But lowering wages for a grocery clerk and then lowering prices on groceries transfers the wealth from the less efficient smaller grocer to the people who now shop at Wal-Mart. And because Wal-Mart can put price pressure on manufacturers like P&G like no other company can, it squeezes the wealth out of those companies and transfers it to the people who shop there. This makes the town wealthier, enabling them to save more, buy larger houses, newer cars, better health care. One major cost center becomes less costly and in the process improves the quality of life for a lot of people. I'm certainly not saying there are no losers, but any time incumbents are pushed out there are going to be unfortunate souls who have to adjust.

Although it is true that the consumers in the town are paying less for the goods, their salaries are also smaller on average. Meanwhile, in some other town that happened to be more aligned with increasing demands for human labor (Silicon Valley) people are getting richer. When those peopl visit the small town, their income dwarfs the town's inhabitants' income.

All this is mitigated somewhat when a town can issue its own currency. But if they are forced to use the country's fiat currency, they may start defaulting on their loans. This can explain what happened with the PIGS countries' economies after they joined the EU for example.

In any event, the income disparity pushes some people around (making them move) . There is an ever greater amount of people unable to earn enough to leave their small town to a "booming center" without significant risk. Those who do are willing to put up with worse conditions in order to get a chance at the big bucks. This happened for 10 years in the Great Depression as farmers migrated to the cities and our country transitioned to be dominated by industrial sector. A sector which has been disrupted in the last 30-40 years much as the agricultural sector was before.

However, even with all that, a growing "underclass" of people becomes less economically significant. For example why develop vaccines for them? The overall pictureis that automation increasingly favors the capitalists over the wage laborers. One of the best ways that has worksd to mitigate this is to decentralize the capital, eg have wordpress and linux instead of facebook and windows. Patents work against this, though.

> it squeezes the wealth out of those companies and transfers it to the people who shop there

That's very neat. But aren't the people who shop there themselves getting lower wages, so the purchase power remains the same as before?

i.e. my grocery shop is 20% cheaper, but my wages are 20% lower.

No. Wal-Mart has distribution that makes the operations of most grocers look archaic. More man hours are devoted to managing their operations than putting a rover on fucking Mars. This makes them extraordinarily efficient. Things that don't sell are pushed out for things that do, giving people exactly what they want, when they want it.

They also know that they only need to have, on average, four checkouts open from the hours of 8-6, Monday through Friday, so there is no inefficiency when it comes to staffing, either.

Meanwhile at Mom and Pop's Five and Dime, inventory is brought in once a week on a truck, and if they got rid of cereal X and moved the milk over two aisles how much would their sales increase? Who the hell knows? They are just doing what has worked for the past 40 years. But it's okay, because shoppers in the area like them and because there isn't any meaningful competition, they can just use cost-based pricing to guarantee a satisfactory margin and keep themselves in business.

Unfortunately in this scenario, local town inhabitants are paying for this inefficiency. When Wal-Mart moves in and gives the consumers more choice at lower prices, Wal-Mart robs Mom and Pop of their margin, keeps a little of it, and gives the rest to the consumers. Your wages aren't 20% lower just because Wal-Mart ironed out a huge producer surplus. You are wealthier because you can go to the mall and buy a quality shirt for $30 that was made for about two bucks whereas before you would have had to make your own shirt which might take you most of a day. This is how economic progression works. Better business practices make society wealthier through efficiency.

> Things that don't sell are pushed out for things that do, giving people exactly what they want

Well, no. I can't find rabbit (meat, not pet) for love nor money. Because it "doesn't sell". Time was, the butcher would always have rabbits and if people didn't buy it they would go to his dogs.

> there is no inefficiency when it comes to staffing, either.

inefficiency, otherwise known as plenty of jobs.

I'm seriously not convinced that the ideal society is the one that is most efficient.

Wonderful things live in the obscure, inefficient corners of things.