New Orleans              

In the current fight in New York City an oft cited study that buttresses the case for coupling public investment in private development with living wage improvements on such projects was written by T. William Lester and our old friend and comrade, Ken Jacobs from the University of California at Berkeley’s Center for Labor Research and Education.  The study, “Creating Good Jobs in Our Communities:  How Higher Wage Standards Affect Economic Development and Employment,” put together a list of cities that had enacted “business assistance living wage” ordinances and created a database to compare them to a similar set of cities to determine in a unique way whether or not cities had hurt their growth and job development with such policy initiatives.  The cities  had a good dose of California in them, not surprisingly, but also included a good smattering from around the rest of the country, making the work truly national in scope.

The results contained good news for all of us who have advocated and organized for such policies to be enacted in our cities:

“Economic development wage standards are one tool that a city can use to create jobs of greater quality. We have compared two sets of cities in order to assess the effectiveness of such laws—those with enforced business assistance living wage laws and those without—and found that there is no loss in the number of jobs due to the living wage requirement. It appears that, even during hard times, economic development wage standards are an effective tool for increasing wages in a city without sacrificing the number of jobs.”

This work builds on the path breaking work done by Dr. Robert Pollin of the University of Massachusetts at Amherst that had established in Los Angeles and later, working with ACORN in both New Orleans and Florida, that the any adverse impacts were at worst negligible, and at best wildly positive.  Walmart ran from ACORN’s big-box proposed ordinance in Chicago in 2006 which would have coupled business assistance with their development and pulled up stakes in Sarasota, Florida when we won an ordinance requiring living wages on such developments in that city, but these studies seem to conclusively argue that they simply left money on the table, rather than allowing cities to develop in equitable and sustainable fashion.

With the first hints emerging that we may be coming out of the recession, we need to dust off all of these reports and initiatives and move more aggressively to reassert these agendas in North American cities and around the

New Orleans             

In recent days the India the FDI Watch Campaign has indicated to me that they believe the government will be forced to suspend their announcement of the FDI modifications in multi-brand retail.  Our default position for years has been to point out to the government that even when FDI in retail has been modified in other countries, it has often been done over lengthy timelines, like the 10 year rollout in China.  Countries that have moved too quickly, have always paid huge prices in terms of domestic discontent and marketplace confusion.

Watch this story.  This is a political fireball in India that could scorch the government and everything in its path unless finally our demands are heard and time and due diligence are provided for existing business, communities, and workers.

            New Orleans              

All of which found me very interested in reading line by line the article by Orville Schell of the Asia Society in the December 2011 issue of The Atlantic entitled, somewhat ominously, “How Walmart is Changing China and Vice Versa.”  I can’t recommend the piece too highly, though I know full well you won’t read it, which is why I’ll share the highpoints here.

Schell did extensive travel and research in China, including talking directly to customers and others as he tried to get his arms around the fact that Walmart presents itself – and is seen! – in China as having a “social conscience” compared to its hard earned and abysmal anti-worker anti-community reputation in the United States.  The most vivid contradiction explored in the article was willingness to be an environmental leader in China both in terms of what it offers in the stores and how it manages its business and suppliers.

A significant and missing piece in Schell’s analysis in my view was his failure to detail how “clean and green” the Walmart’s distribution center operation was in China, which is widely recognized as part of the core logistical success of the company (and where it has spent the last several years in India working to support its partnership with Bharti before the FDI modifications) and also widely thought to be the most fuel inefficient and unsustainable of all of the company’s operations.  Many analysts have often argued, correctly in my view, that Walmart isn’t committed to the environment at all, except in the most superficial marketing sense, but recognize that its fundamental business model cannot survive future fuel and transportation costs necessary to support its distribution and logistics system.  Walmart desperately needs to cut environmental costs by 20% from its suppliers in order to offset a severely damaged model.  Regrettably, Schell does not look at the “farm to store” distribution and logistics and its support of “factory farming” and “monoculture” farming.  I don’t understand enough about the Chinese cooperative farming system, which may have made this easier for Walmart, but in India, the land of very small and marginal farmers, this issue is huge.

Schell comes to believe that Walmart is sincere in China in no small measure because his discussions with international environmentalists and Chinese non-governmental organizations convince him that close observers believe they are sincere.  I want to believe Schell and his sources are correct, but this also makes me wonder why Walmart is not a better leader in these areas in the rest of the world.  If the answer is that Walmart is better in China, because the Chinese government – and recent consumer panic on foods in that country – have made it better, then why are other governments (can you hear me USA and India?) doing more to make them what they should and could be.

