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Thread: The cost of WalMart Nation

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    Default The cost of WalMart Nation

    http://netscape.fool.com/news/mft/20...ce=y&bounce2=y

    Is Wal-Mart Costing Us Billions?

    By Selena Maranjian (TMF Selena)
    March 11, 2005

    What a fascinating and rich topic Wal-Mart (NYSE: WMT) is. Love it or hate it, it rarely bores us. I myself have written a few articles on the company, such as when I questioned whether the firm was a force for good or evil and heard from many impassioned readers in response, and when I suggested some new business lines for the company. Other Fool writers have also chimed in:

    * Jeff Hwang: Wal-Mart: $10 Billion Saved
    * Rich Smith: Wal-Mart Paints Bull's-Eye on Itself
    * John Reeves: Predicting the Next Wal-Mart
    * Rich Duprey: Wal-Mart Breaks Into China

    I recently read some new perspectives on the firm, though, and thought I'd offer them up as food for thought and/or discussion. (Jump into the fray on our Wal-Mart discussion board.)

    First up, at Slate.com, Timothy Noah presented an interesting take on a recent speech by CEO H. Lee Scott, Jr. He explained that while Scott seemed to be defending the firm's record on how it treats its employees, Scott may have been really trying to quietly reassure investors that they're not being treated that well -- that pay and benefits remain at relatively low levels. Cynical? You bet. But some compelling data backs Noah up. For example, Scott says that "Wal-Mart's average wage is around $10 an hour, nearly double the federal minimum wage." But that average is skewed somewhat by the steep salaries of those at the top. Scott's own $15 million-plus compensation package, for example, will only bring up the average. The median (or middle) wage would have been a more telling figure.

    Scott also explained that "our wages are competitive with comparable retailers in each of the more than 3,500 communities we serve." Noah countered that although this may be true, Wal-Mart has likely driven down the pay rates in such communities, as competitors try to compete.

    Meanwhile, in The New York Review of Books, Simon Head reviewed a bunch of books related to Wal-Mart. His article was long and full of too many points to cover here, but these two points, among others, jumped out at me:

    * "

    * m. For a two-hundred-employee Wal-Mart store, the government is spending $108,000 a year for children's health care; $125,000 a year in tax credits and deductions for low-income families; and $42,000 a year in housing assistance. The report estimates that a two-hundred-employee Wal-Mart store costs federal taxpayers $420,000 a year, or about $2,103 per Wal-Mart employee. That translates into a total annual welfare bill of $2.5 billion for Wal-Mart's 1.2 million U.S. employees." He added that state governments are burdened by Wal-Marts, too, with California spending more than $20 million on health care for Wal-Mart employees.


    By the way, this was written by a WM shareholder!~

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    Default Re: The cost of WalMart Nation

    WalMart is the devil.

    Not only do I refuse to go there, but I WILL be the first on the curb protesting when they try to build another one (on top of about 10 mom and pop stores that I frequent).



    Because there ain't no tits on the radio

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    Default Re: The cost of WalMart Nation

    I agree..but the challenge is they are an EASY solution for people. Everything in 1 place, cheap, cheery, colorful, it becomes easy to ignore the underlying issues.

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    Default Re: The cost of WalMart Nation

    IMHO the supposed $2,103 being paid out per WalMart employee per year in social benefits is a 'red herring'.

    Point one, anybody working in any job which pays less than the eligibility threshold is eligible for those benefits. Those benefits are paid for in a roundabout way via progressive income taxes, with low income people contributing little or nothing and with high income people contributing a lot.

    Point two, anybody who works at a unionized/upscale store is being paid more than the eligibility threshold thus will not generate direct costs to provide them social benefits. However, every CUSTOMER of a unionized/upscale store is paying higher prices to finance the higher salaries for store personnel. Unlike taxes, these higher prices are assessed on a dollar for dollar basis based on what the customer buys, with equal amounts being charged to a $25,000 per year customer as to a $250,000 per year customer if they both buy the same item. It could therefore be argued that localities which do not allow discount box stores are de-facto discriminating against poor people in the community.

    I would also add that federal and state taxes paid out for social benefits are a hell of a lot higher than $2,103 for persons who aren't working at all, and Social Security/Medicare tax revenue is a hell of a lot lower for persons who aren't working at all ! Therefore it could be argued that for every unionized job which winds up being outsourced or bankrupted that tax money payouts to each affected employee can be 10 times the $2,103 amount between unemployment, social benefits, and zero tax revenue coming in. This makes up for 10 years worth of 'WalMart evil' in a single year.

    I trust we're not headed back to a political discussion regarding 'socially appropriate' rates of pay versus market value based rates of pay, i.e. the 'living wage' thing ...

