Remembering Chinatown

(Photo: Omar Bárcena)

Learning that Los Angeles’s Chinatown is fighting a Walmart store, including with a lawsuit against the city, reminded me of what I learned in that Chinatown years ago.

One midnight, fed up from revising our dissertations all day, a friend and I drove the 10 minutes from Caltech into Chinatown to dine at Full House Seafood, open until 2 AM. (My Ph.D. adviser once asked why graduate students all seem to live on Guam time.) The restaurant was lively and crowded but not packed, and we quickly got a table. While waiting to give our order, I noticed an African-American man sitting on the chairs near the front counter. Even though several tables were free, the waiters did not offer him a table. Other customers came in, and were seated. As our dumplings arrived and got eaten, and then the spicy tofu, the man still sat on the small chairs.

There could be only one reason. Indian society holds a dim view of dark people, including darker-toned Indians like me. In “Bhaji on the Beach,” the Indian matriarch, who has just learned that the young Hashida is pregnant, editorializes about the boyfriend, “But why did it have to be a black boy?” And then faints.

Maybe other Asian cultures are similarly prejudiced. And anyway isn’t the Chinese word for foreigner “barbarian”? I’ll protest to the manager. I’ll never again eat at Full House Seafood. I’ll picket in front of the restaurant. As frustration and anger flowed through me, the restaurant staff handed the man a large brown paper bag. It was stapled shut using the receipt for his take-out order.

Sometimes a chair is just a chair; and I wonder how many other lenses I wear without knowing.

I hope Chinatown wins.

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  1. Dave says:

    I hope Chinatown wins as well. The majority of residents in the area want the Walmart to be there. ..

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  2. Joe J says:

    Too bad many others wouldn’t let the truth stop them from protesting or suing over this obvious (to them) injustice.

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  3. Steve says:

    Honestly – I was reading through the post and the first thing I thought was ‘maybe he was waiting for take-out’. I’ve been in that same small chair at the front of a Chinese restaurant before.

    Then I read to the end. Ha!

    I hope they win, also. But, even if they lose, they can win with their buying habits (but they won’t).

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  4. tylerh says:

    First of all, Chinatown nearly as Chinese as it used to be. The sons, daughters, and grand children moved away decades ago (first to Monterrrey Park, then further afield).

    Last time I was there, most of the business owners I interacted with were Viet Namese. Just as Seafood is now trucked to Fishermans Wharf in San Francisco, so Chinatown is a valuable Tourism trademark that has little bearing on who lives there or what they do. Census data shows that “asians” are less than two-thirds of the residents in 2010

    http://www.laalmanac.com/population/po24la.htm

    Oligopolists who hide behind ethnic identity are still oligopolists. I hope Walmart gets a a fair chance to compete. After all, if the community *really* doesn’t want Walmart there, Walmart won’t make money and will leave on its on accord

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  5. Jon says:

    The chinese word for foreigner is wai guo ren, literally “outside the country person”, not barbarian… And definitely not savages….

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  6. caleb b says:

    I can’t understand the anti Wal-Mart craze. If the mom-and-pop stores can’t win, so what?

    How many Wal-Mart protesters are driving imported cars? Yeah, my point exactly.

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    • Enter your name... says:

      The problems are two:

      Smaller stores can’t compete because Walmart engages in abusive and unfair practices. Vlasic pickles is a well-documented example: Walmart said, we see in your SEC filings that you made X in profits last year. You will therefore sell us this year’s pickles at your cost minus every dime in profit your entire company made last year — or we’ll get Chinese pickles and leave you to layoff a third of your workforce and get sued by a bunch of cucumber farmers whose product you suddenly no longer need. Smaller stores can’t force a decision like that because they don’t buy a third of a major manufacturer’s annual output. The decisions made by one small store can’t threaten a much larger business.

      Walmart competes by paying the lowest amount of money possible for staff, which is what businesses “should” do, but which inadvertently creates burdens on the local economy. A Walmart stocker or checker might be paid minimum wage or slightly more — plus food stamps for his kids, subsidized housing, Medi-caid, etc., which all comes out of the taxpayer’s pockets. The profits all go elsewhere. At the mom-and-pop store, the people doing most of the jobs get (if you were to do a proper accounting) the low wage for the lower skill work like stocking shelves, some higher wage for higher skill work like purchasing, and also the store’s profits, which might not add up to a whole lot, but usually adds up to enough that they don’t qualify for taxpayer-funded welfare. So four small stores with two employees each results in less burden on the community than the same eight employees working at Walmart, most of whom are making only minimum wage and none of whom get any profits.

