Tag Archives: CostCo

GOOD LABOR NEWS

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In the spirit of the holiday, three pieces of good recent labor news with good long-term implications as well:

The same week Wal-Mart announced its lowest profits in years, the launch of Robert Greenwald’s film “Wal-Mart: The High Cost of Low Price,” with thousands of showings nationwide was a huge success, as was WalmartWatch’s coordinated “Higher Expectations Week.” Last week showed definitively that just as battling the Wal-Marting of our economy has become a top priority of the labor movement, it’s moved into a position of prominence on the national radar as well. This issue is finally coming to be understood for what it is: the frontline in the struggle over whether democratic majorities or corporate ultimatums will shape our economy. And its potential to bring together feminists, environmentalists, unionists, trade activists, anti-sprawl activists, and immigrant rights activists is finally being realized in a way it hasn’t before. The foundations for a truly effective targeted international campaign are finally being laid. Also, my Mom is telling everyone she knows to shop at CostCo instead of Wal-Mart.

The AFL-CIO and the Change to Win Coalition announced a tentative compromise on the issue of non-AFL-CIO local participation in country and state labor federations. This was the first serious test of the ability of an American labor movement split for the first time in half a century between two competing federations to lay the groundwork to work together on common challenges at the local level. A compromise here – like the SEIU/ AFSCME anti-raiding agreement – bodes well for a future in which each federation pursues different national organizing strategies while pushing their locals to work together to push for progressive change and hold the line against anti-labor candidates, initiatives, and employers.

And Histadrut Head Amir Peretz unseated Shimon Peres as Head of Israel’s Labor Party. Much of the analysis in the wake of that election has understandably focused on its role in prompting Peres and Ariel Sharon to bolt from Labor and Likud, respectively, to form a “centrist” party of their own (it’ll be interesting to see what this means for Labor’s relationship the left-of-left-of-center Meretz Yachad party, itself the result of a recent merger). But Peretz’s ascension is historic in its own right, as it represents the reclamation of the Labor Party by Israel’s foremost Israeli labor leader. Peretz won by doing what few Israeli politicians have done much of recently: talking about issues beyond hamatzav (the situation, i.e., the Israeli-Palestinian conflict). That includes mounting unemployment, extreme poverty, and severe economic inequality largely mapped along lines of race and immigration status. These issues have only worsened from neglect, and Peretz’s ascension to head of Labor offers a real chance to put them back on the national agenda – and offers Labor a chance to pull impoverished voters away from more conservative parties, like Shas.

Happy Thanksgiving.

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THE COSTCO ALTERNATIVE

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In yesterday’s New York Times, Steven Greenhouse profiles Costco, its Chief Executive Jim Sinegal, and the model he’s providing as an alternative to the Wal-Mart economy:

Costco’s average pay, for example, is $17 an hour, 42 percent higher than its fiercest rival, Sam’s Club. And Costco’s health plan makes those at many other retailers look Scroogish. One analyst, Bill Dreher of Deutsche Bank, complained last year that at Costco “it’s better to be an employee or a customer than a shareholder.” Mr. Sinegal begs to differ. He rejects Wall Street’s assumption that to succeed in discount retailing, companies must pay poorly and skimp on benefits, or must ratchet up prices to meet Wall Street’s profit demands. Good wages and benefits are why Costco has extremely low rates of turnover and theft by employees, he said…If shareholders mind Mr. Sinegal’s philosophy, it is not obvious: Costco’s stock price has risen more than 10 percent in the last 12 months, while Wal-Mart’s has slipped 5 percent…

Despite Costco’s impressive record, Mr. Sinegal’s salary is just $350,000, although he also received a $200,000 bonus last year. That puts him at less than 10 percent of many other chief executives, though Costco ranks 29th in revenue among all American companies. “I’ve been very well rewarded,” said Mr. Sinegal, who is worth more than $150 million thanks to his Costco stock holdings. “I just think that if you’re going to try to run an organization that’s very cost-conscious, then you can’t have those disparities. Having an individual who is making 100 or 200 or 300 times more than the average person working on the floor is wrong.”…Costco also has not shut out unions, as some of its rivals have. The Teamsters union, for example, represents 14,000 of Costco’s 113,000 employees. “They gave us the best agreement of any retailer in the country,” said Rome Aloise, the union’s chief negotiator with Costco. The contract guarantees employees at least 25 hours of work a week, he said, and requires that at least half of a store’s workers be full time.

CostCo continues to prove, as I wrote here last year, that the choice Americans face isn’t between policies that are “friendly” or “hostile” to business, or between “big government” and “economic freedom.” Government policies can force a race to the bottom of ever-worsening standards and quality of life for the working Americans who make prosperity possible. Or they can pave the high road by rewarding companies that invest in the economic security of workers and consumers. It’s the latter choice which fosters and expands the real economic freedom which comes from workers’ voice on the job and control over their lives, and whose expansion increases the humanity of our economy.