March 22, 2008

Supersize Me- Part2: Poway WalMart's Impact on Our Community

Confessions of a Wal-Mart Hit Man
Extended Bonus Scenes From
Wal-Mart: The High Cost of Low Price
a Robert Greenwald Film

All are welcome to a free screening of Robert Greenwald's film, "WAL-MART: The High Cost of Low Price" on Thursday April 3rd at 7:00 PM at Poway Royal Mobile Home Park Main Clubhouse at 13300 Alpine Road, Poway.
Click here for a map of this location.
The event will be hosted by South Poway Residents Association.
For more information, click here.

Do we want a super-sized Wal-Mart in Poway? Assuming the people who live in this town actually will have a say on the matter (and I am not sure we will), I have written a 2-part post to get the discussion rolling. In part 1, I discussed how screwed-up public officials give hundreds of millions of taxpayer dollars to Wal-Mart in the hopes of getting a disproportionate share of sales tax and some political donations. In this post, I will discuss some of the other effects Wal-Mart has on our community.

Be sure to check out the video of the former Wal-Mart "hit man." It is pretty long, but the poor wretched dude worked for Wal-Mart for 17 yrs and he has a lot to get off his chest. Around the 4 min mark, he talks about what happens when Wal-Mart moves into a town. He and his corporate buddies would drive through the town and point out which stores were going to get the kiss of death. While Wal-Mart does drive out mom-and-pops, it is the bigger chain stores that they really target. Last summer, my brother moved to Springfield, Missouri (pop 150,000) and he was surprised because he couldn't find any of the chain grocery stores in town. They all moved out after the Wal-Mart Supercenter opened. Reports from my brother indicate the prices are high and the plastic wrapped produce looks like it has been sitting in 100 degree temperatures for a few days somewhere.

Before the Supercenter phase, a classic Wal-Mart gesture was to build very near to a K-Mart. Poway's own K-Mart was an early victim; it closed about a year after Wal-Mart opened. Even before that, the Longs (where Henry's is now) closed in anticipation of Wal-Mart opening. And then there was the Creekside Plaza fiasco.

The city's redevelopment agency made a private deal with Creekside's developers. Nobody else got to bid on the project. The developers promised the city that they would find a retail store to anchor the shopping center. The city moved the residents of Haley's trailer park out and filled in and graded the land. But when it came time for the developers to show us what they had, they had nuthin'. No retailer would bite. We had to make do with a grocery store. But that didn't temper the hype. Creekside Plaza was our first Town Center, and it was going to be the "crown jewel" of Poway.
The plaza, with its stucco-and-wood Western design, "will be the town center, something which Poway has never had, as a strip-mall commercial district," said Mayor Jan Goldsmith. "It all starts with Creekside. It's just the beginning, to change the direction of the city."

More from the Feb 27, 1992 SDUT:
Goldsmith headed a committee that worked with ADI officials on Creekside's design. The mayor envisions one day building a pedestrian overpass to connect the project with a library planned on the opposite side of Poway Road.

Eventually, horse-drawn carriages may carry shoppers between the plaza and Old Poway Park, which is part of an historical district about a mile north of Creekside.

The mayor's vision "is not just a pipe dream," said Assistant City Manager John Fitch. "There has been lot of discussion of how to tie these two areas together. We're trying to make this into a small, Western-type Seaport Village."

Did I mention that the city threw $1.3 million in incentives at the developers? Color me jaded, but I don't buy any of the hoopla about the proposed Town Center redux. I don't think it is going to be anything more than a taxpayer gift to a bunch of developers.

Wal-Mart brings in a lot of traffic, and noise. A group of people trying to get signatures for a recall petition back in the mid-90s did an unofficial survey. 85% of the people going in to Wal-Mart were NOT from Poway. Almost every one of them drove to Wal-Mart in their car. From their homes to the freeway. On the freeway, to Scripps Poway Parkway or Poway Rd. And then on to Wal-Mart. Add to that all the Wal-Mart trips from Powegians and from the folks in Ramona, and it adds up to a lot of traffic. It would have been more appropriate to locate a venue that attracts so much traffic up in the industrial park rather than in downtown Poway, especially now that Poway is trying to build a lot of multi-family housing in the center of town.

There is something about shopping at Wal-Mart, or any big box store that affects the psyche. There is just so much to try to tune out, from dodging cars and shopping carts in the parking lot, to the gum-stained apron, the security cameras, the immense amount of stuff to buy, the long lines at check out, and the final, visual shake-down to see if you are stealing anything. The big box shopping experience is impersonal, frustrating and competitive. Maybe that is why so many people seem to be constantly talking on their cell phones. I used to think they were just plain rude, but perhaps they are just trying to maintain personal connections in a hostile environment.

Remember the 141 day supermarket strike in 2004? The grocery chains insisted they needed to pay cheaper wages and fewer benefits in order to compete with the Supercenter Wal-Marts. The end result was a two-tier pay structure where new employees would get lower pay and fewer benefits. It's a race to the bottom. Thanks, Wal-Mart. Now the grocery stores have lots of turnover. I don't think they can keep anybody working in the bakery section at Vons on Poway Rd for more than a couple of weeks. Hot bread at five? It is rare that the bakery is even staffed in the evening.