    Lastly, if you're really concerned about the costs of providing social benefits to WalMart and other low income workers, complain to the true source of the problem - your state legislators - to lower those benefits [email protected]!
    Last edited by Melonie; 03-25-2005 at 10:25 AM.

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    Default Re: The cost of WalMart Nation

    PS if you're really worried about the costs of social benefits, the root of the problem lies here ...



    ... and raising the $10,000, $12,000, $14,000 per student per year being spent on education by unionized teachers isn't the answer either.

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    Default Re: The cost of WalMart Nation

    Quote Originally Posted by Melonie
    Point one, anybody working in any job which pays less than the eligibility threshold is eligible for those benefits.
    and I have a problem with any business making a HUGE profit (as WM does) paying employees less than the threshold (which is too low anyway for a family to live) and expecting the taxpayer to subsidize their profits.

    However, every CUSTOMER of a unionized/upscale store is paying higher prices to finance the higher salaries for store personnel.
    Pay for what you choose to buy. SImple capitalist economics. Don't expect "the government" to subsidize your choice of product or store.

    Amazing...a conservative would rather have the taxpayer who doesn't consume a product or service from an underpaying vendor be responsible for the costs associated with keeping that vendor in business.

    It could therefore be argued that localities which do not allow discount box stores are de-facto discriminating against poor people in the community.
    1. doesn't that discriminate against rich taxpayers who don't shop at "swetashop stores" that underpay employees? They then pay more for product AND subsidize the stores who are underpaying employees and causing them to be poorer

    I would also add that federal and state taxes paid out for social benefits are a hell of a lot higher than $2,103 for persons who aren't working at all, and Social Security/Medicare tax revenue is a hell of a lot lower for persons who aren't working at all !
    so social programs to subsidize box stores are beter than social programs to subsidize non-working people (even though the feds pay WM about $6 per hour for "work skills training" making employees basically 100% government paid). Very liberal of you, to be so supportive of social programs!

    I still don't see why that in any way excuses a profitable company from the responsibility of its value chain. WM bills $9BILLION in profits (or more) while states and federal groups (not to mention faith based groups, families, etc) are sharing the burden of their overly low wages. At least SOME of that profit is atributable to the costs they've spread on innocent parties (including me, a taxpayer that doesn't shop at WM or box stores which underpay).

    Why is it so bad they pay the true cost of doing business? I thought thats what capitalism and the Republican Party believed in...business operating in a free and open economy.


    Therefore it could be argued that for every unionized job which winds up being outsourced or bankrupted that tax money payouts to each affected employee can be 10 times the $2,103 amount between unemployment, social benefits, and zero tax revenue coming in. This makes up for 10 years worth of 'WalMart evil' in a single year.
    Where is your 10:1 estimate backed up with facts?

    Again, why do they get away with their profit while spreading their costs on people and organizations not involved in their business?

    Does America need to PAY companies to hire our people now? companies which profit from the American economy? I believe if you make money here, you support here.


    I trust we're not headed back to a political discussion regarding 'socially appropriate' rates of pay versus market value based rates of pay, i.e. the 'living wage' thing ...
    nope. simple fact of subsidizzed big business being costly to taxpayers (and shoppers at other stores who pay the taxes through products they buy) rather than where they belpng

    Lastly, if you're really concerned about the costs of providing social benefits to WalMart and other low income workers, complain to the true source of the problem - your state legislators - to lower those benefits [email protected]!
    Can I get this straight? WM doesn't have to pay the workers more because the state is picking up the tab -in the form of social programs - covered by the current "rich pay more" tax structure... if we have a problem, we should complain to have the programs reduced but NOT to require that WM and other profitable companies pay their share of supporting their value chain (employees). Seems that leaves 1 group out in the cold...the workers who won't be able to live ((or remain healthy, with no benefits, or keep kids healthy with good nutrition).

    ignoring the other tax breaks these companies get - tax free land and loans, etc...your plan doesn't seem to solve anything.

    So we then have reduced taxpayer burden, kept the employees in their jobs at underpaid rates, protected WM profits and created a "Serf class"

    that your goal?

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    Default Re: The cost of WalMart Nation

    So we then have reduced taxpayer burden, kept the employees in their jobs at underpaid rates, protected WM profits and created a "Serf class" that your goal?
    Jeezus, here we go again ...

    We already have a 'Serf class' - they're called unskilled workers.

    Your selection of the word 'underpaid' is a subjective political/social judgement. The free market does not consider them to be underpaid - if they were then WalMart and all other $6.50 per hour employers of unskilled workers would not be receiving job applications.

