Since about 1980 or so, the United States and the whole of the developed world has been locked in a race to the bottom. Though it's most apparent in North America, it's evident in Europe, Japan and Australia too. Competition based on innovation and smarts seems to have been replaced by competition based on low cost.
We were sold a bill of goods called the Information Economy and rather than working in factories, we'd work with our brains and usher in a new era of prosperity. But in the course of exporting our manufacturing base, the so called job creators failed to bring about this new prosperity. What they did bring forth was the big box store and the promise of ever cheaper consumer goods.
But how cheap are those cheap consumer goods and what effect do they have across our economies? In Robert Greenwald's documentary Wal-Mart: The High Cost of Low Price, the film maker explores in depth how big boxes, and Wal-Mart in particular, depress wages, impose high social costs and gut local businesses. A 75 cent bottle of shampoo is a shiny object few can resist and the act of buying it sets in motion a whole host of unintended consequences.
The first consequence is that the margin on that bottle of shampoo is so low that Wal-Mart can't afford to pay the cashier who's checking you out anything close to a living wage. Another consequence is that the company who actually made that bottle of shampoo is making so little money that they have to cut wages, benefits or to leave for the developing world.
Every time that happens by the way, it's another job exported to Mexico or China; countries where living wages and environmental regulations are considered to be quaint ideas at best.
When manufacturing jobs go away, what jobs remain are positions as cashiers at Wal-Mart. A society can't support a robust middle class on the back of Wal-Mart or any of the big boxes.
Yet the draw of that 75 cent bottle of shampoo is so strong that municipalities fight to lure in big boxes. The suburbs in the US are covered with strip malls built around them. It doesn't matter if they're Wal-Marts, Targets, Office Maxes or Pet Smarts, they have the same effect. The promise of low prices brings with it a host of social ills that range from low wages to non-existent healthcare benefits.
Furthermore, the obsession with low prices extends out from the retail sector. It extends into government where gutted education budgets and calls to eliminate the postal service are met with applause. It extends into other businesses where staff reductions and increased productivity to accommodate them are considered to be normal. It bleeds into the professions too and everyone from doctors to designers feels the same pressure to compete on price rather than value.
So what is there to do? Well, for starters stop spending money in big boxes. I have never been a fan of them and I've always been suspicious of bottom line prices. I don't buy 75 cent bottles of shampoo. I buy $4 bottles of shampoo at a grocery store where the cashiers make a living wage and have health insurance. Now that we're part of a thoroughly consumerist culture, pay attention to how and where you spend your money. I consider it to be an obligation to spend my money locally and as painful as it can be sometimes, to pay full prices. When I buy anything I think about its repercussions. What am I supporting with my dollars? Where is my money going once I spend it? Is it staying in the local economy and helping to support my neighbors or is it swelling the coffers of someone far removed from me? What do you think? How far can the push for cheap go?