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      • Dave says:

        If they have monopolistic practices, then they need to be sued. End of story.

        I love the old big business forces people to work there story. Evidently, WalMart is such a big story that it can go into middle income peoples homes, command the wage earners to quit their jobs and work minimum wage at WalMart. It is bad logic and a typical problem with WalMart haters. Do we need to talk sweat shops too?

        The real issue here is what gives a city council the right to vote unanimously against the rights of a business to set up shop, especially when the people in the city want the store?

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    • Charles L. says:

      You obviously haven’t been to a Mom and Pop store. The problems with Wal-Mart are numerous.
      •They do not give their employees insurance, and many of them qualify for state or federal aid. We effectively subsidize Wal-Mart
      •They discourage new businesses from setting up shop, stagnating development
      •They pay their corporate income tax somewhere else
      •Particularly in suburban communities, they hire workers who could be termed “undesirable” by the elite, and lower land values
      •When was the last time Wal-Mart gave money to the Little League team or offered free catering to the church? They’re poor citizens.

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      • Dave says:

        I think your comments are trying hard to point out good, moral reasons, but the fall short on any sort of economic principles. Lets look at them a little

        1) Walmart gives employees the best deal they can have for their skills, background, etc. This may sound bad, but really if they raised wages/benefits they would get more applicants and many lower skilled and undesirable workers wouldn’t be able to get the job. From another one of your comments you seem to be saying ‘screw those undesirables, they don’t deserve to work around normal folk.’ Now THAT doesn’t seem charitable. The response is that ‘elites’ have the option to go to a nicer store and pay a premium to do so.
        2) Yes we subsidize their employment through welfare, but what is the alternative. If they weren’t employed they would need MORE help. By employing these people, Walmart reduces welfare needs. Are you saying minimum wage should be $15-20 an hour? You would see much higher unemployment, the store wouldn’t be as well kept as janitors lose their jobs, and our food would cost more.
        3) Every business discourages other businesses through competition reducing profits. If they are using unfair means (like lobbying a city council to vote out competition even though the community wants it) or monopolistic practices those issues can be dealt with through litigation. Personal experience indicates to me that WalMarts create an area where other stores set up, stimulating business around the new hub.
        4) They pay their corporate income tax elsewhere because our corporate income tax is the highest in the world and they are a multi-national company. Sorry, it happens.
        5) Our local Walmart always has a sign up showing how much it has donated this year to local charities and scholarships, and a google search for Walmart charities will lead you to their site which claims almost a billion in donations over the past year.
        6) But wait, we haven’t discussed how those rich billion Waltons are sqeezing people. The hoard their money and don’t share, right? Actually, the Waltons have donated billions – do some research. Part of this is the 16 billion-ish, or Helen Walton’s entire fortune, that is being distributed to charity after the years following her death.

        Lets try and be a little wiser in our criticisms here. Walmart is not the Salvation Army, but they aren’t deserving of the unnatural criticisms they receive.

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      • Gray says:

        @Dave:
        “3) Every business discourages other businesses through competition reducing profits. If they are using unfair means (like lobbying a city council to vote out competition even though the community wants it) or monopolistic practices those issues can be dealt with through litigation. ”

        This is a very rosy view indeed, of the possible success of litigation, and of the likelihood of such litigation being brought in the first place. I suggest that in areas where Walmart is actually in violation of the law, only the most egregious examples, with the most powerful plaintiffs, have any chance of being prosecuted. Additionally, examples such as the Vlasic one may not involve illegal practices, but generate rather harmful externalities to the local community and the country. Of course you consider lobbying the city council an “unfair” practice, yet it is just as legitimate in the political-economic environment in which Walmart operates as is their domination over the supply chain – which I assume you don’t consider “unfair”.

        “4) They pay their corporate income tax elsewhere because our corporate income tax is the highest in the world and they are a multi-national company. Sorry, it happens.”

        That is a reason for their behaviour, but the behaviour remains disadvantageous for the local economy. All else being equal – which of course it’s not – a small business paying taxes locally is preferable from this standpoint.