    State governments may consider them to be 'underpaid' relative to some arbitrary income number they have chosen as a threshold for receiving social benefits. The arbitrary level of eligibility for social benefits, and the types and amounts of benefits set by each state, are also subjective political/social judgements on the part of state legislatures and state voters as to the 'acceptable standard of living' for their state. Thus any supposed subsidies being paid out to $6.50 per hour employers of unskilled workers in the form of means tested social programs are a rather large factor in northern Blue states with generous social benefit programs, and a next to non-existant factor in southern Red states where a $6.50 per hour pay rate may not entitle that person to any social benefits.

    Pay for what you choose to buy. SImple capitalist economics. Don't expect "the government" to subsidize your choice of product or store.
    Absolutely true, IF you support the idea that 'poor' residents of communities which do not allow discount box stores can freely 'choose' to buy food or not buy food - given the fact that all non-discount local stores charge prices higher than a discount box store would have.

    Also, I expect absolutely no government subsidies to businesses which employ $6.50 per hour unskilled workers - I'm all for cutting back medicaid, food stamps, utility subsidies etc. to these unskilled workers ! Not only would this reduce my taxes, but it would also provide a strong incentive for unskilled workers to either acquire some skills or take a second $6.50 per hour job !

    However, what I do object to is having my tax money used to subsidize a laid off former union grocery clerk who is collecting unemployment and across the board social benefits - and who will not take a $6.50 per hour grocery clerk job until his unemployment benefits run out !

    ~
    Last edited by Melonie; 03-25-2005 at 12:19 PM.

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    Default Re: The cost of WalMart Nation

    I would probably never shop again anywhere if I had to think of the all the financial reports and how a company became successful gee wiz must we always beat down success ? I to like the ma and pop stores but I have a budget to live on as well so as a consumer I try to get the best bang for my buck .Is that so wrong ?

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    Default Re: The cost of WalMart Nation

    Quote Originally Posted by CuriousJ
    I would probably never shop again anywhere if I had to think of the all the financial reports and how a company became successful gee wiz must we always beat down success ? I to like the ma and pop stores but I have a budget to live on as well so as a consumer I try to get the best bang for my buck .Is that so wrong ?
    Yes. It is.

    Ask the Masterlock workers in Milwaukee who saved by shopping at Walmart - saved themselves right out of a job when Walmart demanded lower prices on the locks and so Masterlock outsourced to Mexico.



    Melonie is a backer of the perversion that has been happening to capitalism in America as of late. Read what she says with a grain of salt - mostly it is correct, but it tends to flood the riverbeds a little now and then.

    What once was American Capitalism, that form of Capitalism that raised the living standards of so many - union or non-union - has become more of a Feudal Capitalism. Anyone can look at overpaid CEO's - some of whom drive a company into the ground (Carly?) and yet still get severence pay of $20 x 10^6 dollars. Feudal Capitalism works for an Aristocracy - one of whom is getting more and more in bed with the ruling powers to protect themselves.

    Lets take a look at some "NewSpeak:"

    "Big Government" is that government that protects the citizens of the locality from pollution and malfeasence of various enterprises by the aristocracy.

    "Business Climate" is bullshit. Land and sea have climates - businesses have markets. What they mean by a climate is that the society the business is trying to operate in is rejecting their way of doing business. For some reason, business came to believe that THEIR way irregardless of the people it effects is the proper way.

    "Business incentives" refer to the people giving up tax loop holes and even go so far as tax credits so that business can profit off the backs of the tax payers. That is a whole lot more money than what union and welfare recipents cost a locality. But hey - corporate welfare is just fine as long as they can drive their porsches on public provided roads in the safety of public provided law enforcement - it is those damn bums that is the problem!

    "Chilling effect" refer to things that slow down a business' ability to make a profit - you know - things that protect the public's safety, bank accounts, and public powers.

    "Choice" generally means lack of choice - like the HMO that discharged mothers eight hours after giving birth so that they have "unlimited visitors at home" and better choice of foods because "hospital food is untasty" and better choice in sleeping in their own beds. Of course they didn't really have a choice in staying to protect their babies from jaundace or dehydration.

    "Cost of business" refers to the justifications of huge profits, lavish executive compensation, extravagant junkets, and unexpected service fees (paid to their buddies of course.)

    "Deep Pocket" is meant to turn the tables from the injured being the victim to the corporation that is making the trouble becoming the victim. The company is not a wrong doer - it is simply a victim of greed! (Greed indeed.)

