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$904,542: That's  how much it costs taxpayers to support the workers of just ONE Walmart store because of the company's low wages. Did you agree to subsidize Walmart?
I think we can all agree that 2010 wasn’t the best of years. After all, unemployment at midyear was still bordering on 10 percent, home foreclosures were at a record high, and profits per employee at US corporations only rose 24 percent. Now, go back and read that last one again. As it happens, U.S. corporations were on their way to record profits in 2010, raking in more money at the same time as they were cutting both staff and benefits.

Think that’s a fluke? Profits per employee jumped another 22 percent in 2011. That’s as layoffs reached record heights and 312,000 jobs were eliminated. The year 2011 also marked another record year of profits for U.S. companies. Not only did Fortune 500 corporations pocket a record $824.5 billion, they generated earnings at a rate 23 percent percent higher than the historical average. By the end of that year, Apple alone had $76 billion in the bank, after generating a profit amounting to half a million dollars per employee.

Tell me again that this was a hard year. The economy is bad only in that we've allowed the economy of corporations and the economy of real, living human beings to become totally disconnected.

It’s one thing to say that middle class wages are stagnant while those of the top 1 percent are continuously growing, but there’s a deeper, more fundamental flaw in our current notion of capitalism: Everyone understands that profit is good, but no one seems to understand what profit is for. We’ve constructed a set of standard practices that would not only make Gordon Gekko blush, they’re self-destructive. American capitalism is profiting itself to death.

Few companies are as emblematic of the New American System as is Walmart. The company that in 2011 generated more revenues than any other, the company that is now the largest food retailer in the world is the same company that recently encouraged donations of food to its own employees. It’s also a company that, putting aside any losses generated when it replaces smaller, local stores, causes a net loss to every community it enters in the form of increased tax revenues needed to support the underpaid employees. Walnart not only counts on taxpayer dollars to subsidize its “low cost” stores, it counts on that same taxpayer dollars to drive its business. Walmart employees not only need food stamps to get by, Walmart is the largest place where those food stamps are redeemed. It’s a cycle that grinds employees (and communities) relentlessly down, while driving Walmart revenues just as consistently up.

Of course, it doesn’t have to be that way.

While Walmart may be the corporate expression of the darkest timeline, Costco shows that it’s not required to be a corporate ass to be profitable. Costco workers start at a salary of over $11 an hour—a modest amount, certainly, but an amount that most Walmart employee never attain even after years of labor. The average Costco worker makes almost twice that amount on an hourly basis, and Costco workers also tend to work normal work weeks, with all the benefits that implies, rather than the truncated working hours Walmart imposes to keep employees just shy of such extravagances as health care or paid leave. Costco executives also make a much more reasonable sum compared to the corporate profits. Put it all together, and the CEO of Costco makes as much as 48 workers earning the median wage—a rate that’s high by historical standards, but downright Spartan compared to the situation at Walmart where the CEO pulls in the pay of 796 average workers (a shameful rate that is closely matched by the 645 employees it would take to reach the pay awarded the CEO of Target).

Walmart's unending quest to inflate its profit by any means is such that it scrambles to find elaborate schemes to deny the wages promised to workers who sacrifice their holidays to the corporate coffers.

The most shameful thing out of all these numbers may be this: Walmart could quite easily afford to pay its workers a living wage.  It could do so without threatening its ability to operate. It could do so without slowing its relentless expansion. It could do so without residing its prices one dime. Walmart has ample ability to pay its workers more, because it's not just profitable, it's massively profitable.

If Walmart were to pay all of its employees a living wage—not a poverty rate, but something more like the $45k average that Costco workers earn—if it did that, Walmart's corporate profits would have declined last year from $17 billion, to a mere $12.5 billion.

But this isn't just a Walmart story, it's an American story. Not so long ago, American corporations accepted the idea that they had obligations to their stockholders, but also to their workers and the communities where they did business. They understood that profit was a tool, a fuel that powered the corporation to achieve its goals. But now profit is the goal. It's been fetishized beyond all reason. Many people will even tell you that there's a law requiring companies to generate as much profit as possible. There is no such law. There never was. And the only thing more insane than believing that such a harmful law might exist, is that many seem to think it's a good idea.

Originally posted to Daily Kos on Sun Nov 24, 2013 at 06:00 AM PST.

Also republished by In Support of Labor and Unions and Daily Kos Classics.

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Comment Preferences

  •  Autophagy (104+ / 0-)

    1) the process in which an organism destroys its own cells as a source of energy, particularly in times of starvation.

    2) the process in which a corporation destroys its own employees and communities to generate a temporary increase in profit. Also known as Walmart syndrome, also know as insanity.

  •  Here in Los Angeles (27+ / 0-)

    Walmart has to compete with other stores like it, so a no shopping at WalMart pledge is something that's very possible. I won't. Period. And I don't, not even online.

    But consider what it's like in rural America where where you have to shop is WalMart, and, aside from that, WalMart is the largest employer. Of COURSE WalMart needs a union, but we know how well that's going.

    I wish I had an answer to this. I'll work on it.

  •  Amazon isn't profitable. Bezos is a billionaire. (16+ / 0-)

    Jeff Bezos thinks growth and market share is more important than profits. Investors seem to agree. I don't know where the absurd meme came from that there's a law that profits must be maximized. It's pernicious and wrong.

    Many people will even tell you that there's a law requiring companies to generate as much profit as possible. There is no such law. There never was. And the only thing more insane than believing that such a harmful law might exist, is that many seem to think it's a good idea.

    look for my eSci diary series Thursday evening.

    by FishOutofWater on Sun Nov 24, 2013 at 06:17:58 AM PST

    •  Not only that (9+ / 0-)

      but it is decreasing the life expectancy of public-owned companies. It might be different for companies like Walmart or Amazon that don't create things, but overall the life of a company used to be soemthing like 75 years. Now it's like less than a third of that. There are temporary companies designed to fleece workers and move on.

      Knock twice, rap with your cane

      by plok on Sun Nov 24, 2013 at 06:35:05 AM PST

      [ Parent ]

    •  Some of that "absurd meme" came (8+ / 0-)

      from successful shareholder lawsuits against companies for not maximizing profits.  As I understand it, many of those corporations are incorporated in Delaware.

      •  Yes. this is why Ben & Jerry's were compelled to (6+ / 0-)

        sell to Lever Brothers rather than a non profit. Since then different corporate entity types have been created allowing for mission to be valued rather than profits. B- Corps is what they are called, benefit corps. King Arthur Flour, Patagonia are examples. Some are employee owned. Gar Alperovitz in his book "What Then Must We Do? Straight Talk About the Next American Revolution" refers to it as part of the Democratization of wealth.  An excellent read. Highly recommended.

      •  Unequal Protection by Thom Hartmann (2+ / 0-)
        Recommended by:
        JesseCW, Oh Mary Oh

        I think most people know about the 1919 Michigan Supreme Court decision on Dodge vs. Ford from Hartmann's book Unequal Protection, which is a study of the history of corporate personhood. One contemporary argument against interpreting this decision as justification for corporate profit maximization has been written by Lynn A. Stout and can be found here.

