The Walmart Watch Blog

WAL-MART AND THE ‘POORING OF AMERICA’
I’m not sure where the phrase “Pooring of America” came from, but it’s perfect to explain Wal-Mart’s effect on working families. Seeking Alpha ponders why Wal-Mart and McDonald’s are doing so well right now.

What are McDonald’s and Wal-Mart Telling Us? [Seeking Alpha]

I am very intriqued by our top 2 choices for the “Pooring of America” trend - Walmart (WMT) and McDonalds (MCD) - what exactly are the charts above telling us?  If we are to enter a long drawn-out recession, which I have believed, these seem to be screaming buys here. The only question is credit - how does a lack of credit potentially hurt both. They are not expanding a ton, in the U.S. at least - perhaps with Wal-mart it’s financing of inventory, but I cannot wrap my mind around this behavior.

Wal-Mart gets downgraded while stock up in 2008 amid the turmoil [BloggingStocks]

Will Wal-Mart weather the storm? To a point, it already is. Sure, all retailers are expected to have a dismal holiday season this winter, but Wal-Mart will do better than the competition. It has more stores, more pricing leverage and more wherewithal to hold customers hostage with lower prices and inventory turns at a time when it’s needed most. Perhaps we’ll see WMT return to the $60/share level by Thanksgiving—if not sooner.

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Wal-Mart Watch has launched a new website - http://www.waltoninfluence.com - which analyzes and tracks the Walton family’s and Wal-Mart’s growing influence on American politics.

Although Sam Walton believed his company should stay out of politics and stick to retailing, Wal-Mart’s strategy changed immensely after his death. From 1999 to 2007, Wal-Mart’s lobbying expenditures for outside firms increased 7425%. Although Wal-Mart attempts to tout its bipartisanship, the Wal-Mart PAC has given the vast majority of its over $7.5 million in the past decade to the Republican Party and other conservative groups.

With more than $12 billion in profits last year, Wal-Mart is the biggest and arguably most powerful corporation in America. Sam Walton’s heirs, the majority owners of the company, are worth over $100 billion - making them the wealthiest and certainly one of the most influential families in America.

During the past year, Wal-Mart Watch conducted an analysis of public lobbying and political contribution records for the Walton family and Wal-Mart Stores, Inc., in order to determine how this influence is used to affect politics and policy. The conclusion is clear: Wal-Mart and the Walton family spend millions of dollars every year to fund an extreme right wing corporate agenda that is often directly at odds with the interests of Wal-Mart’s workers and shoppers.

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Check out this week’s issue of the Wal-Mart Watch Weekly Update for Elected Officials – a compilation of Wal-Mart news from across the country and beyond.

This week’s issue focuses on Wal-Mart and the current economic crisis. You’ll find stories on how Americans are shifting to thrift stores in order to save money, and whether September’s retail sales figures reflect a downturn in consumer spending. You’ll also find an article from CNN Money discussing whether the state of the economy will affect Wal-Mart’s hiring, especially with the holiday season coming up.

In addition to the economy, you’ll find stories on Wal-Mart’s move to small stores. Are Wal-Mart’s Marketside Stores the wave of the future? And in health care news, Wal-Mart is rolling out electronic personal health records to all of its employees, and has announced changes to its health plan for 2009.

And finally, check out our “Stateside” and “Wal-Mart International” sections to find out what’s going on with Wal-Mart around the country and across the globe.

Wal-Mart Watch Weekly Update for Elected Officials [October 10, 2008]

Parents beware:  If you live in Owasso, Wisconsin, you may want to give a closer listen to what your children’s dolls are saying. If your child has a “Little Mommy Real Loving Baby Cuddle and Coo” doll purchased at Wal-Mart or Target stores in the area, it could be among those reported to be saying things like: “Islam is the light” and “Satan is King.” The dolls are supposed to squirm around and make baby noises and only word the doll is supposed to be able to say is “mama.” A release from Fisher-Price had this to say:

Because the original sound track is compressed into a file that can be played through an inexpensive toy speaker, actual sounds may be imprecise. Attached is the original sound file for your reference, in which you can clearly hear that the doll does not say any phrases or words.

KJRH in Tulsa, OK posted this video and sound-byte in a story updated today. Some stores have removed the doll from shelves. 

The doll was reviewed by a site called Tech Talk for Families; the author didn’t seem to notice anything unusual about what the doll was saying but the three pages of comments following the article seem to think something is strange about what it says. 

SweatFree Communities, an anti-sweatshop activist group, went undercover in Bangladesh to examine working conditions in Wal-Mart’s supplier factories. The resulting report (PDF) paints a heart-wrenching portrait of the poverty and abuse that make Wal-Mart’s low prices possible.

