“4/15/2008, 10:03am EST”
Retailing chains caught in a wave of bankruptcies (NYT) →
Since last fall, eight mostly midsize chains — as diverse as the furniture store Levitz and the electronics seller Sharper Image — have filed for bankruptcy protection as they staggered under mounting debt and declining sales.
But the troubles are quickly spreading to bigger national companies, like Linens ‘n Things, the bedding and furniture retailer with 500 stores in 47 states. It may file for bankruptcy as early as this week, according to people briefed on the matter. …
Because retailers rely on a broad network of suppliers, their bankruptcies are rippling across the economy. The cash-short chains are leaving behind tens of millions of dollars in unpaid bills to shipping companies, furniture manufacturers, mall owners and advertising agencies. Many are unlikely to be paid in full, spreading the economic pain.
Ah, that pesky division of labor thing. Sure, it allows a million openings for fraud, shoddy quality, reprehensible practices, secretive manipulations/usurpations of resources, and the list goes on. And in the minds of the capitalist true believers, those are simply opportunities to be — you guessed it — capitalized upon, until the true believers themselves start to feel the pain.
But division of labor also does something else. It sets everyone up in reliance upon one another for basic pieces of their respective livelihoods. Because businesses live so close to the edge in a credit-based economy, even a single bad season for one sector prompts a chain reaction that ripples through the entire constructed system.
Of course, it’s the constructed system that inevitably produces internal crises (such as the closing of retailers) and external crises (such as global warming, reduction in biodiversity, introduction of invasive species to vulnerable ecosystems, etc.). I wish we would stop trying to save it.
Never leave home without it.