    •  I did a little googling. This is what I found... (7+ / 0-)
      By so stating, I do not mean to imply that the corporate law requires directors to maximize short-term profits for stockholders.  Rather, I simply indicate that the corporate law requires directors, as a matter of their duty of loyalty, to pursue a good faith strategy to maximize profits for the stockholders.  The directors, of course, retain substantial discretion, outside the context of a change of control, to decide how best to achieve that goal and the appropriate time frame for delivering those returns.[56]  But, as I have noted in other writings, the market pressures on corporate boards are making it more difficult for boards to resist the pressure to emphasize the delivery of immediate profits over the implementation of longer-term strategies that might yield more durable and more substantial benefits to stockholders, as well as society in general.
      http://wakeforestlawreview.com/...

      So even though technically legally it is not quite the same, the reality is that the strategy becomes maximizing short -term profits.

      "Hate speech is a form of vandalism. It defaces the environment, and like a broken window, if left untended, signals to other hoodlums that the coast is clear to do more damage." -- Gregory Rodriguez

      by Naniboujou on Sun Nov 24, 2013 at 06:53:29 AM PST

      [ Parent ]

    •  The ideas I like about Amazon. They always have (1+ / 0-)
      Recommended by:
      FloridaSNMOM

      treated me fairly. And. I can get the things I want without driving all over creation to get them.

      So why should 100,000 people drive to the store to get dish towels, when they can order from Amazon and get their purchases delivered to their house in a commercial truck?

      Why is it easier to buy a gun than it is to register to vote in most states?

      by 88kathy on Sun Nov 24, 2013 at 07:05:04 AM PST

      [ Parent ]

    •  I once read the autobiography of Christopher Milne (4+ / 0-)

      ... that is, THE Christopher Robin of the Winnie-the-Pooh books.

      It seems that as he grew older, Milne became an incredibly wise, thoughtful, philosophical person -- a sort of Southwest England Taoist/Zen thinker (although he wouldn't have thought of it in those terms).

      Writing about how the political leaders in his lovely small English town were determined to have the town GROW and GROW and EXPAND, he questioned this modern lust for growth for its own sake -- wherein it's just taken as a given that we HAVE to grow and grow and grow, that that is a good thing -- pointing out something that has always stayed with me.

      He pointed out that nothing in nature -- NOTHING -- grows and grows and grows forever.  Nothing is expected to.  In nothing is that considered a good thing.  If something did do that, it would be a sign of a big, big problem ... something really, really abnormal and sick.  And eventually that thing's own ever-expanding growth would kill it.

      He pointed out that the natural, healthy pattern is for things to grow to a certain point, and then to STOP -- a point of balance and stability.

      As I just commented in the diary about Bill Moyers and Henry Giroux -- on Giroux's comment that U.S. society is genuinely insane:

      If one considers it from the Taoist viewpoint -- that health and balance mean living in harmony with the laws of nature, with the "spirit" and flow of the universe -- then modern America is the exact opposite.  We live so proudly and consistently against nature that it is no wonder we are literally going crazy;  that we are so spiritually and psychically sick.

      If I had the United States as one of my therapy clients, I could only conclude that it is profoundly disturbed ... something very close to an out-of-control addict in denial, with narcissistic personality disorder and delusions of grandeur thrown in.

      •  In medicine, we usually call cells that reproduce (4+ / 0-)
        Recommended by:
        niemann, 6412093, Treetrunk, Calamity Jean

        indefinitely... cancer.

        Fry, don't be a hero! It's not covered by our health plan!

        by elfling on Sun Nov 24, 2013 at 02:54:20 PM PST

        [ Parent ]

        •  I've thought the same thing, in a way. (0+ / 0-)

          That is, that human beings can pretty much literally be considered a cancer on our planet -- a natural part that has grown out of control and is consuming and destroying the rest.

          And we know from human experience how that ends up working out for the cancer itself.

          •  Profiteers continue to make it worthwhile (0+ / 0-)

            for our leaders to give them certain advantages, causing superfluous consumption, resource diminution, pollution, and most of all, fostering population increase  -  all of which act as cancers taxing the sustainability of our planet.  Both profiteers and leaders (and the lack of public "eternal vigilance") are at fault, but in this vein, Citizens United is not helpful.

      •  As a diligent parasite (2+ / 0-)
        Recommended by:
        niemann, Oh Mary Oh

        Walmart must show some concern for the culture in which it is found. A careful parasite should never kill its host.

        Let X be an entity; call it Y.

        by Senile Goat on Sun Nov 24, 2013 at 05:02:19 PM PST

        [ Parent ]

  •  Have to admit: brilliant business plan! (24+ / 0-)

    That goes to show how f'ing gullible and suckers most people are, believing they are "saving" money buying their crap at Walmart, when in reality they are ALSO directly subsidizing them through their taxes: DOUBLE DIPPING!!!

    And Walmart makes record profits from it, prancing as the ultimate capitalist example, while in all truth they profit from SOCIALISM!

    So, profits are privatized and costs are socialized!! The ultimate con!

    •  I remember before 7-11. There were mom&pop (4+ / 0-)
      Recommended by:
      Aunt Pat, Mayfly, Senile Goat, Oh Mary Oh

      'convenience' stores everywhere. But they were 9-5. And sold at a 30% markup because they were convenient. The first 7-11 stores carried many times the variety of merchandise they do today, at cheaper than supermarket prices. So 7-11 drove everyone out of business. Slashed the variety of stock and the prices are long past a 30% markup.

      Why is it easier to buy a gun than it is to register to vote in most states?

      by 88kathy on Sun Nov 24, 2013 at 07:10:43 AM PST

      [ Parent ]

    •  NOW you've reduced it to (0+ / 0-)

      the bullet comment that we have all NEEDED to define Walmart (or, as I call them -- knowing them as I do from the inside -- "The Corporate Antichrist"....).

      THANK YOU.

      And to others here who've done research to point out the lies, I thank you, as well.  I just went THROUGH a deluge of those lies the other day, while making a point about upper store management's tendencies...namely, "piss-poor prior planning on their part DOES make an emergency on my part", in their minds.  I had to set that straight, and had limited success.

  •  Competition Is Supposed To Be The American (5+ / 0-)

    way of capitalism.  The truth is that congress has killed competition, and we have turned into a society that is killing capitalism.  There should be limits on how big a store can be, how big banks can be, and how big media can be.  We have no regulations or rules on competition and that is why Wal Mart has become a monster and has killed out all their other competition.  The only answer is for society to kill Wal Mart and any other super stores that don't treat their employees fairly, but the real answer is smaller stores, and more stores.

    "Don't Let Them Catch You With Your Eyes Closed"

    by rssrai on Sun Nov 24, 2013 at 06:22:49 AM PST

  •  Great point (3+ / 0-)

    The only way to get "fiscally conservative" people to understand that fiscally conservative does not equal fiscally responsible is by pointing out how destructive their policies are.

