Cheap labor? Check. Communist? Stalinist, actually. Incredibly repressive regime that starves it’s own citizens? Sounds like love. After all, what self respecting capitalist company could ask for more? Via Wal-Mart Watch:

American consumers could shop for their favorite pair of jeans or T-shirts with “Made in North Korea” labels at Wal-Mart stores in a few years, if North Korean officials get their wish.

But there are several hurdles, including complete and verifiable denuclearization, that Pyongyang would have to clear before the Stalinist state can develop business ties with America.

North Korean officials are reportedly interested in signing a deal to export textile products to Wal-Mart, a U.S. corporation that runs a chain of large, discount department stores, Radio Free Asia (RFA) reported Friday.

I notice that all this says is that North Korea wants Wal-Mart, not the other way ’round. At teh same time, it appears that Wal-Mart hasn’t denied the story yet either. Perhaps they’re just playing coy.

Has Wal-Mart waited too long to roll out its upscale boutique food market model? I mentioned yesterday that public relations gaffe of tagging the Marketside stores as the place for fresh and delicious food and the highest level of customer service.

With sales down at the cheap fast-food chains, does Wal-Mart really think all those formerly affluent shoppers will frequent these stores?

From the Reuters:

Wal-Mart Stores Inc. is now hiring store managers to work at Marketside, new smaller format stores the world’s largest retailer is preparing to open in Arizona.

And from the Marketside website we learn:

My favorite line is:

Marketside associates are enthusiastic people with a passion for fresh and delicious food! We are looking for candidates with superior customer service skills and who enjoy working in a team environment.

And all the other Wal-Mart associates don’t?

Wal-Mart is building, but will the customers come?

Jeff Hess: Have Coffee Will Write.

According to the Financial Times: Wal-Mart says it will be pursuing a “passion for fresh and delicious food” and “the highest level of customer service” in small neighbourhood grocery stores – its first new format for a decade. And in it’s other stores?

This is a classic public relations gaffe. By implying that its Marketside stores would be in someway special, it raises the question of why these stores have to meet some higher level of service and quality.

Could it be because the customers for Marketside aren’t the typical Wal-Mart demographic? Is Wal-Mart owning up to it’s double standard?

Not that a double or triple standard is bad. Corporations have practiced market stratification for decades. General Motors and its auto lines — stretching from Chevrolet to Cadillac — is a perfect example. But both a Chevy and a Caddy ran; they both got you to where you wanted to go, the more expensive model just carried you to your destination more comfortably.

That’s a tough distinction to make when you’re talking about fresh and delicious food or a highest level of customer service.

How fresh and delicious is the food you buy in a Wal-Mart superstore? What level of customer service do you get from a Wal-Mart manager?

Jeff Hess: Have Coffee Will Write.

From TMZ (sometimes I can’t believe what I read for the benefit of this blog):

NFL superstar Andre Johnson claims his charity got stiffed by Wal-Mart — it all involves water and ice. Yes, ice.

Johnson ordered 750 bicycles to be given to underprivileged kids at an event sponsored by the Andre Johnson Foundation — in return for the purchase, Wal-Mart agreed to donate water and ice for the May 3 event.

But there was a problem with the order, so Johnson ended up buying fewer bikes than planned. Wal-Mart countered by not giving the water and ice as promised. That’s cold.

Gee, I wonder how many of Wal-Mart’s other charitable donations attempts to get people to forget about their labor and sourcing policies are as calculated as this one seems to have been? Come to think of it, does Wal-Mart do anything that’s not this calculated?

This study finds that the lowest paid workers get the biggest benefit from unionization compared with others in a similar job that is not unionized.

The Union Wage Advantage for Low-Wage Workers

Using national data for 2003 through 2007, we estimate that unionization raises the wages of the typical low-wage worker (one in the 10th percentile) by 20.6 percent, compared to 13.7 percent for the typical worker (one in the 50th percentile), and 6.1 percent for the typical high-wage worker (one in the 90th percentile). The traditional statistical approach applied to the same data produces an estimate of the average union wage premium of 11.9 percent, which is substantially lower than the union effect on low-wage workers (20.6 percent) and somewhat below the effect for the median wage worker (13.7 percent).

