Taking Aim at the Big-Box Economy


Today’s guest blog is by Stacy Mitchell, author of the highly recommended book Big-Box Swindle and a keynote speaker at our conference next week.

Wal-Mart wants your rebate check. So does Home Depot. But spending it at a big-box store will only further gut the U.S. economy.

As these companies expand, they continue to decimate two pillars of the middle class: small business owners and unionized manufacturing workers. In exchange for all the family-supporting livelihoods they take away, the chains leave us with nothing but very low-paying jobs working in their stores.

It’s a raw deal and a vicious cycle of ever-widening working poverty.

Yet cities continue to welcome, and often subsidize, the construction of more big-box retail. This is not economic development. It’s more like economic colonialism. Studies show that only about 14 cents of every dollar spent at a big-box store stays in the local community —compared to about 50 cents of a dollar spent at a locally owned business.

The chains manage this feat of wealth-extraction by keeping local payroll to a brutal minimum, requiring none of the local services (such as banking, printing, accounting, etc.) that independent retailers need, and carrying virtually no products produced or grown anywhere near the store.

Perhaps most disturbing of all, the rise and continued growth of mega-retailers have been driven in large part by public policy: Billions of dollars in development subsidies for big-box stores. Massive tax loopholes that favor chains over local businesses. Diminished rights for workers and communities. Transportation and planning policies that mandate sprawl. An utter failure to enforce antitrust laws. And the list goes on.

Fortunately, there’s a growing and increasingly effective grassroots movement to withdraw government backing for big retailers and build an economy that supports the common good.

These are a few of the successes so far: Arizona passed a bill last year that bars subsidies for big-box stores and shopping centers. Several states have eliminated a major tax advantage for chains and more are weighing legislation now (including Massachusetts and Colorado). Maine recently enacted a landmark law requiring economic impact studies for retail development.

But perhaps the biggest success of all was that every one of these victories was made possible by exciting, and potentially powerful, new coalitions among independent business alliances and labor and environmental groups.

I’ll be talking about these exciting developments at next week’s Good Jobs First conference — a great forum for building and expanding these ties.

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