    And one of the best ways to do that is to take something they hate (subsidies for poor--and therefore in their minds, lazy--people) and use it against them.

    •  You'd think that (1+ / 0-)
      Recommended by:
      Miira

      they'd be able to look at these giveaways logically and see they're corporate welfare.

      However, in talking to the dittoheads, they generally see no problem with Walmart - or any other business getting corporate welfare in any way, shape, or form.

      In the case of Walmart itself - they don't blame Walmart because its employees need help.  They blame the employees themselves.  Their cognitive dissonance prevents them from acknowledging that low pay is problematic, even for unskilled labor.  They think it's just a matter of those working unskilled labor jobs being "too lazy" to better themselves.  They simply don't follow that logic to it's ultimate conclusion:  What would happen to these jobs if everyone took their advice and did "better themselves" - it's not like a need for these jobs would simply vanish.

      They always have some abstract concept at the ready to explain away actual logic and reason, thanks in large part to the conservative echo chamber.

    •  Actually... (0+ / 0-)

      The way to get fiscal conservatives and antisocial corporations to see the error of their ways is to not buy their shit. They don't give a flying fuck if their policies are bad for society because the customers keep on coming. How many of you have an iPhone in your pocket right now? The only message they care about comes in their dividend check and P&L statement.

      The lazy people we like to excoriate are us. Many people have achieved a socially responsible purchasing policy, but not enough. We don't like to be inconvenienced. Walmart is an easy target because they sell cheap Chinese junk. Let's look deeper. We seem to have an amazing double standard when it comes to the things we want. How many of you, dear readers, have an iPhone in their pocket? How many of you are reading DK on an iPad? If you want to look at antisocial companies, let's not neglect to shine the flashlight on the monster Mr. Jobs built. You know, the one that sued another company for having rounded corners (learned in engineering 101 as a safety feature, by the way)?

      In this regard, Adam smith was right. We're the invisible hand, and we've taken the century off.

      That picture that was plastered on the top of this post and many others need to go and stay viral. Maybe we can succeed with the next generation.

  •  Say goodbye to the middle class (9+ / 0-)

    Take a profession that can't be exported or insourced to "guest workers". Plumber? Mechanic. Appliance repair? You'll still find work.

    I do high-end business automation using knowledge models captured from experts. Already legal and medical work is done offshore.  Any information work except at the highest levels of understanding will be built into high-productivity knowledge platforms used by the few remaining "knowledge workers", who will be well paid - a thin underlayer for the capitalist ownership class who collect the profits.

    Remember the Jetsons? They were inspired by the new productivity materials and tools (plastic?) of the 50s and 60s. Then, the conversation was about what we would all do with all the leisure time we would have in the future. Ha. Didn't France have a 30 hour week at one time? Ha!

    Say goodbye to the middle class; or maybe the Doctors, Lawyers, and Accountants will join the revolution ...

    •  They Are, They're Becoming Investors & Owners (1+ / 0-)

      joining the ownership revolt against the occupants.

      We are called to speak for the weak, for the voiceless, for victims of our nation and for those it calls enemy.... --ML King "Beyond Vietnam"

      by Gooserock on Sun Nov 24, 2013 at 06:35:58 AM PST

      [ Parent ]

      •  Ownership: another example of autophagy (1+ / 0-)
        Recommended by:
        Senile Goat

        The virtue of home ownership only works in the context of overwhelming owner-occupancy.

        Absentee owners have a completely different way of valuing community: mostly they don't. But they do value acquisition of more properties, even the ones crumbling before everyone's eyes. See most of our inner cities.

        Change does not roll in on the wheels of inevitability, but comes through continuous struggle. --Martin Luther King Jr.

        by Egalitare on Sun Nov 24, 2013 at 08:20:06 AM PST

        [ Parent ]

    •  You are very replaceable. (4+ / 0-)
      Recommended by:
      Hohenzollern, Miira, jbsoul, 6412093

      There are people in India and China much brighter and younger than you willing to work for a fraction of your wage. There is no job that can't be done by a guest worker.

      “Conservation… is a positive exercise of skill and insight, not merely a negative exercise of abstinence and caution…” Aldo Leopold

      by ban nock on Sun Nov 24, 2013 at 07:03:27 AM PST

      [ Parent ]

  •  On Facebook (7+ / 0-)

    there is a group called Unbiased America.

    the person running it just posted a thought on wealthy people hoarding money, the post leads one to believe wealthy people invest their money to create jobs, good paying jobs.

    I posted your story !

    :=)

  •  Walmart's long time response (6+ / 0-)

    to their low prices is that "it's an indirect  pay increase to their shoppers". Well now we know where that pay increase goes!

    Knock twice, rap with your cane

    by plok on Sun Nov 24, 2013 at 06:30:40 AM PST

    •  And you don't need (2+ / 0-)
      Recommended by:
      Aunt Pat, Miira

      a doctorate in mathematics to know that doesn't add up...

      "A lie is not the other side of a story; it's just a lie."

      by happy camper on Sun Nov 24, 2013 at 06:55:15 AM PST

      [ Parent ]

    •  Walmart doesn't have low prices, they have loss (3+ / 0-)
      Recommended by:
      tb mare, TexasTom, Calamity Jean

      leaders. Prices on an item so low it leads you into the store where you are forced to walk by merchandizing so advanced that you cannot leave with only the loss leader, you are attracted to many more things you didn't know you needed, and your basket is full by the time you leave.

      Why is it easier to buy a gun than it is to register to vote in most states?

      by 88kathy on Sun Nov 24, 2013 at 07:14:56 AM PST

      [ Parent ]

      •  Loss leaders + supply induced demand = (2+ / 0-)
        Recommended by:
        88kathy, coffeetalk

        Wal-Mart sales model.

      •  I've been to Walmarts a few times... (1+ / 0-)
        Recommended by:
        Senile Goat

        ...and never have been forced to buy anything and never have bought anything I didn't need or want. In fact, I usually have left with less than I intended because they didn't carry everything I wanted.

        This is one criticism I just don't understand about Walmart. Almost every business tries to get consumers to buy their products. If a consumer has so little self control that they feel compelled to buy anything offered to them, Walmart is likely the least of that person's problems and it's hard to see how Walmart is responsible for that consumer's disability.

        In the area I live there's a lot of competition so pricing at nearby Walmarts may reflect that. However on the few occasions I've gone to Walmart I've found their prices to be among the lowest regular prices around. Sometimes other stores will put particular items on sale and beat Walmart's prices of course (for example, just yesterday, one supermarket I shop at offered "personalized" coupons on my "loyalty card" that gave me four items for free whose total regular price was over $20 - but obviously they didn't make money on that transaction and Walmart almost certainly wasn't giving away those items also).

      •  This sounds like customers are hypnotized and (2+ / 0-)
        Recommended by:
        WillR, Justanothernyer

        forced to buy things because Wal-Mart puts up attractive displays.  

        you are forced to walk by merchandizing so advanced that you cannot leave with only the loss leader,
        I've never seen "merchandizing so advanced" that you were literally require to buy something -- that you "cannot" leave without buying it.  

