T Nation

Leftwing Anti-Wal-Mart Bias


#1

Very apparent in the reaction to Wal-Mart's push to offer generic drugs -- and I don't really need to point out what this says about how easily bias creeps in to news coverage...

Why Can't We Have a Better Press Corps?

Kathleen Day's article in the Washington Post ( http://www.washingtonpost.com/wp-dyn/content/article/2006/09/21/AR2006092100400.html ) on Wal-Mart's plan to offer a $4 price for many generic pharmaceuticals is a classic example, practically a caricature, of anti-market, anti-big-business bias. Here with emphases added are some choice quotes from the front page article:

[i] Retailing giant Wal-Mart Stores Inc., known for forcing prices down to dominate nearly every market it enters, said yesterday that it would sell nearly 300 generic drugs for $4 per prescription...

Using its might as the nation's largest retailer and its legendary ability to force suppliers to cut prices to the bone, the company will begin the $4 price program in its 65 stores in the Tampa area today...

...the program has the potential to transform the $230 billion prescription-drug business the way Wal-Mart has transformed other industries, including groceries and toys, where its aggressive pricing has forced some competitors out of business and allowed it to dominate entire categories of merchandise.[/i]

In the entire article there is not a single positive mention from the reporter of consumer benefits or Wal-Mart productivity. It's not until inside the fold that you even get a hint of consumer benefits and then it's in the context of an absurdly biased attack on Wal-Mart.

Wal-Mart executives, criticized by labor unions and consumer groups that say the company shortchanges its employees on pay and health care, said they started the program to help families and retirees, especially those on Medicare.

The only thing missing is how Wal-Mart executives achieve their legendary efficiencies by eating small children for breakfast.

For comparison the AP story ( http://www.nytimes.com/aponline/business/AP-Wal-Mart-Health-Care.html ), written by Mitch Stacy, covers the same angles but without bias or rancor and it's better written. Here's the first sentence:

Wal-Mart, the world's largest retailer, plans to slash the prices of almost 300 generic prescription drugs, offering a big lure for bargain-seeking customers and presenting a challenge to competing pharmacy chains and makers of generic drugs.


#2

The argument about what type of market is best, especially for the middle and lower classes -- having a) a market dominated by one player that offers lower prices through economies of scale or b) a market with many small players who have to charge higher prices (since they do not have the benefit of economies of scale) -- has been going on for decades.

It is easy to simply focus on the price to the consumer and pick the former. I mean, the price is what matters, right? And what is more democratic than lower prices, right?

Unfortunately, things are much more complicated than that. Sure, it's nice to have $4 a pop generics, as it is nice to have $10 DVD players, but the thing is that is simply hiding the problem; it creates a smoke-screen hiding the larger issues, and in fact they augment them.

There is no such thing as a free lunch. Having Wal-mart essentially competing unfairly -- economies of scale create that unfairness, in the sense that they create barriers to entry than even the most determined entrepreneur can't go over -- are very, very bad in the long run. They reduce choice as both consumers and workers; they open the door to large-scale corruption; they create -- or worsen -- social-economic problems -- like our dependency on China and on illegal immigrants -- while only providing a band-aid: do poor people really need a cheap DVD player, or should they spend those $10 on a decent meal (as opposed to a McD Dollar Menu item)? Should people without health insurance have yet another excuse not to have one?

It boils down to this: short-term vs long-term. And Wal-mart basically represents the ultimate choice of "nice" short-term benefits with huge, very, very bad long-term costs.


#3

1) Where is Wal-Mart getting these $4 generic drugs? (hint: starts with C, ends with hina). Who benefits from this arragement?

2) Is my pharm insurance provider going to insist that I go to Wal-Mart to buy generic drugs from now on? If I buy the same generic drug from the Safeway pharmacy that's on my way home will it still be covered? Or will I need to drive 15 miles out of my way to fill a script at Wal-Mart?


#4

Ok I am basically conservative, but I despise Wal-Mart with a passion. I don't trust them. They offer cheap stuff at cheap quality. Most of there stuff is made in China, which ticks me off. I am very patriotic, and therefore only buy things made in the USA.


#5

When the first Wal-marts opened in my town,they were one of the only places that had American made products.Then after Sam past on,you couldnt find hardly any American products.I guess his already rich kids,became GREEDY!!


#6

Butr doesn't that drive a stake in the heart of the evil drug companies? Isn't that what all good liberals want? To criminalize the sickening profits made by the domestic pharmaceutical industry?

At 4 bucks per - why have a prescription drug card anyhow? That's just putting money in the evil insurance companies' pockets.

[/quote]


#7

Wal-Mart is unfair because they are so succesful that they form a quasi-monopoly?

Mwuahahahahahahahah!!!!!

Yeah, those mean motherfuckers that give people exactly what they want for prices they can afford.

Hspder I refuse to take what you wrote seriously, that must have been meant ironic...


#8

No, that means that times have changed an a lot of goods that were produced cheaply in the US are now produced in China.

