Cozily nestled within his good-news-only Natalie Harp cocoon, President Trump effuses daily (if not hourly) about the American economy. In August, he took credit for the “74 all-time highs” that the S&P 500 had reached since his re-election, for the “BOOMING” manufacturing sector (which now employs 62,000 fewer workers than it did when he resumed the presidency), and for the “record number” of working Americans (a consequence chiefly of population growth, though the net number of new jobs created monthly since he took office is about one-third of that created monthly in the last two years of Joe Biden’s presidency).
Lacking their own Natalie Harps, Americans are not experiencing the Trump Boom in quite the same way that Trump is. The University of Michigan monthly survey of consumer confidence hit a record low in late spring and has been on a downward trajectory since.
That said, there are positive metrics to be found, so long as they don’t concern the experience of the American people as such. The share of national income going to corporate profits is the highest it’s been in nearly a century (while the share going to wages and benefits is correspondingly down). The profits of oil and drug companies are notably up. And perhaps most revealingly, because this is a metric that does reflect the experience of the American people, business at dollar stores is up and rising.
Second-quarter sales at Dollar General, which has 21,000 outlets, rose by 3.7 percent over the first quarter of the year, while sales at Dollar Tree, which has 9,000 outlets, were up by 3.5 percent. Items purchased at Dollar General’s “Value Valley”—aisles in which all products are on sale for a flat $1—rose by 16 percent.
“Our core customers continue to be financially constrained,” Dollar General CEO Todd Vasos told The New York Times. “Higher and more volatile fuel prices have forced customers to further prioritize purchases with a focus on value and affordability.” To that end, Vasos continued, “We have got real plans to expand that $1 price point.”
The only cloud in the dollar stores’ sunny skies is the move by Walmart and Target to keep lowering their own prices to stanch the flow of stressed consumers to the dollar outlets.
America has a long history of low-price mass marketing, of course. At one point, it even played a key role in the creation of the country’s broadly shared prosperity of the mid-20th century. By “it,” however, I don’t mean the entire sector. I really mean just one company, the Filene’s department store chain, and even more precisely, that company’s president, Edward Filene.
In the early 20th century, when department stores weren’t marketing to working-class consumers, Filene created his own Value Valley: Filene’s Basement, where clothes were on sale at reduced prices. He established and promoted America’s first credit unions, and founded the Twentieth Century Fund, whose studies consistently and persuasively argued that higher wages for workers would create a larger consumer market and thus spur more mass production. Those arguments prefigured and informed the key reforms of the New Deal, and Filene, not surprisingly, was among the handful of corporate leaders who backed Franklin Roosevelt’s landmark legislation (Social Security and the National Labor Relations Act, which legalized collective bargaining and spurred mass unionization). As Princeton University historian Meg Jacobs wrote in her entry on Filene in the Prospect’s August issue on 50 American heroes,
With his support, and that of the Twentieth Century Fund … the drafters of the National Labor Relations Act of 1935 justified this key piece of New Deal legislation by explaining in its preamble that “the inequality of bargaining power” between employers and employees results in “recurrent business depressions by depressing wage rates and the purchasing power of wage earners in industry.”
When he died in 1937, Roosevelt hailed Filene as “an analyst who was able, by mathematical calculations, to make plain to us that our modern mechanism of abundance cannot be kept in operation unless the masses of our people are enabled to live abundantly.”
As Filene remains the early-20th-century American business leader most committed to creating mass prosperity, so another mass marketer, Sam Walton, was the late-20th-century American business leader most committed to curtailing mass prosperity. Under his leadership, Walmart rose to become America’s leading retailer and largest private-sector employer by featuring everyday low prices and everyday even lower wages.
As labor historian Nelson Lichtenstein has documented, he opposed minimum-wage laws, shuttered any Walmart where workers were trying to unionize, and used the chain’s power as the nation’s largest wholesale purchaser to reduce the wages of the American workers who made the products that Walmart sold, or, even more calamitously, put those workers on unemployment lines by shifting production to China. His adamant opposition to employing unionized American workers trickled down to such current-day oligarchs as Jeff Bezos and Elon Musk. By the time the dollar stores began to take off, the laws protecting workers seeking to unionize had been so hollowed out that even the doomed-from-the-outset efforts to unionize that had confronted Sam Walton had effectively ceased to exist.
Under any management, however, the dollar stores continue to occupy an important niche in the nation’s political economy: They’re the canary in the coal mine when the economy is going to hell. Only a Natalie Harp–insulated Donald Trump would be able and willing to ignore that.