        I agree that Wal-Mart has a business model that gets people in the store based on certain items as loss leaders and then tries to entice people into buying other things while they are there.  But everyone who walks into Wal-Mart certainly "can" walk out without those other things.  Nobody is forced to do anything.  It's our own overly-materialistic culture, if anything, that leads people to buy things they do not need because they see them attractively displayed and want them.  Attractive displays are not unique to Wal-Mart (and, in fact, Wal-Mart's displays, the few times I've been in one, have seldom been at what I would consider the higher end of displays.  

        It's the fact that customers validate Wal-Mart's model -- they go in for a few really cheap things, and see (and want) other stuff so they buy that other stuff, too -- that reinforces Wal-Mart's business model.  In other words, Wal-Mart's business model, like those of virtually every other retailer, is driven by its customers.  If they stopped buying that other stuff simply because they walk by and see it, that would force a change in the Wal-Mart business model.  

        Again, what Wal-Mart does is driven by what its customers do.  If you want to change Wal-Mart, you have to do it through two ways: (1) change the views of the people who invest in Wal-Mart (the stockholders) and/or (2) change the practices of Wal-Mart's customers so that Wal-Mart's business model is no longer as profitable.  

  •  The only good news on the retail front ... (17+ / 0-)

    ... is that at least here in Florida, Publix - an employee-owned grocery chain started in Lakeland nearly 100 years ago - is kicking Walmart's ass, to the point that the retail giant is targeting them specifically with a massive advertising campaign and aggressive pricing in an attempt to undercut them in their home state. So far, it hasn't worked.

    It seems even people who aren't particularly well off - in fact, even more than a few Walmart employees - are willing to pay a bit more for their groceries in exchange for higher quality, a clean and pleasant store environment, and excellent customer service.

    It doesn't hurt that Publix was well-established and had a huge, extremely loyal customer (and employee) base long before Walmart got here. But it would be nice if more retailers followed Publix's lead and began hitting Walmart at its weak points - a lousy employee environment, low quality, a hideous in-store experience and crappy customer service. Publix has proven that customers will respond to more than low prices.

    I vote we run Rick Scott out of Florida on a high-speed rail.

    by ObamOcala on Sun Nov 24, 2013 at 06:34:22 AM PST

    •  In the western states ... (4+ / 0-)

      ... people might choose to shop at WinCo, an employee owned grocery chain. I used to shop there instead of Walmart when living in California. Prices were excellent and I knew the employees would be reaping the reward of my modest purchases instead of billionaires. At the store I shopped at, and maybe all of their stores?, checkout was very fast because the register splits into 2 output lanes. You bag your own groceries as the clerk starts checking out the next customer, whose groceries go into the other lane. I liked that because I prefer to sort, group and arrange my bags in my own way.

      It was also located in the same shopping center as the local Costco, making it handy to support both companies which treat their employees better than most.

  •  Obviously, food stamps is too easy to get. WE need (0+ / 0-)

    to cut foodstamps.

  •  Walmart is the number one employer (3+ / 0-)
    Recommended by:
    DRo, dharmafarmer, ban nock

    in my state! Got poverty?

  •  Well written, Mark. (2+ / 0-)
    Recommended by:
    wasatch, starduster

    Wages are a business expense and can be written off as a tax deduction.  Corporate tax loopholes that allow a corp to pay little and, in some cases, no taxes on profits are a disincentive for corps to pay a living wage.

    •  Wages are not tax deductions (6+ / 0-)

      They are simply a business cost, just as much as buying merchandise for sale. Expenses are deducted from revenues to determine taxable profit, but it is a misnomer to refer to them as a tax deduction.

      •  To be precise, (3+ / 0-)
        Recommended by:
        pdxteacher, d to the f, 6412093

        they are tax-deductible expenses, but the point is the same - if the corps don't have to increase wages in order to increase their tax-deductible expenses (because they have loopholes to work with on the other end), they won't.

        •  To be really precise (2+ / 0-)
          Recommended by:
          KingBolete, dharmafarmer

          they are taken further up the return - akin to how a person might itemize their expenses on their personal income taxes instead of taking a standard deduction.

          Essentially, they are expenses that reduce an employers taxable income like any other operating expense.

          I think hmi may have misread you somehow, thinking you consider wages to be a tax credit that is taken directly against tax liabilities on a dollar-for-dollar basis, which obviously is not the case, nor did it appear to me that that was what you were saying.

          I think you got the concept correct in saying it is a "deduction", because relative to how most people think of returns (income tax returns), the concepts are very similar.

  •  the system (3+ / 0-)

    If you're the CEO of a large corporation, you are supposed to maximize profits, not help your employees.  If you're the mayor/governor, your job is to deliver services at the lowest cost in order to minimize taxes.  To counteract this, unions sprung up.  To destroy unions, we were Reaganized.  The AFL/CIO got soft, and PATCO was destroyed--along with the whole union movement.  Countervailing power is needed, until that is accomplished, the CEO of Walmart is following the rules as they exist.
    Put another way, the CEO is not the problem.  The lack of union power is.  Trumka has not succeeded--he is playing by Reagan's rules, he is law abiding.  He needs to read up on union history--successful leaders were often jailed--were always disruptive.

    Actions speak louder than petitions.

    by melvynny on Sun Nov 24, 2013 at 06:52:16 AM PST

  •  Yes, there is a "law" (5+ / 0-)
    Recommended by:
    hmi, Bailey2001, AlexDrew, nextstep, Treetrunk
    Many people will even tell you that there's a law requiring companies to generate as much profit as possible. There is no such law. There never was. And the only thing more insane than believing that such a harmful law might exist, is that many seem to think it's a good idea.
    Well, yes, the officers and directors of a corporation have a fiduciary duty to the shareholders (the owners of the company) to maximize shareholder value.  And they can be held legally responsible (through shareholder lawsuits) if they do not act in the best interests of the shareholders -- the owners of the company.  There is no fiduciary duty to act in the best interest of the employees.  As for employees, the company simply has the legal obligation to follow labor laws or the negotiated employment contracts.  
    •  No, there is not (6+ / 0-)

      The Shareholder fallacy.

      “It is literally – literally – malfeasance for a corporation not to do everything it legally can to maximize its profits. That’s a corporation’s duty to its shareholders.”

      Since this sentiment is so familiar, it may come as a surprise that it is factually incorrect: In reality, there is nothing in any U.S. statute, federal or state, that requires corporations to maximize their profits. More surprising still is that, in this instance, the untruth was not uttered as propaganda by a corporate lobbyist but presented as a fact of life by one of the leading lights of the Democratic Party’s progressive wing, Sen. Al Franken. Considering its source, Franken’s statement says less about the nature of a U.S. business corporation’s legal obligations – about which it simply misses the boat – than it does about the point to which laissez-faire ideology has wormed its way into the American mind.

