Tags: Money | Minimum Wage | Wal-Mart | Uber | Walton | Washington | D.C.

Walmart Collaborates With the Enemy, Pays the Price

Friday, 22 Jan 2016 04:26 PM Current | Bio | Archive

Walmart is proving yet again the truth of the Obama outreach fallacy: You can’t negotiate a mutually beneficial deal with fanatics who dream of a better world when you’re not in it.

No, Walmart wasn’t hoping to expand to Tehran. Their goal was Washington, D.C., arguably more difficult. It’s no accident Walmart founder Sam Walton built the company through expansion in rural areas that feature a low density of cultural Marxists and “inequality” experts.

After Sam’s death, it seems the new owners thought low prices were only possible by keeping workforce wages low and aggressively combating union agitators.

Walmart was branded a “big box” retailer and subject to the equivalent of a zoning bill of attainder that prevented urban expansion.

Had Walmart management believed in the corporate credo, it would have fought these anti–consumer regulations — like Uber has repeatedly done. Or it would have gone elsewhere and condemned leftists and their pet politicians to shop at Ames, A&P, and Kmart.

All of which are either bankrupt or vanished.

Instead the company, after protracted negotiation, agreed to build five stores in Washington. Three in upscale D.C. and two across the Anacostia River, as part of a crony capitalist “revitalization” project.

Unions are driving the “living wage” and blocking urban stores with rent–a–crowds and rent–a–politicians.

Impressive until you learn union membership has collapsed to a new low of 6.6 percent of the private sector workforce.

While America’s workers reject union membership, Walmart applies for a discount membership and raises the wages of hourly employees to a minimum of $9 per hour in 2015, and $10 per hour this year.

Economically the move makes no sense. 

Public relations–wise it doesn’t make sense either. The left wants a $15 per hour living wage. The $10 per hour copout only shows weakness. If management had really wanted to do something about "inequality" it makes more sense to reduce the multiple between what the CEO makes and the median Walmart employee’s wage, currently $22,591 times 1,133.

That alternative is much less appealing because executives make a certain sacrifice. 

While raising wages means stockholders might make a sacrifice.

Maybe the CEO thought he would get a Vanity Fair cover surrounded by cheering associates. Or, be invited to speak at one of those Davos, Switzerland movers–and–shakers conferences, instead of being the keynote at the national industrial shelving convention.

Stockholders quickly made their sacrifice. Earnings were down 10 percent last year and are projected to decline another 6 to 12 percent in 2016.

Even worse for employees, Walmart will be closing 156 stores this year, meaning for 10,000 U.S. workers their wages will be $0 per hour.

Meanwhile, back in Washington, now that Walmart had agreed to council demands it was time to change the business climate for the worse. The city’s minimum wage will rise to $11.50 per hour this year and a referendum is in the works to have voters impose a $15 per hour minimum.

Since dreams of employment utopia have a tendency to expand, the council is studying mandating 16 weeks of paid family leave paid for by a new payroll tax.

Once the sabbatical is over the council wants to make sure workers aren’t exploited by the calendar either. It is considering another meddling law that would require merchants to post worker’s schedules as much as two weeks in advance and severely limit the ability to match workers with demand. (One element of the Walmart pay and working conditions debate in D.C. has always confused me. If the company is such a hellhole, why did 23,000 area residents apply for the 600 jobs the new stores offered?)

Walmart leadership finally deciphered the writing on the wall and told D.C. the two stores in Anacostia won’t be built after all. The three stores currently open aren’t very profitable and the council’s interference will only serve to make operating more expensive in the future.

Thanks to a leftist council shoppers in the poorest part of town who could really use choice and lower prices won’t get their stores, while snobs in toney D.C. would rather bump into Ted Cruz in the checkout line than be seen shopping at Walmart.

It’s what happens when a formerly vibrant company gets weak management that first lost its focus and then lost its way. 

Michael R. Shannon is a commentator, researcher (for the League of American Voters), and an award-winning political and advertising consultant with nationwide and international experience. He is author of "Conservative Christian’s Guidebook for Living in Secular Times (Now with added humor!)." Read more of Michael Shannon's reports — Go Here Now.


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Walmart is proving yet again you can’t negotiate a mutually beneficial deal with fanatics who dream of a better world when you’re not in it. It’s what happens when a formerly vibrant company gets weak management that first lost its focus, then lost its way.
Minimum Wage, Wal-Mart, Uber, Walton, Washington, D.C.
Friday, 22 Jan 2016 04:26 PM
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