No license for lore
july 24, 2000. If you read the Chronicle, you know that
the latest casualty of the new economy is the Home Drug Co.,
on the northwest corner of Union and Hyde. It’s a fine old
pharmacy.
But times have changed. Pharmacist Eugene
Malmquist says his profit margin has been cut in half over
the past thirteen years. Carlo Michelotti, head of the
California Pharmacists Association, blames competition from
the chains. Malmquist blames the HMOs, which have usurped
his control over prices. Both suggest a brave new world
where the big guys call the shots and the little guys cry
uncle.
That’s pretty much the lore of the day.
Small farmers and shopkeepers — the sturdy independent
citizens who traditionally gave the United States its
strength — are passé. Forget about the stubborn band of
soldiers and solons who stood up to King George and pieced
together a patchwork quilt of a nation the likes of which
had never been seen before. Today that only happens in the
movies. Today these vertebrae in the backbone of democracy
have been replaced, in the courts and in the eyes of the
public, by a liberal economic scaffold composed of national
or multinational producers and local consumers. Because of
economies of scale, these producers can offer lower prices
and higher employment than their two-bit predecessors. As a
result, they offer salvation.
That’s the lore. But sometimes lore
lies. A new book by Stacy Mitchell called The Home Town
Advantage suggests that this particular lore, which we
have endowed with the force of natural law, is actually
still in the formative stage. Which means that it ain’t
necessarily so.
Yes, it is true that chains and mass
merchandisers are doing their best to take over markets.
Barnes & Noble and Borders Books account for 25 percent
of the U.S. book market, with independent booksellers taking
care of only 17 percent. Home Depot and Lowe’s control 25
percent of all hardware and building supply sales. And so
on.
But all too often these giants also
extract a painful price from the community where they are
located. When Wal-Mart moved into nine Iowa counties, for
example, rather than adding to local economies, it simply
shifted things around: 84 percent of its sales were at the
expense of existing businesses.
Nevertheless, the lore insists, small
shops and manufacturers can’t compete with the behemoths.
Not so, says Mitchell. It’s all a matter of doing your
homework, knowing what you want, and coordinating with other
like-minded organizations. Just as activists groups in the
Mission have found success through coalitions, so business
alliances — either of similar organizations over large
areas, or across different sectors within one community —
are finding ways to reestablish local clout. Ace Hardware
and TruServ, the two largest cooperatives of previously
independent hardware dealers, are breathing hard on Home
Depot’s neck with 20 percent of the market. And about 125
local firms in Boulder, Colorado, have decided to try a
city-wide approach, relying on the Boulder Independent
Business Alliance to lead them into the fray.
Ecologist and District 6 candidate for
supervisor Joan Roughgarden likes to compare our present
economy to a waterfall. We can’t stem the flow, she says,
but we can determine where it will land. Seems like all it
takes is some careful planning and an army of bulldozers. n