PORTLAND, Maine — The homeless population in Portland is swelling, with nearly 25 percent more people seeking shelter this fall than even the historically high numbers seen a year ago. That increase and the expectation by Portland Department of Health and Human Services leaders that the numbers will continue to climb well into 2013 are fueling fierce debate over a question posed by city business advocates: Is Portland too attractive to the homeless?
That was the question posed by the Portland Community Chamber of Commerce in an 11-page response to a recent report by a city task force on homelessness that recommended more accessible services and more housing options.
The question draws the ire of social workers and service providers, who counter that life in the shelters is anything but attractive — and that jumps in the city’s homeless population can be traced back to the recession, which drove up unemployment and forced budget cuts in programs aimed at helping people who are on the brink. Their counterparts in Lewiston and Bangor, Maine’s second and third largest cities, respectively, say they’re battling similar allegations of attractiveness and that they’re seeing their share of shelter seekers from Portland.
“It’s an emotionally charged issue,” said Portland DHHS Director Doug Gardner. “It’s emotional for people seeking services, it’s emotional for people in the community and businesses, and it’s emotional for service providers.”
The Chamber document offers anecdotes in which homeless people from other parts of the country describe migrating to Maine’s largest city because of its reputation as a place where “nobody hassles you” when in search of public assistance.
The business organization contrasts those stories with anecdotes from longtime tourists who say they’re taking their shopping and recreational dollars elsewhere because Portland has become — as one reported visitor called it — “a disgusting filthy mess.”
The Chamber’s conclusion? As the number of homeless people visibly rises, the number of shoppers and visitors in Portland is bound to decline. And the organization wants the city to consider how it can take steps to be “less attractive” to the homeless, in direct opposition to task force recommendations to build 105 more supportive housing units for the chronically homeless.
“Is this expansion of capacity an invitation for an exacerbation of an already deplorable situation? Could be,” said Chamber consultant Christopher O’Neil. “What steps might we take to avoid such a result?”
‘Why come to Portland for that?’
Mayor Michael Brennan, a vocal supporter of the task force recommendations, acknowledges that Portland attracts the homeless — but no more so than might be expected in a city that’s nearly twice as large as any other municipality in the state.
Portland has a population of more than 66,000, while Lewiston and Bangor rank second and third with populations of about 36,000 and 33,000 people, respectively. By some metrics, the Greater Portland area — which economists consider to include Cumberland, York and Sagadahoc counties — accounts for more than half of the Maine economy.
So there are more jobs, more opportunities, more health care specialists, more buildings and, yes, more homeless people, Brennan said.
“Historically, Portland has always attracted persons who are seeking shelter, economic opportunity or a number of other things. I think what has captured people’s attention more is obviously we have a larger number of people who are coming now — an unprecedented number of people,” Brennan said. “I believe as I have always believed that that is driven by … economic activity, the fact that we’re the largest city in the state, we do have homeless shelters and we do have services. If you lose your house in Casco, Maine, there’s not a shelter [there] for you to turn to.”
Portland in October averaged 434 people seeking shelter each night, which was up from the October 2011 figure of 371.
Between 190 and 240 people each night seek emergency overnight accommodations at the city’s Oxford Street shelter, which has a capacity of 154, according to Gardner. The overall number also includes those who stayed in designated shelters for families, teens and those in mental health or substance abuse programs in the city.
The adults who don’t fit at the Oxford Street shelter, which is designated for single adults, are given thin mats to sleep on at the floor of Preble Street’s community center or chairs in the lobby of the city’s general assistance office. Associating that life with the phrase “too attractive” rankles service providers.
Mark Swann is the executive director of Preble Street, an independent nonprofit organization in Portland that provides services for the homeless and hungry, and a recent finalist for the Congressional Medal of Honor Foundation’s prestigious Service Before Self Honors.
“They sleep on the floor, on a mat six inches away from somebody they don’t know, clutching their belongings,” he said. “Being woken up in the morning, walking down the street to the soup kitchen for a meal with 350 other people. Waiting in line, hoping you can sign up to take a shower. Hoping you can use the phone because you want to make calls to landlords and potential employers, but there’s only one phone. It’s a really, really hard and challenging life. So to characterize it as ‘too attractive,’ I think, is really, really wrong.”
Chamber officials say they agree with the notion that life on the streets of Portland is difficult, but not that it’s hard enough to deter what they say has been a steady influx of homeless people from outside the city limits. City data indicate that only about a third of the homeless individuals who stay in Portland shelters are from the city of Portland — about another third are from other Maine towns and the final third hail from out of state.
