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Falling Sears

30 Oct

[courtesy Google Images]

[courtesy Google Images]

I remember buying at Sears stores when I was a kid.  The stores were always crisp and clean.  Their shelves were well-stocked. Sears prices tended to be high, but they sold quality.  For example, Craftsman tools were about as good as you could get and carried a lifetime guarantee.  You couldn’t beat ’em.

Four years ago, about Christmas, I stopped in at a Sears store at Dallas.  I was shocked.  The carpets were dirty.  The shelves were only partly stocked and what was there was mostly junk. There were only a few employees, but almost no customers.  The store was grubby.  It was clearly a corporation headed for bankruptcy.

Today, I read an article in DealBook entitled “For Once-Mighty Sears, Pictures of Decay”.  The article chronicled the author’s visits to several Sears stores–all of which were as shabby as the Dallas store I’d seen four years ago:

 

When Brian Sozzi, the chief executive of Belus Capital Advisors, visited Sears locations in New York and New Jersey this month, he said, he found barren shelves, haphazard displays and badly stained carpets.

Also missing: customers.

“It’s just badness throughout,” Mr. Sozzi said in an interview. “Every store has something fundamentally wrong with it.”

What’s wrong with Sears?  Why has this one-time corporate giant fallen on bad times?

 

Gross mismanagement by the Sears corporate officers?  Probably.

But I suspect that to understand the fall of Sears we might compare and contrast that business to another similar business that has thrived:  Walmart.

Why did Walmart thrive?  Because it sold products manufactured in China and imported into the United States.

Why did Sears fail?  Because it sold products primarily manufactured in the USA.

Viewed in that light, the fall of Sears is a troubling sign of what’s happened to America:  we’ve lost much of our capacity to build our own products and we’ve sent profits that should’ve been kept at home to foreign producers like China.

In many regards, Sears is a metaphor for the USA.  Just as Sears has fallen on hard times, so will America.

Why?  Because our government committed to Global Free Trade and therefore lowered our tariff barriers.  Without the protection tariffs provide, Sears succumbed to Walmart’s inexpensive Chinese-made products.  Without the protection tariffs provide, the USA will certainly lose the American dream and hope of an ever-increasingly prosperous people.

The fault is not merely government’s but also that of human nature.  Sears prices were always higher than Walmart’s, so we abandoned Sears to buy at Walmart. It’s human nature to buy low.

But Sears prices were higher because their products were made by Americans.  As a result, we might pay more at Sears, but the excess costs went to our neighbors and other Americans who worked for Sears.  We paid higher prices at Sears, but we also received higher wages.  As a nation, we prospered.

Now, we pay lower prices at Walmart, but we also have fewer jobs, more unemployment and reduced wages.  By buying at Walmart, we may be individually enriched by our savings.  But by buying at Walmart, we are, as a nation, also impoverished.

When we bought American, we all prospered.  When we buy foreign, we may individually seem to prosper, but as a nation we are diminished.

There is something about being “our brother’s keeper” that should cause us to buy American rather than foreign goods.  Buying American is a kind of welfare.  We pay more for our goods and services, but we also keep our brothers employed and prosperous.  In doing so, we also tend to be more prosperous.  By buying foreign made goods, we cut some of our “brothers” out of employment.  Result? They–and we–become increasingly impoverished.

It’s not an accident that Sears went down while Walmart went up.  It’s not an isolated incident, either.  And it’s not a coincidence that Sears’ decline coincides with the elimination of tariffs.  So long as we can purchase inexpensive, foreign made goods, we will not only do so–we will continue to cause higher and higher rates of American unemployment which will eventually impoverish all but the upper 10% of Americans.

Solution?

It’s human nature to buy the least expensive products of comparable quality.  Nothing will change that.  No amount of moral lecturing will persuade people to pay more than they have to.  No matter how ultimately self-destructive it may be, we’ll continue to buy at Walmart instead of Sears.

Therefore there’ll be no individual solution to the “problem” of low, foreign prices–nor to the correlative rising rate of US unemployment and falling wages.

But, if no individual solution is possible, there could still be a national solution.  We could lean on the treasonous whores in the cathouse on the Potomac and compel them to restore high tariffs. Being treasonous whores, they’d scream and shout that we must have low tariffs for Global Free Trade.  But our politicians are, finally, just as self-serving as those of us who shop at Walmart.  If preventing high tariffs could cost them their jobs, they’ll vote for high tariffs.  If we lean on ’em hard enough, they’ll restore high tariffs.