      Emphasis mine.
      •  Wrong. There is a difference in the common law (5+ / 0-)
        Recommended by:
        tb mare, Blood, AlexDrew, nextstep, Treetrunk

        between a "statute" and a "law."  In every state except my home state of Louisiana, "law" is not only what is in a statute, it is what has been developed over the common law. That means that what is decided in lawsuits becomes the law.  And there are LOTS of shareholder derivative actions (Google is your friend) and LOTS of lawyers who have gotten rich bringing shareholder derivative actions against corporate officers who violated their duty to the shareholders.   You might want to read that last link from the American Bar Association that outlines the fiduciary duties of officers and directors to act in the best interests of the corporation itself (owned by the shareholders).  There is no fiduciary duty to act in the best interest of the employees of a corporation.  

        I agree that in some states there is no statute that requires  corporate officers to act in the best interest of the shareholders. That does NOT mean there is no "law."  "

      •  True, but . . . (2+ / 0-)
        Recommended by:
        jan4insight, Treetrunk

        while there is no law, there is that 1919 Michigan Supreme Court decision (Dodge vs. Ford) which has been used to justify profit maximization. An excellent critique of that wrongheaded reasoning can be found here.

    •  I agree. I was wondering if the diarist was not (2+ / 0-)
      Recommended by:
      coffeetalk, Treetrunk

      thinking about the very real legal obligation to maximize profits as beholden to the shareholders.  

    •  While their fiduciary duty (4+ / 0-)

      is to maximize shareholder value, it is not an excuse for low wages.

      Costco is publicly traded, so using the theory that shareholders will sue if wages are too high, reducing shareholder value, Costco should be sued endlessly.  It isn't.

      Corporate officers fiduciary duties are not an excuse for this.  Never have been, never will be.

      •  Sigh. Costco is a completely different (2+ / 0-)
        Recommended by:
        AlexDrew, Treetrunk

        business model.  It's a membership place, more like Sam's Club.  It's like comparing McD's to a private dinner club, and saying since the private club pays its wokers more, so can McD's.  

        Shareholders do not sue if "wages are too high."  They could sue if officers knowingly pay more for something - equipment, rent, or employees -- than makes business sense in that business model of that company, and if they do that knowing that it will cut into profitability.  What employees are paid is a balance - officers are supposed to pay enough to keep employees with the skills they need.  Employees have an economic value to a corporation, and the officers keep track of that kind of thing.  Also. losing employees -- turnover -- costs money, but that may -- or may not -- be enough cost to justify raising salaries.  You have to do the numbers based on the business model of that corporation, its revenue and its expenses, to see what is the best thing for the corporation's overall profitability.

        If an officer said, "profitability be damned, I'm going to pay every Wal-Mart worker $25 an hour," and did that and profits went down, yes he would be sued.  If an officer said, "we're going to spend capital to invest in more automation, so we'll need fewer workers, but more of the kind of skilled workers that we'll have to pay $25 an hour, and here's how the numbers work out demonstrating that increase in automation and fewer, bu higher paid workers will increase profitability over the long term," that's the kind of analysis they are SUPPOSED to do.

        •  *sigh* squared (3+ / 0-)
          Recommended by:
          jbsoul, 6412093, Treetrunk

          Costco is an example - point being, you can apply the logic just about anywhere.

          Shareholders could sue GM, Ford or Chrysler because they feel they pay their union employees too well.  Ad nauseum.

          "Fiduciary duty" is not a license to be a bunch of dicks.  Period.  You already note above employees have a financial value to businesses.  As such, that value is the defense against some nutjob shareholder decided to bring suit - all an employer must do is state that paying the employees $X brings value to the company because the employee(s) themselves are valuable.  This works from executive compensation on down.

          Now, if you want to drag out reductio ad absurdum and state that a company would be successfully sued if they paid janitors $200k a year, sure, you'd be right.  But would Walmart be sued over lost shareholder value if they raised their starting wage to $15/hour and provided decent benefits?  FUCK NO.  Even at your example of $25/hour I would seriously question whether or not a suit would be successful.

          So I reiterate:  Fiduciary duty is not a license to be a bunch of Gordon Gekko-ish dicks about employee compensation.  Dismiss it all you like, however, I doubt you can actually find legitimate case law anywhere in the US to reflect an employer being successfully sued over it's rank and file employees compensation being too high.  There's a reason for that - "too high" is relative, not an absolute.

          So while the diarist phrased the "no laws.." part in a way that one could bring up fiduciary duty to shareholders, his intent is correct - Walmart could pay it's employees far better and still not get sued.  Perhaps you should consider that instead of berating him over minutiae.

          •  You really should read the law on this. (2+ / 0-)
            Recommended by:
            Justanothernyer, Treetrunk
            But would Walmart be sued over lost shareholder value if they raised their starting wage to $15/hour and provided decent benefits?
            If doing this significantly cut into profitability, AND if the officers did it knowing it would hurt profitability but intentionally and knowingly disregarding what is good for the corporation's profitability, sure they'd be sued.  If the officers said, "I don't care if the corporation makes money, I think we should pay workers $x an hour even if it means the corporation does not make money," that would be a pretty clear violation of their fiduciary duty.

            If they did it as a result of a specific business plan geared toward increasing the corporation's profitability, then no they would not be sued.  That's the point.  Their first and primary duty is to do what's good for the corporation.  They can do what's good for the employees to the extent that it's good for the corporation, and sometimes those two things coincide.  Sometimes it is necessary to pay more to get employees with specific skills, sometimes it is worth it to pay more if turnover costs justify it.  Officers can explore all those possibilities.  But the point is that their first and primary duty is to act in the best interests of the corporation.  

            You probably should read the law -- that ABA publication is a good start, before you talk about what would, or would not, get people sued.  Or maybe talk to some of the lawyers who have made a lot of money suing officers and directors in shareholder derivative suits.  See also here.

            •  Pull up Lexis/Nexus (2+ / 0-)
              Recommended by:
              6412093, Treetrunk

              and find me a successful suit over rank-and-file employee compensation.

              Good luck with that.

              /dropsmic

              •  Read what I said. (2+ / 0-)
                Recommended by:
                AlexDrew, Treetrunk

                I did not ever say that simply raising employee pay would be justification for liability.  There are lots of instances where raising employee pay can be in the best interests of the corporation.  If an officer raises employee pay AND has worked through the numbers to show that there is a benefit to the corporation, of course he will not be sued for that.

                What I said is that if an officer raised employee pay while knowingly and intentionally disregarding what is good for the corporation, THAT would be a breach of the fiduciary duty.  Acting knowingly and intentionally in disregard of the best interests of the corporation is virtually a per se violation of the fiduciary duty.   People get sued for THAT -- for acting in a way that knowingly and intentionally disregards the best interest of the corporation -- all the time, especially when a corporation is no longer profitable as a result.

                Since you apparently did not carefully read what I wrote before, I'll say it again as simply as possible.  

                -- raising employee pay with justification (for example, economic data) as to how that will benefit, or at the very least not harm, the corporation = no breach of fiduciary duty.

                -- raising employee pay while knowingly and intentionally disregarding what is good for the corporation,  and loss of profitability results = breach of fiduciary duty.  

