Who is really destroying the US economy?

This is a discussion that I was having with a friend at work. It was really interesting, so I thought I might post some of what we were talking about.

We starting talking about Wallmart destroying all of the great mom and pop stores that are out there, and what can or should be done about it. So as we started talking about it... it occured to us that the rise of Walmart is actually our own fault!

Sounds a bit strange, but here is how it works. Walmart took the gamble that what people really wanted in the US were the lowest prices possible. So that is what they focused on. Not fancy stores, not great customer service, but the rock bottom lowest prices that they could. The US people responded to it and that is why they are as successfull as they are today.

The strange thing about it is... is that let's say tomorrow for the majority of people in the US, lowest price was not the highest concern. Maybe customer service is. The customer service at a smaller store is usally much better. So people as a group start shopping more at mom and pop type places. And guess what... Wallmart starts to loose money. Eventually they go out of business, because they are no longer what people really want the most. I really like going to ACE hardware, they get my business over Home Depot every time. The price is SLIGHTLY more (perhaps a dollar or two), but they are always positive and helpful.

This recently came up in a conversation I was having with a friend at work because he wanted to buy something in a store, but claimed he could buy it somewhere online for cheaper... which is certainly true. But in doing so he was actually hurting the US economy. Funny how when YOU are the one getting the better deal, the US economy is suddenly not such a be concern for him. He was angry when I pointed this out to him....

 

Special interests and the fed which takes our tax money and instead putting it back into our economy gives that money away paying interest on the debt they created.

 

Actually, it's greed.

Republicans want everything for themselves and will do anything short of murder to get it.

Democrats will use every law in the book to get something for nothing.

How do I know this?
I read it here - every day.

 

Lol. no it is not: if the dollar would be worth today what it was worth 100 years ago, chinese would have had no chance to compete with us - regulation, taxation, corruption, lobbyists sank our dollar by ripping off an average business man/working man on every turn so that he in turn had to charge more for their products and services, then they opened this thing that THEY call "free" trade which is really "unfair" trade since their money is completely different. My suggestion to you is watch less television, and do more of your own reading and thinking. People ALWAYS look where to buy things cheaper, that is not a crime, and it is not a crime to buy ice cream made a block away instead of the one on your block.

 

At least I know now that someone on this forum gets it...deserves a bump

 

The problem with this logic is the fact that a person cannot usually buy ice cream cheaper than Wal Mart sells it. And if Wal mart finds out about it they will take a temporary loss on a product locally to put the competition out of business. I used to sell plants and the first thing I learned was not to set up anywhere near a Wal Mart.

In order to compete with the big boys you have to go underground. Wal Mart is a large corporation acting like a monopoly. They will bury you unless you are very careful.

And you can't save money on products if you spend more on gas than you would save. Unless you buy in bulk.

 

The ole Walmart as PREDATOR baloney. You're probably too young to know that the EXACT same things were said about Sears, 50-60 years ago. They had all the business, Sears was ruthless, Sears put the mom and pop stores out of business. Sears would buy from a manufacturer until they had all their production, then they would lower the price they would pay and the mfg. had no choice but to go along or go OOB. It wasn't true then, it isn't true now. Dollar General, Dollar Store, Target, Lowe's, Home Depot, are all competitors of WallyWorld. and many others. The Walmart angst is just a manifestation of the always present jealousy of success.

Apple is the most valuable company on the plant, or # 2 sometimes, depending on their stock price. Not too many years ago, Microsoft almost drove Apple out of business. They were facing bankruptcy. Microsoft was too big and had to be broken up. Microsoft is doing OK today and Apple is doing OK too. Good corporate management. Not predatory practices.

Budweiser, many decades back embarked on a campaign to put ALL small breweries out of business. They all but succeeded. Back in the caveman days when I was in college. Bud, Miller, Pabst, and other large national brands were the only beers available. How's the boutique beer business doing today? Too many breweries, a shakeout will happen in a few years. Or some brewers will go the way of many small German brewers and market only to their local area and keep expenses to a minimum.
Every aspect of business is always dynamic and changing.

 

It doesn't sound like that's mutually exclusive.

 

Conservatives and their race-to-the-bottom economic policies.

