by W.R. Hothershall and Sydney Daeng
On April 16, the notorious megacorporation, Walmart, announced that it was closing four Chicagoland locations, three of which operated in predominantly Black and low-income areas located on Chicago’s south and west sides. The announcement of these closures gave workers and community members merely five days’ notice: not even half of the duration that an employee is expected to give businesses if they intend to leave a company!
With this action, Walmart joins Aldi, Whole Foods, and Target on the list of corporate giants who have recently vacated predominantly disadvantaged Chicago communities. These shutdowns are also happening on a nationwide scale, including in states like Oregon and Georgia, indicating that there are larger trends at play that are reorienting the US retail (and specifically grocery) market.
Three of the four stores being shut down in the Chicagoland area are Walmart’s “Neighborhood Markets” (as opposed to Walmart’s traditional “supercenters”) which focus primarily on selling groceries as opposed to more profitable retail products such as electronics. The company’s goal was to box out local competition and become the go-to grocery supplier in those areas where it set up shop.
Urban settings, in which many residents depend exclusively on public transportation, lend themselves to a consumer base that makes smaller and more frequent shopping trips. This counteracts one of Walmart’s biggest strengths: being able to sell large quantities of products at comparatively lower prices. With the demand for food remaining stable as Walmart entered the Chicagoland market, the move tangibly resulted in Walmart absorbing the sales of other city grocers.[1]
On the same note, the entrance of Walmart into this market resulted in a loss of roughly 300 equivalent jobs in the area, about the same number of jobs that Walmart itself was supposed to “create.” This is further proof that Walmart’s entrance into Chicago merely undercut local prices, which boxed out smaller vendors and forced those retail workers who were laid off by local grocers to look towards Walmart for employment prospects. When the corporations then themselves vacate an area that they had formerly invaded, the community is left with a larger economic void than it initially had before the companies appeared on the scene.
In its own announcement of the closures on April 11, Walmart explicitly admits that this move is in the interests of its own profits: the same logic that was used when Walmart sought to enter the Chicago market roughly two decades ago. “The simplest explanation is that collectively our Chicago stores have not been profitable,” said Walmart in their announcement.[2]
Such a problem, of course, cannot be solved by “sufficient restrictions on monopolies” or “maintaining a ‘healthy’ market,” as the logic of capitalist companies necessitates a drive toward profitability above all, and thus monopolization at all costs. The myth of a “limitless prosperity” where a plethora of similarly-sized small businesses are able to sufficiently supply food to the populace is predicated on the misconception that our capitalist economy is not subject to periodic crises and consolidation.
With production (in this case of food) being carried out for profit, and with the interests of all business owners being to keep wages as low as possible, a repeated cycle occurs in which workers are unable to buy back the products which they themselves create. This naturally forces those businesses which cannot absorb the temporary profit slump to shut down and those businesses which are able to withstand such a situation are able to further monopolize in a given area.
When food production and distribution are in the hands of capitalists (large or small), one of the essentials for human life is commodified, and those who don’t earn enough to buy back the products at the prices that the capitalists are selling them at are simply “out of luck,” and are often even victim-blamed for “not making or saving enough money.” Those stuck in food deserts have to “wait for the market to correct itself.” Such “solutions” constitute complete subordination to the laws of capitalism: laws that condemn the working class to the endless cycle of crises and hunger.
With a socialist economy, the production and distribution of food would be carried out in a way that reflects the needs of working people, as such an economy would prohibit “profitability” from being a determining factor in where food distribution centers would be built and operated. Socialism will also ensure that nobody is “priced out” from buying certain goods, as such a system ensures that the workers own the social value they produce. We must not be made to worry that our home and/or community will be the next victim of capitalism’s economic crises.
[1] “Study: Chicago Walmart Does Not Boost Employment or Retail Sales,” University of Illinois Chicago, January 8, 2010, http://archive.news.uic.edu/releases-2002-2012/2734-study-chicago-walmart-does-not-boost-employment-or-retail-sales.html.
[2] “Walmart Announces Closure of Four Chicago Stores,” Walmart, April 11, 2023, https://corporate.walmart.com/newsroom/2023/04/11/walmart-announces-closure-of-four-chicago-stores.