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      • Dave says:

        @Gray
        Good points mostly. I encourage litigation because it raises the cost of misconduct, and I wish people would litigate more often. I do wish people knew the Vlasic story better. We like to talk about how the killed Vlasic but the story is much more complicated than that. Furthermore, this is the classic example, but happened over a decade ago, and you can still buy Vlasic pickles today, and at Walmart!

        I did think that the lobbying of city council was a cheap trick, but I should correct myself. My real issues with it wasn’t with the lobby-ers, but with city council for voting against the will of the people. I will spare the Freakonomics boards my opinions on Obamacare passing regardless of polling numbers. Regardless, it is definitely true that bug businesses get away with too much. On the other hand, while Walmart’s actions definitely hurt Vlasic (and arguably Walmart), saying it imposed a nationwide negative externality doesn’t seem to hold water for me…. maybe you will explain that.

        With the corporate tax issue, I think it is hard to blame Walmart for doing smart accounting. Either we need to stop complaining or change the laws. My preferred way would be to eliminate the corporate tax. Economists know well that corporations don’t pay taxes, it is always people that pay taxes. Corporate taxes are a way the government hides taxation. It is easy to see the benefit of the revenue coming in, but very difficult to count the jobs that aren’t created, the increased product costs, and the wages that don’t rise since we have corporate taxes. This is definitely beyond the scope of the discussion, but that would definitely help us tax more fairly and effectively.

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      • Gray says:

        Dave,

        Thanks. I don’t think it’s practical to expect private lawsuits to significantly impact their business practices, because they are just too daunting to take on to ever become as common as they perhaps should be. Government-prosecuted suits are of course possible, but here too we see a decline in the number of these suits that are brought for antitrust reasons.

        The externality I am proposing, from the point of view of the local or national economy, is the conversion of domestic to foreign jobs in the supply chain – not in Walmart itself, of course, but in companies that, due to the juggernaut’s ability to (somewhat) build dependencies and then dictate prices, are forced to make cost-cutting decisions they might otherwise have avoided. I know an argument can be made that this leads to greater efficiency in the long term – although there are counterarguments there too – but in the short and medium term this imposes many costs which are not borne by Walmart.

        As to the taxation question, you say “I think it is hard to blame Walmart” – but this is irrelevant, it’s not a question of blame. It is a simple reality that Walmart, and similar multinationals, siphon wealth out of the local economy in a way that smaller alternatives, such as the Mom & Pop operations originally discussed, do not. This makes Walmart less attractive than it might be otherwise. Elimination of corporate taxation, which as you say is another issue, wouldn’t in any way remove this problem; smaller, more locally-held corporations (or partnerships such as Mom & P ops) still keep the money local in a way that giants with remote owners do not.

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      • Dave says:

        Yep, probably more litigation should happen. If we want to pass litigation reform we can. Should WalMart be sued? Does it have a monopoly? Probably not a convincing one if you look at market share estimates.

        I still think it is hard to justify a general Walmart negative externality. As I have stated before, it is easy to count jobs lost overseas from places trying to cut cost, but hard to count jobs created by lower prices of goods and services. You could just as easily argue that insofar as Walmart can dictate prices it can also incentise greater efficiency for its partners. Jobs are a good thing, but we need efficient jobs for global competitiveness.

        WalMart will remove money from the local economy in that profit will go elsewhere, and will stimulate the local economy since we all have extra money from goods and services. I know I personally am richer when there is a Walmart in town. You have to remember that Walmart saves money by operating more efficiently than a mom-and-pop store (per dollar of sales) and by getting better deals on products from suppliers.

        Mom and pop stores are great and it is sad when they go out of business. My grandfather’s lumber store went out of business about a decade ago (he was still working at 89) after being open almost a century. It was sad, but consumers were finding that they could get their goods faster and more efficiently from the nearby home depot. Home depot could have greater selection, has an online site to help with projects, and was large enough to have an expert on each category in the store. Such is life. My grandfather’s store wasn’t forced out, it simply lost most of its customers. Such is life.

        I will agree to fight monopolistic practices, but my experience says that the customer will choose (and by right should be allowed to choose) the product or company that fulfills their needs. In the case of Chinatown, the people wanted a Walmart there. Who are we to say they can’t have one?

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  7. Saru says:

    Why, also, assume he was “African-American”? A black person could be that…or Caribbean, Melanesian, plain old African, or something else.

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