February 18, 2007

"Organics": WalMart Style

WalMart’s deleterious effect on the American economy is way more than luring customers away from Mom & Pop’s General Store on Main Street. It’s also cruelly ironic to use “classism” in support of WalMart . (As in: "The anti-WalMart proponents are elitist; knocking the lower-classes who can't afford to buy anywhere else." That paranoid logic is an insult and slap in the face to the now nearly defunct Made In The U.S.A-label and the hundreds of thousands of near-pension-eligible-ex employees who are out of work from companies for whom they’ve loyally toiled behind desks or worked on oft times non-unionized production lines (see: textiles) for 30 years. Companies who've had to close their doors permanently or outsource the majority of jobs overseas because of enormous, unparalleled pressure from the world's largest retailer to tow the WalMart line or suffer the consequences. Jobless, no prospects, with no health care, perhaps no pension and too young for social security, many of these disillusioned folk can now ironically only afford to shop at the very store which put them out of a job in the first place. Perhaps that’s part of WalMart’s plan, too?

I think this article gives a pretty complete description of WalMart’s m.o. and can serve as a background primer for "Organics: Walmart Style" based on their past history.

For the economic-terminology-challenged (myself included), it's helpful to know terms such as “Monopoly” (which is the only one I knew wasn’t just a board game), “Oligopoly” and “Monopsony".

-Monopoly: A market where a seller controls and dictates price and availability.
-Oligopoly: A market of few sellers for a product or service. i.e. multinational corporations that dominate specific products or services.
The main difference between monopolies and oligopolies is monopolies attract a bit too much government attention and regulation for the multinational’s taste.
Then there’s...
-Monopsony: A market similar to a monopoly except that a single, large buyer (i.e. Walmart, which controls the largest proportion of the world retail market) drives prices down by driving manufacturers to slavishly slash their operating costs to the severe detriment of a manufacturer’s profits leading them to either declare bankruptcy or outsource the bulk of their manufacturing to Third World Countries. WalMart has honed monopsony to a fine art.

”Organics” is the hottest potential market. It’s only natural that the world’s largest retailer would salivate at the chance to jump on the bandwagon. But, Walmart doesn’t just want to ride the wagon, chances are it’ll grab the reins, hurling organics down a muddy, dead-end road by undermining quality and purity for profit. Novel? No. But for organic advocates (we are aren’t we?) and organic growers, the potential for dilution of that "organic label" both for U.S. and foreign producers is infinite.

From Eco-Labels.org:
"Originally, the USDA National Organic Program required that all substances used in organic production meet National Organic Program standards. The USDA has since narrowed the definition of substance to ingredient used in organic production. This means that a substance - used in processing that may leave residues but that is not actually an ingredient in the final product - does not have to have USDA approval. " In other words, as long as it’s not used as an intentional ingredient, the residue (pesticide, herbicide, etc.) gets a pass. As long as the alleged chicken has access to a 4x4 outdoor enclosure for 10 minutes a day, it’s considered “free range”. Is it any wonder, then, why so many small & large family organic, sustainable farms have regretfully abandoned the USDA’s organic certification because of the whoring of true organic criteria and More diluted standards.

In light of all of all the aforementioned, here's why WalMart's organi-bubble should be burst.

Once WalMart commences outsourcing (and it will), it’s noteworthy that even the USDA will admit that because of precious few organic certifiers in the field and vast distances between supplier, certifier and retailer, an enormous potential for oversight exists. Especially if the retailer at the reins has golden saddlebags loaded with lobbying loot and foreign certifiers are easily influenced to look the other way.

Even if doubts about WalMart’s foray into organics doesn’t mean diddly to the general population, then the next time you’re checking out at WalMart, take a gander at the person standing next to you in line and wonder if the pair of cheap pajamas, very possibly the only ones you could afford, wasn’t made from the crap Pakistani material that replaced the material that guy or gal or their relative once produced on a loom, 10hour- days , six days a week in a North Carolina, non-unionized mill that now stands quiet, gathering dust. Tough decision, to buy or not to buy? But, sometimes there’s no option. If that’s all you can afford, what are you going to do? Then try to imagine the depression, anger and humiliation that other person must feel if they’ve got the same pair of pajamas in their cart, too. Sad. Very sad.

Sam Walton must be spinning in his grave. He who proudly lauded “Buy American!” on banners upon the grand opening back in Bentonville, Arkansas away back when.