Sam’s town sees changes

Sam Walton wanted Wal-Mart Stores Inc.’s corporate home town to look as though Norman Rockwell could live there. More than six years after Walton’s death, this small Northwest Arkansas city also might be appealing to Donald Trump.

Precautions to hide wealth by Wal-Mart executives and vendors who wanted to mirror Walton’s modest lifestyle died with the icon. Many of today’s Wal-Mart executives like their cars foreign and their homes palatial.

And because Bentonville is still only 15,000 people with the “rich section of town” off on the fringes, the gap in economic classes is easy to identify. In fact, it could be a microcosm of the “diminishing middle class” of which sociologists have been warning Americans in recent years.

“When I was growing up, my dad was a policeman and my mom was a telephone operator and secretary,” Bentonville Mayor Terry Coberly says. “[But] I didn’t know Sam Walton made more money than they did. What a healthy thing that was.

“That’s what I miss. That’s what I see as the negative.”

Coberly, however, is quick to add that life without Wal-Mart would be far worse than any challenges brought on by its success. Indeed, Wal-Mart’s rise has fueled Bentonville to the same economic prosperity as other cities in northwest Arkansas — home to Tyson Foods Inc., J.B. Hunt Transport Services Inc., the University of Arkansas and more than 100 manufacturers.

But the visible change in Bentonville’s socioeconomic landscape during the past five years is irrefutable. There has been a sixfold increase in sales of homes valued at more than $200,000 this year compared with 1992, while sales of homes valued at less than $100,000 have increased only about 60 percent — approximately consistent with the overall growth of Northwest Arkansas.

According to an informal survey of Realtors, the average home in Northwest Arkansas’ two counties is $100,000-$125,000 — modest compared to the region’s success and other locales.

“You get a lot for your money here,” says Ron Metz, who moved to nearby Rogers from New Jersey in November when he was named team leader for Colgate-Palmolive’s Wal-Mart sales staff. Of course, the value Metz experienced has a flip side.

“We have a glut of $60,000 homes,” says Danny Brewer, a Bentonville Realtor and city councilman.

He says 65 homes valued at less than $70,000 were available Dec. 1 — a large number in a town its size.

And while cheaper homes are moving slowly, big homes seemingly can’t be built fast enough. This is just fine with Carmen Lehman, who along with her husband, Arnold, has developed Bentonville’s two premier subdivisions, Hanover and Stonehenge.

Lehman says the 260-lot Hanover subdivision was started 13 years ago, but Phase 3 of the project has just been completed and represents more than half the total lots, with individual homes valued at up to $650,000. Stonehenge has 140 lots, with the most expensive topping out at about $500,000, she says.

“When I came here [from Illinois, 30 years ago], I had to hold down two jobs, working double shifts as a nurse,” the 53-year-old Lehman says. “I never had a grand goal to live in a wonderful house. It just happened.”

Lehman’s sales figures show that bigger homes have increased dramatically since Sam Walton’s death — and property values along with it. Land she could have bought three years ago for $4,000-$6,000 an acre is now between $10,000-$25,000. she says, and therefore “unfeasible for residential development.”

The end result would make Dickens proud — Bentonville is seemingly a tale of two cities. Some say this provides the best of both worlds: a small town atmosphere with upscale amenities for those who can afford it. Others warn of a sociological downside.

Sam’s legend

Stories of Sam Walton’s modest lifestyle are legend — the old pickup trucks, the relatively simple home (compared with other billionaires) and the penchant for doing business without flair or pretense.

His example flowed downhill, either by insistence or osmosis. Wal-Mart executives and vendors avoided sprawling homes, designer clothes, fancy cars and watches more expensive than engagement rings. Those who didn’t were usually chastised.

“Ever since Mr. Sam passed away, there are more Mercedes [Benz] on Bentonville streets than there ever was before,” says Tom Rife, a Bentonville real estate appraiser who says some Bentonville homes are worth $1 million each. “The Wal-Mart people who make money aren’t as intimidated as they used to be.”

And it’s not just a change in attitude by longtime employees that has transformed Bentonville. Wal-Mart and its vendors often recruit top-level executives and salespeople from the ritzy suburbs of larger cities who want the same luxuries they left behind — or more.

This change in style is humorously categorized by Coberly as the “yuppie mentality of the ’80s” finally working its way to the heartland. As a lifelong Bentonville resident, 15-year school teacher and first-term mayor, Coberly has seen the transformation on a variety of levels.

