SPEAKERS SAY WAL-MART NEEDS FAIR LABOR POLICY 2004-04-19 (1)

ELLIOT ZWIEBACH

SANTA BARBARA, Calif. -- Wal-Mart Stores is operating with a 20th-century mind-set in a 21st-century environment, and it will have to change with the times or face ongoing resistance from the public and government, speakers at a daylong conference on the Bentonville, Ark.-based company said here last week.

The conference, sponsored by the University of California, Santa Barbara, featured a variety of speakers using the forum to bash Wal-Mart. The organizers said they had invited Wal-Mart to send a representative but the company had declined to do so.

"Looking at Wal-Mart today, it's less like a Ben Franklin trying to be thrifty and more like an Ebenezer Scrooge," Ellen Rosen, a professor of women's studies at Brandeis University, Waltham, Mass., said. "As it goes forward, it will find the culture that encourages cost reductions and saving money at the expense of dealing fairly with its employees must come to an end.

"Wal-Mart management is very steeped in the culture of the Ozarks, and it just hasn't gotten it yet. But it may have to change as it moves into more urbanized union areas, as it deals with the major sex discrimination suit filed against it and as it faces rejection in communities like Inglewood [in California]."

Bethany Morton, a doctoral candidate in history at Yale University, New Haven, Conn., offered a similar assessment. "The farther Wal-Mart moves from its original territory, the more resistance it encounters," she said.

Brad Seligman, a San Francisco-based attorney who is leading the prosecution of the gender-discrimination lawsuit against Wal-Mart, also talked about Wal-Mart's cultural base. "The company has created its own cultural identification -- I call it the Bentonville effect. Every member of senior management spends part of each week in the field, but they all come back to Bentonville every week.

James Hoopes, a professor of history and society at Babson College, Wellesley, Mass., said, "The way Wal-Mart works is based on a set of Walton family values that are intimately connected with the way management thinks, and that attitude facilitates much of its behavior."

The conference was co-sponsored by UCSB's Center for the Study of Work, Labor and Democracy and the Interdisciplinary Humanities Center. The theme of the conference was, "Wal-Mart, Template for 21st-Century Capitalism?"

Nelson Lichtenstein, a professor of history at UCSB, compared Wal-Mart -- the largest contemporary private employer -- with General Motors, the largest employer in the mid-20th century and the company that set the template for that era.

"Both perfected, integrated and systematized technological and marketing ideas put in play by their competitors, and in doing so, they both ratcheted up their own overall productivity and made it impossible for any competitor to survive without emulating the template firm," he said.

But the time of Wal-Mart's hegemony could be ending, Lichtenstein suggested. "Inglewood's recent defeat of the municipal referendum facilitating a new Wal-Mart supercenter may well signal the start of an era in which that corporation's template is subject to much greater political challenge and constraint."

Simon Head, director of the Century Foundation, a New York-based consulting firm, said the early 20th century paradigm that combined mass production and scientific management -- the model Henry Ford used to produce automobiles -- resulted in high productivity but slow growth of employee compensation, which appears to be the model Wal-Mart is pursuing.

"It's a capitalism that resembles the capitalism of 100 years ago," he said.

"Despite its dynamic application of technology in running its business, Wal-Mart's treatment of its workforce is primitive. It treats employees like automobile chassis on a factory assembly line, given its obsession with time, speeding up work processes, training people to open crates and put products on shelves."

"What Wal-Mart is doing is competing on the basis of pushing down employee compensation, and the only way to constrain it would be for government intervention through use of the National Labor Relations Act and other laws that protect union organizers -- to get Wal-Mart unionized so it can't compete in a war at the bottom [of the wage scale]," Head said.

Joey Hipolito, a research associate with the United Food and Commercial Workers International Union in Washington, said the union's effort to organize Wal-Mart workers will be based on forming coalitions with community groups to force Wal-Mart onto "the high road," where business ties its economic health to the health of the communities in which it operates.