With sufficiently high tariffs to protect us all from cheap, foreign labor, overseas factories would be forced to relocate into the USA, restore American jobs, reduce American unemployment and restore high, American wages.

Yes, if we restore tariffs, we’ll cause store prices to rise.  But we’ll cause employment and wage rates to rise, too. With higher tariffs, America won’t be as lucrative for the top 10%, but it’ll be a whole lot more prosperous for the bottom 90%.

Restore tariffs and Sears will prosper and so will the whole USA.  Keep low tariffs and this country will come to look like one giant Sears store–devoid of products, devoid of customers and grubby.

 

27 responses to “Falling Sears

  1. Felipe

    October 30, 2013 at 2:11 PM

    Well, think about it, when the Federation was formed its income was to come primarily from impost and tariffs.

    Then the War of Northern Aggression came and changed the Federation into a National government with its internal funding on an income tax…

    Throw in USURY as a primary measure and there is no doubt as to how we came to be on our present state of misery.

     
    • Cody

      November 14, 2013 at 9:56 AM

      Felipe,
      I do declare, I think you are correct to point out the source of our country’s misery. First the War Between the Yankees and the Americans. Then the subjugation of all by the 14th Amendment.

      Deo Vindici,
      Cody

       
  2. Joseph S Haas

    October 30, 2013 at 2:31 PM

    How about this idea: Have a local, county +/or state auditor canvas the stores like WALMART that sell mostly foreign products, of then at whatever the foreign percent is in products, that is what the employee / worker gets in like Chinese Yuan http://en.wikipedia.org/wiki/Chinese_currency of then they have to go to the Coin Shop for to exchange such into American coin or currency to spend elsewhere or if another store sells such foreign goods too then by agreement of paid over on an even swap. Otherwise the profit made by the owner of the Coin Store taxed accordingly. – – Joe, P.S. Of here in New Hampshire it’s R.S.A. Chapter 275:43,I http://www.gencourt.state.nh.us/rsa/html/XXIII/275/275-43.htm in that EVERY employer SHALL pay wages in lawful money of the United States. Of maybe an amendment can be made of NOT that of for “Every” or ALL employers at the 100%, but only SOME, of if they sell more than 50% of foreign goods, as can be checked by inventory slips to the auditor, then the employer pays in the currency of THAT country, of it a hurdle for the employee to have to go over to convert to American at LESS than what be at par for American, of actually bad for the employee, but then if they want quality to their pay, then to have to work for a quality company! (;-) Slave labor made the goods for sale over here as why so cheap, of per room and board and walk from their local jail, thus what’s next? A WALMART Parking Lot housing? (;-) Note: Canadian goods, of if paid in Loonies be actually worth MORE than the American dollar now BELIEVE IT OIR NOT! Of in the 1960s my neighbor, now retired of who had a grocery store, bragged about the fact that he’d vacation north of the border and bring back Canadian dimes and filter them through the change to his customers. Of now I’d rather have those 1960s dimes with the sailing boat than the current FDR debased metal dimes.

     
  3. cory

    October 30, 2013 at 3:18 PM

    I tend to agree with you. But in the case of Sears, I think what they did was try to keep their prices up but lower the quality of the products they sold. Their quality has definitely declined over the years. The Craftsman mower I have today is not the quality of the mowers they sold some years back. I heard one of the employees attest to this in the store. You cannot sell what everyone else sells and maintain the higher price. This is part of the problem that all retailers are facing.

     
  4. Yartap

    October 30, 2013 at 3:25 PM

    Everyone – require your congressman and senator to raise Tarriffs on manufactured goods to create an equal balance of trade (for starters, then gradually increase the Tarriffs over time) or no vote for them – Period!

     
  5. Howard R Music

    October 30, 2013 at 6:03 PM

    How do you get enough Americans to stand together and put a stop to all the nonsense? It should be easy to kill the NSA. Just don’t fly. Yet, people are still flocking to the airports to get groped.

     
  6. Pat Fields

    October 31, 2013 at 12:55 AM

    Just one little ‘fly in the ointment’ … banknote ‘money’.

    First off, tariffs and duties are NOT properly levers for protection of domestic manufacture; they’re methods for tax alleviation … accommodation for government’s dutifully minimized costs. All other uses are offensive against the basic nature of economy.