Intriguingly, Schell is no patsy.  He makes the case that China is in some ways “playing” Walmart as a soft paw for governmental policies that might have been more difficult to implement without its compliance, arguing that “inWalmart, the Chinese government has found a source of public education, control, and regulation – at no extra public cost.”

The summary from Schell doesn’t equivocate and makes it clear that, even missing some key issues, Schell was not snookered:

“…the efforts they are making are influencing not only their suppliers, but other businesses as well.  Now Walmart is acting something like a private regulator.  Nonetheless, the nature of their outsourced business model is not, ultimately, sustainable.  But,” he [Edward Hume author of an upcoming book on Walmart and China] says, laughing at the irony of what he is about to say, “we have created a situation where crazy-sounding things make sense.”  In fact, one could say the same thing about Chinca, which – after so many decades of defiant proletarian opposition to capitalism, consumerism, and American imperialism – has embraced the American-style market and is ardently following the Walmart path to prosperity.  Indeed, allowing, even encouraging people to consume as much as they want, or can, has become one of the Chinese Communist Party’s key strategies for political legitimacy and social stability.  Party leaders may label their version of development “scientific” or “sustainable,” but it’s still development.  The bitter reality is that even if unrestrained consumerism becomes less environmentally destructive per unit of production than it was in the past, it is still unsustainable in the long run.   So even as this most innovative of corporate and statist green strategies may represent an environmental breakthrough and good business for Walmart, and good politics for the Chinese government, it may nonetheless end up being very bad business for humankind.

Amen!  And, beware!

Kingston    

In recent communications with their workforce (“associates”), Wal-Mart lowered the boom by eliminating any access to healthcare insurance for any worker averaging less than 24 hours per week – and from our experience that would be a vast majority of their 1.4 million workers!  Additionally for employees who remain eligible the costs went up marginally on a weekly basis but the co-pays and deductibles went through the roof, sometimes moving from $1000 to as high as $5000.  Under the new Wal-Mart plan if you smoke, you croak.  Any admitted smokers would be required to pay additional huge premiums.  Other incentives that Wal-Mart (and may other large corporations) had supported to encourage coverage or savings for health care were substantially reduced or eliminated.

Wal-Mart’s argument was straightforward and simple:  it’s their economy, stupid!  Premiums had gone up and their profits were flat in the recession, so it’s so long, Charlie, and goodbye.  Will it hurt their workforce?  Hell, yes!!! Was that a factor, hell, no!  The company, which had been glad to herald its expanded coverage several years ago (though we questioned the veracity of their reporting!), now was very close mouthed about how many people were affected and how many would remain covered and actively insured.   Relatively speaking, I would bet from our experience that the numbers would plummet to less than 10% of the hourly, non-supervisory workforce, though Wal-Mart is always slick about the way it merges the salaried and supervisors into all figures about average wages and healthcare coverage.

Greenhouse indicated that some of the material on this change was supplied by OUR Wal-Mart (Organization United for Respect at Wal-Mart) and was clear that part of the original “reform” by Wal-Mart had been the result of widespread labor and community pressure, but it seemed to me that the company was once again reminding all of us how transient our efforts had been in the past and how irrelevant current programs like OUR Wal-Mart are to them in their current calculations.  Those of us who worked to organize Wal-Mart in recent years at least liked to try to rationalize all of our work by hoping that we had created the leverage that had led to some reforms, even if we thought the leverage was sold short and stubbed out when it could have yield more dramatic results.

An advocacy and communications campaign with a company as large as Wal-Mart certainly has some value, and ACORN International continues to aggressively and substantially support the work in India of our India FDI Watch Campaign which has kept Wal-Mart and other big box retailers bottled up and at bay on their expansion efforts in this huge market, so we understand why it is important.  Nonetheless Wal-Mart seems not to mind rubbing our noses in the dirt and reminding us that without deep and permanent organization inside the company of their workforce, the rest is just public relations and politics to them, entered based on their will and exited at their whim.

For all of the smoke and mirrors, sound and fury, unless there is a sustained, permanent effort to create a viable and internally powerful workers organization at Wal-Mart, the worlds’ largest private sector employer, nothing will check the ability of this company to give and take away based on whatever it deems expedient.  That simply does not work for its workforce, and when the giant roars others will follow, so the big footprints of the company will be dug deeper by other large and small firms moving to curtail benefits and protections in the wake of this action.  The company cannot be organized “old school,” and the UFCW and others have not yet mastered how to mobilize the resources, support, and commitments to successfully create the infrastructure that will build organization inside the company for the long term.

