Saturday, December 03, 2005

Walmart, Walmart, Walmart....

Over at TPMCafe, Matt Yglesias posted a rather dismissive comment about criticism of WalMart which, needless to say, inspired reaction.
This [notion of WalMart's payroll as subsidized] is a genuinely perverse way of looking at the situation. Here's what's happening. You have some people. Once upon a time, they didn't work for Wal-Mart. Then they decided to take jobs at Wal-Mart. Presumably, their previous jobs were worse, or not jobs at all. Wal-Mart jobs don't pay very much money, which makes many of the people who work at Wal-Mart poor. The government, at the behest of decades of liberal agitation, runs programs that provide services or money to poor people. And now liberals are supposed to complain that this amounts to Wal-Mart getting subsidies?
I think his analysis is simplistic, but it did inspire an interesting response from Mark Schmidt about a trend away from a minimum wage (which would be paid by business) to subsidies for low-wage employees (which are paid by our taxes). Personally, I don't think this is a WalMart question - lots of employers pay their employees poorly, with WalMart standing out due to its size - but instead reflects the outcome of public policy decisions which attempt to ensure a basic standard of living for wage-earners, but which doesn't require corporations to bear the full cost of that public policy.

If minimum wage is $5.15/hour, and WalMart pays a typical entry level employee $7 or $8 an hour (pulling numbers out of the air here), it is difficult to argue that the minimum wage is forcing up the cost of labor. But if you were to raise the minimum wage to $7.50 per hour and also mandate reasonably comprehensive, employer subsidized health care, you would significantly increase the cost of labor. The subsidies we give to low-wage workers allow "pro-market" politicians to pretend that they are letting the market set wages, allow "labor-oriented" politicians to pat themselves on the back for protecting low-wage workers, and... well, beyond the political convenience, they aren't really pro-market and probably aren't the most efficient subsidies we could offer if we truly wished to improve the lot of low-wage workers and their families. Like so many things in our society, we create an ugly kludge of policies that perhaps best serve politicians by allowing all of them to declare victory, and to give themselves glowing self-appraisals in the letters they send to their constituents.

If you have ever been a manger in, say, food service, it would be difficult to leave the situation without recognizing that there are people in the job market who will never rise above the lowest levels of employment. Some are capable of more, but either by poor work habit or by preference don't rise through the ranks. Some aren't capable of more. Some, you wonder how they managed to successfully complete the application (and, actually, some don't). We can't pretend that corporations will take care of these low-end workers - WalMart's factories in China (or heck - the history of the industrial revolution, or the story of Triangle Shirtwaist) tell us how it would treat its employees here if given the chance.

The population which always rises to the defense of corporations would use the same line, no matter what the circumstances for the workers - "They decided to take jobs at a sweatshop. Presumably, their previous jobs were worse, or not jobs at all." Anything above penury is an improvement, and is thus justifiable. To some, it seems like profits are a moral imperative, people an afterthought.

At its heart, the question of how we treat these workers - whether through education, minimum wage, subsidies, other anti-proverty programs - helps define our culture and society. Are we truly committed to providing opportunity for all, or do we prefer to give lip service to equality while instituting or perpetuating policies which perpetuate or even expand the population of workers who will never rise more than a few inches above the entry level.


  1. You rarely hear that crap about "it's better than their previous job" from people who might ever be in danger of needing to work for minimum wage.

  2. Actually, you do . . . at least I did when I was stationed in Arkansas where "good" jobs by most people's definition are hard to find and Wal-Mart jobs were sought after and appreciated. Although to put it in context, most (though not all) of the people I heard making the comment were generally the family members of military members (or the military members themselves, seeking second jobs) and thus already had benefits.


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