From Kevin Williamson, Who Boycotts Wal-Mart?
If you want an illuminating example of the fact that there is more to the way that prices work in a free market than can be captured by the pragmatic calculations of cold-eyed util-traders, consider the luxury-goods market and its enthusiastic following among people who do not themselves consume many or any of those goods. One of the oddball aspects of rich societies such as ours is the fact that when people pile up a little bit more disposable income than they might have expected to, they develop a taste for measurably inferior goods and outdated technologies: If you have money that is a little bit obscene, you might get into classic cars, i.e., an outmoded form of transportation; if your money is super-dirty obscene, you get into horses, an even more outmoded form of transportation.
Or consider the case of fine watches: Though he — and it’s a “he” in the overwhelming majority of cases — may not be eager to admit it, a serious watch enthusiast knows that even the finest mechanical timepiece put together by magical elves on the shores of Lake Geneva is, as a timekeeping instrument, dramatically inferior to the cheapest quartz-movement watch coming out of a Chinese sweatshop and available for a few bucks at, among other outlets, Wal-Mart.
Of course, one doesn’t buy a Cartier watch to know what time it is. The person* who just paid $16 Million for Steve McQueen’s Ferrari 275 4-Cam didn’t buy it for transportation. They probably don’t buy these things for investment either, although the previous owner of Steve McQueen’s Ferrari paid a few hundred thousand dollars for it several years ago, had it completely restored by the factory in Italy, and did very well on his investment. Those with the money to buy and own such things are obviously getting something intangible and personal to them.
Kevin Williamson doesn’t begrudge them for any of this, he only disagrees with those who get all holier-than-thou with a self-righteous attitude and go on a “social justice” campaign against Wal-Mart for selling low-income people things they need everyday at low prices. Those who indulge themselves in this sort of ego salvation and guilt abatement ought to be more thankful for the good life they have and stop doing positive harm to the people they claim to care about. Their claims that Wal-Mart is exploiting their customers and their workers looks pretty ridiculous when one compares the low-profit margin of Walmart to the “obscene profits” made by sellers in the luxury goods market the rich do-gooders support with their lavish expenditures.
As Mr. Williamson says:
If you’ve ever seen the heartbreaking sight of a young woman stopping a Wal-Mart checker three-fourths of the way through ringing up her purchases — because she does not have enough money to pay for what’s left in her cart — then you can be pretty sure that what’s going in her sack is more or less the opposite of Veblen** goods.
Ironically, the anti-Wal-Mart crusaders want to make life worse for people who are literally counting pennies as they shop for necessities. Study after study has shown that Wal-Mart has meaningfully reduced prices: 3.1 percent overall, by one estimate — with a whopping 9.1 percent cut to the price of groceries. That comes to about $2,300 a year per household, savings that accrue overwhelmingly to people of modest incomes, not to celebrity activists and Ivy League social-justice crusaders.
I agree with Williamson; these “social justice” crusaders are tribal warriors. It’s the Nordstrom’s tribe sneering at the Wal-Mart tribe. Grotesque snobbery compounded by stupidity.
* I don’t know the person who bought Steve McQueen’s Ferrari and I’m not accusing who ever it is of being a stupid snob or a social justice crusader. In fact, I think classic car enthusiasts as a group are pretty smart people who do a lot of good in the world just by preserving these beautiful old cars. With their money they are supporting a lot of talented and highly-skilled people who maintain and restore these cars, as well as all the other people who have good jobs in the classic car markets they are creating.
** “Veblen goods” alludes to Thorstein Veblen, The Theory of the Leisure Class (1899)