Wal-Mart keeps throwing down the gauntlet and proving one generation of labor leaders after another that they have the staying power and that any deals with them are temporary and contingent.  It’s all about them and the devil take the hindmost.

We need to make a commitment to organize this company come hell or high water, and finally mean it, not for a couple of budget cycles but until the job is done.

Houston

Now more than a million women have to figure out how to individually collect on the sexual discrimination they have experienced at Wal-Mart.  The lawyers who have been handling this case for years (here’s to you, Joe Sellers!) stepped right up and said they would figure out a way, but there’s another dog in this hunt now that could bring this bear down:  the new Wal-Mart workers association, change at Wal-Mart or whatever we call the union!

This is the clarion call for a workers’ organization.  The chance to bring together women working at Wal-Mart now, along with women who have been there in the past, to move collectively through the myriad hoops standing between them and their money is the perfect scope for a union.  No one else has the nationwide network of people that could mobilize the lawyers and others necessary to represent all of these women.

One thing could easily lead to another.

In the end it such a campaign would cost Wal-Mart more both in penalties and lawyer fees.  What’s more it could finally be the bridge between all of these workers and their understanding of what a union does and why it is essential.

Time to make lemonade out of this lemon!

New Orleans

According to the Wall Street Journal our buddies Wal-Mart and Target had waged a huge war of their own to try and convince the Securities and Exchange Commission (SEC) to exempt them.  As we all remember Wal-Mart was somehow successful in its battle first for and then against healthcare reform to win an exemption from the provisions of that new act based on its slim pickings health plan currently in place.

The retailers association head whined that the SEC just didn’t understand the “supply chain,” which only means that they want the rule to be caveat emptor – the buyer beware rather than having to take any responsibility for how much blood might be on their hands and later wiped off not by them as the purchaser but by the consumer way down the line.  For a change the SEC held strong.

In another good play the SEC is requiring big oil to disclose how much they pay foreign governments for resource rights, hoping to bring some transparency to the global casino of bribery and corruption in the name of natural resources for developed countries at the rack and ruin of developing nations.  This is also very, very good news.

What’s up these days that we find out what’s going on diplomatic work seems mainly about business and we learn about it from Wikileaks and we can’t curb Wall Street or the banks, but their reform produces international victories?  We must be living in an era of the head fake and the sleight of hand, but for a change score one for us, rather than another for them!

New Orleans

This is all trending from blatant to bizarre.  The estimates of a settlement now range in the billions which is not surprising:  a million women workers each averaging only $1000 in the settlement would be a billon!

I’ve been wrong on this before.  Almost two years ago in a fit of optimism I wrote here that settlement might be imminent.  My bad!  I had forgotten one of the cardinal Wal-Mart rules:  it’s always cheaper to pay lawyers than to pay workers.

The company’s legal gambit seems to be that the “class” has too little in common, only the fact “of the lawsuit” and that “they are women.”  It’s hard to imagine why that isn’t more than enough?  The whole point is that they are women, and the company did them wrong.  Hello?  Are they just playing for time now?  Postponing a bad press day?  What’s up?  They can’t really be serious that they think the class is too big?  They should have thought of that before they paid women less, didn’t promote them, and rolled them out earlier than men.

Dukes is still working as a greeter for Wal-Mart even a decade after filing the suit.  Now there are going to be three women on the Supreme Court.

The waiting strategy is not going to work for Wal-Mart.

I’m liking Dukes’ odds now, because at a million to one, a million women against one company, I’m not seeing a way to lose at this point.

New Orleans

These debt-beats buy the debts at 5 cents on the dollar, and then assume that they can get more than their nickel back by hauling someone with a bill into court, where they usually don’t show and would virtually never have a lawyer.  As we discussed before, frequently that allows the collector to add on collection fees that may double the debt and interest charges on the whole shebang that can run over 25% of the debt.  If they are successful in getting a judgment to garnishee the wages, then they can bleed the poor working stiff for years, while the debt remains virtually unchanged.  This is the modern debtor’s prison:  soft walls, but no escape!

These computerized court cases file on little more than a name, social security number, and allegation of the debt owed with little or no detail on charges, fees, interest, or anything that might explain what and wherefore.  Tragically that is often more than enough to get a judgment, especially when there’s a no-show by the alleged debtor at the hearing.

North Carolina has passed something requiring more information.  A judge here and there has dismissed a claim because there was too little information.  None of this is enough.

This is a crises crying out for a movement!

