. South America: Here is information of the impact that one company (in this case Wal-Mart) can have in the local economy of any area of the country, because of the economic multiplier effect. ******************* âWal-Mart & The Multiplier Effect / Re-Circulated Moneyâ Economists talk about the multiplier effect of money. They may disagree about the number of times it re-circulates, for instance, 3.7 or 7.3, or higher or lower or perhaps in between, but no one underestimates the importance of the fact that it does re-circulate and that re-circulation is vital in a healthy economy. Another thing economist generally agree on is that the longer money stays in any given area, more people in that area will get their hands on it. This occurs because people spend money, and the folks they spend money with, in turn, spend that money with folks that turn around and spend that money with others. This process will, in time, generate a large amount of sales tax revenue for the community. This happens each time a new and different consumer purchases a taxable item. If the original money is removed from the area completely, the process stops immediately. No one can declare, with certainty, just how many times money re-circulates, while dependant on many factors, it is thought that somewhere between 3.7 and 7.3 are traceable numbers. You may pick any number you want, anything over once will generate more tax revenue for our city/county/state, than Wal-Mart will provide. #1: Wal-Marts sales are electronically deposited out of state daily. This removes any possibility of multiplying our tax base on whatever profits are involved. Wal-Mart cannot magically produce more money in a given area than there is already present. No new money is generated by Wal-Mart, It is only removed by Wal-Mart. #2: When Wal-Mart buys its merchandise outside the United States it removes any possibility of multiplying our tax base on whatever manufacturing monies are involved. As an example, in a FAST* apparel survey where Wal-Mart is recorded as the company of record responsible for a particular piece of apparel, 98% of the items surveyed were produced offshore; 75% in Asia 14% in Africa & Middle East 5% in Europe 4% in Latin America 2% in the U.S.A. Wal-Mart stores dramatically deplete United States taxable income each and every year on manufacturing. They bring nothing new to the taxable table. Nothing! Communist China, Korea, Taiwan, Hong Kong, the Asian Rim, receives the greatest benefit, then Africa, the Middle East, Europe, Latin America and Dead last, the good old U.S.A. The obvious conclusion must be there is no multiplier effect, on manufacturing created by Wal-Mart and that too is a major reason why sales taxes continue to go up. The 1970's saw 5% sales taxes charged the California consumer. The 1980's sales tax hovered around 6%. The 1990's sales tax is up to 8.50% in some areas of California. Now the Century has turned over, the State is flirting with sales taxes over 10%. The greater the loss of the multiplier effect, the higher California sales taxes will have to go. #3: The 3rd and last item that could generate additional tax revenues is wages, however Wal-Mart cannot produce Multiplied tax dollars here either. Studies show that a Wal-Mart produces' only one job for every 1.5 that they destroy. These jobs come from the business sector that was somewhere in that marketing area prior to the arrival of a Wal-Mart One evidence of dissatisfaction with the pay and benefit package Wal-Mart offers, is the 60% plus yearly turn over of their employee base, (approximately Â¾ of a million employees quit Wal-Mart every year). With fewer people making less wages and benefits, taxable income from total wages will decline in a Wal Mart area, this also removes any possibility of multiplying our tax base on any wages involve Note: The average U.S. discount store is 90,000 square feet and generates $23-million in annual sales. The average Wal-Mart Supercenter is 182,000 square feet and does $87-million in sales. .