Shame on Walmart!

By Ralph Nader, Reader Supported News

13 July 13

hen one considers Walmart's company slogan - "Save money. Live better." - it almost seems as if they are referring to their corporation's big shareholders - the super-rich Walton family - rather than their employees or the communities they squeeze. After all, Walmart is the same company that has recently made headlines for firing workers for verbally protesting against unfair wages and lack of health care benefits. This situation forces Walmart employees to work second jobs or rely on government assistance to make ends meet.

According to a recent report from the U.S. House Committee on Education and the Workforce, the low wages provided by a single Walmart store costs taxpayers upwards of $1 million in governmental support for those workers and their dependents. "The report finds that a single 300-employee Wal-Mart Supercenter in Wisconsin may cost taxpayers anywhere from $904,542 to nearly $1.75 million per year, or about $5,815 per employee. Wisconsin has 100 Wal-Mart stores, 75 that are Wal-Mart Supercenters."

Walmart's most recent attempt to advance their bullying brand of profit-over-people hit a snag this week when the District of Columbia City Council voted to approve and send to the mayor a "living wage bill" which mandates that billion-dollar big box retailers must provide a $12.50 "living wage" in the District. According to a background briefing from the council, the cost of living in the District is 42 percent higher than the national average - meaning fairer salaries are a necessity for workers in the District just to meet their basic expenses.

A similar disagreement between Walmart and a city council occurred in Chicago several years ago, with Walmart ultimately prevailing when then-Mayor Richard Daley vetoed the city's proposed living wage ordinance.

In a preemptive op-ed in the Washington Post, Walmart executive Alex Barron described the D.C. Council's pending decision on the living wage bill as one that "discriminates against business and threatens to undo all that we have accomplished together." After the vote, Walmart issued a statement declaring that their stance had not changed and that they would "review the financial and legal implications" of the D.C. stores currently under construction. "This was a difficult decision for us and unfortunate news for most D.C. residents, but the council has forced our hand," said Walmart's spokesperson.

Mr. Barron and his fellow executives should be ashamed of themselves.

I sent D.C. Mayor Vincent Gray five questions to consider in deciding whether he would support or veto the bill passed by the city council. These questions should be answered by any community considering the value of a Walmart store.

- If the 1968 minimum wage kept pace with inflation, it would be $10.70 today. If it kept pace with worker productivity, it would be $22 today. If it kept pace with the wealth of the top 1 percent of earners, it would be $33 dollars today. In an April 4, 2013 letter to me, Walmart U.S. CEO Bill Simon wrote that "in the U.S., Walmart's full-time, average hourly wage is $12.67 per hour." Given these facts, shouldn't Walmart be willing to pay workers in D.C. $12.50 an hour minus benefits, which is how the bill is written?

- Walmart's top executives each make thousands of dollars an hour. Walmart CEO Mike Duke makes $11,000 an hour plus great benefits and perks. During the length of a city council session, Mike Duke will make more than many Walmart employees working a full year! Clearly, he could afford a pay cut. Is it fair for Walmart to say it cannot afford to pay workers in D.C. $12.50 an hour minus benefits?

- Costco starts their workers at $11.50 an hour plus benefits and is a profitable company. Walmart itself is profitable in Ontario, Canada, where it starts its workers at $10.25 as well as providing them with two weeks paid vacation. What is stopping Walmart from treating Walmart workers in the District of Columbia with the same level of respect?

- Walmart recently announced a new $15 billion stock buyback. They have already used $36 billion to buy back stock throughout the past four years, which averages out to $9 billion a year. Since the billionaire Walton family owns over 50 percent of company stock, it is likely that they will be a beneficiary of most of these billions. If instead of transferring billions of dollars to the Walton family, Walmart had chosen to use the money to a pay a more respectable wage, they could have given each of their 1.3 million workers a $3.30 per hour raise. Why does Walmart have another $15 billion lying around to buy stock but empty pockets when it comes to paying $12.50 an hour minus benefits to D.C. Workers?

- A study from UC Berkeley's Center for Labor Research and Education has shown that raising a Walmart wage floor to $12 per hour would add - if all of the wage increase was absorbed by price increases - just $0.46 per trip for the average Walmart customer. Again, this is the highest estimate, as portions of the raise could be absorbed through other mechanisms, including increased productivity or portions of the stock buyback being rolled back. How can Walmart claim a $12.50 minimum wage minus benefits is untenable?

Back in 1968, Sam Walton - the founder of Walmart - had to pay his workers wages that were worth much more than wages today because the law required it of him. In that light, isn't it hypocritical that Walmart's official stance now, as articulated by Mr. Barron, is that providing workers a more livable wage in the District of Columbia in 2013 is "arbitrary and discriminatory" and "discourages investment"?

In the District of Columba and other communities throughout the country, it's time for Walmart bosses to acknowledge that supporting an increase in the minimum wage would help restore the income of 30 million hardpressed American workers - including Walmart employees - to the level of 1968, inflation-adjusted, and provide our floundering economy with a much needed jolt. (See "The Catching Up To 1968 Act of 2013" [H.R. 1346] introduced by Rep. Alan Grayson [D-FL] which, if passed, would raise the minimum wage to $10.50.)