Friday, March 25, 2005

Voting with your feet: WalMart and WarMart

Today I listened to radio show that was discussing the recent California court decision that basically said, environmental impact reports must consider the economic impact of new development. It also came down against doing two developments simultaneously and having impact reports for each that do not consider the other.

Actually for an public radio show talking about WalMart and big-box development in general it was surprisingly calm and balance, even the attorney who represents big-box stores seemed to have her leash on. In fact I've heard Ms. Shimco represent retail developers in real life in a local situation and she was being very calm and restrained in her comments, as was the economics professor from San Francisco.

One comment that came up time and time again was "well if you don't like WalMart or any other retailer then they should just vote with their feet and not shop there". As they say, no one is forcing people to shop at WalMart. Well that's true up to a point - right up to the point where there are no other stores to shop at and you have to shop at WalMart or move somewhere else. Which brings one to the second objection to saying people should vote with their feet: it assumes a well informed voting population. Basic economics says people make "the economic choice" but they do so with the information they have at hand. What if there are hidden externalities that they don't know about?

On a different aspect of "voting with their feet" it seems American men and women are failing to point their feet in the direction of the local Armed Forces recruiting center. Why not? Well naturally Americans are just making the economic choice again since many, if not most recruits join primarily for financial reasons. Now they are starting to realize there are a few hidden costs to signing up - like maybe actually being put in harms way and dying. That's not going to do much good for your future income potential. Or perhaps realizing that the "seeing the world" promise isn't quite ringing so true any more when all you're likely to see is the inside of a Hummer for the next two years.

I don't blame people for making the economic choice, but just remember when the supply of willing and able has run out there are interventionists in high places with one word on their minds and a big stick behind their backs. Does anyone feel the draft?

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