The most recent numbers indicate there’s approximately one homeless person for every 150 people in Portland. That compares with a ratio of one for every 234 people in New York City, and about one for every 246 people in Bangor, according to municipal officials and shelter providers in those municipalities.
“You might ask, ‘Who in their right mind would go out of their way to come to Portland for that?’ It’s a good question. [One] that we want answers to, because obviously they are,” said Chamber consultant O’Neil.
During a recent City Council hearing on homelessness, former mayor and head of the Western Promenade Neighborhood Association Anne Pringle argued that Portland’s 1987 policy of taking in anyone and everyone who arrives seeking shelter should be given a critical review, telling councilors the now 25-year-old initiative has been “assumed but not debated.”
Swann said he hears the complaint that two-thirds of the people staying in Portland shelters are from out of town, but counters that they often have ties to the city that aren’t reflected in statistics. They have family in the area they had hoped to stay with or wanted to be close to, or they grew up in the city, or they had a job offer on the table here.
Ultimately, he said, homeless people move from place to place for the same reasons people who aren’t homeless move. Swann rejects the notion that people “are coming here to be homeless.”
While the Chamber’s document implores city record keepers and policymakers to differentiate between “the person who uses the shelter because she loses her Portland apartment” and “the Texan who traveled here with no place to stay,” Swann said the latter example is literally laughable to service providers in places such as Texas.
“We talk to people who do similar kinds of work all over the country,” Swann said. “I always ask, ‘Do you know about people coming to Maine? Do you hear about that in your community?’ The first reaction is always laughter. That’s the very first thing, because there’s a common-sense piece to this that I think more people need to reflect on, which is: If you really are homeless and you’re trying to move somewhere, would you move to Maine where it’s cold?”
Even within Maine, shelter providers in other service center communities say Portland is not alone in its efforts to grapple with increasing numbers of homeless.
Dennis Marble, executive director of the Bangor Area Homeless Shelter, said he hears similar allegations that Bangor is a magnet for the homeless. He said he sees people coming to his shelter from Portland — in many cases, because the larger city’s homeless facilities are quite the opposite of attractive.
“What we’ve found in terms of data and this shelter is that 55 percent come from … the Bangor region, another 21 percent come from somewhere else in Maine, and the other 24 percent are basically transient,” Marble said. “We’re one of the places that gets people from Portland. Some people find [the Portland] shelter to be too big and scary.”
Brother Irenee Richard of Lewiston’s St. Martin De Porres Residence echoed Marble’s comments.
“We’ve been full for as far back as I can remember,” Richard said. “There used to be times when with 10 beds you’d have only seven beds or six beds [occupied] for a few days or even a few weeks, but now that’s fairly rare. And lately we’re getting people from Portland. I’m not sure if it’s because the shelters are full down there. It could be, or it could be something else.”
Which comes first? Housing or sobriety?
The city’s homelessness task force made two major recommendations in addition to developing 105 new supportive units for the homeless. Those recommendations are to overhaul the emergency shelter system to create a centralized intake and assessment portal for the homeless, and expand case management services to better meet the needs of clients.
While the task force’s draft report did not include a price tag to implement those recommendations, the Chamber estimates it could cost around $6 million.
“The more we build housing units, the more we build structures that are intake centers, and set up triage systems, the more we spend,” O’Neil said. “It’s spending. You can call it generosity if you want, but it’s an expenditure. You can also extrapolate that there are savings to be had by employing these best practices that cost money, but let’s talk about them, and let’s employ the dollars wisely that give us the best return.”
The task force recommends development of three facilities each including 35 units of what in the industry is known as “ housing first” model apartments. Under the “housing first” approach, chronically homeless individuals battling the most severe substance abuse and mental health problems are provided small apartments in buildings staffed with specialists at little or no cost, and with no initial demand that they change their lifestyles.
The model is based on the notion that with stable housing in place, the chronically homeless then will have the motivation to keep up with their medications, dial back substance use and piece their lives back together. The approach is used by Preble Street at its Logan Place and Florence House facilities.
But the model isn’t universally agreed upon among service providers in Maine.
St. Martin De Porres in Lewiston, for instance, only takes in referrals and requires many shelter seekers to submit to background checks before they’ll be admitted.
“We are a dry shelter,” Brother Richard said. “They cannot be under the influence of alcohol or high on drugs. They have to be clean. If they are drinking, they need to go through detox, and then detox would refer them to us. The other thing for us is that if a person has some mental health issues and they’ve been prescribed meds, they have to take their meds. If they don’t, we can’t help them.”
