It is often laid against corporate giants that they destroy local commercial ecocultures with their big boxes and their ubiquitous neon signs. These accusations often come from people who are less than freedom oriented, who favor handing more freedom to the state and seizing liberty of action from the individual and the family.
While many local businesses in small towns confronted with a Wal-Mart or a Target collapse, others survive by adapting and becoming more service oriented. “Some businesses find ways to compete effectively by filling niches that the larger stores can’t fill, particularly with respect to distinctly local products, such as restaurant food,” notes the Freeman, a bright defender of the free market which recently posted an essay, “The limits of local.”
Steven Horowitz, a professor of economics at St. Lawrence University, points out the advantages of big. Chains buy in giant quantities and force down prices from suppliers, who yield control of many operations to their giant and demanding customers. Low prices at big boxes attract shoppers, and are a boon to the poor.
“A second advantage is less commented on. The very similarity of chain stores and franchises nationwide, and even worldwide, is a big attraction to many customers because they are a known commodity. If you’re hungry in a strange town, you know that you can always go to a national fast food chain and get a meal of nearly identical quality to what you’re used to at the chain’s restaurant at home — and for a good price.” Consistency of brand is ideal for the “risk averse.”
Mr. Horowitz tells about being in a strange town without socks, and being comforted by being able to find his usual Faded Glory cottons at a Wal-Mart a “five minutes up the road.” He tells of the sense of reassurance a traveler feels at being able to take a car for repair in a strange town to a chain with which he is familiar. Interstate chains “bring reputation and repeated dealings” to a consumer, “removing uncertainty and reducing the seller’s power over the buyer.”
Freedom of choice
Mr. Horowitz’s delightful little essay points out that in a free market the consumer benefits. Choice in shopping is a benefit. With more choices there is more competition, and presumably the lowest price and best service.
But Mr. Horowitz attaches to the “buy local” movement a sinister presumption that hardly seems true. “In a world where everything is local, those of us who want to ‘buy global’ presumably would be prohibited from doing so — in the name of saving local character.”
Well, it’s worth at least a smile to suggest that the “buy local” idea can be imposed by some sort of prohibition against global. Every object is produced in someone’s local economy, though it may be produced in circumstances of an alien or remote owner or group of shareholders. Once the item is sold to a faraway party or a distributor, it enters the chain of interstate commerce, and becomes part of the national or the global economy. In other words, the global economy exists because smart people sell to whomever needs their product, wherever they may dwell.
Making local mandatory is to theorize about shutting down the marketplace. The idea popped up in October suggesting that because I favor local economy I favor the use of force to bring it about. Has anyone read of any serious writer proposing such a constraint on liberty?
Not even left-wingers and socialists would go that far. Why not? They prosper from the existence of the freedom their remains in the marketplace, which produces the incomes and prosperity they tap for their social welfare program and their myriad government agencies.
Mr. Horowitz rightly says that freedom of the marketplace allows for big and small players, and that these are needed to meet the needs of consumers. I make no argument against this point.
However, his critique of the argument for local economy overlooks a matter that is perhaps outside the realm of economics.
He takes up for the stranger, traveler, visitor and alien in his defense of bigness in business and the global brand. He finds comfort in a familiar hotel, retail or dining chain when he is visiting a place far from his domicile. His essay suggests that if one is traveling, one should not expect new sights and sounds. One should not find unfamiliar stores and restaurants and hotels. Rather, I should find in a town far away the same marquees as in my hometown. Yes. I find the Starbucks, McDonald’s and Wal-Mart flying their flags, just as they do back home.
The success of corporate giants is partly in “removing uncertainty” for travelers and newcomers. The comforts of home are not the distinct business that separate Chattanooga from, say, Charlotte, N.C., or Butte, Mont. They are the very corporate chains whose effect on the national soul seems to be to turn every place into every other place, to deny seemingly the particularity of place by making their outlets identical.
Particularity is part of God’s creation. Man’s efforts to homogenize reality and culture by totalitarianism, public schools, mass media and propaganda have gone a long way toward centralization and amazing economies of scale. How long will we view our interactions with giant stores as favorable to us?
Sources: Steven Horowitz, “The Limits of Local,” The Freeman