Since the vast majority of Walmart workers fall in the lowest wage categories the effect would be dramatic. Keeping information like this from workers is thus vital to Walmart. Propaganda seems to work best on those who are most adversely impacted by misinformation.

While the gnomes and Wal-Mart’s share holders are doing Snoopy happy dances over the boost in profits from the rising misery of recession in America, but now Wal-Mart has chosen this moment to boost it’s sales of pet food because kids and pets are recession proof?

It’s enough to make you eat cat food.

From CNN Money:

Eduardo Castro-Wright, CEO of Wal-Mart Stores U.S.A., recently told a gathering of analysts that the $43 billion pet products category was “going to be a big investment for us this year.”

Castro-Wright proceeded to show a few slides illustrating how Wal-Mart is “redefining” the pets business in its stores, including repositioning pet food and supplies right in front of its other fast-growing business, baby products.

There lies the connection, according to retail industry experts, who point out that kids and pets tend to be fairly recession-resistant businesses.

Even in a recession, dogs will be fed and kids will get their toys, said Stevan Buxbaum, analyst with retail consulting firm Buxbaum Group.

Got to make sure that even those Shar Peis from affluent households get their cheap poisonous kibble crap from China.

Jeff Hess: Have Coffee Will Write.

How do you really feel about Wal-Mart? Here’s your chance to express your true feelings — pro and con — about the world’s largest retailer. Write whatever you like in the comments section and engage your fellow readers in the conversation.

Jeff Hess: Have Coffee Will Write.

There’s a reason that politicians don’t pay a lot of attention to economists; they’re a lot like expert witnesses in civil suits, you can shop around and find one who will swear that your point of view is the right one supported by tons of empirical evidence.

So I’m not surprised with the battling headlines in the financial news this morning.

Wal-Mart profit rises 6.9 pct on strong sales

Or,

Wal-Mart 2008 outlook cautious and down we go

The important point here is that for the family clutching at straws as our recession deepens and gas prices skyrocket, the gnomes are irrelevant. I’m predicting that in the run up to November the only mantra will be (once again): It’s the economy, stupid!

Jeff Hess: Have Coffee Will Write.

I was over visiting Check Out this morning to see if any of those busy Wal-Mart buyers had bothered to blog in the last week (they haven’t) when I noticed that Rand’s “Wal-Mart hates rBST” post was up to 246 comments. 246! I actually started reading them all, and you know what? The commentators aren’t all Monsanto shills. Some of those self-proclaimed “dairy farmers” actually make sense.

Don’t get me wrong. I support Wal-Mart’s decision to take rBST out of the milk supply. However, to call this decision one towards sustainability is absolutely ridiculous. rBST increases milk production per cow. If each cow makes more milk we need fewer cows. If cows produce less milk per cow, supply drops and prices go up. Not only that, we get more cows belching gallons of methane into the atmosphere each day. Here’s my favorite comment along these lines:

Let me tell you about my PSP. I am a twenty year practising Dairy Nutritionist. My daily Personal Sustainability Practise is to try to keep my dairy producer clients profitable after their milk production of their diary cows has dropped twenty percent or more, because they all signed legal documents that they would not supplement their cows with manufactured rBST after December 31st, but their feed and fertilizer and fuel costs have doubled in the last twelve monthes AND their cows are still eating the same amount of food! That is a tremendous loss of sustainability to use to try to feed the world while Walmart marks up the price of milk to increase profitability, as you pass off this action as sustainability!!! It makes my blood boil!!!!

The farm system in America is a complete disaster. Wal-Mart, as powerful as it is, can’t fix it by itself, but it can exploit the problem under the guise of sustainability. However, more cows = less sustainability. It’s really as simple as that. Wal-Mart can’t say, “Your milk stinks, buy the more expensive kind,” (even though it does) so they send out a dog whistle that only people who care and can afford to respond to can hear.

