Occam's Razor

It’s no secret that I don’t like Wal-Mart. In fact, I pretty much abhor it. I abhor it not for its merchandise or its low prices, but principally because they give their workers the shaft. They push workers to crazy and dangerous levels of productivity, constantly look for ways to work them even harder, give almost nothing in the way of benefits or job security, and don’t begin to pay them enough to actually live on. On a Black Friday a few years back, bargain-crazy customers crushed a Wal-Mart worker to death.

Most of their employees are not full time employees, but part time workers. This is not unusual in the retail business, of course and it is fine as far as Wal-Mart is concerned. Part time employees cost less, are easily let go, can have hours cut on a dime and get no benefits like vacation pay. Granted that full time employees at Wal-Mart don’t make much either but they are entitled to some measly benefits such as overtime pay, if Wal-Mart will actually grants them, as they have been loathe to do in recent years.

The fact is that even full time Wal-Mart retail employees, with a few exceptions, cannot survive on Wal-Mart wages alone. This is true even if they have additional jobs. Most of them qualify as working poor. They can be found trying to make up the difference shuffling two or three jobs, hoping for handouts at food banks and when needed getting treatment at emergency rooms.

In most states, children of Wal-Mart employees make up the largest group receiving health care via the Children’s Health Insurance Program (CHIP). For example, in Alabama alone Wal-Mart employees have 4,700 children enrolled in the CHIP program, more than twice as many children as employees working at McDonalds in Alabama. Wal-Mart won’t raise salaries of their employees so they can afford health insurance, so taxpayers are left to pick up the tab.

Since Wal-Mart does not have to pay for their employee’s health insurance, and the few that are eligible for Wal-Mart’s very limited health insurance plan are able to afford it, this in part explains how they deliver low prices. In effect, taxpayers subsidize Wal-Mart’s low prices. Taxpayers are making up some of the difference between the real cost of living and wages that Wal-Mart is willing to pay. It is still not enough. Despite working forty or more hours a week, many Wal-Mart employees also qualify for food stamps. This strikes me as obscene: how can it be possible to be fully employed in this country and still not have enough to eat? How can we possibly permit a minimum wage that won’t even keep a person from going hungry?

In some ways though the workers in the stores have it good, at least compared to Wal-Mart’s warehouse workers. Wal-Mart will say that they are not their workers, so they don’t count, but the people who fill trucks at distribution centers mostly are loading trucks full of goods that are shipped to Wal-Marts. They are working in hellish and unsafe working environments. They too are often subjected to unpaid overtime, numerous violations of safety and overtime regulations as well as long and crazy hours.

Low prices of course are also made possible by squeezing the whole Wal-Mart supplier chain. When you keep squeezing distributors and suppliers, they keep finding ways to squeeze workers. The results are pretty obvious and accounts for much of the minimal wage growth over the last decade. Still, when you make as much in the way of profits as Wal-Mart does (about $15B a year), it’s clear that the company could afford to do a lot better for their employees, but simply won’t. Wal-Mart is emblematic of a general trend that stockholders win at the expense of workers. In the case of Wal-Mart, it is also at the expense of taxpayers. Arguably, Wal-Mart is a prime example of corporate welfare at work, which likely explains the company’s outsized contributions toward political candidates. However much they spend to influence politicians, it must be considerably cheaper than paying their employees a living wage.

It’s been ten years since I stepped inside a Wal-Mart. It’s possible I never will step inside a Wal-Mart again. My condition for shopping at a Wal-Mart again is that they have to pay their employees a living wage. Right now Wal-Mart simply refuses to do so, even for the full time ones, unless they are a store manager and maybe if they run a department. If an employee does earn a living wage, if you divide their wage by the number of hours these workers actually work, their wage per hour is still low. Many of them are salaried, which means you may be working sixty or more hours a week but being paid for forty.

Obviously Wal-Mart is not the only retailer screwing its employees. The same can be said for most of the major retailers out there, including Target and Kmart. However, there are prominent exceptions. Costco is one of the most successful retailers out there and is also quite profitable. Applicants are beating down its doors to get jobs there. That’s because Costco pays living wages and Wal-Mart does not. The grocery chain Wegmans also pays living wages. It’s obvious when you are in a Wegmans that its employees like their jobs. They almost gush with enthusiasm and energy. You can’t say the same for Wal-Mart greeters.

Recently, some Wal-Mart workers have realized they simply have nothing left to lose. There have been recent walkouts that resemble strikes at twelve Wal-Marts across the country. You can’t really call them strikes because Wal-Mart is famous for being non-unionized, at least here in the United States. Wal-Mart workers have made slight inroads elsewhere, like in Canada and ironically Communist China (although its unions are really puppets of the Communist Party.) Strikes are not problems at Costco and Wegmans, probably because management treats employees with respect and compensates them fairly. They happen when the frustration level becomes so acute that workers simply cannot endure it anymore. These Wal-Mart walkouts may be a harbinger of things to come.

I do know one thing: if the behemoth Wal-Mart can be made to scream uncle, then justice is possible for retail workers across the country. That it is starting to be felt at Wal-Mart through strikes and walkouts is poetic justice. If employees can be paid fair wages at Wal-Mart, it could create real change across the entire retail industry, whose employees desperately need to be paid living wages.

So I wish these strikers well, and hope that more Wal-Mart employees join them. I am glad to make a contribution to their strike fund and urge them to hang tough. For like many of us, I too was once an underpaid retail worker. More than thirty years has passed but I have not forgotten how shabbily I was treated. So far I have been able to do little more than avoid patronizing the more egregious employee-screwing retail chains like Wal-Mart. As I get older and find myself with more money in my pocket and time to become engaged in just causes, the more I feel the need to work for their justice and wreak some real justice on amoral corporations like Wal-Mart.