    "Economic Growth" refers to good things like government subsidies of oil companies to find oil and so generate privately held profits - indeed there is no such thing as "progress" unless "economic growth" is fulfilled by some level of the aristocracy. Any other form of progress - whether it is the union worker getting a fair share of the profits and incomes generated by their work and skills or the safty of the people using the products or the safety of the people around the production of the products - these things are not "progress" because there is no positive margin to be made.

    "Free Market" - see "Faith based economics" "The One Mind" "Buddah."

    "Frivolous Lawsuit" means that some consumer of a product or service has dared to stand up to bad quality and dared to stand up for their rights. Of course, if the RIAA is out sueing dead people and 12 year olds - this is no frivoulous lawsuit. Indeed - many business to business lawsuits can not be marked as frivolous indeed. Frivolous only means the consumer, the individual, and the government is fucking things up for someone to make money.

    "Government Take Over" means legislation occurring where companies and industry can't get their acts together. Like the "government take over" of the savings and loan market by regulation - oh sure - the S&Ls can ask for billions - but if the government decides some laws and regulations need to be put in place - that is a "government take over."

    Maybe later on tonight I will continue on with the New Speak dictionary.

    Don't confuse me for a communist - I myself have plenty of stocks and started two corporations - but I do not bow before the religion that American Capitalism is becoming.

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    Default Re: The cost of WalMart Nation

    Quote Originally Posted by Melonie
    serf class...called unskilled workers
    YEP and your plan will not only keep them in place financially (because the cut in programs will also cut job training) it will also make sure they're unhealthy (spreading disease!) and have no place to live (no HUD, no subsidized housing). What a solution!

    Your selection of the word 'underpaid' is a subjective political/social judgement.
    Nope, paid less money than it takes to live is underpaid. If they had enough money to live they wouldn't be on assistance would they?

    State governments may consider them to be 'underpaid' relative to some arbitrary income number they have chosen as a threshold for receiving social benefits.
    Have you ever tried living on $14,000 a year>? if not, read the book "Nickel and dimed" about a reporter that went "undercover" in walmart and similar low-wage jobs and tried to lvie on her income. Didn't work. Here's some basic math:

    14,000/yr = 1166/mo
    unemployment, FICA,*etc 15% or 200
    rent (1/2 of cost for 1 bedroom apt in average city) 400
    utilities (1/2) 75
    food (10/day for 30 days) $300
    clothing (1 outfit of average style per month) $50
    supplies (cleaning, etc.) 50
    transportation 50
    over the counter medicine, etc $50
    TOTAL $1,175.00
    you make it through the month owing only $10!
    No medical care coverage
    Certainly no kids
    No fun, hobbies or entertainment

    The arbitrary level of eligibility for social benefits, and the types and amounts of benefits set by each state, are also subjective political/social judgements on the part of state legislatures and state voters as to the 'acceptable standard of living' for their state. Thus any supposed subsidies being paid out to $6.50 per hour employers of unskilled workers in the form of means tested social programs are a rather large factor in northern Blue states with generous social benefit programs, and a next to non-existant factor in southern Red states where a $6.50 per hour pay rate may not entitle that person to any social benefits.
    your point being? State by state choices are OK, and are often determined by economics (costs more to live in Boston than in rural Louisiana..especially lack of heating expenses.

    also, if it's so arbitrary and state based, then how come the WM studies show such similar issues nationwide

    Absolutely true, IF you support the idea that 'poor' residents of communities which do not allow discount box stores can freely 'choose' to buy food or not buy food - given the fact that all non-discount local stores charge prices higher than a discount box store would have.
    by pennies, first of all but
    if the workers were getting paid fair wages, they'd have more to spend on products...and have to rely less on social programs

    Still, you haven't explained how cutting social programs and leaving these workers underpaid makes it any easier for them to afford food or necesities


    Also, I expect absolutely no government subsidies to businesses which employ $6.50 per hour unskilled workers -
    I will find the link...this is fact. I can point you also to PA's Keystone Opportunity Zone real estate subsidies


    Not only would this reduce my taxes, but it would also provide a strong incentive for unskilled workers to either acquire some skills or take a second $6.50 per hour job !
    you mean more skills from non-existant (thanks to your cuts) training opportunities, with hunger in their stomachs and worry that if anything goes wrong they won't be able to afford to eat

    Or they should go to class (same time every day) when WM changes their schedule on a weekly basis...meaning no long term plans can be made

    In my 32 years, I've never met a union store clerk..and I've worked alot of retail!

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    Default Re: The cost of WalMart Nation

    great job Deo!

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    Default Re: The cost of WalMart Nation

    So capitalism is the enemy here I guess I dont understand what everyone is talking about is America in trouble because we are living beyond our own means or are we just too damn greedy and not willing to stop expanding on our financial gains .Where I use to work we brought in people from other countries because us Americans were too good to clean rooms or do dishes what gives here people ? I love this country dont get me wrong but if you snoop around enough with any corporation you are going to find dirt eventually .