    “I expressly say that Congress is not a representative body but a diplomatic body, a collection of ambassadors from thirteen sovereign States….” –John Adams

    Though the ‘plan’ had already been progressing elsewhere in the world as executed by the city-state of London, in America the competitive stance of companies like Sears was undermined and ultimately destroyed the instant silver was ‘de-monetized’ under the ‘Crime of 1873’ and replaced by the ‘gold standard’. With a much smaller volume of money to ‘manage’, the banks got busy circulating their Bills of Credit to capture and hoard it.

    Once the banks had control of the world’s bulk of gold and the leverage to nominally devalue it in relation to their banknotes, they embarked on the next step of making banknote ‘money’ universal so as to ‘de-monetize’ gold itself and thus manipulate the various ‘brands’ of banknotes to suit their purpose of effecting control over all commerce world-wide.

    In the untrammeled scheme of poly-metallic specie money and freely competitive markets, wages and materials don’t long remain disjoint in different economies because entrepreneurs swoop in to take advantage of the arbitrage and equalize the disparities. Consequently, common goods may be manufactured at less expense in regions where costs of living are low, but that condition is relatively temporary and domestic manufacturers and merchandisers (like Sears) can creatively adjust their own methods of competition to accommodate the gap.

    We’re suffering under a revival of Mercantilist Social Order, where government’s favored producers and manipulators of finance are enabled access to relatively limitless quantities of banknotes with which they can ‘out bid’ potential competition into oblivion (such that statutory ‘rules and regulations’ don’t ALREADY preclude their very formation), no different than ‘the King’s Charter and Treasury’ of the post-Medieval period.

    “(L)et our affairs be disentangled from those of all other nations, except as to commerce, which the merchants will manage the better, the more they are left free to manage for themselves, and our General Government may be reduced to a very simple organization, and a very inexpensive one; a few plain duties to be performed by a few servants.” –Thomas Jefferson

     
    • tom

      October 31, 2013 at 4:55 AM

      Ill bet sears was all for trade with china while the trade legislation was being crafted probably even one of the original proponents.

      You cant stop free trade, just like the embargo against Cuba is a 50 year failure. The small people suffered more than anyone else both in Cuba and America with the accompying loss of freedoms for both.

       
      • Pat Fields

        October 31, 2013 at 9:12 AM

        Tom, maybe you’ll be so kind as to explain how you square ‘Free Trade’ with ‘Trade Legislation’. Seems to me they’re intrinsically contradictory notions.

         
    • Yartap

      October 31, 2013 at 7:30 AM

      Pat,

      I agree with you. But you are speaking of a time in the past when congress and men had a better understanding of true money, unlike the men of today who believe currency grows (on trees). And you speak of a time when economic facts truly effected each and every legislator in our country. Thus, the incentive for each to keep the cost of government low, so as, to not interfere with their personal endeavors, unlike the dumb-down payed-off prostitutes of today.

      I agree with you, that tariffs and duties are methods of tax alleviation (which is a good thing for our economy). Jefferson agrees, too, when he said that the common farmer and man was relieved of taxation by the wealthy paying the tariffs on the foreign goods and luxuries. And Jesus agrees, also, when he said “are not the children (locals) free (from taxation).”

      But, in a world of fiat currency, protectionism is the means to have the return of our manufacturing and jobs. The spend-today and worry tomorrow legislator will not use the increased revenues from protectionism to help us, but rather, they will spend and spend. So, no alleviation, but rather, a return of jobs. This should be our first goal.

      Yes, a return to hard metal money is a means to fight the fiat bank currency and bank control, but it does nothing to return jobs in a timely manner as protectionism.

      It took many years and small steps to get us in our bad shape, and it will take small steps to have our return to greatness. And protectionism is one of many of those small steps.

       
      • Pat Fields

        October 31, 2013 at 9:03 AM

        “But, in a world of fiat currency, protectionism is the means to have the return of our manufacturing and jobs.”

        You don’t get it. You’re in the exact same mindset you believe you’re lamenting. There is no ‘accommodation’ to the current ‘monetary’ condition. The banknote scheme is irreversibly doomed.

        Currency is loaned as principal at interest … you’re completely ignoring the obvious question of where that interest currency is supposed to magically appear from. There’s only place it CAN come from … more borrowing of currency as NEW principal, at interest. IT’S ALL PRINCIPAL. If every loan was ‘paid back’, there is STILL a HUGE amount of debt remaining. THAT’S what you need to get razor sharp in your mind, Friend.

        “All the perplexities, confusion and distress in America arise, not from defects in their Constitution or Confederation, not from want of honor or virtue, so much as from the downright ignorance of the nature of coin, credit and circulation.” –John Adams

         
      • Yartap

        October 31, 2013 at 10:40 AM

        Pat,

        I believe that I understand usury. But, please explain (in simple terms) to me how as a nation we will return our jobs without the advent of protectionism.