Philadelphia

I was not surprised because part of the reason I had agreed to support the great work in Philly lay at the footsteps of a good example of the potential of majority unionism.  For several years JwJ here under its director Fabricio Rodriguez had been involved in the long, arduous process of supporting the building of an organization among the 175 security workers at the Philadelphia Museum of Art.  After several years the organization had navigated the obstacles for security workers in organizing and recently had transitioned to an independent union, filed, and won a representation election handily, and not surprisingly having already proven the organization at the workplace long ago.  Now, they challenges of bargaining away, but that’s another story.

Majority unionism is what I have called the process of changing the labor organizing paradigm to allow workers first (not employers!) decide they want an organization, build strength through direct membership and direct action, and using that power along with community and political leverage to win recognition and advances regardless of any other obstacles in law or habit.  This kind of strategy led to the huge success in our generation among informal workers (home health and home day care) which have added more than a half-million members in the last 30 years to the ranks of organized labor.  This is also the heart of the successful pilot we led in Florida several years ago to prove that Wal-Mart workers could be organized a different way.

The hard question asked by several of the union lawyers and reps in the room, was how do you make the organization sustainable over the time frame necessary to win?  This question was particularly important because the examples from home health care and Wal-Mart were based on more modest dues levels (in some cases only $10/month) than what many of them were accustomed to seeing in existing unions.  Certainly this had also been our challenge as well, and led to our independent union becoming part of the SEIU, and kept us from continuing the Wal-Mart Workers Association as an independent entity.

The answer I was too well mannered to give was that this question lies at the heart of the dilemma between being a union movement and an institutional structure.  The efforts among farmworkers, home care workers, and others – including what we are doing with ragpickers and cartoneros now – are rooted in deep political, individual, and organizational commitments over long time frames of sacrifice and struggle until victory is achieved.  These are projects that don’t fit the normal box of excellent wages and benefits for union organizers, but will be driven by rare organizing zealots willing to pay the price for years in the conviction and passion that success will justify the climb long into the future.  There’s a crazy, courageous history to this, but my friends were right:  it’s not a model.

But it is a way to shift the paradigm and turn the tide, especially if we can convince unions and others to help balance the books while the work is done until what I, perhaps crazily, believe will be the inevitable victory.  The workers want organizations.  They want power on the job.  Eventually, we are going to have to pay the dues, and give them what they demand, even if it is harder than we like and different than what we know.

Mumbai

Wal-Mart is amazing.  You take your eye off the company for a minute, and it explodes on you.  Gross sales are now over $400 billion annually.  The company has to add $8 billion, just to grow by 2%.  But, I digress, because public relations though all of this clearly was, there were nuggets of real interest.

They concede that pure, legitimate “cash-and-carry” or full-on wholesale operations, which is their only legal entry point within the foreign direct investment (FDI) rules in India is a first for them.  Even Sam’s in the US is a hybrid of individual member/customers and business/wholesale purchasers.  In India the entire focus of their market is the birana or mom-and-pop stores that proliferate in India.

Although the company makes a big distinction about having changed from being “an American company that works overseas” to being a truly “international” or global enterprise, meaning that they are finally trying to really understand and adapt fully to local markets, a lot of this still seems the same.  The distribution centers are still central and are 150 kilometers from all of the stores, almost exactly the US model except a little closer probably given the roads and traffic conditions in India.  Not surprisingly then all 27 stores put together so far are in northern India, largely the Punjab, though I noticed 4 have slipped into the Delhi suburbs as well.  95% of the suppliers are bar coded into the famous distribution routing system that Wal-Mart has virtually patented in the US as well.

On the other hand in order to keep some items fresh, like spinach, Wal-Mart in India is taking some supplier deliveries right at the store, which is pretty unique for them, since it also involves some pretty small traders.  But, it’s smart and moves them closer to the ground.  In fact the whole operation seems closer to the ground and more focused, though that’s part of the sweetness of the spin as well, I’m sure.

Other parts of the model are consistent.  Keeping land costs cheap (and political opposition down) they are buying on the outskirts of the cities where they operate.  The physical space is spare and constructed with skylights so that they don’t even have to turn on the lights until after 6 PM at night.  Not only is that smart, but given power supply problems throughout India, it also keeps them up and running, though anything that slows the computer tracking system is heck to pay.

I got my 50 rupees worth.  I put down the magazine thinking that perhaps Wal-Mart did have a future, if they could embrace and focus within wholesale and be “value-added.”  Unfortunately when you have to grow by $8 B to add 2%, simple growth is never enough.  The number of 1000 stores slipped out in one management interview.  Hard to get that number just on “cash-and-carry.”  Hard to believe that this isn’t the honeymoon with many rocky days to come still in their Indian adventure, many of which will continue to threaten India greatly.