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Can Wal-Mart Reform Itself?

Via Ezra Klein, who has a lot of interesting things to say about this, here's the progressive case for Wal-Mart, by Jason Furman. The paper makes some solid points, though as Max Sawicky points out, it's unlikely that the effect of Wal-Mart's low prices can compensate for rock-bottom wages for the lowest income groups. But set that aside. The weakest part of the paper, I think, is that Furman seems to believe that just because Wal-Mart has some positive and progressive effects on the economy, it can also be a progressive company.

If Wal-Mart were committed to the welfare of its more than 1.3 million "associates," as it calls its workers, then it would push to expand these public programs. Instead, Wal-Mart and the Walton family have generally worked against the progressive issues that would benefit its employees, including funding campaigns advocating the repeal of the estate tax. Recently, Wal-Mart has come around to endorsing a higher minimum wage, but this limited step is outweighed by its consistent funding for attempts to roll back progressive priorities that would benefit its workers.

This seems almost willfully naïve. Of course Wal-Mart works "against the progressive issues that would benefit its employees." Why wouldn't it? In as much as Wal-Mart can be said to be an entity that "wants" and lobbies for things, it will want a) lower corporate taxes, b) lower taxes for its managers and owners, c) lax corporate and workplace regulation, and d) a governing party that can distract the working class with cultural issues. Now which party delivers that?

Ezra seems to think that Wal-Mart can somehow be convinced to become a progressive ally and support universal health care in order to lower its labor costs. Nonsense, I say. If Wal-Mart's worried about its health care costs it will stump for a Republican health care plan that leaves workers at the mercy of the sharks in the open insurance market and ensures that Wal-Mart, along with its managers and shareholders, pay as little as possible for the scheme. Back to Furman:

Finally, Wal-Mart should obey labor laws that bar gender discrimination, unpaid overtime and environmental laws like the Clean Air Act. I do not know whether or not Wal-Mart has systematically broken these laws; to the degree it has, the remedy is through the legal system, not through restricting the expansion of Wal-Mart into new areas or applying new mandates to a single company.

Aargh. That ignores the fact that Wal-Mart, along with other corporate interests, gets involved in politics precisely to neuter the legal system that's supposed to act as a "remedy"—trying to limit its liability from class-action lawsuits through tort "reform," and trying to weaken workplace regulations, and so on. More to the point, the legal system as currently structured is inadequate for dealing with corporations like Wal-Mart. The company has shown no remorse for anything it has done, any of the workers it has mistreated, any of the laws it has broken, and considers paying fines simply a cost of doing business.

This is why many people support the death penalty for corporations. In the short term it would be disastrous for many people, not least the company's 1.3 million employees, if Wal-Mart's corporate charter was revoked and its assets auctioned off. But understandably, many people feel that drastic action is necessary to teach corporations that you don't lock workers in the store after hours, you don't treat undocumented workers like indentured servants, and you don't let children operate heavy machinery just so that economists can gush over your "productivity growth." Now there are certainly problems with the corporate death penalty, and personally I have mixed feelings on it, but the idea gets at the general problem here: you can't just ask Wal-Mart to play nice.

That's exactly why, as Matt Yglesias says, unions are so important—so that there is some countervailing power fighting against corporate-friendly changes to the legal system and hideous labor practices. That's why the SEIU wants to unionize the company, so it can tip the balance of power, and Wal-Mart stands in the way. Trying to "get along" won't get the job done.

Now Ezra's totally right to say that there are real problems with simply demanding that Wal-Mart offer its workers health care—employer-based health care is a very flawed system. Better to get a more rational universal health care system. But quite naturally, unions don't think universal health care is ever going to come, and that any such system would inevitably be weakened by corporate lobbyists hired by, among others, Wal-Mart. Ezra's trying to think through what a more rational long-term strategy to get to universal health care would look like. I'd love to see it, and think it's a worthwhile project. But I don't think it does any good expect that Wal-Mart can ever be "persuaded" to fight for the working class and single-payer health care. It's still a war and always will be.

Posted by Bradford Plumer on 12/02/05 at 9:56 AM | E-mail | Print