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    Default Re: The cost of WalMart Nation

    Capitalism isn't the enemy...getting back to it is the goal. Old-style capitalism didn't rely on government programs to support their workers...

    yes we're living beyond our means...and yes that's (part of) why we're in trouble

    You brought them in because Americans were too good, or too expensive? Did you bring them in legally or under the radar, which is WRONG

    You will find dirt wherever you look, the goal is to eliminate the dirt that causes the most trouble or is affecting other people. WM paying workers too little to live and expecting government to pick up the difference is wrong...I don't see how that can be defined as good or capitalist.

    But, like the other thread asking why people don't demand better efficiency from their cars, the reality is it's not on the radar for many people. Gimme cheap prices, a shiny and fast car, and cheap subsidized gas - who cares what goes behind the scenes. Raise the federal debt ceiling so we don't have to pay the real cost of our government programs and imbalanced workforce pay structure.

    And no, I'm not saying everyone gets paid the same or nearly so...I'm just saying set a livable bottom end, so people can afford to live, grow, etc..without needing my assistance as Mr. Taxpayer.

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    Default Re: The cost of WalMart Nation

    Yes they were legal and legit . I just cant understand where we are headed as a nation me being 40 now I think I will probably see some kind of major fallout of our country before my time is up I can just feel the tension all over sometimes . We have been fortunate for a while in our safe haven but I feel other powers are coming up the ladder ( China ) . Maybe in my lifetime .scarry thought

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    Default Re: The cost of WalMart Nation

    Have you ever tried living on $14,000 a year>?
    Actually, yes I have ! I worked full time at a $6.00 an hour job, went to community college after work, and raised a son at the same time.

    I will find the link...this is fact. I can point you also to PA's Keystone Opportunity Zone real estate subsidies
    I don't doubt for a minute that in PA and NY at least that someone working at a $6.50 per hour job is eligible for all sorts of benefits. In fact, in NY it's arguable that the social benefits pay so well that someone needs to be earning about $9 an hour to equal the standard of living they can achieve by not working at all and collecting every available benefit. But where you see this 'minimum standard of living' as some sort of positive accomplishment, I see it as an outrage. If any force is keeping 'poor people' in their place, it's the generous social benefits they are receiving and don't want to take a chance on losing by making an effort to improve their job skills and (gasp) maybe earn $8.50 an hour instead of $6.50 (thus pushing them over the eligibility threshold)

    In my 32 years, I've never met a union store clerk..and I've worked alot of retail!
    that was a specific reference to Save Mart and their unionized employees, who are the ones funding the 'environmental' lawsuits to stop the opening of new WalMarts in many California locations - locations which already have Save Marts nearby.

    your point being? State by state choices are OK, and are often determined by economics (costs more to live in Boston than in rural Louisiana..especially lack of heating expenses.
    Actually, heating and air conditioning costs pretty well balance out. What doesn't balance out are high property taxes, high state income taxes etc. which MA residents must pay to fund the generous social programs. The cost of living argument, like the Save Mart prices argument, are both indirect methods of (stealthily) achieving the same result of shifting costs.

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    Default Re: The cost of WalMart Nation

    I won't even enter Wal-mart. The people that work there are disgusting in Myrtle Beach, convicted criminals and such. That's all that will work there at the rate they are paying.

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    Default Re: The cost of WalMart Nation

    I won't even enter Wal-mart. The people that work there are disgusting in Myrtle Beach, convicted criminals and such. That's all that will work there at the rate they are paying.
    Nobody is forced to enter a Wal-Mart. But my earlier point was that if a community invokes zoning laws or 'environmental' laws or other means to prevent a discount box store from entering their community, the community is de-facto forcing 'poor people' to enter more expensive stores and pay higher prices. That same community is also de-facto forcing several hundred unskilled workers to sit home and collect full welfare and other social benefits instead of allowing them to work for $6.50 an hour and thus collect substantially less in social benefits. That same community is also de-facto encouraging 'poor people' to remain out of sight and/or to move elsewhere.

    The common argument against $6.50 per hour employers of unskilled workers like WalMart is that the gov't is subsidizing their business model by having to pick up the tab for medical and other benefits the low paid unskilled workers are not provided by the employer. However, this argument ignores the costs to gov't of providing even more benefits if these unskilled workers were not given the opportunity to work at all.