Expect that to go on until China and India have a comparable live style to the US, weather that means theirs rises or yours drops.


#9

Indeed, the argument has been going on for a long time. One would think that would make it quite easy for a newspaper to write a balanced news story that portrayed both sides of the issue.


#10

No, see what you don't realise is that EVERYONE who makes large amounts of money is evil.

The benefits package is one thing, there people may have a legitimate point; but the main grievance against walmart seems to be that they are very good at what they do. It's kinda fucked up when a company is evil merely because they do a better job than their competitors.

I'm not gonna even argue about the buying of stuff from China or using illegal immigrants; it suffices to say that I think everyone deserves a fair shot to make a buck, just being American doesn't mean you have a divine right to more money than people in other countries.


#11

For all the whining about its disdain for "fearmongering!!", the Left is in constant need of a boogeyman.

I never go to Wal-Mart - their "Just In Time" inventory basically translates into nothing more than a crapshoot on products when you go in there - but it serves the needs of many people who go from paycheck to paycheck.

Would it be too much to get a journalist to provide a balanced viewpoint? Of course it is too much - ever since the media decided its job was to 'speak truth to power' rather than to just 'speak the truth', we have been the lesser for it.


#12

So, you believe monopolies are good?

That reminds me of a question I wanted to ask you: why is it that Austria seems to have such a disproportionably high number of libertarians like yourself? Seriously -- the percentage of people in your country who subscribe to libertarian beliefs (like you) is much, much higher than anywhere else in the world, including the US. You also seem to have way more non-Keynesian economists than anyone else (they're a dying breed everywhere but there). Why do you believe that is so?

This is a very serious question, by the way -- no rhetoric, no joke.


#13

Of course not -- but anyone who enters this country without following the rules DOES NOT have the right to make money here; that is the law, you know.

I am all for immigration -- but legal one. Starting your life in a country by breaking the law every time you get paid is definitely not a good way to start.


#14

If monopolies can exist in a free market they are are a great thing. WalMart must do a great job.

I have no problems with monopolies if they are the result of excellence instead of government intervention.


#15

God I hate to agree with a Euro - but this thinking is dead fucking on.

Now if you will just give up your fascination with cradle to grave governmet care - you could be a conservative. An america hating conservative - but a conservatie nonetheless.


#16

The problem with monopolies is not the monopoly in and of itself, it's the abuse of the power granted by the monopoly (such as Microsoft using it's OS monopoly to crush competitor Netscape's browser) that can become a problem.

Lack of incentive to provide a better product to consumers is another, lesser, problem of monopolies.


#17

Where do you from get that I am a fan of the Swedish way of live?

Living in a semi socialist system however made me a big fan of free education (up to and including college) and free basic healthcare.

Level playing field = good.

Plus, I would never be a conservative, more like a slightly left leaning libertarian.

I try to be left from most Democrats on social issues and right from the Republicans on economic ones.

This way I piss off the most people with the least amount of effort.

PS: our welfare system is collapsing anyway, I think I?ll start a thread on this.


#18

As far as I know the Austrian school of economics is alive and well, not only here but also very much in the US.

We flirted with Keynesianism under 30 years of Socialdemocratic rule and they never got around to paying the money back they pumped into the economy when it was weak.

They also, and this probably answers your question concerning Austrian libertarians, made it almost mandatory to belong to one of the two great parties if you wanted to make a career in the government or state owned enterprises (which included large parts of the heavy industry sector), television, radio, school, universities, art or anything else except pivate businesses which were heavily regulated.

If you are even a bit of an independent thinker and see how collectivism from the left and the right creeps into every fucking nook and granny of public and privat life you tend to start to dislike it.

That was also the reason for Haiders success that was never understood outside of Austria, it was either voting for him or voting for the status quo that had become unbearable.


#19

Most people who find WalMart "evil" do it because they represent what is wrong with globalization.

To massively import goods from china is not a "smart" thing. It's also a disregard for western beliefs. I find it funny Orion mentions free education (which is a great thing) . Only that because of "evil" globalization we -Germans and Austrians- won't be able to afford it any longer.

It's [i]crazy[/i] that we feed systems (China) that are the exact opposite of what we stand for (freedom of speech, social insurance, trade unions) via WalMart.


#20

Alive, yes. Well, no -- currently absolutely no government on the planet is using policies based on that school of thought, and its mechanics have been disproven so many times it's not even funny anymore.

It's based on fairytales... It is only alive because people still want to believe.

True. But that does not mean Keynes was wrong. It just means people are incompetent and short-sighted. No news there. The problem is that by proving that people are incompetent and short-sighted, it also proves that laissez-faire capitalism would be even worse, because it gives people free reign to be incompetent and short-sighted to an even greater scale.

That was my impression too. I'm very sad to hear that -- the only thing that pisses me off more than an incompetent government is an incompetent social-democratic government. Apparently they somehow forgot the "democratic" part. It's sad, really.