        Thanks, your friend, Yartap.

         
      • Pat Fields

        October 31, 2013 at 5:42 PM

        First, Yartap, I ought to say I have no problem with interest charged on loaned money (money, that is … NOT credit. Credit is properly discounted from maturity, which is different). To borrow money without compensating it’s natural appreciation and loss of access during the term of borrowing is plain theft from the lender.

        We (as is the case with all countries) can rebuild our manufacturing base by universally returning to real money that forms a level operating base for all folks to work from. This banknote boondoggle is a means to manipulate costs that create financing advantages which governments, bankers and monopoly industrialists use to negate Free Markets between Free Peoples.

         
      • tom

        October 31, 2013 at 10:53 AM

        Gubment is the problem. Let me decide how to spend my own money, if I want to buy from my neighbor or from my Chinese friend on the otherside of earth, anything less than that is a loss of freedom by those that want to increase my costs for thier own enrichment.

         
      • Martens

        October 31, 2013 at 1:03 PM

        tom,

        Protectionism only limits trade on the international level. It does not stop you buying from your Chinese friend.

        You, personally, are free to do business with whomever you chose. Likewise, the people of the United States are free to control who and what crosses their borders.

         
      • Pat Fields

        October 31, 2013 at 5:17 PM

        So, what clause of the Constitution (either the original Federal Trust Compact or its simile adopted by the DC city-state) authorized Congress to use Tariffs and Duties to favor specific industries or product categories against competitive forces?

        If congress hadn’t committed the Capital Economic Crime of imposing Bills of Credit on The People’s commerce, we wouldn’t need to engage this topic. The very fact we are, is a gross diversion from the core of the problem.

         
      • Martens

        October 31, 2013 at 5:41 PM

        Article I, Section 8, Clause 1: “The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States…”

        The success of specific American industries and product categories is one of the more important factors in the general welfare.

         
      • Pat Fields

        October 31, 2013 at 5:56 PM

        Well, Martens, that may be the present ‘interpretation’ of the Barristocracy, but it wasn’t the Spirit and INTENT of the Constitution’s writers. Foremost among whom said …

        “If Congress can do whatever in their discretion can be done by money, and will promote the General Welfare, the Government is no longer a limited one, possessing enumerated powers, but an indefinite one, subject to particular exceptions.” –James Madison

        “I cannot undertake to lay my finger on that article of the Constitution which granted a right to Congress of expending, on objects of benevolence, the money of their constituents…” –James Madison

        You can justify this protectionism malarky ’till you’re blue in the face’ and it doesn’t change the fact that it plainly violates Private Property and Individual Determinism which are SUPPOSED to be sacrosanct maxims on which our American Social Order is founded.

         
      • Martens

        October 31, 2013 at 7:36 PM

        In the same year the Constitution went into effect, the Congress passed the Tariff Act of 1789:

        “Whereas it is necessary for the support of government, for the discharge of the debts of the United States, and the encouragement and protection of manufactures, that duties be laid on goods, wares and merchandise…”

        This legislation was introduced by James Madison.

         
      • Pat Fields

        November 1, 2013 at 12:26 AM

        Just as in today’s Congress, where statute is bulldozed throuth common sense by ‘pass it to read it’ exigencies, the Bill was introduced and largely ‘sold’ as a Revenue Measure for payment of War Debts and the maintenance of the ‘General Government’ to be unburdensome on the States, when as anticipation of the Spring Season grew imminent, the colour shifted to protectionism as an added initiative. Poignantly, before the State Legislatures had time to debate the broadened scope in defiance of the Founding Principals, the ‘vote’ was rammed throughto pass it. Still, the revulsion against its beligerent features, afterward kept the Tariffs at a relative pittance.

         
  7. Adrian

    October 31, 2013 at 12:56 PM

    There is a good practical solution: STOP buying imports and START buying Made in America.
    Support the American labor.
    Educate yourselves and the rest of Americans.
    Action is our motto. Talking is cheap.

     
  8. tom

    October 31, 2013 at 5:19 PM

    There are jobs out there and you have to create them if you cant find any. Come to any bigger city and landscaping or building maintence contractors are in infinite demand. In south Idaho they are hiring illegals at $14 an hour to milk cows, at the bakken oil field you can work at mc donalds for over $20 an hour, sure the housing is expensive but all it requires is effort. The harvest is ripe and the workers few.