I say: drink soy milk instead. It’s better for your health and is the real sustainable alternative.

Via Wal-Mart Watch:

Wal-Mart made it to Keith Olbermann’s “Worst Person in the World” last night for its slow response in the case of Jim and Debbie Shank. Despite Wal-Mart’s recalcitrance, the case is once again moving forward and the trust in question should be transferred to Jim Shank soon.

Tomorrow, however (since Keith was talking last night) actually means today. Gee, I wonder if Wal-Mart is going to do a press release when it’s done? I won’t hold my breath.

From Reuters:

Wal-Mart Stores Inc, the world’s largest retailer, reported a 7 percent rise in quarterly profit Tuesday as discounts drew shoppers looking for bargains on necessities like food and pharmacy items.

While Wal-Mart said the year was off to a “solid start,” it indicated results for the current quarter could miss Wall Street estimates because of higher transportation costs and customers who are running out of money between paychecks.

“Customers are faced with results of a tougher economy, higher gas prices, food inflation and the increase in the overall cost of living,” said Eduardo Castro-Wright, head of Wal-Mart’s American operations, on a recorded call.

“The ‘paycheck cycle’ is more pronounced as things get tighter for customers toward the end of the month,” Mr. Castro-Wright said.

Wal-Mart shares, which through Monday were up 22 percent year to date, fell 3 percent in early trading.

This is not good news for anyone.

I’m not a coupon clipper. I’ve tried in the past, but I very rarely ever see a coupon for something I’d actually buy, so the whole clipping obsession doesn’t work for me. But for some people, coupons are a religion and they’ll go to great lengths to redeem them.

Alyssa deserves a medal.

From Keeping the Kingdom First:

This from reader Shawna:

“So, I took my internet coupons to Wal-Mart today and they were refused. I am NEW to internet coupons, but this is ridiculous. So…instead…I shopped at Kroger and at Tom Thumb.”

Do you hear that, Wal-Mart? You lost a customer!

I agree, Shawna, this is ridiculous! And this is not the first time I have heard this, either. You have probably read about my Wal-Mart frustrations, however, I have NEVER had a coupon refused!

So… I am asking you, frugal friends. Join with me and take a stand against Wal-Mart’s inconsistent and discriminatory coupon acceptance policy. It must be the same across the board, period.

And Alyssa is serious.

May 3rd - New to couponing…I took my Internet coupons to Wal-Mart today and they were refused. I am NEW to internet coupons, but this is ridiculous. So…instead…I shopped at Kroger and at Tom Thumb. I used printables…I got the majority of the coupons from coupon bar and coupon bug.

May 10th - I went to Wal-Mart to pickup the All You magazine. You might remember that last week I had an unfortunate experience at Wal-Mart (which is NOT my favorite store because I used to work there years ago and know how the run the place). My Internet coupons had been refused. But, I spoke to a manager today and was ASSURED that they would take my Internet coupons.

May 12th - I spoke to a manager at the Arlington Wal-Mart this morning and also contacted Wal-Mart customer service to let them know the issue I have been having with my ‘electronical’ coupons. I have been assured by both the manager and corporate Wal-Mart that the company’s policy on Internet coupons will be reviewed with the front-end cashiers and supervisors of this store and that they appreciate my call.

Note to Wal-Mart: women who clip coupons are serious; you do not want to mess with them.

Jeff Hess: Have Coffee Will Write.

From a review of the new book Gross National Happiness by Arthur C. Brooks (not surprisingly, in the Wall Street Journal):

He challenges those partial to tales about long-suffering Wal-Mart workers and surly burger flippers to rethink their victimology creed. The woe is not nearly as widespread as rumored: 89% of Americans who work more than 10 hours a week are very satisfied or somewhat satisfied with their jobs while only 11% are not very satisfied or not at all satisfied. Most surprisingly, Mr. Brooks writes, there “is no difference at all in job satisfaction between those with below-average and above-average incomes.”

