Independent Christian Voice

Tuesday

Put lipstick on a pig, it's still a pig

One of the Washington Post's columnists might be a great candidate to replace current White House Press Secretary Scott McClellan — he can polish a turd as well as anyone. Well, you can polish a turd all you want, but it's still shit. In a column yesterday, Sebastian Mallaby is trying to delude us into believing that Wal-Mart is a progressive company that does more for poverty relief in America than many federal programs:
…Wal-Mart's "every day low prices" make the biggest difference to the poor, since they spend a higher proportion of income on food and other basics. As a force for poverty relief, Wal-Mart's $200 billion-plus assistance to consumers may rival many federal programs. Those programs are better targeted at the needy, but they are dramatically smaller. Food stamps were worth $33 billion in 2005, and the earned-income tax credit was worth $40 billion. [...] Companies like Wal-Mart are not run by saints. They can treat workers and competitors roughly. They may be poor stewards of the environment. When they break the law they must be punished. Wal-Mart is at the center of the globalized, technology-driven economy that's radically increased American inequality, so it's not surprising that it has critics. But globalization and business innovation are nonetheless the engines of progress; and if that sounds too abstract, think of the $200 billion-plus that Wal-Mart consumers gain annually. If critics prevent the firm from opening new branches, they will prevent ordinary families from sharing in those gains. Poor Americans will be chief among the casualties.
Typical of many Corporate America apologists, this guy ignores the facts and generally all semblance of reality. He has done a masterful job of spinning the numbers to imply something that's completely opposite of Wal-Mart's true impact on America's poor, working families and many local businesses — the heart of the American dream. Let's look at some real facts:
Impact to the local economy:
  • Industry analyst, Retail Forward, predicted that for every new Supercenter that Wal-Mart opens, two local supermarkets will close. —Business Week, “Is Wal-Mart Too Powerful?,” 10/06/03
  • Wal-Mart has received more than $1 billion in taxpayer-funded subsidies from state and local communities. — Good Jobs First, “Shopping for Subsidies,” May ‘04, www.goodjobsfirst.org
  • One study found that local businesses spend 53% of their revenues within the local and state economies; whereas big box stores, like Wal-Mart, spend just 14% within the local economy. — Inst. for Local Self-Reliance, 9/03
  • A study of the impact of Wal-Mart’s growth found that over ten years 7,326 Iowa businesses closed, including: 555 grocery stores, 298 hardware stores, 293 building suppliers, 161 variety shops, 158 women’s stores, and 116 pharmacies. — Dr. Kenneth Stone, Iowa State University, “Competing with Discount Mass Merchandisers,” 1995
  • A study of Wal-Mart’s expansion in Iowa found that 84 percent of all sales at the new Wal-Mart stores came at the expense of existing businesses within the same county. — National Trust For Historic Preservation, “What Happened When Wal-Mart Came to Town?,” 1996
Impact on workers' rights:
  • In California, Wal-Mart is facing a lawsuit filed on behalf of 115,919 current and former employees who were systematically and illegally denied meal breaks while working for the company. — Bloomberg News, 9/19/05; Associated Press, 9/19/05
  • In 2000, Wal-Mart closed its company-wide meat-cutting division after ten butchers in Texas voted to unionize their shop. Wal-Mart closed a profitable Canadian store in 2004 after employees chose union representation. — Associated Press, 3/3/00; 2/09/05
  • Wal-Mart [reportedly] paid $50 million to settle a lawsuit that involved 69,000 workers in Colorado who had allegedly been forced to work off the clock. In recent years, Wal-Mart has faced legal actions in over thirty states for overtime violations. — New York Times, 11/19/04
  • Wal-Mart’s CEO Lee Scott took home $17.5 million in 2004, which equals $8,434 an hour. An average Wal-Mart associate earns just $9.68 an hour. — Institute for Policy Studies
  • The average pay for a Wal-Mart sales associate is $14,000 a year $1,000 below the poverty line for a family of three. — New York Review of Books, 12/16/04
  • On average, Costco pays its workers 65% more than Wal-Mart, yet earns more profits per employee. — New York Times, 5/3/05; Business Week, 4/12/04
Healthcare:
  • Just 47 percent of Wal-Mart employees are covered by the Wal- Mart health plan; while nationally 68 percent of workers in large firms receive their health benefits from their employer. Many of Wal-Mart’s uncovered employees are forced to rely on public health assistance, adding to the cost of the bloated Wal-Mart tax. — Kaiser Family Foundation; www.walmartfacts.com
  • As momentum grows, lawmakers in 16 states have revealed troubling statistics. Wal-Mart employees top Medicaid and CHIP rolls; many are forced to rely on public assistance for their health coverage. — Wal-Mart Watch; walmartwatch.com/healthcare
  • Wal-Mart’s health plan has deductibles as high as $1,000 in addition to many hidden fees. For example: a $100 deductible for ER visits, a $100 deductible for ambulance services and a $25 weekly “spousal” surcharge for health coverage. — Phil. Inquirer, 5/16/05; Wal-Mart 2005 Associate Guide
  • Full-time Wal-Mart employees must wait six months to be eligible for their health care plan, while part-time employees must wait two years to become eligible. — Phil. Inquirer, 5/16/05; Wal-Mart 2005 Associate Guide
Cost to taxpayers:
  • The estimated total amount of federal assistance for which Wal-Mart employees were eligible in 2004 was $2.5 billion. — “Harper’s Index,” Harper’s Magazine, Vol. 310, No. 1858, 3/2005
  • One 200-employee Wal-Mart store may cost federal taxpayers $420,750 per year. This cost comes from the following, on average:
    • $36,000 a year for free and reduced lunches for just 50 qualifying Wal-Mart families.
    • $42,000 a year for low-income housing assistance.
    • $125,000 a year for federal tax credits and deductions for low-income families.
    • $100,000 a year for the additional expenses for programs for students.
    • $108,000 a year for the additional federal health care costs of moving into state children's health insurance programs (S-CHIP)
    • $9,750 a year for the additional costs for low income energy assistance.
    — “The Hidden Price We All Pay For Wal-Mart, A Report By The Democratic Staff of the Committee on Education and the Workforce,” 2/16/04
Given the above facts, how can a sane person call Wal-Mart progressive? The answer: a sane person couldn't.

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