Walmart is good: good for its employees, its customers, its suppliers, and even for the environment, says the company’s new ad campaign and website, dubbed “The Real Walmart” as a retort to the company’s critics.
But alas, the facts say otherwise. On inspection, each of the major claims in the campaign turns out to be “The Fake Walmart.” Let’s examine each of these glowing pronouncements, along with the murky reality that lies behind it.
1. The Claim: “Opportunity: That’s the Real Walmart!” exults one of the ads. “Over 75 percent of store management started as hourly associates.”
The Reality: An internal Walmart document just leaked to the press this week reveals that:
- Hourly “associates” at Walmart start at or near the minimum wage. Performance-based pay increases can result in “promotions” in pay and title. But even the very highest level of performance will net you an annual raise of just $.60 per hour, capped for each job title. Last year, only 18 percent of hourly workers received any pay raise at all. If an employee is so industrious as to rise to the management level of, say, “check out supervisor,” her pay will be $1.70 more than that of the lowest paid employee.
- And getting from the hourly wage ghetto to a salaried position is, as the Magic 8 Ball likes to say, “Not likely.” In a typical Walmart store, there may be 200 employees and only a handful of salaried managers. Getting one of those few positions is “more like a lottery than a reliable path.”
2. The Claim: “When our store does well, I earn quarterly bonuses!”
The Reality: Those bonuses of $100 to $300, intended to make employees work harder, don’t make for a living wage. If Walmart really wanted to improve workers’ lives, it would allow more of them to work full time, and thus have access to health insurance and other benefits. Instead, the company keeps a tight lid on full-time work, thus denying benefits to about 70 percent of its store employees.
3. The Claim: “Walmart helps customers save on prescription drugs!”
The Reality: But at what cost to those same customers as taxpayers? Walmart’s wages and benefits are so low that many of its workers have to rely on Medicaid and other social services to support their families, costing taxpayers between $900,000 and $1.75 million annually per store in the state of Wisconsin, where these costs were calculated. That’s a taxpayer tab of at least $67.5 million each year for the state of Wisconsin alone.
4. The Claim: “President Clinton praised which company for putting solar panels on its stores?” asks a cheerful young spokesmodel of passersby in another ad. They are surprised to learn that it’s Walmart.
The Reality: The passerby’s initial assumption — that it wouldn’t be Walmart — is well taken. In fact, despite announcing in 2005 that the company would move to having 100 percent of its power supplied by renewable sources, Walmart today receives only four percent of its energy from solar and wind power.
Why would Bill Clinton say such a thing? Call me cynical, but it may have something to do with the fact that Walmart has been a major supporter of the Clintons since Bill’s days as governor of Arkansas. In fact, Hillary was a member of Walmart’s Board of Directors for the six years leading up to her husband’s first presidential campaign in 1992. By 1993, tax returns showed the Clintons owned more than $100,000 worth of Walmart stock. In 2008, the company made substantial contributions to Hillary’s presidential campaign, while Bill has maintained a close personal relationship with Walmart CEO H. Lee Scott. If Hillary runs in 2016, it will be in the post-Citizens United era of the SuperPac. These are made by billionaire contributors, and there are few billionaires as billiony as the scions of Walmart — the six Walton heirs together own as much wealth as 40 percent of the U.S. population. The candidate who has them has the atom bomb of the SuperPac wars.
5. The Claim: “Meet real Walmart shoppers!” Here we meet a businessman, a teacher, a carpenter, a mechanical engineer, a firefighter and an accountant, all of them redolent with middle class status, who proudly shop at Walmart. “Living better,” the tag line says, “that’s the real Walmart.”
The Reality: Walmart’s customers are disproportionately poor, Southern and elderly. The fact that none of these demo’s made it into Walmart’s ad about “Our Customers” means not only that Walmart is a fibber, but also that Walmart is a disser of its own “real” customers.
6. The Claim: “We work directly with manufacturers, eliminating costly markups.”
The Reality: If by “work with,” the ad means “dictate to,” then this claim is accurate. But again, as Charles Fishman, the business reporter who wrote The Walmart Effect asks, what is “the high cost of these low prices?” Walmart’s market power is such that many of its suppliers face a stark choice: take dictation from Walmart, or lose half or more of their business. “To survive in the face of [Walmart’s] pricing demands, makers of everything from bras to bicycles to blue jeans have had to lay off employees and close U.S. plants in favor of outsourcing products from overseas.”
Just ask Steve Dobbins, CEO of 75-year old Carolina Mills, a company that supplies thread and yarn to textile manufacturers — half of whom supply Walmart. His company grew steadily until 2000. Then his customers, with Walmart’s gun to their heads — began a hemhorrage of offshoring in order to find the dirt cheap labor necessary to meet Walmart’s low price demands. Carolina Mills shrank from 17 factories to 7 within three years. The way Walmart “works with” its suppliers has been disastrous for American workers.
In the end, what can we learn from “The Real Walmart”?