    This argument also ignores the indirect costs the gov't bears to subsidize more highly paid workers of local stores - i.e. a 'poor person' goes grocery shopping in a Save Mart, paying more in food stamps for the same amount of groceries. Save Mart cashes in those food stamps and pays a portion of that money out in $9.00 salaries to its also unskilled but unionized employees.
    Last edited by Melonie; 03-26-2005 at 05:22 AM.

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    Default Re: The cost of WalMart Nation

    Mel, where did you live, how did you eat, etc while making $6 an hour and raising a kid PLUS paying for college. That's amazing .. quite an accomplishment!

    Having bee there, however, I can't believe that you support the concept of companies continuing to profit from paying people less than it costs (today) to live. Keeping in mind the min. wage is BELOW $6 an hour. I'm also shocked you would take away social programs that would directly hurt these people and their children while simultaneously not forcing companies to pick up the tab. Not like $300MM more in salaries will bankrupt WalMart. Wouldn't even affect the stock price for more than a quarter.

    The common argument against $6.50 per hour employers of unskilled workers like WalMart is that the gov't is subsidizing their business model by having to pick up the tab for medical and other benefits the low paid unskilled workers are not provided by the employer. However, this argument ignores the costs to gov't of providing even more benefits if these unskilled workers were not given the opportunity to work at all.
    You keep saying this, as if we should be happy to support these companies and let them profit from gov't subsidies. If they paid the workers a wage that didn't require outside help (from my taxes) they would still be profitable (what was the article's number, a few hundred million nationally is spent subsidizing walmart, drop in their profit bucket) AND WE COULD REDUCE YOUR TAXES BECAUSE THE SUBSIDY WOULD NOT BE NEEDED.

    But since you also support cutting the social benefits, I'm still curious what you say to the family that can't find a job that pays all the bills (since WM killed all the local competition and outsorcing subsidies shipped all the factories overseas) and now have no social programs to depend on. Too bad?
    Last edited by discretedancer; 03-26-2005 at 06:13 AM.

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    Banned Melonie's Avatar
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    Default Re: The cost of WalMart Nation

    Mel, where did you live, how did you eat, etc while making $6 an hour and raising a kid PLUS paying for college. That's amazing .. quite an accomplishment!
    ... in a trailer ... lots of pasta ... and an fair amount of help from family. Every day of living like that provided more motivation for me to do well in my college studies and eventually improve my situation through my own efforts. At the same time, the people living in the next trailer were content to sit home, drink beer, collect welfare and other social benefits, and essentially teach their children to do the same.

    Having bee there, however, I can't believe that you support the concept of companies continuing to profit from paying people less than it costs (today) to live. Keeping in mind the min. wage is BELOW $6 an hour. I'm also shocked you would take away social programs that would directly hurt these people and their children while simultaneously not forcing companies to pick up the tab.
    Again, what it actually 'costs (today) to live' is a function of whatever arbitrary standard of living you consider to be minimally acceptable, not the point of starvation and sickness. Millions of people throughout the world, and for that matter millions of 'undocumented workers' in the USA manage to 'live' on much less than $6.50 per hour.

    By insisting that social benefits and other support mechanisms be funded to that arbitrary level, it might appear that people are being 'helped' in the short term. However, in the long term, it is arguable that the minimally acceptable standard of living and the costs of providing social benefits to maintain that artificial standard of living are causing more hurt - i.e. the entire culture that the gov't owes people a living. This is the point that I just can't seem to get across to you - that it's the concept of the arbitrary 'minimally acceptable standard of living' which is the root of the problem. Do away with that well intentioned but truly dangerous idea, and reduce the expensive social programs necessary to implement it, and free market forces plus human incentives will again be able to take effect and resolve such issues as WalMart's pay rates, illegal immigration, outsourcing/relocation etc.

    I must admit that California and other Blue states, however, have possibly 'borrowed' an idea from Red states offering a politically acceptable answer to both aspects of the problem i.e. lack of motivation of unskilled workers and the high cost of providing tax funded social benefits to people who choose not to work at $6.50 per hour jobs ...



    ~
    Last edited by Melonie; 03-26-2005 at 07:23 AM.

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    Default Re: The cost of WalMart Nation

    Quote Originally Posted by Melonie
    and an fair amount of help from family.
    And without that help (which perfectly describes my situation also) it wouldn't have been possible, or as likely to succeed. Sadly, in America, not everyone has that family.

    I know the story about neighbors who are happy swilling welfare when they could work...and I FULLY SUPPORT reforming the system and putting em al to work if they're able (even something like FDR's CCC or other work programs...do government work if you're getting a government check). Train some to be daycare workers (or pay a daycare) and get the rest of em out to work. No argument there.

    Also no argument the system has abuses...but so does the corporate system when they are allowed to pay less than a living wage and make a profit off my tax dollars.

