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Mainstream, VOL L, No 23, May 26, 2012

FDI in Multi-Retail is Anti-Aam Admi

Monday 28 May 2012, by Shyam Chand


Sam Walton, who created the largest and most powerful retail marketing organisation, died in 1992 as the richest man in America. Now his successors are just behind Bill Gates.

Sarah Anderson and John Cavanagh in their report, ‘The Top 200: The Rise of Global Corporate Power’, issued by the Institute of Policy Studies, Washington D.C., September 25, 1996, wrote: “The annual sales of the Wal-Mart made its internal economy larger than the economy of 161 of the world’s countries— including Israel, Poland and Greece.”

Bill Quinn’s book, How Wal-Mart Is Destroying America, is replete with stories and data on how Wal-Mart has achieved phenomenal success at the expense of small traders across America. “The retailer’s basic strategy is to blanket an area with large freestanding ‘box’ stores at the outskirts of small towns to pull customers away from downtown merchants. Initially Wal-Mart gets customers and support of the local press by advertising heavily in the area’s newspapers. There is strong emphasis on promotions that target the business of local retailers by aggressive undercutting their prices.”

On an average, a hundred stores that have served the people of local community for decades and generations go out of business for each Wal-Mart store opened.
According to the Forbes magazine, “Wal-Mart’s concept is clear and simple: Discount stores in small towns and rural areas, each big enough to freeze out competition.”

A Fortune magazine reporter, who spent a week travelling with Sam Walton for a cover story, gave this assessment: “And finally, there is the ruthless predator Sam who stalks competitors in any size, shape or form and finds sport in blasting them from the sky like so many quail.”

Wal-Mart pays rock-bottom wages to its employees whose number is kept confidential. It makes substantial use of part-time employees to avoid paying benefits. “Even hourly employees are asked to go home if business is slow on a given day.”

According to Quinn, once Wal-Mart has destroyed all local stores, it withdraws all its local advertising, raises the price of commodities, then decides to open a superstore, shuts down all its small stores and sometimes “people have to drive thirty miles or more to where the new store is located.”

Now the question arises as to whether one can expect Wal-Mart come to a town as a good neighbour to small retailers who have served the neighbourhood for generations.

The answer is: Can the lamb drink water with the wolf?
In support of FDI in multi-brand retail a false propaganda is being spread by the brain-dead ventriloquists who think farmers and consumers are brainless, that it would benefit both the consumers and farmers. Wal-Mart is not a charity or a social service organisation. It is a ruthless predator’s business organisation intent to maximise its profits by exploiting farmers, consumers and destroying local retailers. During its existence it has driven 80 per cent farmers out of their holdings in the US, fleeced its customers, rendered millions of small retailers jobless and underpaid its employees.

Our farmers are not getting regular power supply to run their tubewells and students are not getting proper electricity even during their examination days in the rural areas and Wal-Mart would demand power supply round-the-clock for its cold storage and magnificent malls for its well-heeled customers. Will Wal-Mart join the save electricity campaign we have started now?

Or will it set up a thermal plant to generate electricity at least for its own use? Or will it supply goods at cheaper price? Not at all! Then why this predator is allowed to enter India?

There is proxy plea to amend the Agriculture Produce Marketing Committee Act under which the farmers bring their produce to the nearest Mandi. Wal-Mart will require the farmers of Punjab, Haryana and UP to bring their produce to the Delhi border where it will set up a storage facility.

The argument of foreign investment is not very convincing when people are allowed to invest abroad.

Globalisation has destroyed our small scale industries which provided maximum employ-ment. Now, the progenitors, perpetrators and perpetuators of privatisation and globalisation are resorting the worst-kind of protectionism. Wal-Mart would drive all the street vendors to starvation and suicide.

Americans are experts in making discursive experiments. First, they sold their goods to tyrants they set up in different capitals. That went against them when people lost their jobs. Then former President George Bush dreamed of his royal British lineage and tried to establish empires by invading Iraq and Afghanistan forge-tting that empires exist by extracting resources.

“After eight years of war and attempted occupation of Iraq all Washington has for its efforts is several trillion dollars of debt and no Iraqi oil. After ten years of struggle against the Taliban in Afghanistan, Washington has nothing to show for it except possibly some part of the drug trade that can be used to fund covert CIA operations.”

“In the New Empire success at war no longer matter. The extraction takes place by being at war. Huge sums of American taxpayers’ money have flowed into armaments industries and huge amounts of power into Homeland Security. The American Empire works by stripping Americans of wealth and liberty.” And who benefits?

“The military security complex, Wall Street, agri-business and the Israeli lobby use the government to extract resources from Americans to serve their profits and power. The US Constitution has been extracted in the interest of the Security State and Americans’ income has been redirected to the pockets of the one per cent. That is how the American Empire functions.”

“This is why wars cannot end, or if one does another starts.” The above has been observed by Paul Craig Roberts. Before demitting office, President Bush tried to show that the civil nuclear deal with India was his achievement. President Obama is trying to show that FDI in multi-brand retail in India is his achievement and Hillary Clinton has something to fall back upon.

American hegemonic arrogance of arm-twisting the leaders of developing countries is further given more painful twist for personal gain. Hillary Clinton, during her wilderness out of the glamour of the White House, was on the pay-roll of Wal-Mart as some sort of Director on its Board. Now, when the Obama Administration is coming to an end without any hope of a comeback, she is arm-twisting the Government of India like a bounty hunter to allow Wal-Mart enter India.

Before going into oblivion, she made the last effort to reach out to Mamatadi, the CM of West Bengal, via Bangladesh to throw a bait of bank-rupt American investment if she would not oppose the entry of multi-brand retail in India.
The Congress party believes and some people perceive that it can keep the country and democracy intact. Never in the history of democratic India did the Congress party lose two consecutive elections. After the liberalisation in 1991, it lost three consecutive elections.

UPA-II has taken oath of allegiance to the socialist Constitution. To allow FDI in multi-brand retail is against the Constitution of India and against the interest of ‘aam admi’ whom the party’s hand has promised to protect.

If Wal-Mart is allowed to enter India not only street vendors and small traders, but people in general will also come out on the streets against the government. Is anybody listening?

The author is a former Minister, Haryana.

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