The hand-painted signs were still being propped up, but a small crowd had already gathered on the Brooklyn sidewalk. “We’re organizing against Wal-Mart,” announced Peter Sikora, 30, as he struggled to unfold a portable table on an 85-degree Saturday.
Passerby Lupita Gonzalez dove for a clipboard and filled in her contact information before even reading the literature. When Sikora told her about the group Wal-Mart No Way’s call-in campaign, Gonzalez pulled out her cell phone and dialed 311.
“Wal-Mart discriminates against women and destroys good jobs, and it would take away business from local businesses. I don’t want it here,” she told the operator, who promised to get her message to the mayor’s office. Gonzalez, 34, like Sikora, lives on the increasingly trendy strip of Fifth Avenue in northern Park Slope, near two sites the retail supergiant is rumored to be considering for its first store in the city.
The nation’s largest retailer, with $285.2 billion in annual sales at the most recent count, and largest private employer, with 1.2 million workers, has not yet planted its flag in the five boroughs. But it is on a mission to conquer. It is buying full-page ads in community newspapers like the Park Slope Courier to woo the city’s consumers. It has won over Staten Island Borough President James Molinaro and some of the City Council, and it is working on skeptical pols like Brooklyn BP Marty Markowitz. It is assessing traffic flow, shopping patterns, and low-wage labor supply, as it does whenever it gets serious. The one thing it has stopped doing is revealing its dream locations. “New York is a very viable marketplace,” said spokesperson Mia Masten, “but we don’t have any particular sites in mind.”
That caginess comes of lessons learned. The suburban behemoth is increasingly provoking communities’ fury as it ventures into urban markets. Two months after it declared designs on a Rego Park, Queens, site last December, its plans were sunk by a steely coalition of labor, neighborhood, and small-business forces.
Accusations involve every issue that could possibly apply to a multinational retail corporation: sweatshop wages and factory conditions overseas, child labor here and abroad, increased traffic, environmental destruction, systemic discrimination against women, poverty-level domestic pay, and fervent union busting. Anti-Wal-Mart blogs and websites number in the dozens. All the major unions have an anti-Wal-Mart position or campaign, as do many social-justice groups and elected officials. Thousands of newspaper and television reports and numerous books have chronicled people’s ire.
Yet despite the universe of opposition, Wal-Mart has proved nearly invincible. Even after years of hot pursuit by organized labor, not a single one of Wal-Mart’s 3,600-plus U.S. stores, employing 1.2 million Americans, is unionized. Wal-Mart continues to dwarf every other corporation in sales, raking in $285.2 billion in its fiscal year ending January 2005. Its stock price had recently stagnated, but it announced plans to re-energize by opening up to 335 new stores in the U.S. this year.
Opponents believe if New Yorkers give it an inch, Wal-Mart will take the whole city. They want to ward off the enemy at the gates. “If Wal-Mart got in, it would take over and become the only place most people could afford to shop,” said Sikora, a Cornell graduate who works at a consumer rights group. His aim is to draw more young, liberal professionals like himself—the type who might have campaigned for John Kerry and who wield some political and possibly financial muscle—into a vanguard previously composed of old-school community boards and unions.
Tabling in hipster areas, some 20 to 30 regular volunteers have signed over 1,000 potential reinforcements to an e-alert list and sold hundreds of $20 T-shirts to raise money for a television ad. Now an official nonprofit, they have gotten repeated coverage in the community newspapers where Wal-Mart has bought full-page ads.
But even with fresh blood, Sikora acknowledges, the odds against the resistance are “enormous.”
‘The hidden cost of cheap underwear’
Matteo Manzella, a meat cutter with Local 342 of the United Food and Commercial Workers union, hung out at the sidewalk stand with Sikora and crew on his way to work an afternoon shift at the nearby Key Food. Looking not unlike Hulk Hogan, he proclaimed, “Wal-Mart’s got low wages, discrimination, and no benefits! They literally tell their employees to go on welfare for benefits!”
Wal-Mart dismisses UFCW as a selfish “third party” conspiring to gouge consumers with pricey groceries. But those less than dirt-cheap prices enable Manzella to earn a decent living and “great benefits.” As a result, he said, he’s more than happy to “do a custom order” for any shopper. In 2000 a tiny fellowship of 10 meat cutters in Texas became the only Wal-Mart workers ever to hold a successful vote to unionize. The company eliminated their jobs and stocked factory-cut meat.
“I don’t buy nothing from Wal-Mart anymore. I buy all my fishing gear from other places now,” Manzella declared.
