Wal-Mart is reportedly intensifying its PR counteroffensive. Today’s St. Petersburg Times headlines an article, “Wal-Mart Stops Smiling At Critics,” in which Wal-Mart CEO Lee Scott says he is sick and tired of being a “punching bag” for reactionaries who don’t understand the free market:
The thing is, innovation and competition tend to change the status quo. We were a small store once, too. We were able to innovate and use the economies of scale and volume buying to deliver the value our customers needed and wanted. If it weren’t Wal-Mart, it would have been someone else. I can assure you that people who live paycheck to paycheck are thrilled when we come to town.
Thrilled? Only if they don’t know the facts. The problem with Scott’s reasoning is that Wal-Mart has benefitted as much from state subsidies and handouts as it has from “innovation” in the free market. One study has documented more than $1 billion in state and local incentives for Wal-Mart nationwide since 1981.
Meanwhile, because of the way Wal-Mart treats its employees, much of the money the public supposedly saves because of the superstore’s low prices gets taken right back out of its pockets. In Florida, where the company has receieved more than $51 million in incentives since 1981, Wal-Mart, “has more employees and family members enrolled in Medicaid than any company in the state.” That means state taxpayers – many of whom live “paycheck to paycheck” – foot the bill for more than 12,000 workers and dependents. In West Viginia, 452 people — the most for any employer in the state — listed Wal-Mart on their applications with the state’s Children’s Health Insurance Program. And in California, a study showed taxpayers spend $32-million a year providing health care to Wal-Mart workers and $54-million a year in other assistance such as free school lunches and food stamps.
Unfortunately, Wal-Mart’s “innovation” consists primarily in getting strapped state governments to subsidize its massive profit margin. Perhaps that’s why the “chorus of critics” keeps growing.