[Vision2020] Buildings old and new + taxes

[Pat Kraut]

Not really fair to include Ernst...it was a bankrupcy problem. But the
Moscow store was doing fine.
PK

----- Original Message ----- 
From: "Melynda Huskey" <mghuskey at msn.com>
To: <jeffh at moscow.com>; <vision2020 at moscow.com>
Sent: Monday, April 11, 2005 10:16 AM
Subject: RE: [Vision2020] Buildings old and new + taxes


Jeff writes:

>Markets run best when demand is the driving force for the operation of the
>market.  An unfettered demand (that invisible hand) will allocate goods and
>services to their appropriate values.  For those that fear the appearance
>of "new" box stores, they should put their fears at rest.  If the box store
>is serving the needs of the market, it will survive.  If it doesn't serve
>the interests of the consumer, it won't.  Even in Moscow, we have had the
>box stores come and go - Ernst, K-Mart, Lamont's, "big" style Sears, even
>Tidyman's.

Jeff, something that has always troubled me about this model is that "the
market" is so vaguely defined.  For example, the benefit to shareholders is
a powerful driver of corporate policy, often to the detriment of consumers,
who may not even know how badly they're being screwed by sweet deals among
capitalists.  And when a company like, say, Enron collapses, the victims of
this operation of the free-market are the rank and file employees and
consumers, not the executives.  The free market allows the folks who have
broken the law and grown rich at the expense of others to buy their way out
of trouble, while those folks who lost their pensions after years of working
for the company have no hope of recovering their lost earnings.

The destruction of the natural world, negative health effects, the
consumption of irreplaceable natural resources--clearly NOT in the long-term
interest of consumers--are rarely part of the operations of the market.
Similarly, this model doesn't consider the benefits to shareholders and some
consumers of unethical behavior.

Clearly, one reason WalMart has prospered is its unethical and sometimes
illegal labor practices--from union busting to hiring undocumented workers
and then refusing to pay them to various just-barely-legal ways of evading
paying for workers' health benefits.  Another reason it's done so well is
that it uses its enormous market share to pressure suppliers to reduce
prices at any cost, thus encouraging equally exploitative labor practices in
its suppliers.  Its size allows it to overwhelm competitors by short-term
price adjustments, but once well-established, it can alter its pricing
structure to maximize profits without reference to the good of the consumer
or the well-being of its employees.

The siren song of "Trust the Invisible Hand" sounds a lot more like "Pay no
attention to the man behind the curtain" to me.

Melynda Huskey


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