Wal-Mart demands corporate welfare from taxpayers. California already spends $86 million/year to subsidize Wal-Mart's healthcare bills.
Whatever happened to capitalism? If Wal-Mart can't compete without taxpayer subsidies, why doesn't it simply give up to the competition?
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Wal-Mart Denounces Health Bill
Retailer Says Maryland Could Lose Future Jobs
By Michael Barbaro
Washington Post Staff Writer
Thursday, April 7, 2005; Page E01
ROGERS, Ark., April 6 -- Wal-Mart Stores Inc. yesterday said approval of a bill that would require it to boost health care spending in Maryland could endanger its plans for growth in the state, including a new distribution center that would employ as many as 1,000.
The company questioned the motivation behind the bill, which is backed by a top competitor and its labor union.
Wal-Mart "will have to rethink its future growth in a state that is willing to pass such a bad business bill," said Nate Hurst, a government relations manager for the company. "This type of legislation, where lawmakers single out one employer, does not create a favorable environment."
The bill nearing approval in the Maryland General Assembly is touted by supporters as a step forward in health care policy for workers, but Wal-Mart is asking why Giant Food LLC and the union representing Giant workers have so strongly endorsed the legislation.
Wal-Mart, with 52 stores and 15,000 employees in Maryland, is now a powerful force in the grocery industry, and its growing share of the local market is coming, in part, retail analysts say, at Giant's expense.
"It's unfortunate that a competitor would use the legislative process," Hurst said. "Is this bill really tackling health care for the state of Maryland or trying to get at one of Giant's competitors?"
Wal-Mart's distribution center planned for Somerset County could be affected, the company said. The company is planning to build an approximately 1-million-square-foot distribution center in the town of Princess Anne. Hurst said the facility would initially employ 350, and after five years, up to 1,000. "The company is still working through plans to build a distribution center," he said.
Wal-Mart's sharp reaction to the bill came as it wrapped up a two-day media conference here in northwestern Arkansas that was designed to repair its image.
The discount giant, which in the United States operates more than 3,700 stores and employs 1.2 million people, has been the subject of class-action lawsuits accusing it of gender discrimination and labor law violations, and last month it forced out a director for allegedly misusing as much as $500,000 in company funds.
In a series of presentations Wednesday, executives documented Wal-Mart's efforts to improve the diversity of its workforce and to address discrimination complaints, saying it boosted the percentage of women and minorities across the company last year. As of 2004, women accounted for 38.3 percent of salaried managers, up from 36.3 percent in 2003, the company said.
But health benefits remain a focus of unwelcome attention for Wal-Mart. Organized labor and unionized retailers argue that because the discount chain covers less than half of its employees, companies across the economy are being forced to cut benefits to compete, dragging down workers' standard of living.
Although the legislation before the General Assembly does not name Wal-Mart, it appears to be the only company affected by it. The bill would require organizations with more than 10,000 employees to spend at least 8 percent of their payroll on health benefits -- or put the money directly into the state's health program for the poor.
The coalition backing the legislation said it expected similar bills to be introduced in several other state legislatures and, possibly, the U.S. Congress. U.S. Rep. Chris Van Hollen (D-Md.) yesterday said he would try to use the General Assembly's bill as a model for a health care reform proposal he plans to introduce in Congress, though he did not offer a timetable.
In addition to Giant, the coalition backing the Maryland bill includes the United Food and Commercial Workers Local 400, which represents Giant's Washington area workers. Both Giant and Local 400 have cited increasing competition from Wal-Mart and other nonunion retailers as the impetus for proposed benefit cuts.
Giant Vice President Barry F. Scher said that health care costs now account for 20 percent of Giant's payroll expenses. By comparison, Wal-Mart spends between 7 and 8 percent, Hurst said.
Scher said Giant is not singling out Wal-Mart. "We believe there should be a level playing field for every employer in the state," he said. "When that does not happen, we all shoulder the cost of the uninsured."
C. James Lowthers, president of Local 400, said the debate "is about what's right for the country."
"We have a system of health care through employers, and Wal-Mart is not providing an adequate plan." Lowthers said Local 400 waged "one of its most aggressive lobbying" efforts to win support for the bill in the General Assembly.
Maryland Senate President Thomas V. Mike Miller Jr. (D-Calvert) said lobbying on the issue from labor groups was "very light."
"It's an issue that's been around for a while, and all of us recognize that Wal-Mart doesn't do right by its employees," Miller said.
Business groups worry the bill will hurt Maryland's chances of attracting new companies. Robert O.C. Worcester, president of Maryland Business for Responsive Government, a business advocacy organization based in Baltimore, said companies big and small will now fear state intrusion into their health care plans.
"This bill says, 'Come to Maryland and your overhead costs will be unknowable,' " he said. |
