NewGround Technologies

Bruce Bartlett vividly illustrates PBS’s "agenda journalism by providing readers with facts regarding the astounding macroeconomic impact of Walmart on the US economy over the last decade. PBS, having been supplied the same facts during its "investigation" of the issue, chose to omit them entirely from its negative presentation about Walmart.

I also pointed out to Smith that Wal-Mart, all by itself, was responsible for a significant amount of the productivity miracle we have seen in this country over the last decade. In a 2001 report, the McKinsey Global Institute, a respected think tank, concluded that Wal-Mart’s managerial innovations had increased overall productivity by more than all the investments in computers and information technology of recent years. Wal-Mart’s innovations include large-scale (big-box) stores, economies of scale in warehouse logistics and purchasing, electronic data interchange, and wireless barcode scanning. These gave Wal-Mart a 48 percent productivity advantage over its competitors, forcing them to innovate as well, thus pushing up their productivity. The McKinsey study found that productivity improvements in wholesale and retail trade alone accounted over half of the increase in national productivity between 1995 and 1999. A new study from the prestigious National Bureau of Economic Research found that Wal-Mart has a substantial effect on reducing the rate of inflation. For example, it typically sells food for 15 percent to 25 percent less than competing supermarkets. Interestingly, this effect is not captured in official government data. Fully accounting for it would reduce the published inflation rate by as much as 0.42 percentage points or 15 percent per year.

Ignoring these beneficial macroeconomic effects, Frontline focused almost exclusively on the loss of jobs allegedly caused by Wal-Mart. Acting as what economists call a monopsony, it supposedly forced countless American manufacturers to close their domestic operations and move to Asia in order to get their costs low enough for Wal-Mart to sell their products. It is also said to have caused innumerable local retailers to go out of business, further adding to the job loss. In fact, academic research by economist Emek Basker of the University of Missouri contradicts this last point, finding that Wal-Mart permanently raises local employment.

George Gilder compares Korean broadband deployment in a pro-regulatory environment to the broadband deployment/regulatory mess we have in the US.

"…it’s important to really understand what happened over the last five years. A trip to Korea can give you an understanding. We didn’t have a fundamental bubble that consisted of Ponzi schemes and accounting frauds. That wasn’t the basic thing that happened. The basic thing that happened was that we launched a broadband revolution and didn’t consummate it because of regulatory mistakes. So it moved to Asia. Korea has 40 times the amount of bandwidth that we do. And they accomplished that in three years." Gilder continues, "When you have a true deployment of broadband in a country, including wireless broadband, the whole economy changes. In 2003, there was around $450 billion a year of commercial transactions on the Internet in Korea. A third of their economy was transacted on the Internet."