Richard said his facility does not get state funding, but rather runs primarily on donations and charity.
“We want to put people back on their feet and we don’t want to ever see them again, rather than enabling them and continuing to let them use the system,” he said. “It would not be fair [to our donors and volunteers] to just keep someone here that just wants to hang around.”
The Bangor Area Homeless Shelter, Marble said, is “somewhere between ‘low barrier’ and ‘restrictive,’” meaning the organization will jettison shelter occupants who abuse substances or run afoul of the law while staying there.
He said that, unlike its Preble Street counterparts, his group “tries to minimize the services offered [on-site],” instead providing direction for where else in the community homeless individuals can seek therapy, counseling and financial programs.
Marble said that headquartering programs in homeless facilities could inadvertently “put up a barrier to those who need a lot of the same services but don’t want to go to a homeless shelter to get them.”
The “housing first” model does not require tenants to agree to substance use or behavior standards and often is signified by on-site counseling and care services.
According to a study released last year by Thomas McLaughlin, University of New England associate professor of social work, a group of nearly 100 Greater Portland homeless individuals with disabilities cost taxpayers a total of $622,386 less while living in stable housing than they did while living on the streets — with cost avoidance coming primarily from more efficient use of medical care and fewer run-ins with law enforcement.
“With Logan Place and Florence House, we have seen people who had been homeless for years, and are now living in permanent, stable living environments,” Brennan said. “So we have two concrete examples of what works to reduce homelessness and to assist people who have been homeless for extended periods of time find permanent housing. Why would we not want to replicate and make those kinds of programs more available?”
The Chamber’s response to the task force report expressed worries that more housing units for the homeless would just trigger an even more overwhelming increase in homeless people.
Swann said the “housing first” facilities have been shown to have an opposite effect on shelter numbers.
“We have a terrible overflow problem,” he said. “We had that problem before in 2003, 2004 and 2005, and it went away entirely when we opened Logan Place. The overflow shelters were used seven out of every 10 nights prior to opening Logan Place. The night we opened, it wasn’t used at all. [And it stayed that way] for years.”
Gardner agreed, saying the city began having to use overflow facilities again only in 2009, which he said reinforces the notion held by service providers that Portland’s homeless numbers didn’t explode because the city’s “too attractive” to the homeless, but rather because of the economic collapse that left thousands jobless and motivated state funding cuts to mental health and substance abuse programs that had helped keep many people in stable lifestyles.
“The economy is absolutely a foundational issue, but the whole arena of supportive services can be as well,” said Marble of Bangor.
Gardner said “there’s no question in my mind” that the emergence of more “housing first” units would reduce or eliminate overflows at the city’s emergency shelters like Logan Place did when it opened in 2005.
“To say that if you build more ‘housing first’ model projects, they’ll just keep filling up, I don’t think that’s fair because there are so many other factors that play into homelessness,” he continued. “I think if we’re sitting here five years from now, the economy is in a different place, and substance abuse and mental health counseling programs are strong, I think we’re looking at an entirely different homelessness situation.”
And that, O’Neil said, likely would quiet Chamber concerns regardless of where the shelter users originate.
“If 440 homeless people in Portland shrinks to 200 homeless people in Portland and it remains at 66 percent from outside of Portland, will anybody be complaining? I don’t think so,” he said.



The poor are not the problem but a symptom of a greater problem. It’s time to stop blaming the poor for fiscal problems. It’s foolishness.
I didnt re-elect the guy.
Many of those who are so quick to say America is greatest Nation ever, don’t understand the point you are making, nor do they wish to try. ,
…..and inhumane.
Wouldn’t it be ironic if the businesses complaining about the homeless people driving away potential customers were the same businesses that pay “public assistance” wages and cause a lot of the homelessness in the first place? lol.
Your disdain and envy of successful business are quite evident. Nobody is forcing anyone to work at a specific business. They are free to look elsewhere.
Disdain and envy of success? Based on what? How do you know my situation? I smile all day, every day. I have a lot of good friends that stop by to see me all the time and interrupt my work. There are days when I hardly get anything accomplished other than laughing. You will probably have much more money when we both die, congratulations. Keep paying minimum wage.
Irony or reality? Rarely ever heard of a dishwasher making a decent wage…
Half the people in Maine now work for minimum wage. It isn’t just for dishwashers anymore. They also work at WalMart, KMart, Marden’s, McDonald’s, Target, Family Dollar, Wendy’s, Best Buy, Burger King, Reny’s, Irving’s, Kentucky Fried Chicken, Pizza Hut, etc., etc., etc.. “Free” trade turned our decent paying manufacturing jobs into service sector jobs that pay minimum wage, and not one penny more. It probably hit Maine worse than any other state.
