Ruiz: Walmart’s no Santa for city economy

Dec 18 2010

Ruiz: Walmart’s no Santa for city economy

Walmart raises prices during the holiday: Corporate greed or good business?

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It seems that even the largest retail business in the world is not immune to a public relations faux pas once in a while.

A Walmart internal email – sent less than a month before Christmas – directed its 3,800 stores to hike prices on 1,800 types of toys to maximize profits. Hardly a way for the retail giant to win hearts and minds of New Yorkers.

“The Christmas season has clearly brought out the Scrooge in Walmart. Jacking up prices on toys during the holidays is enough to make Santa cringe,” said Public Advocate Bill de Blasio.

The big-box retailer denies boosting its prices.

De Blasio, along with Council Speaker Christine Quinn, is adamant in opposing Walmart’s plans to open its first store in the city. Both believe the plan has disastrous consequences for independently owned and operated local businesses, and the good jobs they provide.

Twice before, Walmart attempted to plant its flag in the city. Although the mega-retailer hopes the third time is the charm, small-business owners and community leaders are uniting to prove the old saying wrong.

The retailer’s previous plans were nixed by fierce community opposition, but five years after its failed push to open stores in Queens and Staten Island, a job-starved city besieged by the economic crisis and looming draconian budget cuts may be less resistant to Walmart’s controversial M.O. of meager salaries and low prices.

An informal Daily News readers’ poll published last Thursday supports that contention. Asked if they wanted to see Walmart come to Brooklyn, 61% responded yes. Nevertheless, Walmart opponents do not think this type of poll is accurate.

“What New Yorkers have not been asked is if they would support Walmart knowing it would mean the disappearance of the stores they have patronized for years,” said Brad Gerstman, a lawyer with Gotham Government Relations, a Long Island consulting firm, who represents Gristedes supermarkets. “I have no doubts their answer would be no.”

People should not be fooled by the “new jobs” mirage, warns Stuart Appelbaum, the president of the Retail, Wholesale and Department Store Union, which supported past efforts to stop Walmart.

The giant retailer has a powerful ally in Mayor Bloomberg, who – small businesses be damned – is all for Walmart opening a store in East New York, Brooklyn, at the Gateway II mall, planned by Related Cos., Bloomberg’s favorite developer.

Meanwhile, Walmart has also been doling out hundreds of thousands of dollars to local politicians in the past two years, the Daily News reported last Friday.

“They’re trying to simply buy their way into New York,” said Pat Purcell, an assistant to the president of United Food and Commercial Workers Local 1500.

Walmart maintains its wages are competitive and would help with the city’s unemployment problems, but opponents disagree.

“They [Walmart] will come in, squash small and medium-sized businesses and replace good-paying, unionized workers with underpaid, nonunion workers,” Gerstman said. But the immediate consequences may not be the main problem, Gerstman said. The long-term impact could be even worse. “Who is going to open a store next to Walmart?” he asked.

“Walmart’s business model spells disaster for small businesses, the middle class and New York City,” said de Blasio who characterized the retail juggernaut as “a weapon of mass job destruction.”

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