The Wal-Mart Watch Blog
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| Nov 18, 2009

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Two Christmases ago, Walmart was inundated with complaints and bad press about carrying products that were dangerous. Chief among those concerns were products that contained dangerous levels of lead. You see Walmart’s business model is based on selling their goods for the cheapest price possible. Often that means pressuring their manufacturers to cut corners or use the cheapest factories around. The result is products that are tainted with lead, contain other harmful material, or are physically dangerous.

While the fervor has died down, Walmart hasn’t stopped carrying dangerous products because their business model hasn’t changed. As evidence, today the state of California has asked several companies to remove several products from their shelves because they contain dangerous levels of lead. On the list, are the Kids Poncho and MSY Faded Glory Rebecca Shoes which are sold at Walmart.

Walmart might have cheap prices, but often there is a hidden cost behind that price tag. The hidden cost of an unsafe product, of environmental degradation, of sweatshop labor, or of labor abuses.

Here is an excerpt from the article from the Los Angeles Times:

California Atty. Gen. Jerry Brown issued a safety warning Tuesday, alleging that seven toys and other products tested by the Center for Environmental Health this month contained illegal levels of lead.

...Other products that the center says have abnormal amounts of lead are the Kids Poncho and MSY Faded Glory Rebecca Shoes, both sold by Wal-Mart; Reversible Croco Belt sold by Target; Dora the Explorer Activity Tote sold by TJ Maxx; and Paula Fuschia Open-Toed Shoes sold by Sears

| Oct 22, 2009

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Apparently Walmart is VERY in to going green...unless it inconveniences them or their customers a little...or cuts in to sales. At least that seems to be the message in Walmart’s latest announcement that they won’t cut plastic bags from two stores until after the holidays, or later. Just a few days after the company announced they would test removing plastic bags in three stores, two of those stores back peddled.

The excuse Walmart gave is that, “The goal of this test is to gauge customer reaction. We think we’ll get a more accurate reaction by offering these bags after the holidays.” But we can’t imagine why the reaction would be any different. The real reason, it would seem, is that Walmart does a huge portion of their business during the holiday season and they don’t want to do anything to cut in to their sales.

Of course there is nothing wrong with wanting to maximize your sales during the busiest shopping time of the year, the issue is with Walmart portraying itself as a super green, environmentally friendly force of good. Walmart’s main concern is profit, and this belies their true motives.

Here’s the article from The Sacramento Bee:

Wal-Mart Stores Inc. on Wednesday said it will not be removing free plastic bags from two of its locations in the region until at least January.

Signs in Walmart stores in Folsom and Citrus Heights had announced that shoppers would soon have to either bring their own bags or buy reusable ones – for 15 cents.

The two stores, along with a third in Ukiah, make up a small test program. Going plastic bag-free is one of a variety of strategies being tried at stores around the world as Walmart evaluates ways to meet its goal of cutting plastic bag waste 33 percent by 2013.

Wal-Mart spokeswoman Amelia Neufeld said the company decided that launching the reusable bag-only program just before the holiday shopping season would skew the test results.
“The goal of this test is to gauge customer reaction. We think we’ll get a more accurate reaction by offering these bags after the holidays,” she said.

Neufeld would not comment on whether recent customer reactions had driven the decision to postpone the test.

At the Folsom store earlier this week, customers interviewed by The Bee were roughly split on the plan.

Matthew Oliver, a Folsom resident who complained in writing at his local store after learning of the plan, said a Wal-Mart representative called him Wednesday to say the Sunday launch of the test program had been called off.

Oliver said he resented the reusable bag program because he felt it was a cost-cutting measure with a green veneer that deprived him of the right to choose how he’d like to carry his purchases.

“I just want to buy my milk from you,” he said. “I don’t want you to tell me what my political views ought to be.”

Wal-Mart is also evaluating other strategies for reducing plastic waste that don’t involve removing free plastic bags from stores altogether. It is retraining some checkers to put more items in each sack, for instance, and is considering switching to thinner bags that contain less plastic.

The company’s 15-cent reusable bags will continue to be offered at the checkout counters in Folsom and Citrus Heights, Neufeld said. They are royal blue and made of a lightweight, recyclable polypropylene fabric.

| Jul 02, 2009

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Here are what the voices on the Internet are saying about Wal-Mart’s support of employer-mandated health care...not surprisingly, it hasn’t taken long for most to deduce that Wal-Mart is hardly acting in an altruistic way.

Number one on Wal-Mart’s hit list? Easy. Target. Because small businesses would either be exempt from the mandate or face a less-strenuous requirement, it would be Wal-Mart’s large competitors (and more specifically those who have to this point been better at managing health care costs than Wal-Mart) that would feel the brunt of the hurt.