It’s a changing time. Mom and Pop businesses are becoming scarce because you can get everything at Walmart and all of these others chains. Having a Career is a rarity unless you get higher education to becoming a Doctor or Lawyer, etc.
WalMart; Shop there today, work there tomorrow. Borrow money to pay your rent the day after that.
I am shopping at small downtown stores at the holidays,etc. even if I can buy less. I don’t care to give my $$$ to places like Wal Mart. Very very rarely.
Good for you. That takes a lot of discipline.
Obamacare is going to do nothing to improve that.Most will be hiring part time to avoid the cost.Unless consumers start paying $25 for a burger that is what we have for an economy.
Why do you think so many people work in low paying jobs in Maine where there used to be lots of well paying middle class jobs with benefits? The answer is knee jerk over regulation and 42 years of democrat dictatorship.
Here we go with the 40 year myth again. Stop lying.
Was it longer than that? It certainly wasn’t less.
I think you’re able to do your own research.
No credit given to the dim wits in Washington, on both sides of the aisle, that enacted “free” trade and closed down every factory in Maine, practically over night? Purely Democratic incompetence and over regulation, right?
Over regulation and a dictator Maine DEP and democrats drove this State to its nothingness. All that’s left are nothing jobs but what the heck, the salmon are coming back,
Dish washing is really not a career.Some believe there is no such thing as an entry level job.The progressives believe the owner should have the same wages as the bus boy.
It’s how society values certain jobs. Not that the workers should make as much as the owner, but everyone’s job is certainly important and necessary. Though entry-level positions, jobs such as bus boys and dish washers assure that people return to give said owner more money. We all work together.
I have employees, who many weeks pull in much more than my salary. I love appreciate and respect those people, and are the hardest workers, never have to hold their hand and repeat what to do. The rest of the complainers watch the clock and wonder why their pay never improves
I see two clock watchers “disliked” your post. The truth hurts, but what you have said is very true!
They are all important but again unless consumers will pay $25 for a burger how can a restaurant pay all employees high wages with benefits.
As with the liberals, who also believe the owner should have the same wages plus a bonus job description of shouldering all of the responsibility of running the operation. Ahhh,,,Yes employees are a barrel of fun. The perfect business is one without employees.. which is what any business owners dreams of.
Aint it the truth except for the few that stand out I would replace them with trained monkeys if I could just find a good monkey trainer.
You hit it right on the head. We have to many morons who want the easy way to do it. Here in our city we have women who have 8 kids and don’t know the father of any of them, but they know the ends and outs of Obama welfare.
So she had 8 kids to collect “obama” welfare?
Mighty busy girl in the last 4 years.
She would have started that venture under GW Bush.
How does a woman pop out 8 kids in 4 years. Must have twins in the family and many premies.
What are the wages you offer in your business?
I have down sized considerably in the last 5 years. I have had many employees in the past since the early 90’s and never paid less than $15 an hour. Some of it was skilled labor, some of it wasn’t. I only have one employee now. He is a Sophomore in High school and works about 20 hours a week. I pay him $10 an hour, or twice the “training wage” supported by our generous governor. I practice what I preach. I also buy local and I buy American, when ever possible.
So ten dollars is a liveable wage.The job i just eliminated was $800 a week no beni’s.I am going to offer another job when i can think i will start at 10 an hour and self train.
$10 an hour is a decent wage for a student who still lives at home. If he worked for me full time and was responsible for his own expenses, he would make at least $15 an hour or I would not offer him the job.
$10 isn’t a decent wage for anyone, regardless of their bills. And, that’s never been more true with the cost of many things today.
I think you should have paid them $40 + an hour.
And I think you should pay the high school kid $25 an hour.
Just saying.
If you can sleep at night after paying people minimum wage, all the power to you. You will definitely be taking more with you when you go than I will. Congratulations, you win.
I’m interested what are you saying? That people should be paid minimum wage that doesn’t pay the bills?
Of course you own a business correct? I am sure you pay full health and have a generous retirement pension also for your employees. So what is the business your into? If you rely on the business of maine people as your sales, you can make a half decent living working 70-80 hrs wk in certain areas. as with most operating in a state which has regulated against business for the last 30 yrs,less than 2% of maine businesses can afford to pay over 30,000 per yr and many of those cater to out of state business.
