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Unstoppable

Think Wal-Mart is just going to pack up its box and go home? Think again.

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On the commercial front of the civil war between red and blue America, there’s no stronghold farther behind enemy lines than Bentonville, Arkansas—home to Wal-Mart Stores, Inc. Union-bashing, Republican-backing, southern-fried to its core, Wal-Mart is the corporate face of Nonurban USA. And in Bentonville, it’s as pervasive and all-sustaining as the Walt Disney Company is in Disneyland. Down every street is another branch of Wal-Mart’s sprawling operation, from the 1.2-million-square-foot distribution center to the Wal-Mart museum housed inside founder Sam Walton’s original five-and-dime. In the center of town, across the road from Keith’s Auto Supply, squats Wal-Mart’s headquarters (known in local parlance as the “home office”). Made of dull red brick, just a single story high, the building is a converted warehouse. Its oceanic parking lot calls to mind the Meadowlands’.

One bright Monday morning not long ago, I found myself hiking across the lot, searching vainly for the lobby. I’d come to visit as the result of an unusual and irresistible invitation. Late last winter, Wal-Mart had seen its plan to open its first store in the five boroughs—in Rego Park, Queens—thwarted by a flurry of political opposition. In the months since then, its top executives had said nothing publicly about the controversy or their future ambitions for the city. But now, apparently, Wal-Mart’s CEO, Lee Scott, was ready to break the silence. His chief handler had called and offered me the chance to fly down for a chat.

Until recently, Wal-Mart was among the least chatty of American business titans. For years after its founding in 1962, its attitude to the press ranged from abject indifference to thinly veiled contempt. But in 2002, Wal-Mart sailed past ExxonMobil to become the world’s largest company. (Last year, its sales totaled a staggering $285 billion and its employees numbered 1.6 million.) Since then, it has become, as well, searingly controversial: an emblem of capricious corporate power, accused by its mainly liberal critics of paying poverty wages, granting meager benefits, discriminating against female workers, violating immigration laws, decimating mom-and-pop businesses . . . the litany goes on.

And so, with its image battered and its stock price stalled, Wal-Mart has lately, if reluctantly, joined the public conversation about its business practices. Speeches have been given. Ads run. A media day in Bentonville convened.

But as I discovered when I finally found my way to Lee Scott’s office, Wal-Mart’s new willingness to speak its mind doesn’t mean it’s changed its tune. Nor does it mean that its appetite for expansion is any less ravenous. Among the firm’s foes in the battle of Rego Park, the widespread assumption is that the wolf will very shortly be at the door again. And Scott confirmed that on this point, at least, his opponents are dead right.

“We’d still be a large, successful company without being in New York, but there are customers there who need to be served,” Scott declared soon after we sat down to talk. “I think New York will be good for us and we’ll be good for New York.” And make no mistake, he added emphatically, “We will be in New York.”

Wal-Mart’s determination to invade a city that’s already kicked it squarely in the teeth may strike casual observers as bloody-minded, masochistic, sinister, or all three. Mostly, in fact, it’s a logical response to a dilemma faced by any company that attains such vast proportions. With more than 3,500 stores in the United States alone, Wal-Mart is fast approaching saturation in the rural and exurban markets on which its business has been built. In order to grow at a rate that will keep its shareholders satisfied, the company has little choice but to launch a series of incursions into urban centers. As fervent as Scott is about New York, he speaks with equal ardor about Los Angeles and Chicago, both cities where Wal-Mart has big things in mind—and has encountered formidable resistance.

Yet, as Wal-Mart and its critics are well aware, the stakes in New York are greater. Not just because the market is so big and potentially lucrative. And not just because Wall Street is here. But because for both sides—each possessed of its own distinctive vanities and conceits—the outcome is freighted with so much symbolic weight in the current cultural climate. With some critical interpretation, Wal-Mart vs. New York is Bush vs. Kerry all over again.

Certainly, politics was front and center in the furor over Rego Park. It began in December, when a Wal-Mart real-estate manager, speaking at a shopping-center conference, revealed the company’s plans for its maiden foray into the city. In 2008, the manager said, Wal-Mart intended to open a 135,000-square-foot store in a mall being developed by Vornado Realty Trust on a site where Queens Boulevard meets the Long Island Expressway. As it happened, a reporter from Newsday was in the room, and the story hit the paper the next morning.


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