    Again, what it actually 'costs (today) to live' is a function of whatever arbitrary standard of living you consider to be minimally acceptable, not the point of starvation and sickness.
    Is starvation and illness the standard?
    If the living wage standard is too high, CHANGE IT. The companies themselves could fund this effort, since it would lower the wage they're expected to pay. But as long as it's teh law/policy, then the companies need to meet it. I don't want to subsidize workers or continue to let people think CRIME and WELFARE are more profitable than WORKING

    Millions of people throughout the world, and for that matter millions of 'undocumented workers' in the USA manage to 'live' on much less than $6.50 per hour. By insisting that social benefits and other support mechanisms be funded, it might appear that people are being 'helped' in the short term. However, in the long term, it is arguable that the minimally acceptable standard of living and the costs of providing social benefits to maintain that artificial standard of living are causing more hurt - i.e. the entire culture that the gov't owes people a living.
    1. no one owes anyone a living, just the ability to afford basic necessities (notice my previous outline had no entertainment budget!) and move from there WITHOUT requiring family (which may not exist or be able/willing to help) to chip in.

    2. THe lifestyle of undocumenteds isn't exacly what I'd call an American standard. And certainly you can't use global examples (where people live differently and things cost less) of pay rates. Pay needs to match the community where people have to live. Also, you can't mandate that $6 per hour employees should live in groups of 4 per bedroom, sleep in shifts, as many undocumenteds do to survive.

    3. you still haven't explained why it's OK for companies to profit off the government subsidies to their workers.

    while I fully support the use of prison labor - and also of mostly not paying the prisoners - I don't see this as a grand scale solution for a couple reasons

    1. the company clearly is doing it because of the "subsidy" provided by the state in terms of room, board, etc (and probably other forms of pork to build the factory...otherwise the prisoners would be shipped to the existing factory). Is the company going to increase its profits doing this? Probably. SO now we have 150 good workers unemployed (with few options except for retail left in the US) and receiving govt assistance so a company can increase profits using more govt subsidized workers. Taxpayers lose 2 ways here.

    2. we effectively now have workers "outside" with real expenses bidding against prisoners (with no expenses and lots of time) for the same jobs.

    3. many federal prisons are exempt from environmental laws...making it questionable if the factories will be clean, safe and pollution controlled

    That being said, I'm happy to see prisoners working. For me, bring back the chain gangs and let them fix the roads and such - take that work away from overpaid govt contractors!

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    Default Re: The cost of WalMart Nation

    I don't want to subsidize workers or continue to let people think CRIME and WELFARE are more profitable than WORKING
    Well in most Blue states, for unskilled workers who don't belong to unions, this is a fact ! This is also the reason that most Blue states act as magnets to attract the migration of unskilled workers from Red states or south of the border !!!

    but so does the corporate system when they are allowed to pay less than a living wage and make a profit off my tax dollars.
    Again you're hopelessly stuck in this quagmire of the 'living wage' concept. I would argue that an employer deciding to pay X dollars per hour for work which is only actually worth x dollars per hour is the way that the free market is supposed to work. All side issues such as arbitrary levels of eligibility for social benefits, and the relative generosity of those benefits, or alternatively employers charging higher markups for the products they sell in 'protected markets' to subsidize paying Y dollars to employees who only are actually worth x dollars per hour, have nothing whatsoever to do with the free market equation.

    And certainly you can't use global examples (where people live differently and things cost less) of pay rates. Pay needs to match the community where people have to live.
    And just what components go into the local cost differences ? Sales taxes, property taxes and trickle-down to rents charged, high markups on retail products to pay unskilled workers higher wages than their labors actually warrant ? I would argue that since the advent of interstate highways and the dismantling of tarriffs that the true underlying costs of products themselves have very little difference from US city to US city. We truly do live in a global economy and no local economy can operate in a microcosm anymore. Thus these differences in local costs of living are primarily attributable to governmental factors - zoning regulations and tax rates primarily. Drop the 'artificial' minimum standard of living and the cost differerences will drop as well !

    Also, you can't mandate that $6 per hour employees should live in groups of 4 per bedroom, sleep in shifts, as many undocumenteds do to survive.
    Who is mandating anything of the sort ? People living under such conditions have a strong incentive to improve their skills and better their situation in life. People provided a comfy roomy apartment with 3/4ths of the rent payment subsidized by HUD have little incentive to do anything different. People living in cities which support rent-controlled housing extract that subsidy from the landlords instead of the taxpayers, but just like the anti discount box store communities this effectively amounts to a stealth mechanism for forcing 'poor people' out of the community (as no sane landlord will pay to maintain such rent-controlled buildings let alone build new ones)

    ~
    Last edited by Melonie; 03-26-2005 at 08:13 AM.