    Secondly, I rather do business with a $2 an hour china man than a $70 an hour GM man. That way the car costs me $2,000 rather than $20,000. At $20,000 i can keep one and give extras to my wife, children and good friends and keep them a hand up and be ready for work. At $2000 a car, service for usury wouldnt be necessary. Keep 10 delivery drivers employed rather than one. More people buying gasoline. Dagg, that would be an additional $360,000 of additional disposable income for ten cars.

    You know its pretty easy to build a car but what business has the money to destroy 20 brand new manufactured cars of each model to meet federal safety requirements. Probably more than half the nations on earth build cars with many manufactures in each country but, they are not allowed to be imported except for the select few that will pay off the gatekeepers. Protectionism destroy wealth wether it be a single man or a group of men.

    The history books are all skewed with things like the boston tea party. Those were efforts to get rid of competion rather than liberty minded patriots. If you want freedom and independence, than open borders are necessary, that was true during the earthly kingdom of Isreal. The chinese man on the other side is not your enemy he just working for a living, its usury, regulation, high taxes, cronyism, etc… that take your earned wealth away. Rather than focusing on the true perpertrators people become defeatist and then blame others because of covetousness and plain laziness.

     
    • Yartap

      October 31, 2013 at 9:41 PM

      tom,

      I agree with much, that you have said. But, I don’t believe you understand the true and real situation.

      You said that you would rather do business with a $2 dollar/ hour china man, than a $70 dollar/ hour GM man. Really! Tom what can you sell to the China man? What can he buy? It’s true that the out sourcing of American jobs to China has raised their standard of living (food, clothing and shelter). But, tom, let’s get real, the true wage in China is $4 dollars/day (wages to make the $8.7 billion dollar Nike Company’s $150 dollar/pair tennis shoe). Now, what can you sell to the China man? It certainly ain’t Nikes.

      One of the main rules in economics is to establish and perpetually KEEP your economy within your own borders FIRST, then expand outward. But, in order to perpetually keep your economy, one must protect the industries and businesses. Remember: Protectionism is not the same as “Isolationism” (no trade).

      Even the great Walmart is failing in China. They plan to attack the Chinese market again with news plans for over 100 more new stores in China. They close 50 stores on average in China each year. Even the people who produce the goods that Walmart sales in China cannot buy from Walmart’s “Everyday Low Prices.” What does that tell you? Walmart is beating its head against a wall. It won’t work for Walmart until a middle class arises in China, which will not happen!

      Tom, protectionism is not the solve-all solution, but it is one of the solutions of many, that are needed. You have correctly pointed out many more of our problems.

      Thank, Yartap.

       
    • Martens

      October 31, 2013 at 10:16 PM

      “Secondly, I rather do business with a $2 an hour china man than a $70 an hour GM man. That way the car costs me $2,000 rather than $20,000.”

      That works if you’re the only one buying from China.

      However, if everyone else in your economy does likewise due to trade barriers being lifted, the market value of your labor will decline to the same $2 an hour the Chinese worker earns.

      And the products you make will lose their pricing power similar to the car that now sells for $2,000 rather than $20,000.

       
  9. Adrian

    November 1, 2013 at 12:01 PM

    As I was saying before,we need to protect our markets here in America.
    We have no governing political body.We the People should assume that position and take action
    to protect our economical interest.
    The best solution now is to STOP buying all that foreign product.
    In this way we create more jobs in America.
    Lets get back the Power to the American People.
    We can crash the GLOBALISTS and THEIR utopian ideas.
    Remember: Man was born free he must live free.

     
  10. Peter

    November 7, 2013 at 11:52 AM

    As with any retail establishment, they eventually become late stage Ponzi schemes. Over time they become top heavy and bloated with overpaid directors on the board receiving a check for a million or so a year for attending a quarterly meeting every 3 months and the rest of the time on the golf course. The front line of the corporation is the store’ that gets gutted any time expenses need to be controlled, as in payroll. WALMART will resemble a SEARS store some day’ just be patient, they operate under the same concept as SEARS,they steal from the employees( minimum wage) and tell them they are lucky to have a job. You may see walmart erect suicide nets similar to the nets they have in China to catch the one’s that jump. All in time.

    When the world stops accepting dollars soon, WALMART shelves will be empty …….

     
  11. Cody

    November 14, 2013 at 10:02 AM

    Sears is also transitioning to more on-line retailing. This will allow them to become somewhat more competitive at the expense of the store front business.

    Is there a reliable source of reasonably priced American made products on line?

     

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