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Source link: http://archive.mises.org/5342/should-wal-mart-be-broken-up/

Should Wal-Mart Be Broken Up?

July 19, 2006 by

Wal-Mart-hating interventionists are running out of reasons to hate Wal-Mart. Incapable of making any kind of coherent argument that America’s biggest retailer is harmful to consumers or workers, they are now rewriting American business history — including the history of antitrust regulation — to vent their hatred of an institution that has done more to help the poor than all the government welfare programs devised in Washington. FULL ARTICLE

{ 63 comments }

faultoelrant July 20, 2006 at 4:42 pm

Lisa says:

“Faultolerant,
Thanks. I was just confirming my suspicions that you are, in fact, nothing but a troll. Don’t complain about others “whining” when you do nothing but engage in immature name-calling. I will be ignoring you from now on and strongly urge others to do the same.”

My, my for a PhD candidate you’ve a surprisingly limited ability to do more than whine. Maybe you should take a job at WMT….after all you’re probably marginally qualified for it. Only marginally. Petulant whining child.

Vince Daliessio July 20, 2006 at 4:50 pm

Faultolerant;

Why don’t you write an article, using a consistent set of economic rules as a guideline, condemning Wal*Mart, or any other entity you desire, by making truthful, testable arguments, for us to criticize?

Or, at least, quit being a jackass.

quincunx July 20, 2006 at 8:34 pm

@pedro

“If neither Wal-Mart nor Microsoft are monopolies, NO other corporation on Earth can possibly be.”

Last I checked, my cable provider, water provider, heat provider, garbage collector, first-class mail deliverers, and electricity provider are all monopolies. OK so not all of them have ‘corp’ or ‘inc’ in their name – but still.

Luckily, I no longer live in a town with a obligatory municipal (read: monopoly) lawn care service.

“The unique abilities of capitalists to sink the future prospects of the U.S is clearly astounding!”

Oh no, capitalists are terrible at sinking the economy themselves – one needs papa government for that kind of assistance.

I personally do not like to shop at WalMart, I have many better alternatives to choose from in my area.

However, I view WalMart’s 24-hour supercenter as an oasis when driving though unknown territory. Seriously, how many places have all the tools necessary to built a decent and sturdy bong at 4am?

M E Hoffer July 20, 2006 at 10:27 pm

quincunx,

Monopoly Lawn Care Services? Where was that Paradise?

And, I’m sure you’d do McGyver proud!~ That Boy Scout training has paid ample dividends, no?

beefcake the mighty July 21, 2006 at 9:18 pm

Mises.org is the Fox News of libertarianism.

Wade July 22, 2006 at 12:48 pm

Even if some of Wal Mart’s products have been deterioriating due to pricing pressures, what can we attribute these pricing pressures to other than the governments inflationary policies and Wal Mart’s constant dedication to sell the same products for less to people on a low fixed income? Who to blame for the deterioration of their own products, a company that is dependent on customers who don’t have the convenience of a flexible income?

bold'un July 26, 2006 at 7:20 pm

There is a basic fallacy in the logic of supermarkets (not only WMT) that buying power gives the right to the best prices.
In a commodities market, if someone wants to buy 1 contract of contract X, he will get a good price but pay a large brokerage fee. But if someone wants to corner the market in contract X, he will need to pay ever higher prices. Between the two there is a sweet spot, perhaps 1000 contracts which can easily be handled in the daily volume but is large enough to qualify for a low brokerage.
From the point of view of a supplier, giving the best price to an uncomfortably large customer is suboptimal because that will drive other customers who pay higher prices out of business as well as increasing the credit risk through concentration (remember Kmart in 2002!).
We have to get close to the idea of the law of the one price: a can of cola of Brand A should be the same price everywhere (though of course competing on price with Brands B, C and D).
How should that one price be fixed? Perhaps the dutch auction system on Ebay provides a model…
So to answer the question of splitting up WMT, I would say no, but the system of trade procurement of branded goods should be made more transparent and commoditized.

beefcake the unsightly July 26, 2006 at 8:02 pm

Beefcake the Mighty is the Fox News of leaving useless comments.

ben c September 3, 2007 at 12:29 am

this is a very interesting and well thought out article on this subject. before i comment i want to say that i am definitly less than an amature in the feild of economics. i tend to agree with the vast majority of what i have read and heard from Mr. Dilorenzo, especially on the subject of Lincoln and the civil war. I am not in favor of government intervention in most areas of life, especially business. So i would agree that a government break up of Wal Mart would be absurd. However, i would say that the comments of one reader, Posted by: Mario Diana at July 19, 2006 11:27 AM, are very important to the discussion of wal mart. i have heard many good arguments for why wal mart is a “bad” corporation for america.this one represented by lynn is not one of them.

one that i see as a good argument has to with wal mart receiving benifits from local communities by having necessary infrastucture paid for by local goverments as well as other expenses. while i agree that the government (local or national) should not hinder the growth of wal mart, i think it is fair that they should not aid in that growth either.

that being said, (and of course i am not privy to all of the details of what goes on with wal mart and the local and federal governments) from what ive come to understand, wal mart would not be nearly as successfull as it has been without some form of “corporate wellfare” dolled out to them by these governments. this is what bothers me. i would be interested in reading Mr. DiLorenzo discuss that aspect of wal mart. a

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