I was in the marine construction and commercial diving businesses. The rates have kept pace with inflation in those industries and I was in a position to pay decent wages. I am semi-retired now and own a little construction and firewood business.
The businesses “cause homelessness”????
HUH???
I am not far from the prospects of living off the street. It is not too hard these days to see how quickly your life savings deplete. I planned for my future, but never thought I would be blind. My rich southern Maine town that supports pro’s to the tune of 150k cannot help me. See I worked honest jobs, two and three at a time since I was 12. But now that I am blind, the town wants me to sell my home I have worked so hard to own and move to PORTLAND. That is because in Portland they tell me here at our town hall they have programs to help me? Yep, only rich people can live in Kennebunk, if you have to sell everything and SPEND DOWN your life savings paying the high taxes and paying for trash then you can scurry your self off to PORTLAND where they can take care of you when you are finally tapped out!
Imagine seeing Senator Susan Collins standing on a seawall in Kennebunk signing off on spending millions and millions of dollars (7 mill I think) to protect a sea wall that crumbles away after every storm. That sea wall protects multi-million dollar homes that are occupied for maybe 10 weeks a year. Susan, you must have more sense than that, come on you are a county girl! Throwing money at a road that is collapsing into the sea, well you might as well be throwing it into your nice fireplace that I am sure you have…but then again these RICH folks are your friends and $$$$upporters. Sea walls and homes are essential to the rich folks, why where will you have those lavish fundraising parties in July? The sea wall will fail again soon, like the shores of New Jersey and New York, the rich people will build right up to the shoreline and then cry when their summah home is just lost to the waves. Mean while back in Portland the poor are the problem right?
Dude, I feel your pain, but don’t let that bitterness toward the system eat you alive, okay? There’s a whole category in this life labelled “Shit Happens.” Get an elder affairs lawyer or counselor over there and lay it all out, check for the loopholes and provisions and open doors. Ya type pretty well for a blind guy, so grab the phone and get with it.
Well thought out post.
Mr. Blackie,
I don’t know what I can say to you a few days before Christmas that could convey my understanding. I do feel your pain. But I realize I could never fully understand what you are going through nor how you feel.
Fight !
I cannot even begin to imagine the thought of losing your home and ending up in a shelter on those mats. I was one of the lucky ones, I never had that much to lose, but yet the first time I ever laid on those mat’s with a crazy person to my right and a criminal to my left trying to rob what few possessions I had, it was a very rude awakening.
Fight !
Don’t get trapped in homelessness, most never make it out again unless they have a good support system of family or friends. It’s to late for me, I’ll die in a shelter.
God bless you Mr. Blackie. and Merry Christmas
Not having a home (apartment, house,etc) and a safe place to sleep at night is one of the most horrible situations. It affects one’s health (mental and physical.
I hope so much that your life can improve. Do not hesitate to contact agencies, reach out….do not isolate. I know there are no easy answers sometimes, and words are sometimes inadequate, but hoping you can find a safe, warm, and comfortable place to live.
I am not opposed to your post but why is Susan Collins your only scapegoat in this?
We need so many changes in Maine, for one I believe we need a one percent sales tax to support our schools. The private property tax, the 100 percent evaluation, is, well even if you happen to be lucky to own a home, the taxes are becoming more of a burden each year, some times 5 percent increases in one year, mostly because of schools. I have been in Maine all my life, and seeing Maine become a state that only the rich can afford to live in is sad, but it is true. There is very little now, between thousands in this State O’Maine, that are close to living in their car, or being homeless, and I do not mean bums, just people priced out of a living, working or not.
how did you post here if you are blind?
With a braille terminal the blind can use the computer.
“The Poor”, as they are called, are often people who choose not to work and do anything with their lives. I live in a city where they inhabit major highway and city street intersections on a daily basis. They are dropped off by van early each morning and take turns ‘working’ the traffic. They are perfectly capable of having a real job, but the booze and lack of responsibility are more appealing to them. Good-hearted people who give them money become suckers and enablers. Why do they have any motivation to straighten up when the citizens give them money and the city gives them a place to sleep until their next round of panhandling?
Give them a home and they won’t be homeless. Most are mentally ill and it’s our responsibility to take care of them. What would the fine people of Portland have done? Move them to another city? Another planet? Dispose of them in the ocean?
I know of homeless people who choose to be homeless. If you gave them a place to live they wouldn’t want the responsibility of it. Some not all made that choice.. You can lead a horse to water, but you can’t make him drink.
We only seem to notice the mentally ill when they use a weapon.
Maybe all those in Portland government that received raises can take a homeless person home every night,.
