Thursday, April 21, 2005

Trouble for Wal-Mart

There’s a new coalition of unions, environmentalists and women’s rights groups claiming Wal-Mart is bad for the nation. Wal-Mart Watch is a slick new advocacy group that just launched a massive media effort to convince Americans that Wal-Mart’s low pay and poor benefits is costing us $1.5 billion a year in federal tax dollars paid out for food stamps, Medicaid and housing subsidies to Wal-Mart employees.

According the AP Wal-Mart was quick to denounce the group.

"This is just one more example of labor unions playing fast and loose with the facts in an attempt to discredit Wal-Mart," Wal-Mart spokeswoman Mona Williams said. "We don't know where they got these numbers. And most sources they cite are from dubious studies they commissioned."

The Yellow Line took a look at Wal-Mart Watch’s research (available as a PDF file here) and the group readily admits the $1.5 billion is an extrapolation based on what one, 200-employee store might cost tax payers if employees took the federal assistance they’d possibly be eligible for. We’re not talking about rock-solid numbers here.

Wal-Mart could very likely do better by its employees, but should we be working towards drastically reforming the retail industry or should we be finding ways to insure Americans don’t have to make low-level service jobs their career? And how many of the problems we see are due to Wal-Mart’s capitalist ambitions and how many are due to a healthcare system that is overly reliant on employers for funding?

The answers are not readily obvious. But we should frame the debate in ways more expansive than “Wal-Mart is bad and their employees areoppressed.” There’s far more to it.


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