:13 AM on September 23, 2009


Here I'd ask you if we can really be sure that crime exploded and that it wasn't just crime statistics that exploded.
I think we can but I'd have to check studies to offer more than broad phenomena and anecdotes - there's a round-table discussion of three of China's key political economists of reform and rural issues who were all sent down to the countryside at this time and they debate this point and mention a surge of murders in the places they were in the commune break-up years. As you can imagine, all sorts of instabilities that come along with that kind of social transformation were the prefect breeding-ground. It's certainly the case that criminal behaviour of another type was concealed in the collective years - abuse of power by officials and the like - but I think it's safe to say it was of a different nature and order.
I don't think you can have an end to interference without markets.
I think you could, as this happened in certain areas during the CR and hence I phrased it that way but actually I'm not opposed to markets per se so much as the World-Bank-type notion that China had to re-integrate itself into the the global capitalist economy in the way it did to have them or anything like them. There's a lot of this in Arrighi's 'Adam Smith in Beijing' which I did a post on a while back - he's one of those interested in why China traditionally had a very marketised economy but never developed capitalism. From one point of view, a non-capitalist, largely self-contained market economy was the Chinese way for centuries and had made it the wealthiest country in the world by per capita GDP, something it remained until the early 1820s.
Nor would I advocate continued isolationism at that point (trade has always been a great generator of wealth), but given that the state set the terms of foreign investment it would follow that they could have done that in a number of ways and it's easy to conceive of realistic models which would have had better development and social justice outcomes.
All sorts of scenarios would be a topic in themselves, but I think the state showed its hand again in the negotiations over WTO accession, when bigger concessions were made on agriculture (with the consequences for the poor farmers) than were actually being required by the international community.
And while GDP from exports wasn't contributing directly to poverty alleviation, it deepened the state's coffers for dealing with disasters and investing in future productive capacity, and here I think it's clear that there's been a persistent emphasis on finding productive work for the unemployed.
Yep, and this is one of those realpolitik considerations which meant I gave a more trenchant defence of the pre-1978 economy than I would when, say, arguing with friends here who really think it was a prelapsarian paradise, as the way the planned economy was rigged also put national development ahead of the individual welfare of citizens. It's not my chosen path but China's leaders are hardly alone in seeing the necessity of having a strong state and given the history of foreign incursions not an unreasonable goal by their lights. Though again, a flipside of the reforms was that they enabled localism which was particualrly strong in the newly wealthier provinces who resented sending money off to build Tibet (so poor it never appeared in any of the statistics books) or whatever. there's been several rounds of tax reforms where the central state has tried to capture more of the newly generated wealth but it's also left localities with theoretical welfare burdens and not the income to pay for them in poor areas, hence the set-backs in education and the charging of extra-budgetary fees that led to so much rural unrest.
posted by Abiezer at 1:05 PM on September 23, 2009


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