‘A specter is haunting the economy of the world-the specter of multinational conglomerates. All the powers of America have entered into a holy alliance to exercise this specter: the President, the Fed, Wall Street, Coo’s, lobbyists, government, and government regulators. ‘ This specter is something new that was not seen in days of mine. I did however, prophesier that events such as these could happen In the future. There is no company that earns as much revenue in the world. By giving some financial statements a mere cursory glance, Walter is by far the largest company in the world.
Is there another store that allows a customer to buy nearly everything they need or want, and have these items under one roof… For, on average, the lowest price possible? Food stuff, car audio systems, gift cards, electronics, welding caps, and furniture all sold at cut-rate prices. Today I am here to talk about how capitalist companies such as Walter does this and the secret of their economic success. The key ingredients to this success include taking advantage of a workforce who is desperate to work due to an unhealthy division of labor caused by Job specialization. Another ingredient added is the exploitation of these workers.
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Lastly, there needs to be some Insight on how Walter Is able to keep such a wide variety of goods in one store and overload the senses of the customers and how customers see these Items. As I have written, the world is divided between two camps. You are either a have… Or a have not. “Society as a whole is more and more splitting up into two great hostile camps, into two great classes directly facing each other: bourgeoisie and proletariat” (Marx in E, pig. 53). This great divide is one key element in how a profit is made by large companies, which is rarely passed on to its employees, and never passed on to Its customers.
Since the Industrial revolution, there are many goods that are produced cheaply and require less manpower. This lack of need to employ for production in modern times has Increased the strength of companies who have own the modes of production for their menial work. With such a high percentage of the workforce who In current times lack skill to produce goods themselves, there needs to be a place for them to go to earn a wage for survival. Surplus value Is the Invisible champion of modern capitalism. Surplus value is the excess of value produced by the labor of workers over the wages they are paid.
Just think, If you, as workers, “did not produce any surplus value, you would not be exploited” (Arsenic and Wolff 1987, 134). If you take, for example, a capitalist who buys raw materials in order to produce a finished good to sell on the market, there has to be something special about this arrangement that allows for the capitalist to continue and repeat. Without this special something, capitalism would cease to exist. Let us look at the equation M-C-MI (M=Money, c=commodity, MI -surplus value). A merchant capitalist would take money and “buy cheap and sell dear” (Marx in E, pig. ). This bourgeoisie practice uncovers something within the C (Commodity). There are multiple commodities the merchant capitalist purchases in order to make his profit. If you were to open a pancake shop, you would need some materials and assets in order to operate. You would need eggs, flour, butter and fruit to make the pancakes (raw materials). You also would need some pans, an oven, a bulling, need to pay outside sources of utilities such as electricity, heat, insurance rent on borrowed assets (technology and bills). However, the commodity that has the highest value is the labor.
The people who make the pancakes, clean the dishes, and take the customer orders. Without these laborers doing all of the work to turn these other materials into a finished product, there would be nothing that could put all of these raw materials together. Their added value to the M-C-MI equation is how the M gets the 1. All of these ingredients off business to turn over are important, but the exploitation of the worker, as if using them as one of the commodities in the process. This is the main ingredient that creates surplus value.
To create an even greater surplus value, major companies use government intervention to pay the lowest amount they can. They call this a minimum wage. This adds to how Walter has economic success. Walter has for some time paid their employees very cheaply. This lowering of expense helps with padding their bottom line. Throughout the history of Walter, you have read stories about how they do not allow workers to work certain amounts of hours that would force Walter to pay benefits. They have made workers work off the clock in the past.
They build megastars in places that both kills the local industry of goods and services while forcing these people to work at their store for their set wages. Walter has been forced to evolve by eliminating workers and training their customers to use automatic, self-checkout kiosks to further reduce labor costs. Others will and are doing what Walter does to generate more profit in our ever-evolving economic landscape. By paying their workers less than what they are worth, they make the C into a SUPER C (super commodity). This model is in stark contrast to days long ago, where the market was not concentrated under one superstore’s roof.