Jonathan Cohn at The New Republic:

I don’t want to make too much of this: Wal-Mart may chicken out once the specifics of an employer mandate end up on the table. Even if they don’t, they may not lift a finger to help. And, make no mistake, Wal-Mart is acting--as it always does--out of pure self-interest.

My undestanding is that, after all of these years, Wal-Mart has suddenly found itself in the same situation its competitors once did: Dealing with unpredictable health costs and facing new competition from businesses that have found ways to spend even less on employee health benefits. Is there some justice there? You bet.

Reihan Salam with the National Review:

There is another way of looking at this. As a large, powerful, deep-pocketed firm, Wal-Mart can sustain regulatory burdens that mom-and-pops and new entrants can’t. And so burdensome regulations are invariably Wal-Mart’s ally. Jonathan Rauch explained this dynamic brilliantly in his book Government’s End. It makes perfect sense for Wal-Mart to back a regulatory initiative that hurts its bottom line as long as it hurts its competitors more.

Megan McArdle for The Atlantic:

Wal-Mart is always going to have a seat at the table when employer mandates are discussed, because Wal-Mart is the nation’s largest private employer.  Target and Macy’s probably won’t have a seat at the table.  So Wal-Mart can influence the rules in ways that benefit Wal-Mart at the expense of the competition.

Jeffrey Young in The Atlantic:

Based on the axiom that nobody in business or politics acts strictly out of altruism, it’s safe to assume that Duke and Wal-Mart’s board of directors concluded that backing the employer mandate would provide the company with some kind of competitive advantage. When I originally reported the story, it wasn’t immediately clear to me what that might be, though I suspected it must have had something to do with Wal-Mart’s calculation of how much money the mandate would cost them relative to other retailers.

Michael Cannon, for the Cato Institute:

A couple of years ago, I shared a cab to the airport with a Wal-Mart lobbyist, who told me that Wal-Mart supports an “employer mandate.” An employer mandate is a legal requirement that employers provide a government-defined package of health benefits to their workers...But it all became clear when the lobbyist explained the reason for Wal-Mart’s position: “Target’s health-benefits costs are lower.”

I have no idea what Target’s or Wal-Mart’s health-benefits costs are.  Let’s say that Target spends $5,000 per worker on health benefits and Wal-Mart spends $10,000.  An employer mandate that requires both retail giants to spend $9,000 per worker would have no effect on Wal-Mart.  But it would cripple one of Wal-Mart’s chief competitors.

U.S. Chamber of Commerce, quoted nearly everywhere (here courtesy again, of Mr. Jeffrey Young):

The U.S. Chamber of Commerce took a pretty nasty swipe at Wal-Mart when I emailed them for a comment. Here’s the statement the Chamber’s press office sent me, attributed to James Gelfand, its senior manager for health policy: “Some businesses make the decision to use the government as a weapon against their competition. We do not agree with this method.” Ouch.

| Jun 25, 2009

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We hate to say “I told you so,” but....

Marc Gunther on ClimateBiz discussed Wal-Mart on his blog yesterday, and points out something we’ve been trying to get across as well. Even as its greenhouse gas emissions have begun to fall, the company’s overall carbon footprint has continued to rise.

As Gwen Ruta of the Environmental Defense Fund, a Wal-Mart partner, writes in her frank assessment of the company’s 2009 sustainability report, the problem is that all the good things that Wal-Mart is doing—increasing its use of renewable energy, driving efficiency in individual stores, improving its fleet operations and pushing up its recycling rate—are offset by the fact that the company is adding more stores and selling more stuff.

In late 2007 we released our own environmental report, in which we brought up the following:

Wal-Mart’s new stores will use more energy than its energy-saving measures will save. Its fleet of trucks, massive overseas shipping to import its goods, and the increasing vehicle miles traveled by its consumers all contribute heavily to CO2 emissions and the number of ozone-causing particulates released into the air. Its huge stores and even larger parking lots contribute to the degradation of our water supply, affecting our drinking water and the viability of aquatic life.

Wal-Mart’s response has been that by increasing its market share, it can replace less efficient competitors and thereby reduce emissions in the retail sector as a whole, even as it continues to expand. That might ultimately be true in the far, far distant future, especially if one day every store is a Wal-Mart. But in the interim, Wal-Mart’s total carbon emissions continue to outpace its efficiency gains. And as Gunther so eloquently adds:

If the Earth’s atmosphere could speak, it would tell us that it doesn’t care about efficiency or renewables or recyling—or market share.

