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Activist Filmmaker Takes Aim at Wal-Mart: The world’s largest retailer won’t get any breaks in a hard-hitting, emotion-packed documentary from a veteran Hollywood producer.
FORTUNE, 9/12/2005, Marc Gunther
In a poignant scene from an upcoming anti-Wal-Mart movie, a taciturn middle-aged businessman named Red recalls what happened when the giant retailer came to his small town in Missouri. Unable to compete with Wal-Mart’s well-known “every day low prices” strategy, Red was forced to shut down his family’s three grocery stores and lay off 150 workers. “It was 40 years of hard work that seemed to disappear all at once,” he says, fighting back tears. What’s worse, he says, Wal-Mart benefited from tax abatements, as well as roads, water, and sewer service that the local and state government provided at no cost. “They get all the breaks,” he says.
Maybe so, but Wal-Mart won’t get any breaks in Wal-Mart: The High Cost of Low Price, a hard-hitting, emotion-packed documentary from veteran Hollywood producer and director Robert Greenwald that is scheduled to have a limited theatrical release in November. Greenwald recently agreed to show excerpts from his movie to FORTUNE, on the condition that the names of people in the documentary weren’t disclosed. Some of them, he says, fear Wal-Mart may try to intimidate them before the film’s release.
Wal-Mart: The High Cost of Low Price is the newest salvo aimed at a company whose reputation has been taking a beating lately. Although Wal-Mart has gotten some good press recently for its response to the hurricane Katrina disaster, in the past few years, the retailer has been the subject of a tough PBS investigation, Store Wars: When Wal-Mart Comes to Town; a Pulitzer Prize-winning series in the Los Angeles Times; and magazine covers with headlines like “Is Wal-Mart Good for America?” Wal-Mart also faces a class-action sex discrimination lawsuit. And now, there's Greenwald, who says: “My belief is that Wal-Mart is working against the best values of America—families, jobs and communities.”
Wal-Mart critics contend that, among other things, the company has contributed to the decline of Main Streets in small towns across America, pays substandard wages, and provides inadequate health benefits. The company strongly denies these charges, noting that hundreds of people line up for jobs whenever it opens a new store, and that its focus on holding down costs saves its customers billions of dollars a year. While it’s impossible to determine whether Wal-Mart’s image problems have affected sales, its own surveys have found that 30% to 40% of all consumers have questions about how the company treats its workers.
Greenwald, 60, has produced or directed dozens of cause-related movies. His recent documentaries include Outfoxed: Rupert Murdoch’s War on Journalism, about Fox News; Uncovered: The Whole Truth About the Iraq War, which went after the Bush administration; and a TV movie, The Crooked E: The Unshredded Truth about Enron. Earlier, he directed The Burning Bed, a 1984 TV movie starring Farrah Fawcett as a battered housewife; as well as TV movies about interracial marriage, teen pregnancy, and Amnesty International.
Despite his long list of credits and left coast connections, Greenwald has been unable to find a major Hollywood studio to distribute the Wal-Mart movie. As a result, Greenwald has arranged for a limited theatrical release and broader distribution of the movie on DVDs, the same route that he took for his Fox News movie, which sold 200,000 units. By keeping production costs low—about $1.6 million, he estimates—Greenwald hopes to finance the movie through DVD sales and donations. He has raised about $800,000 from friends, donors, and advance DVD sales. “You don’t need to convince the traditional gatekeepers anymore,” Greenwald says. “That’s liberating.”
As it happens, anti-corporate documentaries, particularly when leavened with humor, have proven their appeal at the box office. Michael Moore’s Roger & Me (1989), which took on General Motors, Morgan Spurlock’s Super Size Me (2004), which skewered McDonald’s, and Alex Gibney’s Enron: The Smartest Guys in the Room (2005), which chronicled the Enron scandal, were profitable. However, Greenwald’s Outfoxed wasn’t.
For his recent movie, Greenwald used the Internet to research the film, to seek out current and former Wal-Mart employees, and to arrange for nearly 3,000 screenings with the help of dozens of organizations, from labor unions to church groups, with concerns about the way Wal-Mart operates. Groups that will hold screenings include the AFL-CIO, the Teamsters union, the Service Employees International Union, the United Food and Commercial Workers union, the Petroleum Marketers of America, MoveOn.org, the National Organization for Women, the Sierra Club, The Nation magazine, and the American Civil Liberties Union.
Wal-Mart, which had $288 billion in revenues in 2004, declined to make its executives available to be interviewed in the movie, citing the anti-Wal-Mart tone of Greenwald’s website promoting his movie. Mona Williams, a company spokeswoman, says: “We think most people will see it for what it is—a sensationalized and one-sided view of our company. Mr. Greenwald is a nice guy, but he is also just one more enterprising American using our name to make a buck or garner a few more minutes of fame. I guess we will pretty much ignore it—because to all but a handful of anti-Wal-Mart activists, it simply will be irrelevant.”
Indeed, Wal-Mart should not overreact to the movie, advises Eric Dezenhall, the founder and president Dezenhall Resources, a Washington, D.C., crisis communications firm. “These kinds of documentaries serve to reinforce existing prejudices,” he says. “They rally protesters. And they can cause the company internal problems, with employees and shareholders…" But he says it's unlikely to harm sales. "Most of the world doesn’t care,” he says.
Nevertheless, Wal-Mart, which for years ignored critics, has recently begun to engage them in a variety of ways. It has an extensive website at walmartfacts.com that respond to the campaigns by unions and others and it has expanded its Washington lobbying operation. In the wake of Hurricane Katrina, the company made a $15 million donation to help victims of Hurricane Katrina. The Walton family, whose patriarch, the late Sam Walton, started the stores, gave another $15 million. (Right after the storm, the company let many of its out-of-work employees go with three-days pay, but later changed that policy and will continue paying them for an undetermined amount of time.) And, in an unusual move, Wal-Mart will sponsor a conference in November in Washington, D.C., where critics and supporters will be invited to present academic papers examining the company’s impact on the U.S. economy and individual communities. The company says it is hoping top stimulate a “robust, diverse and balanced discussion.”
Jay Rosen, a journalism professor at New York University and a media critic, says that a movie like Wal-Mart: The High Cost of Low Price, may not change many people's opinions of the company, but may still have an effect. “You can make a difference by giving people something to think about, by rallying the like-minded, by informing atomized people they are not, in fact, alone, by mobilizing outrage,” Rosen says. None of which sounds like good news for the world’s biggest company.