                Certainly no one gets sued for raising employee pay if it's justified by what is in the best interests of the corporation.  I've expressly made that distinction.

                •  I get your point (2+ / 0-)
                  Recommended by:
                  jbsoul, Treetrunk

                  and acknowledge its validity:  If the company raised wages and publicly stated it was doing so because of social pressure and civic duty, it would be problematic.

                  However, I don't think anyone is saying or suggesting that Walmart (or any other business, for that matter) raise wages using that argument.

                  The argument is a Henry Ford-esque "paying employees better is good for the bottom line of the company."  There is plenty of economic theory to back that argument up and insulate them from suit.  Could some nutjob shareholder still file one anyway?  Sure.  Would they be successful?  Very unlikely.  That's the point.

                  I most certainly read what you wrote.  What you don't seem to be getting is outlined in my second paragraph of this response.  You're arguing against an argument not made here, and going after the diarist because the diarist didn't clearly communicate what he meant with his comments about "no laws" in a manner that you understood.  The intention of his comment seemed pretty clear to me, however.

            •  HERE'S THE RUB ABOUT YOUR POINT: (1+ / 0-)
              Recommended by:
              Treetrunk

              PROVING that providing a better living for employees has a detrimental effect on the health of a company.  Open to judicial opinion, yes, but not cut and dried "law".  

              Your weak hammer is wearing out; take it elsewhere.

      •  Furthermore, 'shareholder value' can mean (2+ / 0-)
        Recommended by:
        Darth Stateworker, Treetrunk

        a lot more than mere 'profit'. There's also the question of what the company is worth intrinsically, its balance sheet of assets vs. liabilities. Profit is but one component of 'sharehoder value,' not that most boards and CEOs get that.

  •  to be fair it's the same at most other businesses (5+ / 0-)

    or worse. I mean apple just shipped all the jobs overseas right?I go to both Costco and Walmart. More often Costco as our income has improved.

    Costco workers are of generally higher caliber. I don't think most Walmart workers could get a job at Costco or they would. That's something to consider. We need higher pay for all workers, not just young energetic and bright ones.

    There certainly is a difference in the customer base between the stores also. In Walmart I hear Spanish once in a while. When I meet another cart coming around a corner we both stop and often smile when figuring out who goes which way so we don't crash. At Costco sometimes people literally run pushing those jumbo carts to get ahead of someone else, meetings of carts around a corner are generally met with a cold stare and a strategic push to occupy space without collision.

    Walmart is where most of America shops. It's only as evil as America. Changes need to be made such that all retailers, all employers, pay a decent wage. If we are subsidizing the average Walmart to the tune of just under a cool million a year we are also doing the same at McDonalds, the people who clean the Whole Foods, the people who mow the lawn at Barnes and Noble, and most certainly all the employees at those tony restaurants most Kossacks probably eat in.

    “Conservation… is a positive exercise of skill and insight, not merely a negative exercise of abstinence and caution…” Aldo Leopold

    by ban nock on Sun Nov 24, 2013 at 06:57:36 AM PST

  •  OT - Schweitzer might run for POTUS in 2016 (6+ / 0-)

    On Steve Kornacki's show just now former Montana governor was asked if he would run for president in 2016.  He replied that there were 100 counties in Iowa and his goal was to visit them all.   Wow.

  •  I guess that makes us all "job creators." I'd (3+ / 0-)
    Recommended by:
    Julia Grey, tb mare, Senile Goat

    like to drive a stake through the heart of that particular bull$h!t term. I perpetuates a fantasy that needs to die.

    "The object of persecution is persecution. The object of torture is torture. The object of power is power. Now do you begin to understand me?" ~Orwell, "1984"

    by Lily O Lady on Sun Nov 24, 2013 at 07:15:37 AM PST

    •  Ooops! "I[t] perpetuates a fantasy . . .. nt (0+ / 0-)

      "The object of persecution is persecution. The object of torture is torture. The object of power is power. Now do you begin to understand me?" ~Orwell, "1984"

      by Lily O Lady on Sun Nov 24, 2013 at 07:39:43 AM PST

      [ Parent ]

    •  Every seeker of public office has (0+ / 0-)

      in his/her platform the notion that 'job creation' is one of the talents belonging specifically and uniquely to the seeker. It is a broad brush painting much and delivering little.

      Let X be an entity; call it Y.

      by Senile Goat on Sun Nov 24, 2013 at 05:33:26 PM PST

      [ Parent ]

      •  Most probably because it's an empty (0+ / 0-)

        promise on its face.  Public office holders create basically dick in the way of private sector jobs, no matter how much sway they fancy themselves having over market forces.  They give away the farm based on vague promises of "jobs", though try getting a straight answer out of any of them on the question of how many of what kind of jobs.  They kneel at the altar of wealth, pandering and pampering in the hopes that Big Whatever will either move in or at least not move out.  But Big Whatever is already meeting projections and targets with existing staff, and downsizing wherever possible -- in the process creating the scarcity of jobs that perpetuates the cycle, and fuels the fallacy of "All Praise Be To Walmart For Hiring These Poor Unfortunates".

        Fuck that meme sideways.

        I'll believe corporations are people when one comes home from Afghanistan in a body bag.

        by mojo11 on Tue Nov 26, 2013 at 10:00:42 AM PST

        [ Parent ]

  •  Walmart is sort of the retailer version (5+ / 0-)

    of that skin-eating drug that's sweeping the country, unsurprisingly in many of the same rural areas where a lot of poor whites live. It's cheap and enticing at first, but it destroys you and your community over time.

    Free market my ass. It's anything but free.

    "Reagan's dead, and he was a lousy president" -- Keith Olbermann 4/22/09

    by kovie on Sun Nov 24, 2013 at 07:31:47 AM PST

  •  Actually (1+ / 0-)
    Recommended by:
    Treetrunk

    I wouldn't mind Walmart's low wages if the country instituted a robust system of income support.  Why pretend the free market guarantees any minimally acceptable standard of living?  It is the duty--and actually in the interests--of the well-to-do as a whole to secure the economic viability of lower income households, not just the duty of employers to their employees.

  •  Social services costs (5+ / 0-)

    are not the only way Walmart gets subsidized.

    In many cases, Walmart - when building a new store - will demand a decades-long property tax abatement from the locality before building.  

    We see this in my town:  Walmart pays an assessment of about $80k.  Sure, this seems like a lot of money - until you compare their assessment with those of local homeowners.

    A home assessed at around $300k in our town will run somewhere between $8k and $10k in property taxes (I'm in upstate NY, so yes, they're very high) - about 1/10th to 1/8th the taxes Walmart pays.  However, Walmart property is assessed at a value of $12.6M - 42 times the value of that $300k home.

    If Walmart was paying the at the same rate as the homeowners in the area, Walmart would have an annual property tax bill of $336k - $420k.

    Now, rinse and repeat this same scam for practically every Walmart in the US based on their local property tax rates...