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    Default Re: The cost of WalMart Nation

    Quote Originally Posted by discretedancer
    ...AND WE COULD REDUCE YOUR TAXES BECAUSE THE SUBSIDY WOULD NOT BE NEEDED...
    Now when has the government ever said, "hey, here's some of your tax money back, we didn't need it."?
    Dancing is wonderful training for girls, it's the first way you learn to guess what a man is going to do before he does it. ~Christopher Morley, Kitty Foyle

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    Default Re: The cost of WalMart Nation

    Quote Originally Posted by Melonie
    Well in most Blue states,
    I don't recognize "blue states' except for the Civil War historicals.

    But, could you provide evidence that this is true and that the "red states" have a better solution for ALL people (and not just more homeless/underpaid/welfare)?

    And again your hatred of Unions...why?

    I would argue that an employer deciding to pay X dollars per hour for work which is only actually worth x dollars per hour is the way that the free market is supposed to work.
    So Nike deciding the shoe they sell for $90 is only worth $2 to the employee that makes it is OK, even if that emploee needs to make $3 per shoe to survive and continue working?

    Giving people a choice between an underpaid job (paid less than it costs to live) and no job isn't a choice.

    And just what components go into the local cost differences ?
    cost of rent, food, etc. In my town (where I grew up) average house cost (in 1980) about $100,000 - now costs more than $300,000. In PA (where I now live) I just bought the same house for $32,000. It simply costs less to live here (partially due to outsourcing killing our industry and WalMart destroying the local mom-and-pop stores)

    You give the governmetn way too much credit. It's the free market that causes differences in many prices. Apartments cost more in NYC than in Podunk Ohio because more people are in NYC and need an apartment - theres something called SUPPLY AND DEMAND that impact local prices and costs.

    Drop the 'artificial' minimum standard of living and the cost differerences will drop as well !
    OK, so we just tell the boston landlord she doesn't need to charge $2500 a month anymore...because why? And she should do it when 20 people are lining up for her place at that rate?

    "revitalization" of downtowns (a good idea in many areas) have been proven to raise rents (and property values) to the point that long time locals are priced out of the market. Not saying that's bad, just asking how government subsidies, taxes, etc have ANY effect on this (other than the subsidies the developers got to "clean up" that neighborhood)

    People living under such conditions have a strong incentive to improve their skills and better their situation in life. People provided a comfy roomy apartment with 3/4ths of the rent payment subsidized by HUD have little incentive to do anything different.
    change the system. Force the eligible workers to get a job, make it impossible for healthy people to permanently recieve pay for no work...but don't make it impossible for people in the situation you were (minus the family support) to survive and grow.

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    Default Re: The cost of WalMart Nation

    Quote Originally Posted by discretedancer
    You give the governmetn way too much credit. It's the free market that causes differences in many prices. Apartments cost more in NYC than in Podunk Ohio because more people are in NYC and need an apartment - theres something called SUPPLY AND DEMAND that impact local prices and costs.

    OK, so we just tell the boston landlord she doesn't need to charge $2500 a month anymore...because why? And she should do it when 20 people are lining up for her place at that rate?
    So it's okay for the free market and supply and demand to work in setting rental rates on apartments but not for the free market and supply and demand to work in setting wage rates at Wal-Mart?

    If those 200 workers at Wal-Mart had the skills that would enable them to make more than $6.50 an hour, they would do so. I shop at Wal-Mart some, I haven't seen anyone holding a gun on the clerk's forcing them to work there.
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    Featured Member discretedancer's Avatar
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    Default Re: The cost of WalMart Nation

    More costs these subsidized corporations :
    Costs of development subsidies to box stores and other businesses:
    Community "eminent domain" (don't laugh, it happened in my town) of property for developmet of a mall, store or call center (a completely private, not open to the public business)
    Grants, low interest loans, etc
    tax loopholes and exclusions for certain development (usually new construction in outlying areas, not support of a downtown
    COST OF ABANDONED BUILDINGS - just in my town, we have 12 buildings, built in the last 5 years with the above programs, whose companies closed or mnoved before the end of their agreements - the property then has no one paying the taxes, usually the cheap built for purpose building must be destroyed (they all say will build to suit, I'm sure the old building is bound for a landfill near you soon)
    COST OF DISPLACED WORKERS

    in 90% of the cases for my town, these companies are still in business and profitable. Many simply moved accross town when another politician made a better offer, since there was no strength to keep them in the old deal.

    If it's possible to calculate these costs, I haven't seen it -but they are substantial

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