It’s too bad we don’t have factories for people to work at any more. A lot of people only want to work with their hands and don’t want to work on computers. Not everybody is cut out for a sitting down job. Free trade has ruined every country that signed on. Every country should make their own stuff and every country would be better off.
A person who starts a Manufacturing Plant wants to think twice about where he establishes himself. Maine is not the correct answer. Maine is one of the states which thinks it will “save the world”., Part the oceans, stop the winds… You can’t stop or change mother nature. be an Al Gore instead and profit from it. Mr bigfoot, carbon footprint himself. Tell everyone to use every penny in the world and throw it towards stopping the evolution of natural warming. The earth with or w/o humans, will not come to a stop or change the FACT we are coming out of the last ice age, and the fact that EARTH was and will always return to the HOT planet it once was.
As far as Maine goes for business climate, after 75 yrs in this state we would move yesterday if it was portable. to do it
How true. As they say Bill Clinton was one of the better Republican President’s in our history. They had him blackmailed.
But it’s even deeper then what you mention because what it allowed was American business to hide behind the free trade and sell off our manufacturing base to the over sea’s market.
That so called American dream in reality has been dead for some 30 years now. In fact my parents generation, (the greatest generation) where the last to make it to retirement in one piece.
The factories, our manufacturing base is what gave rise to the middle class. Prior to the 1940’s there was no such thing as a middle class. A person could buy a home and raise a family with even less then a high school diploma.
Over the years we turned higher education into a business and made most jobs requiring a college degree. A service oriented economy that has barely lasted 25 years.
Unless America gets back to it’s roots, which is manufacturing it doesn’t matter what we do. A nation such as America cannot be supported on a service oriented economy has we have discovered.
How very true. As they say Bill Clinton was one of the best Republican Presidents ever. They had him blackmailed. That con/dummy did as much damage to this country as Ronald Reagan, unless of course your in that elite status of wealth.
But what you mention is only part of the story. The free trade allowed American business to hide behind, while they sold off our manufacturing base to over-sea’s markets.
That so called American dream however has in fact been dead for some 30 years now. In fact my parents generation (the greatest generation) where the last to make it to retirement in one piece.
They created the middle class. Prior to the 1940’s there was no such thing as a middle class. The factory’s/ manufacturing gave rise to that middle class, where even a person with less then a high school diploma could buy a home and raise a family proper.
But over the years we turn higher education into a business and made most jobs require a college degree. Based on a service oriented economy that has barely lasted 25 years. That is Ronald Reagan’s true legacy, he’s the one responsible for the shift from a manufacturing base economy.
And it doesn’t matter what America does, if we do not get back to our roots which is manufacturing. A nation such as America cannot support itself off a service oriented economy as we have all seen.
Buy local, buy American. That is what our parents did. The only way the traitors who moved their factories to China can profit is with a lot of help from the rest of us at the cash register. If we keep buying that cheap Chinese crap, they are going to keep getting richer while the rest of us keep sinking.
Good luck trying to find something made in America. Remember when even Wal-Mart meant made in America ? Sam Walton wasn’t even cold before the young MBA’s pimp us out.
______
The Wal-Mart You Don’t Know
BY: CHARLES FISHMAND
The giant retailer’s low prices often come with a high cost. Wal-Mart’s relentless pressure can crush the companies it does business with and force them to send jobs overseas. Are we shopping our way straight to the unemployment line?
A gallon-sized jar of whole pickles is something to behold. The jar is the size of a small aquarium. The fat green pickles, floating in swampy juice, look reptilian, their shapes exaggerated by the glass. It weighs 12 pounds, too big to carry with one hand. The gallon jar of pickles is a display of abundance and excess; it is entrancing, and also vaguely unsettling. This is the product that Wal-Mart fell in love with: Vlasic’s gallon jar of pickles.
Wal-Mart priced it at $2.97–a year’s supply of pickles for less than $3! “They were using it as a ‘statement’ item,” says Pat Hunn, who calls himself the “mad scientist” of Vlasic’s gallon jar. “Wal-Mart was putting it before consumers, saying, This represents what Wal-Mart’s about. You can buy a stinkin’ gallon of pickles for $2.97. And it’s the nation’s number-one brand.”
Therein lies the basic conundrum of doing business with the world’s largest retailer. By selling a gallon of kosher dills for less than most grocers sell a quart, Wal-Mart may have provided a ser-vice for its customers. But what did it do for Vlasic? The pickle maker had spent decades convincing customers that they should pay a premium for its brand. Now Wal-Mart was practically giving them away. And the fevered buying spree that resulted distorted every aspect of Vlasic’s operations, from farm field to factory to financial statement.