BusinessWeek’s article on SweatFree’s findings is equally troubling. The piece highlights problems at Wal-Mart that enable sweatshops: preannounced factory inspections mean managers can hide violations, and fewer corporate reports on the state of its supply chain means Wal-Mart executives are turning a blind eye. Wal-Mart also tried to suppress SweatFree’s report, alone a worrysome fact. SweatFree Communities Executive Director Bjorn Claeson is quoted in the article saying, “Wal-Mart has incredible economic muscle in that country. If it takes the leadership position as a retailer and works with other brands, there is no question that it can really have an impact.”

Wal-Mart Supplier Accused of Sweatshop Conditions [BusinessWeek]

The world’s largest retailer, Wal-Mart Stores (WMT), is being accused of buying school uniforms that were made under extreme sweatshop conditions at a factory in Bangladesh.

The JMS Garments Factory in Chittagong, Bangladesh, produces school uniforms that are sold in Wal-Mart stores under the Faded Glory brand name. A report from SweatFree Communities, an anti-sweatshop activist group based in Bangor (Me.), found that workers at the factory work up to 19-hour shifts to finish Wal-Mart’s orders under tight deadlines; are made to stand for hours as punishment for arriving late to work; and are frequently subject to verbal abuse and kicking or beatings. Some workers earn as little as $20 each month, the group says—even lower than the country’s legal minimum wage of $24 per month.

The report is based on interviews with more than 90 workers conducted away from the factory in workers’ homes by a Bangladeshi nongovernmental labor research organization on behalf of SweatFree Communities, a five-year-old nonprofit group funded by activist foundations such as the Solidago Foundation, CarEth Foundation, and Presbyterian Hunger Program. The group works to get commitments from schools, cities, and other employers to buy goods with employee rights in mind.

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The latest in a long, impressive history of environmental violations:

The U.S. Environmental Protection Agency (EPA) today announced a settlement with Wal-Mart to resolve alleged violations of the Clean Air Act (CAA), which prohibits the sale or distribution in interstate commerce of non-essential products containing substances commonly known as Ozone Depleting Substances (ODS). According to the terms of the settlement, Wal-Mart will pay a total civil penalty of $199,000. Wal-Mart has taken action to investigate the causes of the violation, to come into compliance, and to ensure that the violation does not recur.

Maybe they forgot to run “Glow In The Dark Looney String” through the Live Better Index?

Agreement Reached Wtih Wal-Mart in Bentonville, AR on Clean Air Act Violations [EPA Press Release]

Alice and Christy Walton top Forbes’ list of the richest women in America this week. Alice is Wal-Mart founder Sam Walton’s only daughter; Christy married Alice’s brother John and inherited his share of the Walton family fortune upon his death in 2005.

The Walton family takes up nearly half of Forbes’ list of the top ten wealthiest Americans. Alice and Christy are on that list, as well as their brothers Rob and Jim. As we mentioned in our earlier posts on this issue, each of the Walton siblings are worth more than an hourly Wal-Mart employee could earn in several lifetimes. $23.2 billion (what Alice and Christy are each worth) is more than enough for anyone, but the family has refused to share its earnings with the employees who create their fortune. What would Sam say?

America’s Richest Women [Forbes]

Alice Walton is the daughter of Wal-Mart founder Sam Walton. Christy Walton is Sam’s daughter-in-law. Each has a net worth of $23.2 billion, thanks to the ubiquitous discounter, America’s largest employer.

Alice has a taste for objects you can’t find in any Wal-Mart: fine art. She’s led her family in hundreds of millions of dollars in donations to the Crystal Bridges Museum. The new art museum will open in 2010 in Bentonville, Ark., the location of Wal-Mart’s headquarters.

Christy is the widow of Wal-Mart heir John Walton, who died in a 2005 plane crash. She also is using some of her considerable fortune for art. She recently donated an award-winning yurt--a domed tent used by Asian nomads--to a San Diego museum.

Just in time Three months before the holidays, Wal-Mart is challenging fellow toy retailers to try to match its prices on Christmas gifts. The retailer has a history of relentlessly undercutting its competitors, but rival retailers like Target and KB Toys aren’t taking Wal-Mart’s price cuts lying down. After announcing its price cuts last week, several other retailers countered with price cuts of their own. With any luck, the cuts will convince parents to spend big and spend soon on toys for Christmas.

The race to the bottom on toy prices shows how influential retailers can be in setting prices for the products sold in their stores. Wal-Mart might be losing money on its $10 Barbie dolls, but it’s dragging the entire toy industry down with it. One interesting quote, from an executive at Toys ‘R’ Us, highlighted how narrow-minded shoppers’ focus can be: “value is not just about cheapness,” he said, and he’s right. Wal-Mart’s toys might be cheap, but problems persist with almost every aspect of the manufacturing process. Are workers rights, American wages and children’s safety worth a $10 toy?

Wal-Mart Sparks War Among Big Toy Sellers [Wall Street Journal]

Retail price wars are starting early this year, and the latest weapon is the $10 toy—a signal that retailers are bracing for a rough-and-tumble Christmas shopping season.

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