Boycott Local Business
The clarion call to “support local business” is one we’ve all heard many times. Proponents of the “support local” movement claim that local businesses build “local character and prosperity,” foster “community well-being,” and “keep dollars in the local economy.” Indeed, so ingrained is hostility to large, “big-box” retailers that some American communities have passed laws aimed at keeping conglomerates like Wal-Mart out.
But while this kind of localist activism is no doubt well-intentioned, it is nonetheless deeply destructive. For while large, publicly traded companies contribute to the prosperity of the whole country, local businesses serve only to enrich individual owners.
Take a hypothetical case: a Borders Books and Music competing against a locally owned bookstore. Both stores are going to offer paltry wages to their entry-level employees, probably the rather insulting figure of around $10 an hour. Neither store is going to offer much in the way of benefits, either. So far, therefore, both stores are fairly equal in terms of the community well-being that they provide.
But here’s the rub: consider how the profits of each store are going to be distributed. Borders is a publicly-traded corporation: anyone can buy a share and get a piece of the action. The stock market is one of the great engines of American prosperity; the profits from publicly traded companies augment the incomes of millions of middle and working class people. When Borders thrives, the American middle class thrives. The profits of the locally owned store, on the other hand, will pad only the coffers of the store’s owner. (What’s more, there’s also the chance that the local store will be insufferably smug.)
There is certainly an argument to be made that local businesses are a part of the way that communities define themselves. (I’ve long lamented that the advent of the EU has led to the destruction of “independent” and individual cultures in Europe. Even if I am glad that England now has some palatable food.) And at the risk of hypocrisy, I will concede that I patronize many local businesses solely because I feel that they add a certain je ne sais quoi to their neighborhoods.
But is shopping locally really better for the community – or the world?
If you really want to do good, boycott your local business.