Saturday, November 29, 2008

Wal-Mart worker dies after shoppers knock him down

(AP) A Wal-Mart worker was killed Friday when "out-of-control" shoppers desperate for bargains broke down the doors at a 5 a.m. sale. Other workers were trampled as they tried to rescue the man, and customers shouted angrily and kept shopping when store officials said they were closing because of the death, police and witnesses said... (here for more of the gory details)

Commentary from Clusterstock:

After shattering the front door before the official open -- yes, they actually shattered the door before trampling a security worker -- the crowd kept shopping even when asked to stop:

Newsday: Shoppers who surged past the fallen Wal-Mart worker into the store were asked to leave by other store workers, some of them crying and visibly upset, said one shopper, Kimberly Cribbs, of Far Rockaway.

Though rumors circulated among the shoppers that someone had been badly injured, people ignored the Wal-Mart workers' requests that they stop shopping, move to the front of the store and exit, Cribbs said.

"They kept shopping. It's not right," Cribbs said. "They're savages."

So it's not just that the crowd was so eager to grab whatever deals were available that they trampled a security worker at the entrance, but even afterwords they were unwilling to take a timeout from deal hunting and come back later -- when there wasn't a death scene.

Meanwhile, the NYT report gets in a point about Wal-Mart's efforts to avoid unionization of its workforce.

And though there's no need to get too didactic, this isn't the first time we've heard of extreme behavior in the presence of low prices. In 2005, a melee occurred when a school district decided to unload its old Mac laptops at the firesale price of $50.

BBC:More than 5,500 people queued for a chance to buy one of the 1,000 laptops and stampeded when the sale of the computers started.

In the crush 17 people were injured and four needed hospital treatment.

The four-year-old iBooks were being sold off cheap because Henrico County switched from Apple to Dell to supply laptops for its schools.

There's somethign to be said for market prices...

Clusterstock asks, should we blame Wal-Mart for the deadly stampede?

Short answer: Yes.

Long answer: As yesterday's deadly Wal-Mart (WMT) stampede continues to get unpacked -- the cops are reviewing videotape and criminal charges are still possible -- there's bound some debate about the retailer's culpability, and the extent to which their teaser, uber-low Black Friday prices contributed to the melee. If nothing else, this will come out during the inevitable multi-million lawsuit.

On the one hand, we're tempted to just call it an accident. This is a free market and low prices are Wal-Mart's signature advantage. It's not their fault if ravenous customers line up for 8 hours and then bust the doors down five-minutes early to grab a $599 flat-screen TV. If there's anyone to blame, it's the "monsters" at the front of the line.

But the "monsters" at the front of the line were just a few feet in front of equally-ambitious shoppers behind them. So they didn't have much choice but to charge forward, else they might've been trampled themselves. If anything, their crime was being first in line -- not something that's illegal, last we checked.

So you have to look at what external factors caused the whole situation, and it obviously has something to do with the low quantity of low-priced gifts that Wal-Mart was stocking. Sure, Wal-Mart always offers low prices, but they're usually market-clearing prices, that is, the supply and demand are roughly equivalent. But Wal-Mart deliberately priced certain goods below that level (we know this because a line formed starting the previous night).

And we know that bad things happen when goods are priced in that danger area. Think of the Mac example yesterday, or the 70s, when price controls on gasoline lead to injurious riots. If the government forced Wal-Mart to price a limited number of TVs at $599, and someone died in the aftermath, free marketers would be yelling from the rooftop about the evils of price controls (we'd be among them).

So why, then, is it okay if Wal-Mart does the same thing on its own volition? Their ambition isn't public welfare (as a price control would be), it's money -- they want the people who miss out on the best deals to buy some other stuff while they're in the store. And of course, it's great if the people who do get the TVs also pick up a Blu-Ray player and 10 discs while they're at it. But motive aside, they know that this will create a volatile situation. This isn't the first time in history a huge line has formed ahead of an all-out blitz. Heck, the store even calls it a "Blitz" in their own promotional literature (hello, what do they think happens in a Blitz [short for Blitzkreig]?). If you invite customers to stage a blitz, you can't be particularly shocked when there's tackling and trampling.

So Wal-Mart invited a blitz, but then couldn't look out for the welfare of its employees, while potentially endangering its customers (in other locales, some customer injuries were reported). If it were just matter of zealous customers, that would be one thing, but the history of these pricing schemes suggests that the chaos was easily anticipated.

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