    •  Aren't those local tax concessions... (2+ / 0-)
      Recommended by:
      coffeetalk, AlexDrew

      ...made by elected officials and aren't they public record?

      Assuming they are, it sounds like the majority of the voters in the jurisdiction don't disapprove of these concessions. Such concessions may not be wise, but democracies inherently include the right of the majority to enact stupid policies.

      •  Exactly. (1+ / 0-)
        Recommended by:
        VClib

        If people don't like the tax concessions (and I'm not a fan, especially when they go to outlets like a Wal-Mart that simply take revenue from other, more local stores), they should vote out politicians who give those concessions.  

        Some tax concessions are actually approved by the voters, which shows that voters also have the right to enact stupid policies.  

        •  It isn't that simple in New York. (2+ / 0-)
          Recommended by:
          6412093, Treetrunk

          We don't get to directly vote on tax concessions.

          In some cases, as I noted to WillR above, it isn't even politicians negotiating and approving the giveaways in the first place.  In almost all cases, there is no way for the average citizen to see how much this costs them, either for an individual business or cumulatively by municipality - that is by design, same as other giveaways via the tax code on other tax types.

          This isn't as simple as the binary-type thinking of "vote them out if you disapprove."  Most people are simply not sufficiently informed enough to know if they approve or not.  They just assume everything is done on the up-and-up, and aren't inquisitive enough to do the work required to get through the red tape and actually see the info.

          Even then, when someplace like the NY Times actually gives people a tool to shed some light on state and municipal corporate welfare, it's still yawn-inducing, because it's just a bunch of numbers to most people - there is no context, such as the comparison I made above.

          How many taxpayers and voters do you think would actually approve this nonsense if it was put in context, they were shown a bottom line number of how much it would cost them per year (based on $1000/assessed value of their homes) and they had final approval?  I'm guessing slim-to-none.

          So no, it's not as simple as you make it out to be.

          •  That's a problem with the voters. (2+ / 0-)
            Recommended by:
            VClib, AlexDrew
            Most people are simply not sufficiently informed enough to know if they approve or not.  They just assume everything is done on the up-and-up, and aren't inquisitive enough to do the work required to get through the red tape and actually see the info.
            What you are saying is that people don't take the time to understand complex issues before they vote.  If that's true, that's the fault of the voters.  

            Ironically, I've heard people on the right make the same charge -- don't you remember they were circulating that video of the woman who said she was going to vote for President Obama because he was going to give her a phone?  Most people tend to make this accusation -- that people don't understand the issues when they vote for someone -- only against people who vote a way they don't like.  It's amusing how we all assume that people who vote with us are informed, and people who vote against us are uninformed.  

            We all get to make decisions regarding the reason we vote one way or another, and we don't have to justify that to anyone.  I can vote (just to make things up) against Hilary Clinton because I don't like pantsuits, or vote against Rand Paul because I don't like his dad, or vote against Joe Biden because I visited Delaware and don't like it, or vote for Herman Cain because I like Godfather's Pizza.  Nothing says that voters have to make decisions based on factor that you, or I, think are rational.  It's up to candidates to reach voters and convince them WHY they are worthy of your vote over the other candidate.  

            How many taxpayers and voters do you think would actually approve this nonsense if it was put in context, they were shown a bottom line number of how much it would cost them per year (based on $1000/assessed value of their homes) and they had final approval?  I'm guessing slim-to-none.
            You are right, if only one side could present all of the facts as that side perceived them, that side would always win elections.  But that's not how democracy works.  Everyone is entitled to present their own case to the voters, AND to respond to the other side's case.  That is how the system works.  If you think that the other side is not presenting an accurate perspective, or is leaving out important facts, it's up to you to point that out to voters.  And if the voters choose not to listen enough to make an intelligent decision -- that's on the voters.  

            All this is by way of saying I don't have a lot of sympathy for those who argue, in essence, that they "can't" use the political process because "voters are stupid."  Our constitution does not give us the option of deciding that.  

            •  I agree (2+ / 0-)
              Recommended by:
              jbsoul, 6412093

              that it is a problem with voters.

              Now, did I say voters are "stupid."  No.  But when it comes to state and municipal tax giveaways, what information do they have to actually peruse and get informed?

              That seems to be the missing link here.  Tax giveaways are not transparent.  If they were transparent, good ones would survive on their merit and bad ones likely wouldn't exist - or be far more rare.

              Stating voters are uninformed because the issue lacks transparency on purpose  isn't a knock on the intelligence of voters.  It's a knock on the sliminess of our political system.

              It's easy for voters to get pissed off a $X billion in food stamp costs - they can clearly see the number.  It's not easy for them to get pissed off at $Y in corporate welfare spending, because they have no idea what the aggregate total of $Y is.  Shit, I consider myself informed, and even I don't know - because it's just about impossible to aggregate this stuff.  It would take a small army of statisticians and accountants to put it all together.

              Again, point being - this isn't as black and white as "it's the voters fault" or "the voters must approve because they keep electing the same people."

      •  Public record? (3+ / 0-)
        Recommended by:
        jbsoul, 6412093, Treetrunk

        Sure, if you want to go digging for the businesses public tax records.

        Most of these negotiations are done behind closed doors.  In many cases, with things like IDAs (industrial development agencies) - the giveaways are negotiated and approved by term-appointed people in political patronage jobs.  Voters have no direct say either way - not in New York anyway.

        Sure, in theory, people could get pissed off at the pols for giving the money away.  The problem with that theory is that the vast majority of these giveaways are not highly visible.  The information is not easily accessible, and there is most certainly no reporting done in plain language to let taxpayers and voters know what these clowns are up to - such as an annualized report reflecting a town, city, or counties aggregate tax giveaways and the cost to each taxpayer for said giveaway.

        It isn't as simple as "vote them out" if they make accountability difficult in the first place.

  •  Sigh (3+ / 0-)
    Recommended by:
    coffeetalk, pdxteacher, nextstep

    Why do we insist on comparing Costo to Walmart? The only thing they have in common are the size of their stores. A better/fairer comparison would be Sams Club. Both are membership based. You can buy huge quantities of product at almost cost because of the membership dues.

    Sam Club has 630 locations (2012; Costco 622 (2012); Walmart 4,786 as of 10/2013

    Costco employees 174,000 (2012); Sams Club
    Walmart 1.4mil (2013 US only)

    AVG Wage: Sam Club $10 avg to start: Costco $11.50 to start; Walmart $8 avg to start.

    AVG Wage after 4 years: Sams Club $12.50; Costco; $19.50. Blows them out of the water!!!

    I live in San Francisco so I had to look up where the closet Walmart is located (Oakland). I have a Costso on the boundary of my neighborhood (The Mission), so I will never set foot in a Walmart, but I also understand why Costco and Sams Club seem out of reach for most middle and working class families. If a six pack paper towels set you back $4 at Walmart and 24 pack sets you back $9 at Costco, for someone on a tight budget that $5 multiplied over the course of a year adds up.

    There are enough shitty things about Walmart without making false comparisons. Outside of Kos, most people look at you crazy when you compare Costo to Walmart.

