The Big Box Swindle: The True Cost of the Mega-Retailers

Stacy Mitchell is a senior researcher with the New Rules Project, a program of the nonprofit Institute for Local Self-Reliance. She has advised numerous communities on strategies and policies to limit chain store proliferation and strengthen locally owned businesses. Mitchell is the author of Big-Box Swindle: The True Cost of Mega-Retailers and the Fight for America's Independent Businesses (Beacon Press, 2006), as well as Hometown Advantage: How to Defend Your Main Street Against Chain Stores and Why it Matters (Institute for Local Self-Reliance, 2000). She is chair of the American Independent Business Alliance.

Multinational Monitor: What is the big box “swindle?”

Stacy Mitchell: The swindle is that many of us believe that we are doing well by shopping at big box stores, that the chain retailers are bringing us economic growth, prosperity, jobs and low prices. But, in fact, we are paying a huge hidden cost for these retailers. That is the swindle.

MM: But people are shopping at them; they must be happy with what they are getting.

Mitchell: People say, well this is just the free market at work. But I think what’s happening is more complex than that, for a number of reasons. For one, there are the many externalized costs that these companies impose. These are costs that do not show up on the price tags at these stores, but that are borne by society as a whole. MORE >>

Greasing the Deal: The Royal(ty) Scam

by Mandy Smithberger

In many U.S. states, if you drive away from a gas pump without paying for filling your tank, you face fines, jail time and a suspension of your driver’s license. At the very least, someone from the gas station is going to try to stop you. Big Oil and gas station owners expect to be paid for the gasoline they provide.

But the oil companies may be looting U.S. government-owned oil and gas reserves on a far greater scale than any miscreant driver — while suffering at most minimal penalties and no criminal sanctions. In some cases, the companies are sneering at the government for technical mistakes in their contracts, and refusing to pay billions in royalties they would otherwise owe. MORE >>

South Africa Embraces Corporate Welfare: Mega Deal Subsidies Over Services for the Poor

by Patrick Bond

Durban, South Africa — The South African government is channeling Africa’s largest-ever industrial subsidies into the Coega industrial zone complex and port, located in the country’s fourth largest city, the Nelson Mandela Metropole (better known by its apartheid-era name, Port Elizabeth). Government proponents say Coega represents sound industrial and development policy, but a growing legion of critics are labeling it a corporate welfare boondoggle in a country that does not have resources to spare.

Aside from tailor-made infrastructure, including a 20-meter deep port, the key attraction of Coega for foreign investors is super-cheap energy. Following a year of frequent brownouts in the two largest metropolitan areas, Johannesburg and Cape Town, a fierce debate has erupted over the idea of providing discounted electricity to industrial users when citizens cannot get a dependable supply at any price. Mismanagement of the state electricity company, Eskom, in the course of its corporatization has interfered with a steady supply. MORE>>