Indeed, as Vlasic discovered, the real story of Wal-Mart, the story that never gets told, is the story of the pressure the biggest retailer relentlessly applies to its suppliers in the name of bringing us “every day low prices.” It’s the story of what that pressure does to the companies Wal-Mart does business with, to U.S. manufacturing, and to the economy as a whole. That story can be found floating in a gallon jar of pickles at Wal-Mart.
Wal-Mart is not just the world’s largest retailer. It’s the world’s largest company–bigger than ExxonMobil, General Motors, and General Electric.
The scale can be hard to absorb. Wal-Mart sold $244.5 billion worth of goods last year. It sells in three months what number-two retailer Home Depot sells in a year. And in its own category of general merchandise and groceries, Wal-Mart no longer has any real rivals. It does more business than Target, Sears, Kmart, J.C. Penney, Safeway, and Kroger combined. “Clearly,” says Edward Fox, head of Southern Methodist University’s J.C. Penney Center for Retailing Excellence, “Wal-Mart is more powerful than any retailer has ever been.” It is, in fact, so big and so furtively powerful as to have become an entirely different order of corporate being.
Wal-Mart wields its power for just one purpose: to bring the lowest possible prices to its customers. At Wal-Mart, that goal is never reached. The retailer has a clear policy for suppliers: On basic products that don’t change, the price Wal-Mart will pay, and will charge shoppers, must drop year after year. But what almost no one outside the world of Wal-Mart and its 21,000 suppliers knows is the high cost of those low prices. Wal-Mart has the power to squeeze profit-killing concessions from vendors. To survive in the face of its pricing demands, makers of everything from bras to bicycles to blue jeans have had to lay off employees and close U.S. plants in favor of outsourcing products from overseas.
Of course, U.S. companies have been moving jobs offshore for decades, long before Wal-Mart was a retailing power. But there is no question that the chain is helping accelerate the loss of American jobs to low-wage countries such as China. Wal-Mart, which in the late 1980s and early 1990s trumpeted its claim to “Buy American,” has doubled its imports from China in the past five years alone, buying some $12 billion in merchandise in 2002. That’s nearly 10% of all Chinese exports to the United States.
One way to think of Wal-Mart is as a vast pipeline that gives non-U.S. companies direct access to the American market. “One of the things that limits or slows the growth of imports is the cost of establishing connections and networks,” says Paul Krugman, the Princeton University economist. “Wal-Mart is so big and so centralized that it can all at once hook Chinese and other suppliers into its digital system. So–wham!–you have a large switch to overseas sourcing in a period quicker than under the old rules of retailing.”
Steve Dobbins has been bearing the brunt of that switch. He’s president and CEO of Carolina Mills, a 75-year-old North Carolina company that supplies thread, yarn, and textile finishing to apparel makers–half of which supply Wal-Mart. Carolina Mills grew steadily until 2000. But in the past three years, as its customers have gone either overseas or out of business, it has shrunk from 17 factories to 7, and from 2,600 employees to 1,200. Dobbins’s customers have begun to face imported clothing sold so cheaply to Wal-Mart that they could not compete even if they paid their workers nothing.
“People ask, ‘How can it be bad for things to come into the U.S. cheaply? How can it be bad to have a bargain at Wal-Mart?’ Sure, it’s held inflation down, and it’s great to have bargains,” says Dobbins. “But you can’t buy anything if you’re not employed. We are shopping ourselves out of jobs.”
We had an all American Christmas this year. We started early and we did it online. There are plenty of American made products still available if one has the energy to bother to look. We bought union made jeans for $38 a pair. Hand tools made in North Adams, Ma.. Boots made in Texas. And many hand made crafts that came from right here in Maine. Screw WalMart and the traitors in Washington that sold out the American worker, and Merry Christmas to all!
Here here ! Well done. If only I had the funds I’d be right there with you. They have forced us into shopping cheap.
(rat-bas–rds)
Every time I go to Wal-Mart I hold my nose, and hope I can get 30 days use out of what ever I buy.
Happy Hanuka to all..
It’s the former Capt. Smith aka 3rd rail !
Your avatar is interesting.
Are you a multi handled poster, they dont like that here at BDN…LOL
IDK too many people working or not that can afford $38 jeans.
Walmart: Shop there today, work there tomorrow. Borrow money to pay your rent the day after that. If you shop at Walmart, you are part of the problem, not part of the solution.