The activists believe that promoting Manzella’s underlying message—that shopping at Wal-Mart has human consequences—is crucial to countering any support the retailer’s ads may be stirring among consumers. This month volunteer Daniel Stolzman, who works in film, shot a slick, fast-paced television spot to convey just that point. Eschewing hokey PSA fare for a rather suspenseful narrative, the ad will invite viewers to sign up at the group’s URL, wal-martnoway.org. It will urge residents to contact Mayor Michael Bloomberg, and it is set to debut as the city’s election season heats up this fall.
Some of the money to fund the ad was raised at a recent mixer hosted by a wealthy friend of Sikora’s fiancée and fellow organizer, Claire Tuck, a law student. In an art-filled apartment in the West Village, UFCW organizer Ed Lynch explained, “We’re trying to bring together many, many different groups.” He sipped a beer with his buddy from the iron workers’ union as young professionals edged past with their pastries and wine to catch the view from the 11th-floor terrace. He said UFCW, along with others from the city’s Central Labor Council, had begun a multipronged offensive, leafleting at the Staten Island ferry, recruiting support on stretches of mom-and-pop shops, and lobbying pols.
“But we decided this couldn’t just be a union-focused campaign,” said Lynch. The fight is just too large, he said. “We’re trying to educate the consumer. If you think about why that $300 bike is only $159—that it was assembled, probably by a child overseas, definitely by someone who could never afford to buy it—it’s harder to want that bike.” He leaned in and whispered, “I’m saving this for my speech later, but you have to think about the hidden cost of buying cheap underwear.”
The few localities that have successfully fended off Wal-Mart have benefited from clearer-cut battles and smaller, more efficiently aroused constituencies. In Guelph, a town in Canada, opponents have kept the retailer away from its desired location, next to a longtime Jesuit retreat, through 10 years of activism and court battles.
More famously, the low-income, mostly minority community of Inglewood, just west of Los Angeles, trounced the corporation in its first foray into urban America. In 2004 the retailer tried to skirt the land-use approval process by forcing a voter referendum. Despite spending $10 million and boasting that consumer demand would prevail, Wal-Mart won less than 40 percent of the vote.
And recently in Chicago, one proposed Wal-Mart store was rejected by the city council after much local protest, while another was approved. Cities such as San Francisco have enacted bans on the retailer’s “supercenter” models, which sell groceries and reportedly take up areas the size of 17 football fields.
Wal-Mart is trying to turn on the charm. Recently its Northeast rep, Philip Serghini, 36, suggested meeting at a Starbucks a few blocks from his home on East 10th Street in Manhattan. “We don’t have offices in the city,” he explained. He was fit and tan, like a less beefy Ken doll, dressed sportily and toting a backpack. Declaring “I have to try it,” he sipped a green-tea Frappuccino as he explained that the cacophony of anti-Wal-Mart criticism does not reflect real wrongdoing so much as the company’s “Pollyannaish” neglect of image management. “We recognize we have reputational issues,” he said.
He echoed a company comment in a July Wall Street Journal profile of CEO Lee Scott that the quarter-trillion-dollar multinational corporation had been “naive.” Shrinking violet no longer, the corporation now has answers for everything, many of which can be found at its public relations website, walmartfacts.com.
On union busting, Serghini punted to his superior Mia Masten. Via cell phone she insisted that none of the 1.2 million employees “want to be unionized.” The company touts an “open-door” culture where management embraces complainers. A simple Google search will turn up countless accounts to the contrary. Masten stressed, “We’re the norm. Our competitors aren’t unionized.” But as a recent
Times report detailed, competitor Costco pays workers an average of $17 an hour—nearly twice Wal-Mart’s average—along with affordable health benefits and a relatively generous pension plan, permits unions, and still turns a hefty profit.
On gender discrimination, Wal-Mart last week tried an ironic flip on the David-Goliath image, asking a federal appeals court to dismiss the famous class-action lawsuit. It claimed that there are just too many plaintiffs—about 1.5 million women—for the company to defend itself against allegations of unfair denial of promotions and lesser pay. No matter that the size of the class is in direct proportion to the size of the mammoth employer. The appeal aside, Wal-Mart claims to have implemented “leadership seminars designed specifically for women” and to have launched other “diversity initiatives.”
On sweatshop conditions, publicity materials state, “We require suppliers to ensure that every factory conforms to local workplace laws and that there is no illegal child or forced labor.” Critics argue that some countries’ “local” standards would seem cruel here, and that Wal-Mart should use its heft to better conditions, not drive down the bottom line.
