Introduction

Does America Need A Wal-Mart On Every Street Corner? Wal-Mart Thinks So.

As the world’s largest corporation, Wal-Mart – with billions in its deep pockets and an insatiable need for growth – behaves shamelessly in the way it forces itself on American communities. Its aggressive bullying of American communities occurs because Wal-Mart’s growth is central to its business model; it has to grow to sustain its profits, $10 billion in 2004 alone. Analysts have noted that Wal-Mart’s growth efforts are nothing short of a “massive undertaking”. In 2005 alone, Wal-Mart is striving to increase its retail space by approximately 8.4 percent. That amounts to approximately 250 new Supercenters, 45 discount stores, 30 Neighborhood Markets, and 40 Sam’s Clubs on top of its more than 3,600 existing U.S. stores. “[W]e think there’s an extraordinary amount of growth ahead of us,” Wal-Mart CEO Lee Scott has promised.¹ But the reality is that the ongoing public education efforts about Wal-Mart’s business model have made its growth more difficult to achieve.²

To Grow, How Low Will Wal-Mart Go?

This special report reviews Wal-Mart’s bullying tactics through a series of local case studies. Using highly publicized examples like Inglewood, California and Chicago, Illinois alongside lesser known stories from cities like Stoughton, Wisconsin and Lewiston, Maine, the findings reveal patterns: Wal-Mart’s use of local front groups, their reliance on a SWAT team of corporate mouthpieces, aggressive litigation tactics, outright bait-and-switches, and a trail of broken promises. Today, as more American communities rise to fight back against the retail giant, this report offers a strategic map of the company’s tactics.

The Carrot…

The low prices offered by Wal-Mart are used as the enticing carrot to local communities, along with a promise of new jobs and decent wages. Wal-Mart Watch has previously revealed the truth behind those claims. In particular, we have revealed the hidden costs in Wal-Mart’s low prices: devastated small towns, bankrupt local small businesses, drained taxpayers, strained public programs, and endless pressure on competitors to replicate lowest common denominator employment practices.

…And The Stick

It is the stick Wal-Mart wields that is the focus of this report. As a local councilman in Wisconsin remarked during his town’s fight to keep Wal-Mart out, the company’s pressure tactics amounted to “corporate terrorism”. Case studies, relying on myriad primary sources like campaign finance reports and Wal-Mart’s correspondence, illustrate the company’s heavy-handed tactics and the threats made to opponents who resist their efforts.

To be sure, when Wal-Mart has grossly overstepped, they’ve been called out for it. In particular, we chronicle Wal-Mart’s public relations debacle in Flagstaff, Arizona. There, the company was roundly condemned for a newspaper ad placed by its local front group, which used Nazi imagery in denigrating its local opponents. Its other efforts do not always generate such national headlines yet are equally worthy of careful scrutiny.

In his book, “The United States of Wal-Mart,” author John Dicker concludes, “As long as we remain blind to those consequences [of Wal-Mart’s practices], we will also remain blind to the costs we pay…”³ Wal-Mart Watch, in its mission to reveal the full effect of Wal-Mart’s business practices, dedicates this report to growing numbers of local groups and citizens who are recognizing the harmful consequences of Wal-Mart’s victories.

This report is a tool for those who share our belief that the power of this wealthy corporation can be put to better use, and that American communities must be allowed to decide for themselves how best to sustain their vibrant economies.

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