Econ 101 At the Tanstaafl Institute

No, that is not a typo in the headline. Many, many years ago, when dinosaurs roamed the earth and I was in high school, I took my first economics class. On the first day of class, the instructor welcomed us to the “Tahnsstoffle Institute.” Or at least that is sort of what it sounded like. He then wrote the “name” of the “Institute” on the board thusly: TANSTAAFL. He then grandly announced that this was an acronym that stands for: There Ain’t No Such Thing As A Free Lunch.

He then told us if that was all we learned in the class that we would know more about real world economics than most economists. Frankly, I don’t remember much else from the class, but TANSTAAFL has stuck with ever since. I was reminded of it again when I was visiting Door County last weekend.

It seems that the citizens of Door County, or at least some of them, are fighting a proposed big box store which may be built near Sturgeon Bay. It is your classic battle. Local store owners and citizens who want to keep local character on one side, developers, chamber of commerce types and people who want to “save money” on the other. Throw in some out of town money and lobbying for the local politicos and you have an All American brouhaha already in progress. You can read the side of the story of the locals fighting the big box here.Door County Cycles

First I have to say, that I think the forces for Big Box development have a point. It is kind of nice to shop in a store that has a huge selection and rock bottom prices. Wal-Mart has often argued that they help average Americans by saving them significantly at the check out. And certainly compared to the Mom and Pop store of old, Big Box prices are much lower.

Unfortunately, those low prices have a price, as it were. The TAANSTAAFL law applies to Big Boxes just like everything else. Yes, the prices are lower — and so are the manufacturing wages for those products. Often so low that the jobs pay so much less than our minimum wages they have to go overseas. Mom and Pop can’t compete, downtown fades to a romantic memory and the Big Box acts as a conduit for the money — from all those hometowns to the Head Office. Suddenly all those nickles and dimes that were “saved” pile up into huge fortunes. If Sam Walton were still alive (and his now somewhat scattered fortune still intact) he would be the worlds richest man, by far. Target’s CEO raked in over $12 million in pay in 2004 and has some $174 million in stock options waiting for him. That is a lot of “savings!”

There is a place for a nice big cheap store, by now you can’t help but shop at them. But I always try and remember the TANSTAAFL Institute everytime I pull in the parking lot and especially when I see ground broken on yet another corporate money vacuum, come to suck our hard earned dollars away. Development is good, trade is good. But local development that focuses on people and community is best.


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