Yeah, well, life sucks don’t it. And then you die. Oh well perhaps in my next life I’ll be born with more money instead of good looks.
In the mean time shop American for all of us, and pray for all of us, they have turned us into serfs, criminals and drug abusers.
There are 25% more people at the shelters because LePAGE has done NOTHING to add JOBS to the state, (except for his family and Millionaire friends)…
simple
WOW! We need to keep Mr Lepage as governor if he is that powerful all by himself.
Please remember this tidbit Forbes just gave out a report and maine is one of the tiny handfull of states which have more takers than makers and sitting on collapse. Government and state jobs are takers. So remember the gov. should not be the one to create jobs, he can only create an environment /atmosphere for private business to “want “to start a business 30 yrs of business leaving , you think it may be time to wake up….. YOU are the one who need to create JOBS….get a life and start being a maker
How many homeless did we have when we had 45,000 shoe factory jobs in Maine? We had plywood mills, shirt factories, knitting mills., woolen mills, paper plate mills, spool mills.chicken factories, etc,etc.. Bill Clinton signing NAFTA started the demise of the country. Heck even GM who is owned by the unions and Mr Obama are closing US factories and moving them to different countries..
GM will collapse in a short time now that obama selling the stock back at 1/2 price we paid for it. What a deal… basically debt free with a cashbox full of money gm is set for a short time. We the tax payers will foot the bill that bailed out the Auto Union workers so they could keep their cushy pensions and inflated paychecks. They should have let them go under, they would have still had jobs and we the people would not have got screwed.
Are you REALLY going to blame Obama for moving jobs overseas??? Those factories were shuttered before he even became President.
Maine is too atractive to welfare seekers, food stamp abusers, drug addicts, and liberals!
Well, we know that you aren’t a liberal, so…………
Why are YOU here then?
“…The question draws the ire of social workers and service providers, who counter that life in the shelters is anything but attractive…”
It is if the alternative is a park bench or vestibule of a building in 10 degree weather,
I am somewhat ashamed of our country for accepting the situation of homelessness and poverty that I have seem in my lifetime. Throughout my life I was led to believe that most of the people in need were the results of their own faults, and society can not afford to bail them out of the situation they created for themselves, and they need to work hard and pull themselves out of their situation. By opening my mind to the truth and reality of the world I came to see that I was seriously misguided. It is unreasonable even unrealistic to think that everyone has the potential to succeed and be a productive individual in society. The reality is there will always be people that for all types of legitimate reasons will be in need of help and are not capable of being so called productive, and this country above all is capable of affording to come to there assistance. The greed, selfishness, poor morality and lack of responsibility by most people toward most of what is important in society has led to an inexcusable situation that will only get worse with time. For people in the wealthiest country that has ever been to live with the fear that they may not be able to find shelter for the night from the severe conditions of a northern climate when they should not be homeless to begin with is something we should all be ashamed of.
What you have so eloquently stated is the true picture of what the problem really is! So often, parents are afraid of the stigma behind a child’s problem,that they will ignore it. I know of a woman who was born premature, most likely due to her mother’s alcohol use during pregnancy. This woman has never held down a job for long, didn’t graduate from high school, has difficulty making friends, etc.. Luckily, she was supported by her wealthy mother. She recently told me, “Every job I had made me feel as if I was in prison.” It’s obvious she has a learning disability that was never diagnosed. Some people judge her as being difficult, picky, and self-centered-when she actually struggles mentally to get through every day.
If those of us who are able bodied and sound minded would reach out and give a hand up to those less fortunate, we may find we won’t have to give so many hand outs.
Several factors are involved here, chief of which is voting in a government that knows little about creating an atmosphere for economic growth (voters’ fault). The more bird seed I put out the more birds flock to my yard until I run out of 50 lb bags (my fault) and they go elsewhere. Started working at Shaw’s in Portland at $.75 an hour at age 15. I was happy as a lark to get it, but knew I would need more later so I planned to improve and move up. It’s not my fault homelessness in Portland is up 25%.
Portland should stop dressing so provocatively!
Bangor is the sex offender capital of Maine. Their homeless shelter accepts sex offenders.
More homeless…….and economically booming. Go figure.
Volunteering in a homeless shelter I asked a fellow with a very southern twang how He happened way up north here in the winter. He simply explained he had been picked up for vagrancy somewhere in the south and they told him he could go to jail or take a one way bus ticket to Bangor Maine. I have also heard that if you are homeless in Brewer the police will give you a ride across the river to Bangor and tell you where to get services in Bangor. If you build it they will come…
People do not understand poverty and will always blame the poor for their problems.