Wal-Mart’s reps complain that its sheer size makes it the easiest target in the world. Its size, however, also turns any of its questionable practices into problems of tremendous, even global, scale. A Pulitzer Prize–winning 2003
Los Angeles Times series documented how Wal-Mart’s entry into a market depresses wages generally and shuts down competition, eliminating jobs. It tracked how the company’s demand for ever lower prices from suppliers pushes manufacturing overseas, where faster, cheaper production is squeezed from third-world workforces.
Surprisingly, on the issue of domestic wages, Serghini offered some brutal honesty. Although he boasted that Wal-Mart is the nation’s leading employer of blacks and Latinos, he explained that the routine hourly gigs most of them have—$9.68 an hour for full-timers and likely much less for part-timers—were never meant to support families. The company acknowledges that many full-time workers will probably earn less than $20,000 per year, while critics have gone as low as $11,700. Said Serghini, “We hire nontraditional employees—hundreds of thousands out of high school, a huge bloc of seniors.”
Moreover, he continued, “Are the benefits we offer rich benefits? They’re probably not the richest benefits in the world.”
But he bristled at the widespread criticism that Wal-Mart workers should not have to seek public health benefits but do, or that it is wrong that some of them reportedly rely on food stamps. The company provides less than half of its workers with health coverage.
“We don’t put people on welfare. We get them off welfare,” he said. “We pay what the market will bear.”
‘How bad does it have to get?’
Many might say Serghini has a point. In a city with over 400,000 on public assistance, the prospect of an estimated 300 new jobs per Wal-Mart store—assuming competitors stayed in business—cannot be lightly dismissed.
Above all, Serghini said, there is a real hunger in the city for deep discounts. He said that, this April, nearby Wal-Marts had tallied $96 million in sales the previous year to city residents. A recent company-sponsored survey showed 62 percent of 800 city respondents wanting stores closer by.
Wal-Mart describes its cut-rate pricing as if it were doing the work of God. Or Marx. “These savings are a lifeline for millions of middle- and lower-income families who live from payday to payday,” claimed CEO Scott in one newspaper ad. “Wal-Mart acts as a bargaining agent for these families—achieving on their behalf a negotiating power that they would never have on their own. Wal-Mart harnesses the collective clout of ordinary Americans to make their lives better.”
Such collective bargaining power is precisely what critics say Wal-Mart workers need, but not to buy discount socks. Said community advocate Vivian Rothstein, who helped lead the Inglewood fight, “It’s circular. People get shitty wages from Wal-Mart, and then they have to shop at Wal-Mart.” Scott likened the discounts to giving “a raise” to customers, but Rothstein argued the company’s own workers need an actual raise—and the resulting freedom to shop occasionally at, say, Nordstrom.
But losing patience with questions about low wages, Wal-Mart’s Serghini finally exclaimed, “If our wages are too low, then government should set the minimum at $20!” The company constantly points out that the federal minimum is only $5.15 an hour.
One of Wal-Mart’s most public critics agrees, at least in the sense that government must step up. Congressman George Miller of California, whose widely circulated February 2004 report excoriated the retailer’s employment practices, said last week, “Wal-Mart illustrates how easy it is to exploit the weaknesses in our labor laws. They must be strengthened.” He said the place to begin was by increasing the penalties employers face for squashing workers’ attempts to organize—fines that big companies eat as a cost of business. Without a stronger collective voice, Miller said, workers will continue to be victimized.
“The question is, how bad does it have to get before we get to the point of reform?” he said. With Wal-Mart now the leading corporate contributor to political candidates, most of them employer-friendly Republicans, that day may be quite distant.
Democrats have said that if more higher-income voters expressed their solidarity, reform might become more palatable to politicians. That is where the new New York City crew hopes to come in.
Brooklynite Lupita Gonzalez called back 311 to make sure her views had been reported. But she was told that, without her “service request number,” her complaint could not be tracked. The mayor’s office would not comment beyond regurgitating Bloomberg’s response from March, when he was publicly cornered by reporters. The pro-developer billionaire said then, “This city should be open to everybody. And if you don’t want to go to work for somebody, don’t. If you don’t want to shop there, don’t.”
He is, obviously, unlikely to support the Wal-Mart No Way campaign. But even successful resisters elsewhere realize it will be a constant battle to keep the giant at bay. In the meantime, they are capitalizing on the company’s unintended effect—the diversification and energizing of local activism—to enact stronger processes for community control of labor standards and development.
Said Sikora, “Wal-Mart should be careful what it wishes for. If the company sneaks a store by, the opposition that they face in this city will just snowball.”