I miss Plow-Boys. I shopped there for all my fruits and veggies during the strike and I continued to shop there afterwards because they had the best prices and best ambiance of any grocery store in town. What is really strange is that Plow-Boys wasn't driven out because they couldn't compete; they were driven out because Wal-Mart wanted the space where they were located. It is becoming a recurring theme in this town; long time, successful businesses are driven out because somebody else has a hankering for that property. Considering all the commercial vacancies on Poway Rd, you gotta wonder whose brilliant idea it is to push out businesses that seem to be making it on their own, without government subsidies.

The video below shows the exponential growth of Wal-Mart across the country. I find this very, very scary. It's not just all the lives and communities that have been impacted. It's not just that for every Supercenter that opens, 2 grocery stores close or that Wal-Mart is the largest private employer and most of their employees are not making a living wage. What really scares me is that Wal-Mart's business model is unsustainable. When something this big pops, it is going to be devastating to the entire country.

The Diffusion of Wal-Mart and Economies of Density

March 21, 2008

Super Size Me- Part 1: How Poway Got A Wal-Mart

WAL-MART: The High Cost of Low Price -- teaser trailer

This award-winning documentary takes you behind the ”happy face” of Wal-Mart and into the real lives of employees and their families, business owners, product manufacturers and the larger community – all impacted by Wal-Mart. This film is an extraordinary journey that will challenge the way you think, feel... and shop.

There will be a free screening of this film on Thursday April 3rd at 7:00 PM at Poway Royal Mobile Home Park
Main Clubhouse at 13300 Alpine Road, Poway.
Click here for a map of this location.
The event will be hosted by South Poway Residents Association.
For more information click here.

The first Wal-Mart in San Diego County opened its doors on Aug 4, 1992 in Poway. Yep, the mega-retailer's first local coup was in our bucolic community. To be sure, the Poway city council insisted that Wal-Mart blend in with our "city in the country" atmosphere.  Atmosphere apparently was only skin deep, or in this case red-tile roof deep, plus some landscaping around the perimeter of the gigantic parking lot.  

Poway was the first to open a Wal-Mart in San Diego County, but it wouldn't be the only one for long. Santee and Oceanside were under construction in 1992 and Wal-Mart had plans to open hundreds of stores in San Diego County and California.  

Santee and Poway offered Wal-Mart millions of dollars in incentives to build in their communities. Getting financial incentives is typical for Wal-Mart. A 2004 report funded in large part by the United Food and Commercial Workers Union, "Shopping for Subsidies: How Wal-Mart Uses Taxpayer Money to Finance its Never Ending Growth" , details many of the ways Wal-Mart and the developers who build Wal-Marts get taxpayer money.
The most common types are :
1) free or reduced price land
2) infrastructure assistance
3) tax increment financing
4) property tax breaks
5) state corporate income tax credits
6) sales tax rebates
7) enterprise zone status
8) job training and other recruitment funds
9) tax-exempt bond financing and
10) general grants.  

It works kind of like this. Local officials want the sales tax that a Wal-Mart can bring to their community. So they "invest" other taxpayer subsidies to get the Wal-Mart built. And they usually brag about what a "win" it is.  However, from the taxpayer's standpoint it is a losing proposition. Imagine all of the taxes (including sales taxes) paid by the taxpayers in every city are in one big pot. The total amount of sales taxes won't change much if you buy your stuff at Wal-Mart or if you buy your stuff from Ma and Pa Kettle or from a department store. If you take out hundreds and hundreds of millions of dollars of taxpayer money in order to give incentives to Wal-Mart and other big box stores, then the total amount of money left in the taxpayer pot begins to dwindle. 

So, while Poway "wins" on Wal-Mart, they lose when some other town gets a competing retail store. And in the end, we are all losers. There is less money in the pot for funding municipal services. And now, public officials have created an "atmosphere" where big box stores can play off one town against the next for the highest taxpayer funded subsidy. 

Why does Wal-Mart need so much taxpayer money?  Several of the richest people in the world are heirs to Sam Walton's fortune.  Well, to be honest, all of the taxpayer incentives probably don't go to the Waltons or stock holders. Some of it is funneled back to elected officials as campaign donations. In the early 90s Frank Gatlin, of Gatlin Development Company, (which built Wal-Mart shopping centers) set about to cozy up to San Diego city officials. Gatlin would later agree to a CA FPPC stipulation of 107 counts of money laundering and illegal contributions. Gatlin gave illegal "batched campaign contributions" to many officials, especially to mayoral candidate Ron Roberts. Roberts repeatedly phoned Gatlin with requests for another $5000. Gatlin got donations for Roberts (and others) from people in his company and he illegally reimbursed those people later. When Gatlin ran out of people in his own company, he tapped his lawyer's firm. Gatlin would then deliver the batched contributions to Roberts when they met for lunch and Roberts would slip them inside his coat jacket. Of course, Roberts said he didn't know there were any illegal donations in that bulge, and, of course, they never discussed Wal-Mart at these luncheons. Oh no. They just talked about the weather. Um-hunh.

Gatlin would later pay $192,000, one of the largest fines in the FPPC's history. Sheesh, it is hard to imagine just how much $192,000 stings when you are getting hundreds of millions of dollars in taxpayer subsidies.

In my next post on Wal-Mart, I will discuss the impacts of Wal-Mart on the Poway community, particularly how it affects other businesses, traffic, and our community character. Please feel free to chime in with your own comments.