I have an idea to test this theory: Let’s set up one of those medieval carnival days where the peasants hourly associates at Wal-Mart all become the lords of the manor and the masters executives in Bentonville all become peasants hourly associates.

What kind of resentments will surface? Who do you think will be more resistant to switch back?

A story about a bank failing in Bentonville, Arkansas, really has me scratching my head this morning. It could be nothing, pure coincidence, but I have to scratch my head a bit in light of a post from a clearly left-leaning blog that ties:

First, Chinese companies refusing to do business in U.S. dollars;

Second, Wal-Mart scaling back of new construction and;

Third, the failure of the Arkansas National Bank.

From World Prout Assembly:

Over 700,000 Chinese exporters/manufacturers are now refusing to accept U.S. dollars as payment for products for retail sales. Wal-Mart’s on-shelf stock numbers have been significantly reduced. Merchandise quality is now marginal to bad and in many cases becoming unavailable as prices skyrocket with broad spectrum factors coming together to create an uncomfortable sales environment. Wal-Mart’s total overhead is becoming unsustainable we believe.

And.

For the past four months, Wal-Mart has been canceling almost all of their (major) corporate projects into the future. We know the magnitude of Wal-Mart’s financial dilemma directly from its internal (attorney) legal “dropped project memos” and “Real Estate Committee reapproval memos.”

And.

Federal regulators says they’ve closed ANB Financial National Association banks after discovering “unsafe and unsound” business practices there.

David Barr, a spokesman for the Federal Deposit Insurance Corp. says many customers served by the bank’s nine locations had accounts under $100,000, which will be fully insured by the government. Barr says customers can continue to write checks and draw money from ATMs through the weekend.

Barr says Pulaski Bank and Trust Co. agreed to assume control over ANB Financial’s bank locations, which will be open Monday.

Conspiracy theories are always fun, but is there a kernel of truth in all of this?

Jeff Hess: Have Coffee Will Write.

I put together an essay about the effects of unions on earnings in the US awhile back, part of the data I included had to do with the relationship to union membership as a fraction of the workforce (called union density in the trade) compared with other measures. Here are some of charts which support the basic thesis cited in Jonathan’s posting.

The first is union density vs earnings. Red is weekly wages, blue is density. One can see that the wage stagnation started as density dropped. The lag is to be expected since existing contracts remained in force as membership dropped.

The second is union density vs family income. This is slightly different because there has been a shift to the two income family over the period. As a consequence income has increased while wages (especially for working class men) have declined. Working class men were the primary members of unions during the period. Red is union density.

The last compares ratio of wealth of the top of society to the bottom (black) vs % non-union across countries. Those countries which still have a high level of union membership also are more equitable.

Most of the conservative pundit class in the US ignores the experience in other countries, this is especially true of the libertarians who misunderstand the concept of “freedom”. In a democratic society people are “free” to come up with rules that control policy, even if it means that some can’t do exactly as they wish. The opposite is not “freedom”, but anarchy. It seems that most opposition to unions is based not on rational economic judgment, but is a combination of the ego mania of the owners and unbridled greed. This seems especially true in the case of Walmart. Their policies are a throwback to the worst excesses of the first Gilded Age. The need for total control by the Waltons is so strong that they are willing to sacrifice economic efficiency, trash the good will that Sam Walton had created and leave themselves open to unending legal challenges just so that they can demonstrate who is the boss. This way lies madness.

The way firms like Toyota keep unions out in the US (even when the firm is heavily unionized in Japan) is by making working conditions and compensation generous enough so that the workers have little to complain about and the unions don’t have much to offer as a consequence. I should add that this may be changing as these firms start to mature and their working force is getting older. Young workers don’t think as much about health care, retirement and job security as do older workers and all these areas can potentially raise costs without improving productivity.