 

Ok, but still, walmart would not be anywhere near as successful if US dollar was equal value in USA as in China. Speaking of walmart though I bought a computer there couple of years ago, then recently I found out that they make computer in china (probably US companies don't matter) with spywear pre installed. I want my money back for this piece of junk, but I know I have no government representing me who would make them pay me back no questions asked. as a matter of fact if I had a government representing me, I would easily be able to get a million dollar compensation for them selling me a computer with a pre installed spywear. so the real culprit destroyng our economy is that we have no government representing us. below is a video how a man in America got 75 years in prison for filming police:

http://www.liveleak.com/view?i=1ce_1314832958

 

If a frog had wings, he wouldn't bump his ass on the ground so much.

You missed minimum wage laws and union wages for helping destroy the dollar too.

 

That is part of regulation, and I mentioned it.

 

No they're not. Some ruthless business goes on.

Some people rob gas stations, should I condemn you because some people rob gas stations?

And EVERYBODY, that is not self-employed, earns their living from some kind of a business. Shall we condemn ALL employees because there are a few predatory businesses?

 

Fractional-reserve banking.

 

Very good point. But we should condemn (and possibly imprison) people who do rob gas stations, right? And by the same token, shouldn't we also condemn those businesses that are predatory?

I think the OP is really on to something, here. And the solution may not be government. Maybe we just have to choose, as consumers, how we want to spend our dollars and what effect we want our spending to have.

 

Forget all that- I blame mom and pop- and junior too. And everyone else who goes to work for Walmart because Walmart put everyone else out of business.

I blame them all for putting up with Walmart's corporate model of minimum wage, low to no benefits and no retirement. Walmart has become what Big Business wants from the people- to work a lifetime at minimum wage to retire and live off Social Security.

If Walmart had to pay their employees more... that is, if the employees all got together and walked out for higher wages and compensation, they would win... and the price of everything would go up a few cents to several and suddenly Walmart is not the cheapest game in town. It's because the employees are willing to accept Walmart's terms that Walmart is the giant it is.

Personally, I shop at 2-4 supermarkets per month, Walmart included. I buy sale and low price items from all of them and altogether, I am getting the best deal in town while catering to ALL the competition. Bad news for them, good news for me. Why should I buy Campbell's Chicken Noodle soup from Walmart for 89 cents when it's on sale elsewhere for 67 cents? Then again, I prefer to buy bulk- find the truly lowest price and load up.

As to all the other extraneous posts that are trying to tie this into politics- you miss the point.

 

This an easy one, but most do not have the cognitive capacity to see what the broadcast meida is protecting. The destruction of the USA is caused by the DOE, public schools system in each State of the USA.

The fact is, the economic and intellectual capacity of the USA has been declining by a huge spending machine at the State level. It is called the Department of Education (DOE) which includes K-12 and state funded universities and university medical centers. For the past 20 years the DOE has been growing at a rapid pace during the Clinton boom years. and has been declining since 2007 when construction and expansion had halted for new campuses and classess. And, the huge cost of maintaning it is the bigest problem for each State in the USA.

In addition, the Union backed DOE has also become the most powerfull unions in the USA. they call themselves public unions and use this term to aviod letting the taxpayer know that it is a government employee union that makes it's profits from tax money and they strive for larger membership base.
They lobby and spend your tax dollars to hore more employees at taxpayer expense. In fact, the amout that each state spends on the DOE is so huge they can't account for it on government reports, and most of those reports give a cooked book average estimate of their spending to mislead the reader.

Another hidden fact is the DOE and its consuming agencies have massive debt with private investment companies and are paying massive intrest to borrow money from investment banks and mutual funds just to stay in operation. All at the taxpayer expense. It is like giving a shopaholic a hundred credit cards and trying to stop the bleeding. Like the DOE, the shopaholic don't know where all that money went too.

As other emerging countries can produce students that are smarter in key areas like linguistics, science, and math, they will be able to produce a workforce that is up to the challange to progress forward in the new world of global economy; for less money, bigger classess, worst teaching conditions. These global job seekers will supply the USA and other nations with the best and brightest workforce of the world to produce the highest of technology and science, and work in the cutting edge R&D in the best universities of the world.

As the USA continues to teach in the midset of a nationlistic isolationist 18th century mindset, they will continue to produce, more teachers that have this midset, as well as students that can argue history, literature, and pop culture. thus producing more dropout factories and fat, lazy simple minded consumers that are destine to buy what they don't need, and crave stuff they cant have. like a job. The USA student and teachers have a simple mind set and safe and secure privilaged environment which they work from. Thus, they will not venture into anything which requires accountability and hard work.

