Comment by munificent | Hacker News Reader

Comment by munificent | Hacker News Reader

Parent Full thread

Yeah, Wal-Mart and other super groceries like this are the seed of the problem. It goes like this:

1. You have a handful of nice small towns each with their own little commercial center with a small grocery store and a collection of other shops and restaurants.

2. Wal-Mart wants to move into the area. Their efficiency is driven by logistics and scale. They don't want to open a small Wal-Mart in each town that they have to drive trucks to. So they pick one of those towns and put a mega-Wal-Mart there.

3. People in the neighboring towns start going to that Wal-Mart occasionally because it has a few things the smaller local grocery store doesn't have.

4. Business dries up at the local grocery stores. They already operate on razor-thin margins so it doesn't take much to put them in the red. They close.

5. Now even the people who don't want to go to Wal-Mart have no choice.

6. People tend to visit the other shops and restaurants as an additional errand tacked on to their necessary grocery run. Without a local grocery store anchoring those trips, people no longer stop at the restaurants or other shops. Those satellite businesses close down.

Ta-da, now you've got a bunch of dead towns with no functioning city center and one bigger town with a Wal-Mart. Traffic gets worse for everyone. Wal-Mart rakes in the cash because instead of them having to pay for last mile product shipping, customers do it for them by driving thirty minutes from their food desert dying town to the nearest Wal-Mart.

Did I mention that all the people who used to work at these small stores and restaurants now have shitty jobs at Wal-Mart and awful commutes?

I think the worst part is while it is easy to see how this came to be, I don't know how you put it back. It's like saying how do you unburn down a forest. You can't put it back together. One shop opening in the otherwise empty commercial corridor on main street is going to look failing and close down with the rest of the block remaining vacant. Local planners then turn to razing historic commercial blocks to turn them into some cookie cutter chain since no one local has any capital anymore to start a business.

Option B: instead of cookie-cutter chains, it's health care. Cancer centers, physical therapy, and other related things. But all owned by the local health conglomerate, so prices are all obscenely high.

I think the probable reversal of the cycle is:

1. Towns revise their taxation and zoning laws so that more classes of business are permitted in residences. They also start issuing more forms of local credit(the technical means to do so are only getting better), excluding big-box participation and restarting the cycle of capital accumulation locally.

2. Costs are lower and incentives are now aligned for more small businesses to survive in marginal areas.

3. Big-box stores increasingly become commodified and unbundled, themselves; the shift from Main Street to Wal-Mart to Amazon is one of the warehouse turning into a store and then back into a warehouse. The services of shipping logistics and delivery become less of a centralized process. Now the local businesses are using the big-box to their benefit.

The reason why Wal-Mart succeeds is ultimately premised on policies that let capital centralize itself according to a national and global framework. But that's only one way of "seeing" the economy, since following that policy, as we know, creates a mix of expensive star cities and dying no-hope towns. It's improbable that the future will simply be a restatement of the post-1970 trends, given what we know about history - something will change.

I don't have an answer but I do my part by refusing to shop at WalMart or any big box store. I'm lucky to live in area where there are decent local businesses to support.

4.) and 5.) don't quite add up to me. if people moderately to strongly preferred the local grocery store over walmart, surely they would accept a modest price hike to keep the local store in business? these steps only make sense if the people didn't actually care that much about the local shop to begin with.

We didn't. We went to the local grocery store because driving half an hour for groceries all the time wasn't a great option. WalMart when it came to my hometown as a kid was a great liberation - we finally could buy all the things we wanted to buy without a major day long trip to the nearest big city.

Note that Sam Walton was still CEO of walmart at the time I remember. Since then the quality of thing you can get at WalMart has gone down (remember when they used to look for made in the USA products?). I wouldn't be as excited to see them in town now. Though they are still better than the high prices we had to pay locally.

Increasing the efficiency for the consumers appears to be generally a good.

The bad is that the consumers end up stranded in areas which are unsustainable satellites that are no longer fit in a more globalized, technically advanced, specialist filled world.

The fact that these small towns continue to exist, rather than being bought up and shutdown in an orderly consolidation process, is a failure of our society to require planning and execution at scale.

7. Wal-Mart increase its margins.

Their margins have been ~3% for the longest time. Don’t know if it’s possible to go lower and still have a business.

I meant the opposite, without competition they will make more profit.

Reply on news.ycombinator.com