Wal-Mart’s Big Problem: Climate Change [ClimateBiz]

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| Jun 22, 2009

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On June 20th, the Wintu tribe—whose land encompasses parts of Northern California—dedicated an 8 foot bronze statue to memorialize the site of a sacred burial ground. Too bad this statue rests in a Wal-Mart parking lot.

After discovering the burial ground during the construction of a supercenter, Wal-Mart did the right thing and stopped construction kept building the store and made concessions to the local Native American tribe --- in the form of a $60,000 bronze statue dedicated to a traditional Wintu feather dancer. While a nice gesture, local tribal leaders agreed the land should never have been used for commercial purposes.

Of course, this isn’t the first time Wal-Mart disrespected a Native American burial site; or for that matter, an area of historical significance.  .

Wal-Mart construction unearths 64 Native remains in Hawaii.  During the construction of a Sam’s Club and Wal-Mart supercenter in Hawaii, workers found 64 sets of remains.  In 2007, three years after being unearthed, the remains still sat locked up in a trailer under a parking ramp, awaiting reburial. [AP via Fox News, 5/23/07]

...in Georgia and California…

In 1996, Wal-Mart sought to build a new store on a sacred Mohican site, but abandoned the project after four years of court battles. In 1995, JDN engineered a deal in Canton, GA to relocate numerous graves and set up a permanent display of Indian artifacts inside the Wal-Mart, right next to the layaway counter. In 1992, Wal-Mart redesigned a store in Paso Robles, CA so a plaque at one end of a parking lot marked a grassy knoll where Native American graves were left undisturbed. [New York Times, 8/3/97]

...and even in Mexico

Wal-Mart supercenter intrudes on ancient Aztec ruins and destroys farmland. When Wal-Mart decided to place a store in an area of San Juan Teotihuacán, a mere one and half miles from Aztec ruins, some Mexican citizens staged a hunger strike in protest of destroying Mexico’s “indigenous heritage.” Not only did the Wal-Mart store destroy the “cultural heritage” of the land, it destroyed “alfalfa and cornfields” which were “razed to make way” for the big box store. [Newsday, 11/7/04]

To read more about this issue, please check out our Native American fact sheet

| Jun 22, 2009

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MOVE OVER EDELMAN: WAL-MART ADDS THREE NEW PR FIRMS

• Walmart Wraps PR Review by Adding Three Shops to Roster [Advertising Age]
  After a lengthy agency review for its multimillion-dollar consumer-PR business, Walmart has selected Interpublic Group of Cos.' Golin Harris, WPP's Cohn & Wolfe and Omnicom Group's Porter Novelli, according to industry sources. The three agencies will bid against one another for individual assignments in the retail giant's effort to drive greater cost efficiencies.

CALIFORNIA WAL-MART PAYS FOR BRONZE STATUE AFTER BUILDING ON NATIVE AMERICAN BURIAL GROUND

• Wintu memorial is healing medicine for Mother Earth and feather people [Anderson Valley Post (Calif.)]
  Even a youthful vandal who was caught in the act of bending and breaking off portions of a bronze statue's headdress couldn't stop the healing of Mother Earth that took place Saturday, June 20, at the southeast corner of the Wal-Mart Supercenter in Anderson.

ANOTHER WAL-MART SALES TAX SCANDAL; THIS TIME IN MISSOURI

• Sales tax confusion at new Walmart  [Connect Mid Missouri]
  A viewer concern prompted the KRCG Factfinder team to look into the sales tax rate at the new Walmart in Jefferson City. The viewer wanted to know if he was paying more sales tax at the new location than at the old Walmart on Missouri Blvd.

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| Jun 18, 2009

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By this time we should all be aware of the controversies surrounding credit companies - in addition to increasingly complex and confusing options for credit applicants, credit card issuers have been raising interest rates and fees for many current borrowers, many of whom were in complete compliance with their card holders’ agreements when their rates were raised. This is a major reason behind the call for continuing credit card reform.

What many people might not be aware of is the struggle between credit companies and the retailers at which their cards are used. As Bloomberg explains, this could end in a giant Visa vs. Wal-Mart rumble:

Lawmakers are promising new rules to bring down the interchange fee, a charge on purchases sometimes topping 3 percent that’s split by the two banks serving the customer and merchant. Supporters of the legislation include the biggest retail chains, restaurants and small businesses, which say the fees erode profit and inflate prices...Interchange is the second-biggest cost after payroll, Target said, and merchants want to negotiate lower payments collectively without running afoul of antitrust law.

The issue has become such a hot topic, the Government Accountability Office has been ordered to study the effect interchange fees have on both consumers and merchants. The “interchange fee” is the fraction of every credit card transaction that the card’s issuer retains. When combined with additional smaller fees levied by a retailer’s own bank (to which the retailer first submits the transaction), interchange fees can cut into retailer revenue - especially important for those retailers with slim profit margins.