So IMO the destruction of the USA is the DOE. It consumes over 65% of each State's tax revenue. There is no acountability of the money it spends, it has the most powerfull Unions to back it, and it fails to produce any form of quality education needed in this global competitive environment.

If other countries are smart they will privatize public education with strick regulation to save their countries from being destroied by a capitalistic Government entitiy (the DOE) that has gotten so huge and powerfull that no governemnt, court, or law can tame it's expansion and the damage it is doing to the Nation.

Teachers and their administrators can make up all the excuses in the world for who they blame for the failure of the USA DOE and the government, but the fact is simple, the DOE is too big to fail, and the DOE system in the uSA is broke, and we are rolling down hill fast with no solution to fix it.

 

Duh, we already do that.

And that's why Walmart has had the success it has enjoyed. They give the people what they want.
Walmart has no interest in the person that wants to buy an Armani suit. But the Armani guy IS interested in getting a USDA choice steak for $8 bucks a pound.

 

Facepalm!!!! This is the point I was trying to make!!!! YOU are the reason that Wallmart continues to do business, and the reason they pay their employees less is because of their deep discounts. There is no need to get the govt involved here... people decide who they want to buy from. Apparently just like you did. If you were really THAT upset about the business practices at Wallmart, you would not shop there any more. This is the point I was trying to make.... everyone complains about them.... but then says... "wow... thats a good deal... I am going to buy stuff from them!!!" Personally I have no problem with wallmart and shop there on occasion myself. I was just bringing to light the hypocritical nature of it for so many people.....

 

I think the problem is that people aren't really thinking about what they want. Sure, they want a good price on whatever they're buying, but if they think in the long term isn't it likely that they want more money in their community as well?

 

Thanks for sharing, armor99.

Here is an important different way of looking at the problem.

Many liberals hear the work “profit” and they literally become apoplectic. They believe it this the government’s role to over regulate our economy until they can squeeze every ounce of profit out of it.

What many people do not realize is the profit motive associated with capitalism is good in that it forces a business to streamline its operations and deliver its consumer products to its customers at the least expensive possible price. This is of particular importance to poor Americans and senior Americans who must live each day on their limited retirement incomes.

Wal-Mart and The Apple Stores are two very good examples. Because of innovations such as just-in-time product delivery and their ability to purchase large volumes of commercial products from their vendors, Wal-Mart is able to sell its products at the lowest possible cost to its customers.

If the government provided these same services to the public, they would do so with much less efficiency and with a much higher cost to American consumers than does Wal-Mart. The reason for this is the government is not concerned with making a profit or streamlining its operations and operates its “business” as if it were a monopoly.

Consequently, there are no stringent cost savings considerations or strict accountability to its “shareholders”(the taxpayers) when it comes to how a government entity performs its functions. They consequently would purchase more products then they could possibly sell to their consumers, saddle their vendors with costly and unnecessary contractual specifications and paperwork (adds greatly to the cost of the commercial products), hire too many people, pay them too much money and pass these unreasonable costs on to the consumer. The U.S. Post Office, the Walter Reed Army hospital (now closed) and Am-Track are three perfect examples of government entities with these kinds of avoidable and unnecessary inefficiencies.

These inefficiencies and costly requirements do nothing more than drive up the cost the public has to pay for these commercial products. As a result, Wal-Mart is able to sell these same products to the public (the consumers) at half the price as the government even when Wal-Mart’s profit mark-up is factored in!

 

Thank you for thinking about what I have said.... as I know we often do not agree... The point really is... that WE the consumers hold all of the power over businesses. People seem to forget that. If enough people choose to no longer buy your products, it really does not matter how GOOD those products might be, or how much money the company might have. The power of choice means that ultimately companies will produce what it is that people want to buy. And no amount of govt force is going to make people buy something they do not want, or make a company produce something that their research shows people will not buy.

But let me challenge you on this point.... How exactly can a business be predatory? Are they hiring people to beat up, or intimidate customers to buy their products? When you walk into a store, you are free to choose to buy, or not.... only if you are OK with the price, then you buy something. There is no coercion applied at all to my understanding.

