Wal-Mart customers voice concern for the low wages of the megastore’s employees, but they’re not willing to pay higher prices to help solve the problem, according to a revealed-preference experiment conducted Monday by investor and economic pundit Peter Schiff.
Schiff — known for his forceful, generally negative commentary on the state of the U.S. economy and the outmoded pro-inflation Keynesian economics that undergirds its paper money system — tested out public sympathy for the plight of Wal-Mart workers by asking shoppers to pay a 15 percent surcharge on their shopping bills.
None of the customers buttonholed by the noodgy but entertaining gadfly were willing to pay more, though Schiff claimed to be prepared to accept cash or credit payments for his “15 for 15” program. (That is, a 15 percent price hike for a guaranteed $15 per hour wage.)
Several shoppers seemed to accept the basic premises of competition, value theory of labor, and supply and demand. One noted that a hike in Wal-Mart’s prices would simply drive shoppers to other outlets, while another said, “I work and nobody gives me any[thing].”
Others preferred not to resolve the tension between supporting higher wages and balking at higher prices. One man warned that discussing higher prices would scare people and advised Schiff, “Just say ‘higher wages'” — growing angry when Schiff refused to accept this simple economic principle.
The Bentonville, Arkansas-based retail giant is a lightning rod for left-leaning opponents whose criticisms get elite circulation but never seem to catch on with the masses. The Los Angeles Times won a Pulitzer Prize in 2003 for a lengthy investigation of a devastating “Wal-Mart Effect.” The documentary “Wal-Mart: The High Cost of Low Price” received critical raves in 2005. There is a Wikipedia page devoted to criticism of the chain.
This summer, Wal-Mart was targeted for a nationwide series of protests that apparently drew only 50 actual employees of the store. (RELATED: Wal-Mart mocks union walk-outs)
At the start of this year’s Christmas shopping season, organized labor planned a wave of strikes at Wal-Marts around the country. (RELATED: Black Friday union strikes against Wal-Mart likely to fizzle)
These worker actions fell well short of expectations, though retail sales have been consistently bad since the start of the holiday shopping season in November. (RELATED: Remember the ‘massive’ Wal-Mart protests promised for Black Friday?)
Though people all over the world object to paying more for less, central economic planners are concerned that inflation is not high enough. In a front-page story Wednesday, The Wall Street Journal reports that central bankers are fearful of “low” inflation and taking steps to prevent deflation (a reduction in prices and the cost of living).