Posted on 08/24/2003 7:03:07 AM PDT by cp124
Many won't be back; take shopping cart and check out why
07/20/03
By LEE ROOP Times Features Editor lroop@htimes.com
Two people walked into a Huntsville Wal-Mart last week on a challenge: Spend $400 on products made in America.
Two people walked out of Wal-Mart one hour later after randomly checking 40-plus items. Only 10 were made in the USA.
It isn't just Wal-Mart, America's largest retailer. Imported goods line shelves elsewhere, too. But what that means for American workers is the subject of a new economic debate.
"It's a huge issue," Wal-Mart spokesman Bill Wertz agreed Friday, confirming the import trend. "Customers are looking for value ... we try to stock what our customers want to buy."
New Hampshire economist Russ Thibeault threw out the Wal-Mart challenge July 10 on "Marketplace," an award-winning public radio show about the economy.
"Take a trip into your local Wal-Mart and spend your tax refund check on stuff that will generate U.S. jobs," Thibeault said in a commentary. "Chances are your shopping cart will be pretty empty when you get to the checkout counter."
Thibeault was discussing the strange fact that America's economy has been out of recession for well over a year, yet it continues to lose jobs. The National Bureau of Economic Research said Thursday that 1 million jobs have been lost during this recovery.
Many of those jobs aren't coming back, Thibeault thinks, despite tax cuts and strong consumer spending. They aren't coming back because they've moved overseas.
Hence, the Wal-Mart challenge.
Walking into Wal-Mart with a Times reporter was Randall Collier, 37, of Rogersville. Since 1987, Collier's primary business has been buying industrial sewing machines from plants closing here and shipping them to new plants in countries such as Peru.
"For every machine I sell," Collier said Wednesday, "there goes another American job."
Collier is promoting a new venture. He's trying to establish the USASells.com Website to give consumers a place to find American-made products.
"I don't know of one product we don't make," Collier said. "But if people don't start (buying here) now, they won't have a job themselves."
The Wal-Mart challenge was to spend the check coming soon to all American families with children. Congress this year increased the tax credit for raising children by $400 per child, and the money will be "advanced" to taxpayers in the form of checks beginning in a few weeks. The minimum check for a family with one child is $400.
Inside this typical Wal-Mart, clothes greet customers first. Clothes for the new school year would be a logical purchase with any cash windfall.
Virtually every brand is made overseas, including those with strong American images.
Levis jeans: Made in Cambodia.
Faded Glory shirts: Bangladesh.
Hanes underwear: Pakistan. Fruit of the Loom underwear: Honduras and El Salvador.
In the infant section, Cosco infant child seats are made in America, but Cosco playpens are made in China. Many companies seem to have one foot over the border.
A Disney "Winnie the Pooh" bear for baby? Made in China.
Fisher-Price diaper bag? China.
New shoes would be nice for fall.
Dr. Scholls? Made in China. Starter sneakers? China. Faded Glory sandals? China.
Curiously, America still makes the shoe strings and cushion insoles.
"Can we mention these?" Collier says, holding up a Murina brand T-shirt. It's a rare brand made in America.
"See these? These are Tee-Jays," Collier says. "They were in Florence, had 2,000 employees. They sold out. They're made in the Dominican Republic now."
The pattern continues across the store.
Foster Grant reading glasses? China.
Silk flowers? "All China now," Collier says. "They have a major distributing center in Haleyville."
Fabrics? India. China. Some are printed in America on imported fabric.
Rubbermaid and Igloo coolers? Made in the U.S.A.
Zebco fish fryers? El Salvador.
Rawlings baseball gloves? U.S.A.
Wilson, Prince and Head tennis rackets? China.
Black & Decker drills? Assembled in China.
Stanley hammers? Mexico.
Murray lawn tractors? The first in a line outside the Wal-Mart was made in Lawrenceburg, Tenn. The second? "Assembled in Lawrenceburg, Tenn."
Wal-Mart spokesman Wertz said the retailer stocks American items and regional favorites where it can. An Alabama example is Chilton County peaches, he said.
Wal-Mart also helps producers of American products like Denver's Orange Glow cleaner by selling that product in Wal-Mart stores abroad, Wertz said. The company has a special office devoted to that effort.
What economists wonder now is whether an up-and-down cycle of imports and exports has become a steady downward trend.
Collier estimates more than 5,000 textile and manufacturing jobs have left the Shoals area since the economy went global.
"And when (laid-off workers) went on unemployment, they went to the cheapest place they could to shop," he said. "They took their unemployment checks and went to Wal-Mart."
Absolutely. In the US, even our social security tax is a part of the real cost of goods sold, since it diminishes 'take home' wages (requiring higher wages to offset the deduction) and is also placed on business (the employer pays an amount equal to the worker). And this tax (only one of so many hidden taxes) is figured in to every level of production from raw materials to transportation to manufacture at every level. I have no idea exactly what the overall amount of hidden taxes in our products is, but I'm guessing in the 30 - 40 percent range. We have just too much going against us to compete in production with the third world lifestyle. We cannot compete while exporting our tax burden in the cost of our procucts.
The problem is that the global economy is not a free market economy. Japan, China, India, Europe, Middle East and (believe it or not) even Africa all have tariffs (or federal law) which protect their businesses from competition from America. Capitalism can indeed sometimes be cruel to workers – but democracy can also sometimes be cruel to business.
Whatever, but my approach is the approach outlined in the Constitution. So I guess the Constitution is a socailist document huh?
No not at all, but the Constitution also doesn't state your goal of putting a gun up to the head of Wal-Mart shoppers, who are looking for a the best bang for their buck.
I do believe that somewhere it mentions what the federal government can and not not do. And if I am not mistaken the federal government can put a gun to your head and pull the trigger, after due process of course. I also pretty sure that the federal government is allowed to regulate commerce and impose tariffs.
Wrong again, this is exactly what tariffs can change. If China gains a 30% advantange using low cost slave labor then a 30% tariff eliminates that advantage! It effectively raises the cost of Chinesse labor! Pretty cool huh?
Capitalism can be cruel, and it should be more cruel to them than us.
Well why don't you go up to your local "evil" Wal-Mart and stand at the entrance and put a gun up to the consumers who wish to shop there.
According to you, it is okey dokey by the Constitution.
Of course you will be back on FR saying how the "pigs"(police officers) stopped you in your tracks, yada, yada, yada.
Your rhetoric is old, deranged, and pompous.
But what the hey, you revel in your role as a keyboard commando.
Uh, no. It only does that in this country. While we do this, Chinese manufacturers would be blissfully taking away market share from American manufactures in other countries. Your approach is a "head-in-the-sand" approach.
I am not at all suprised to see you on the side of child labor, monpolies and crapping on the environment.
And yours sounds oddly unpatriotic. Your $2 savings that you value so much could be used to employ an American worker and thus have a ripple effect in our economy. In your theoretical world you would invest the $2 saved in U.S. productive enterprises. But in the real world you'll just spend it on more Chinese crap.
The bottom line is your approach is just rationalized laziness. It's easier to buy all your crap at Walmart in one trip rather than take the time to find smaller businesses that sell American made goods. The rest of us will make up for the lost tax revenue as you slowly squeeze Americans out of higher paying jobs.
For every dollar we import from China, we export about 15 cents. With Mexico the dynamic is for every dollar we import, we export about 75 cents.
Its not perfect, but it is FAR better.
If China stops their currency peg, and other forms of subsidies, then their prices will be at least on par with Mexico. When you take into account geography, Mexico will be a FAR better investment. We get cheap stuff AND we export, unlike now.
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