Garlic Country Fights Wal-Mart

It seems that for nearly everything that's perceived to be wrong in America, Wal-Mart (NYSE:WMT) is often blamed. For all the allegations it attracts and hand-wringing it generates, it's extra impressive that it's been able to grow as large as it has -- raking in more than a quarter of a trillion dollars in sales in its last year.

A Fortune article last year pointed out some amazing facts about the company: It accounts for 2.3% of America's gross national product. Its sales on one day in 2002 totaled $1.42 billion, topping the GDPs of 36 countries. In 21 states, it's the No. 1 employer, with more people in uniform than the U.S. Army. Overall, Wal-Mart is America's second-largest employer, after the U.S. government

Wal-Mart is a study in contrasts. On the one hand, it wins titles such as Fortune's "Most Admired Company," but on the other hand, it faces passionate opposition in many places where it tries to grow. As a case study, consider Gilroy, Calif., home of the excellent Gilroy Garlic Festival.

Wal-Mart already has a 129,000-sq. ft. store in Gilroy. But it's bucking to build a 219,000-sq. ft. Supercenter there, with a full-service supermarket, among other things. With Wal-Mart not unionized, its main grocery rivals are nervous, as many of them, such as Safeway (NYSE:SWY) and Albertson's (NYSE:ABS), do have unions to answer to.

Remember the recently ended record-breaking grocery strike in southern California? It lasted about 20 weeks and made life miserable for many parties. In just a few months, grocery worker contracts expire in northern California, which will put additional pressure on non-Wal-Mart grocers.

Still, while some clearly have cause to want to stop Wal-Mart, others see things differently. As it is in many parts of the nation, unemployment is high in the Gilroy area. To many people, a larger Wal-Mart means more jobs, more tax revenues, and more products available at low prices.

A San Jose Mercury Newsarticle quoted single mother Roberta Schmidt, who works two jobs seven days a week, saying: "People like me who don't have a lot of time or money can have a better life because they can get good prices on everything all the time."

Grocery union official Ron Lind described Wal-Mart's planned Supercenter as "a monster," adding that, "It brings labor practices that will force this region into a race to the bottom for fair wages and benefits."

As Wal-Mart grows bigger and bigger, it's likely to remain a lightning rod for controversies. What do you think of it? Is it bad for America because it's driving mom-and-pops out of business, or is it good, providing jobs and low prices? Share your thoughts on our Wal-Mart discussion board (30-day free trial is available).

Longtime Fool contributor Selena Maranjian does not own shares of any companies mentioned in this article. But she did once attend the Gilroy Garlic Festival.