Anarcho-capitalism

I apologize for missing the weekend — my laptop went poof and I wasn’t able to get it all up and running again until this morning. Guess it is time for a backup plan.

The Houston Chronicle has an article on Wal-Mart and Capitalism. The author discusses the book The Wal-Mart Effect by Charles Fishman. Fishman, as the article author puts it, argues that Wal-Mart’s power and scale hurt capitalism by strangling competition.

I tend to disaree, and I’m a big supporter of Wal-Mart in many ways (although I don’t tend to shop there myself).

First, let’s look at how Wal-Mart is anti-capitalism:

1. If they use their power to keep a percentage of sales tax that they charge their customers.
2. If they use their power to modify zoning laws that other businesses can’t modify.
3. If they use their power to subsidize any product with tax dollars or penalize any products with government mandates.

Let’s look at how Wal-Mart is pro-capitalism:

1. When they lower prices through voluntary persuasion, which gives everyone more money in their pocket. For every US$10 you save on cheaper salmon, you have US$10 more to spend elsewhere.

2. When they offer a community a selection of products that they otherwise wouldn’t have had based on their other retailers.

3. When they offer a community a selection of less expensive products that they otherwise wouldn’t have had based on their other retailers.

Many opponents of Wal-Mart denounce the wages of the super retailer, but I was very surprised at what upper management can make at a store. In a store local to me, I couldn’t believe what some of the employees were taking home in benefits and salary. I think the wages that are being compared are likely for entry level workers, and if you can stick it out, your wages go up significantly from that point.

I’m not sure we can say that Wal-Mart is evil. What they are doing is bringing the latest products to the masses at a price the masses can afford. Sure it can hurt the specialty businesses, but so does the Internet — especially considering the sales tax penalty local businesses have to suffer through. I’m amazed at how many anti-Wal-Mart advocates openly embrace the Internet for retail purchases, considering the impact the dotcom retailers have on brick and mortar stores.

For me, I’d like to see more every-day items go down in price. The less I spend on toothpaste and toilet paper, the more I can spend on technology or even on paying my employees more competitively.

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