I know I have used this example before (so forgive me listing it again.) If I opened a store and tried to sell $100 chocolate chip cookies, is that predatory? Obviously that is an insane price to pay, but who knows... maybe there are enough wealthy, brainless, cookie snobs out there, to support that business. Or.... as I would suspect.... I would be out of business in short order.

It is my contention that predatory businesses, banks, etc, really cannot exist, provided they did not purposely lie to you about something. If a furniture manufacturer sells you a chair they say is made of oak, and you later find out it is plywood, you can and SHOULD sue the company for breech of contract, and there are already laws on the books, and an army of lawyers that would be more than happy to help you do that.

However, being ignorant is not an excuse for foolish behavior. When you buy that $200 Rolex watch and find out it is a fake, or stolen, you really should not be too surprised by that. When a bank offers you $500,000 to buy a home when YOU KNOW you only make $30k/year, you should not take that money. Everyone knows when a deal is too good to be true. And if you really are THAT gullible, nieve, and childlike in you behavior, then as far as I am concerned you should be put in a mental institution of one form or another. If you want to make the claim that people just "did not know any better"... ok.. fine.... but I would think that living independantly these people would be a danger to themselves, and for their own good should be taken to a place where they can be removed from making bad deciions like that.

Being a responsible adult is a lot like being pregant.... you cannot be a "little" of either one. You cannot make the claim that someone is financially "retarded" ( for lack of a better term), but yet in other aspects of their lives, are completely adult like and responsible people. It just does not work that way. You either have the mental skills to take care of yourself..... or you do not.

 

The people and the government are. Basically your equal opportunities are strung together by unethical loans starting at the age of 16 and continueing into adulthood where most people take on thier first mortgage for the next 50 years of thier life. Not bad how they charge us through the roof now for the necessity of a home. Were dumb enough to pay, work our assess off and say nothing as we pay more taxes and can buy much less than before.

It used to be one persons salary would pay the way for the entire family, weddings, education, you name it. Now adays like I said its unethical student loans that is supposed to create the equal opportunity. Of course it fails when there are no jobs because you don't replace failing businesses you unethically loan them money.

The problem with the american economy is they think thier debt is what important. Whats important is the value of the land. The people need to take back the land, the money and the government. Unfortuantely if you cannot see all this then the discussion basically ends there because you are perhaps retarded.

 

Everbody thinks they have the answer, Some think you need to be a smart shopper, others think Wal Mart don't pay enough. I think the problem is " Americans want their cake and eat it too." They want the lowest price but they also want the job making it too. I like to use the example of the hammer. If you go to the hardware or Home Depot you will be lucky to find one made in America. If you do it will be priced a lot higher than one made in China. Why? A lot of politicans will say gov't regulations and high taxes. Well thats part of it, but the biggest difference is cost of labor. When the Chineese get paid 75 cents an hour, its hard for us to compete with that. So why try? We have been trying this FREE TRADE for long enough. Who does it benifit? It benifits the Chineese. Some would say it benifits us by getting cheaper prices for the hammer. I say , what good is a cheap hammer when you don't have a job and cannot afford to buy a hammer because the job creaters moved the hammer factory to China to get cheap labor so you could buy the cheap hammer. What is the solution? We need Gov't Regulation, I know that is a dirty word to a lot of you. WE neesd the gov't to make a list of items that we can import. If we can produce it here, put it on the list, if we can't make it here we will import it. Yes, you will pay a little more for your hammer, but hopfully you can get a job at the hammer factory so you can afford it. Americans would be put back to work, paying taxes, Instead of collecting unemployment or food stamps, w would all be better off. It would be win,win for us, It would be bad for the Chineese. Sending all our money and jobs to China is a bad idea. Why are we doing it? To me the solution seems so easy, tell me where I'm wrong.

 

We have a winner. While the dot-com bubble and then the housing bubble created a false source of wealth spanning over a decade, our core industries continued to erode, while our retail markets stayed strong ..... selling items produced elsewhere. Combined with the volume of energy we must import, we screwed ourselves royal. Americans cannot compete in a one-world labor market. It is why the hammers. When the bubbles popped, we found ourselves without the strong manufacturing base upon which we could rebuild. It had left us while we rolled in cash by selling dot-com stocks to each other, and then property back and forth to each other. Now, printing money has about run its course as well.

Our mistake was opening our well developed purchasing markets to cheap goods from elsewhere. Now such as China sells to us all that we used to make here, but does not buy from us, as it is too far for us to deliver pizza.