Interchange fees have risen over time - interesting, since technological advances would suggest the cost of such transactions should go down - and the result is a growing battle between retailers and card issuers. Wikipedia provides a surprisingly simple example of how the fees work:

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| Jun 16, 2009

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Not long ago, we reached out to our Wal-Mart Watch communities in New York, Los Angeles, and Chicago, asking them to contact their city councils and urge them to continue to oppose Wal-Mart’s moving into their cities. Combined, the populations of Chicago, NYC and LA house nearly 15 million people, or roughly 5% of the U.S. population.

For years, Wal-Mart has tried to build stores in those and other urban centers including Detroit, Washington, DC, and Boston. Building stores in these cities represents one of the last few rich avenues for domestic U.S growth open to Wal-Mart, but to this point it’s been one big, giant FAIL.

Since submitting our request, over 25,000 letters have been sent to the city councils in LA, New York and Chicago. And below is an example of the responses those letters have been generating - this one is from David Yassky, a member of the New York City Council currently running for New York City Comptroller:

Dear Neighbor:

Thank you for your concern regarding the recent proposals to open Wal-Mart stores in New York City. I agree that this is not the answer to our City’s economic problems, and I am concerned by the company’s poor track record regarding the treatment of its employees and its devastating effect on local businesses.  Small businesses are the life-blood of our City and as the Chair of the City Council’s Small Business Committee, I will fight against the development of new Wal-Mart stores that bring more harm than good to a community.

Moreover, I strongly support passing the Employee Free Choice Act. This legislation would be an important safeguard against employee abuses.  The Employee Free Choice Act would promote better working conditions and benefits for those who need it most:  New York’s working families.  I will continue to support this legislation and employee rights whenever I have the opportunity to do so. Thank you again for your interest.

Sincerely,
David Yassky
Council Member, 33rd District

We’ll keep updating you as we continue to get more responses. Until then, you can check out more on Wal-Mart’s Urban Problem here. What these cities need now are jobs that pay a living wage, good health benefits that keep people healthy and productive (and off public health care), and thriving small businesses that give back to their communities. Wal-Mart need not apply.

| Jun 11, 2009

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Image above from the Center on Budget and Policy Priorities

When Wal-Mart’s use of an intricate web of subsidiaries to avoid state taxes was discovered, the N.C. Secretary of Revenue famously sent tax lawyers and auditors after the world’s biggest retailer. With state economies strapped for cash, North Carolina is now looking to halt such shenanigans before they can start.

A proposed “combined-reporting” law would require companies with multiple subsidiaries operating in several states to file tax returns as a single business. Opponents of this legislation have given lawmakers the shivers...But in the face of the state’s biggest budget crisis since the Great Depression, combined reporting took a first step Tuesday toward becoming law. After a contentious House Finance Committee meeting, the Democrat-led committee voted along party lines to approve a larger tax package that includes combined reporting.

Combined reporting basically treats a parent company and its subsidiaries as one entity for tax purposes. A driving force behind the move was the public realization of just how much money North Carolina has been losing through loopholes in its tax laws.

Read the rest of this story ...

| Jun 10, 2009

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It isn’t EFCA, but this week the Oregon legislature took its own step towards ending employer intimidation towards employees seeking to form a union. The Oregon Senate passed Senate Bill 519 - the Worker Freedom Act - by a 16-14 vote. The vote nearly split down party lines, with 16 Democrats voting in favor, and 12 Republicans (plus two Democrats) voting against. The measure now moves to the Oregon House, where a similar bill passed in 2007.

Senate Bill 519, which moved to the House on a 16-14 vote, bars businesses from requiring workers to attend company-organized meetings about politics — including union organizing — and religion. There are exceptions for churches and political parties.

The House bill passed 31-27 in 2007, and five more Democrats have since joined the state house. So, needless to say, the measure’s chance of becoming law are looking pretty good.

With public and legislative support behind the bill - 88% of Oregonians, in a December poll, said they did not think an employer should be allowed to force workers to attend meetings about the employer’s opinion on politics, religion, or union organizing - Oregon’s AFL-CIO President appeared surprised in an April email alert that Republicans were fighting the measure so strenuously. As you will note, the bill doesn’t bar the meetings from taking place - it simply bars employers from taking retribution against employees who choose not to attend meetings on politics, religion or union organizing during work hours.

“SB 519 simply states that an employer can’t discipline or fire a worker for opting out of a meetings on one of these topics. Are our Senators, and are the business associations who opposed this bill, upset that we are limiting their right to fire a worker who disagrees with their political or religious views? That’s all this bill does.”

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