“If you give your soul [to an employer], you want to be able to spend the money the way you want,” Coberly says. “A lot of young couples are moving here because we’ve always had good schools and there is still the perception of a small town.

“If more cosmopolitan opportunities come to this area, and yet we retain a Norman Rockwell atmosphere, we would have it all. That’s a big challenge” to strike that balance, she says.

Company town today

Of more interest to sociologists is how Wal-Mart has redefined the “company town.” It boasts the richest family in America, several millionaire executives, about 7,100 employees scattered throughout various headquarter offices in Northwest Arkansas and teams of vendor salespeople who exclusively service this one account.

Comments from any of them on how visible wealth challenges Bentonville’s communal harmony are difficult to elicit. The company declined comment through its media relations department, vendors would nod but say nothing and townspeople are, at best, careful.

Even Coberly, who is generally candid with her insight, repeatedly insisted that her reported comments be balanced by her gratitude for Wal-Mart’s success and generosity. When asked if she knew just one longtime resident whose comments wouldn’t be constrained by ties to Wal-Mart — either directly or by relation — it took her several minutes to come up with the name of a single merchant.

But that merchant also refused comment. Wal-Mart people shop there.

A select few don’t mind voicing their concern. Brenda Anderson, director of the state-run Bentonville Housing Authority and former eight-year director of planning for the city, says she is particularly concerned with the geographic separation of visible wealth.

“People move here from other areas and they want a house like they had in the suburbs of Chicago or the suburbs of Atlanta, and what we have wound up with is the suburbs of Bentonville,” Anderson says with a laugh.

“For some people, living in an area with poorer people means living in an area with crime,” she says. “That’s not true here, but they want what they’re comfortable with … It changes the character of the community. When a town is economically segregated, it is more difficult to maintain a sense of community.”

Class visibility

Lori Holyfield, an assistant professor of sociology at the University of Arkansas in nearby Fayetteville, has special insight into the phenomenon. She got her doctorate from the University of Georgia, but her roots are in Bentonville, where she was raised and graduated high school.

“We don’t want to ‘dis’ folks for earning their money the hard way,” Holyfield says. “The question, though, is visibility. When class becomes visible the absence of wealth also becomes visible.

“[And] there is a direct connection of self-worth to self-esteem. This brings some to think they’re just not lucky and others would think money doesn’t bring happiness. But what they are not likely to think about are the structural barriers that prohibit us from getting to that level.”

Those barriers, Holyfield says, include the difficulty of breaking through to a class level occupied by so few. She says studies show that of the 200,000 industrial corporations in the United States, only 100 control 70 percent of the assets, meaning power and class are restricted.

Visible wealth is why “we have an angrier public today than ever before,” Holyfield says. Lehman, the developer, argues that Bentonville’s nicer homes work as a motivating tool for those who want to better their class. She says the work ethic established by Sam Walton has trickled down to others in Northwest Arkansas, providing examples of how hard work can pay off.

“When it looks like anybody can achieve that dream, that’s dangerous” Holyfield says, “because when they don’t [achieve it], they’ll either blame themselves or the people across town who live in those houses.

“There is an unbelievable concentration of wealth in Northwest Arkansas, with Sam Walton, Don Tyson and others. But the overwhelming percentage don’t make it. How many millionaires can there be?”

Problems not insurmountable

Despite the concerns of a few, most in Bentonville seem to think the “new Bentonville” doesn’t present any insurmountable sociological problems.

Even Mayor Coberly — who says she sometimes longs for her childhood days when wealth was kept under wraps — says she is more occupied by practical concerns. Because of a 36 percent increase in population since 1990, four square miles have been annexed into the city the last three years, requiring improved roads and services.

And Rife, the appraiser who sees the new homes on a regular basis, says he doesn’t fear the outward displays of wealth. He says Sam Walton’s children offset any negatives by raising their own children “as they were raised,” with “proper values” and a penchant for charitable work.

Holyfield acknowledges that charitable work by the wealthy can help bridge the gap but says she doubts it is the entire answer. Constant reminders of wealth can lead to a preoccupation with trying to break through to the next class and failure to do so can cause lifelong unhappiness, she says.

So was Sam Walton right to insist his employees keep their wealth to themselves? Was there a greater cause to be served by the humble lifestyle he lived and preached?

“That’s a good question,” Holyfield says. “How conspicuous can we be and still call ourselves down-to-earth?”