This example is another way how the division of labor has hurt the labor force (proletariat). While there will always be changes in the amount companies in capitalism spend on labor expenses, there is another way in which economic success is achieved. Walter, like other big box stores, force their suppliers into charging the least amount of money for their goods in order to have a place on their shelf. This type of bargaining power is called a monopoly. A place on a Walter shelf is so important because this is where the highest concentration of customer purchasing in the western world.
This power is created when one company captures enough control over an entire market to dictate terms to its suppliers. This raises an important question. These developments in modern consumerism have transformed our market structure and market competition (which is how a free market should work) and is this the best way for consumers in the long run? The simple answer is no. One could argue that capitalistic companies like Walter kill competition by offering the lowest price for most essential (and non-essential) items in the market.
Other business modeled their business around this Walter practice. Cost and B. J. ‘s are sellers of low margin product that sell in bulk. When you have businesses that undercut the more actual cost of a certain product, you are essentially driving the value of the items down, lowering the value across the market. Walter forces their suppliers to keep their costs low as well in order to have the lowest price for their consumer. While this sounds like a great thing for consumers, it is the consumers those products. Commodity Fetishism is a concept that Walter hones in on, as do many other companies.
To reiterate from my prior work, “A commodity is therefore a mysterious thing” (Marx in A, pig. 70). “… The table continues to be that common, everyday thing… T is changed into something transcendent. It not only stands with its feet on the ground, but in relation to all other commodities, it stands on its head” (Marx in A, p. 69). I use this story of the table to show how a simple, ordinary thing is turned into something quite different, almost alien, once it enters the capitalist market. ‘The table’ transforms into a commodity, something that can be exchanged with other commodities and bought for money.
Retailers are at war with consumers psyche to deliver the latest and greatest item. This poses serious questions about what we as consumers need versus want. When you walk into a big box store like a Walter Superstructure, the first thing that happens is a greeting. A smile is put on your face when someone greets you, essentially acknowledging your existence. When you enter the store, it is nearly paralyzing large and the commodities seem endless. Each item is organized across an average of about 182,000 square feet per superstructure (Gustafson).
Walking aisle after aisle, each item Just about bursts off the shelf because of a combination of their affordability and our penchant as consumers to purchase not Just things we need, but things we Justify to ourselves that we might deed in the future, or even Just things that we want. Each aisle, the item has been stripped of their identity and turned into this “mysterious thing… Because the relation of the producers to the sum total of their own labor is presented to them as a social relation… Between the products and their labor” (Marx in A, pig. 70).
A commodity price should be “equal to its cost of production” (Marx in A, pig. 57). This true cost is lost when a person’s desire to have trumps identifying the true value of a commodity. All of the inherent costs of putting a product on a Walter shelf comes an abstraction, Just as the labor required in producing these goods. This relationship between a consumer and the product does seem perverted, but it is all as you as consumers know now. Before modern capitalism, there was a natural relationship between a man’s labor and his freedom to produce what he wanted.
Now the freedom is in the consumer’s hands, and this relationship of a man and his freedom has been morphed into a relationship between his labor and a product. “The more civilized the object, the more barbarous the worker” (Marx in A&E, 36). The relationship between bread maker and a person who would like to purchase bread as been transformed into an aisle of bread and a consumer who has a choice of many different brands and qualities of bread. This is an example of how the human relationship of buyer and seller is gone and in its place is seller and producer and buyer and seller.
The added middleman getting his grubby hands on this transaction is where additional profit is produced. If buyers start to purchase from the producer and left the middleman out, it would possibly generate more of a need for people to start producing again. As I said, I am not here to prescribe any course of action. I am here today to point out that there could be alternatives. By pointing out problems in the modes of production, it was my intention to question them in search for alternatives. Is your time valuable? Walter says yes and no.
While you should be able to find everything you need under one roof. But what about the time it takes to make all of those things on the shelf? Walter, as if making a U-turn, says that they will offer only the lowest prices to its customers, which in turn, forces any Walter vendor to Justify paying their workers the lowest they possibly can for their time. I think your time is valuable, and I think you do too. References Fortune 500 (2013): Annual Ranking of America’s Largest Corporations from Fortune Magazine. Commoner. Cable News Network, 1 May 2013.