    •  The reason for comparison (1+ / 0-)
      Recommended by:
      Treetrunk

      is not the business model itself.  The point is more that both rely on unskilled labor, and one is able to pay its unskilled labor far more than the other.

      Warehouse store versus general retail - there is no difference between most of the jobs.  Cashiers are still cashiers, stockers are still stockers, janitors are still janitors.  

      Point being, one company seems to value their labor more than the other job-for-job, and finds a way to pay them better.

      As such, I think the fact that one is general retail and one is warehouse retail is irrelevant - and I think most others think the same way, hence why the comparison is routinely made.

      •  The comaprison is only made (1+ / 0-)
        Recommended by:
        Justanothernyer

        in our world. Google Walmart vs Costco. On progressive sites it is a given that the comparison makes sense. On moderate and conservative sites, they rip it apart. I think there is more nuance to it than we care to acknowledge.

        Walmart, Target, Kmart et al have the same business model.

        Sams, Costco and BJ's have a completely different business model and demographics as far as income. This info is easy to find.

        A person working at JC Penny or Macy's will make a hell a of lot less than the same person doing the same job at Nieman Marcus. Same job; different demo and business model.

        •  They rip it apart (1+ / 0-)
          Recommended by:
          6412093

          based on what?

          Is a cashier not a cashier?  Is a stocker not a stocker?  Is a janitor not a janitor?

          What makes these jobs any more or less valuable from one business or another, regardless of what variation retail store they are?  Why would one be worth $8/hour and another worth $12/hour in the same labor market?  Why does "business model" matter?  Labor is labor and the jobs are identical.

          If conservatives "rip it up" over this comparison, then they better go back and start applying the same logic they're using to rip this comparison up with many others they make about employee compensation.  For example - how often do they rip union compensation, or government worker compensation?

          They're trying to play the argument whichever way it suits them.  As such, they fail to make a valid or compelling argument.  Let them "think" what they like - if you can call that echo chamber induced rote parroting of talking points they do "thinking."

          If conservatives want to make "business model" arguments, let them.  Liberals should be wise enough not to do such a thing.

          •  Do a little research (1+ / 0-)
            Recommended by:
            6412093

            Business models matter more than you realize. A janitor cleaning the Goldman Sachs headquarters will make more than a janitor cleaning a strip mall office.

            A cashier at small regional grocery store will make less than a Whole Foods cashier. Same skill level, different business model. Business models matter.

            And DKos is the ultimate echo chamber. One that I love, but an echo chamber none the less.

            •  That isn't (1+ / 0-)
              Recommended by:
              Treetrunk

              "business model."

              That's business size.  There's a separate and distinct difference.  The fact that larger firms tend to compensate their employees better than smaller businesses is a well documented phenomenon.  I'm well aware of this.  You, however, apparently aren't.  I don't think I'm the one that needs to "do a little research" here.

              Salary.com illustrates this well - one of the criteria the salary engine asks for is business size.  What they don't ask for is "business model" or type of business.  Nor will you find HR and compensation research firms like Towers Watson making such a comparison.

              Having to argue with Tea Party hatriots routinely over my own salary being a government worker, I guarantee you I've looked into these issues far, far more than you have.  Save the fake appeal for me to "research."

              •  You are covering your (0+ / 0-)

                bogus argument with attacks. That's all you have, so I understand.

                •  It's more like (0+ / 0-)

                  my replies to you are dripping with sarcasm because you're not as informed as you think you are, and I'm not entirely please with your assertions about "doing research."

                  I've just pointed to two separate and distinct items that reflect the validity of my points (Towers Watson and Salary.com).  You've made assertions without any reference whatsoever.

                  Hmm.  And you wonder why you're getting sarcasm and snark in response to authoritarian assertion.

            •  I disagree with AlexDrew (1+ / 0-)
              Recommended by:
              Treetrunk

              having been a janitor. The janitor cleaning Goldman Sachs offices doesn't work for Sachs. He works for the janitorial service, which may clean the mall, too, for the same wages.

              “The answer must be, I think, that beauty and grace are performed whether or not we will or sense them. The least we can do is try to be there.” ― Annie Dillard, Pilgrim at Tinker Creek

              by 6412093 on Sun Nov 24, 2013 at 09:09:39 PM PST

              [ Parent ]

            •  Most likely the janitors (0+ / 0-)

              aren't employed by Goldman or the strip mall but contracted through a service.  And they probably make comparable wages.  They may even work for the same service.

              I'm not convinced that a cashier at Whole Foods will make significantly more than one at the local grocery either.  But absent any empirical data, I'll leave that one alone.

              I'll believe corporations are people when one comes home from Afghanistan in a body bag.

              by mojo11 on Tue Nov 26, 2013 at 10:11:50 AM PST

              [ Parent ]

  •  Math failure (3+ / 0-)
    Recommended by:
    AlexDrew, coffeetalk, nextstep

    You are claiming Walmart could spend $4.5 billion dollars and pay its employees "something more like the 45k average that Costco workers earn".

    Walmart has about 2.2 million employees.  If you are counting all of them, you are proposing a raise of about $2,000 per employee per year.  Of course, you might be counting only the estimated 1.4 million employees in the US and giving each a raise of $3,250 per year.

    I've seen different figures for average Walmart wages ranging from $18,000 to $25,000 per year.  Whichever is correct, there is no way to raise pay to Costco levels, even if Walmart utilized 100% of its profits.

    Now, this doesn't mean Walmart can't raise wages.  And an 8% to 15% increase is definitely positive.  But as part of the reality based community we should not be making arguments for the mathematically impossible.

    •  Well, maybe they need to raise their prices (0+ / 0-)

      Walmart is as successful as they are because they cut the cost everywhere possible.  They actively work with their vendors to outsource production to China, they pay less than a working wage to their workers, they don't provide good benefits, etc. Meanwhile, companies that try to be good corporate citizens get beat by Walmart in the marketplace because they can't even break even if they pay their workers a living wage.

      Your comment assumes that their prices would stay the same.  Raise prices a small amount and pay your people more - that's what the message to Walmart needs to be.

      Ted Cruz: The second coming of Christ, but not quite as good as Reagan (yet).

      by nuketeacher on Sun Nov 24, 2013 at 08:02:42 AM PST

      [ Parent ]

      •  If they thought they could make more money (4+ / 0-)
        Recommended by:
        AlexDrew, nextstep, WillR, Justanothernyer

        that way, they'd do it in a heartbeat.  But the successful business model that Wal-Mart has always used has been to have the lowest prices out there -- "low, low prices" is their mantra. That's why most of their customers choose Wal-Mart over other stores.   You are suggesting that they abandon the very thing that has made them successful.  That's kind of like saying that McD's should just stop selling hamburgers and they'd be just fine.  

        Believe me, Wal-Mart spends a LOT of effort -- and money --determining how much they can charge for things without losing market share.  If they could raise prices without losing market share, they already would have done it.  

        If you raise the minimum wage for everyone, increasing costs for everyone (Wal-Mart's competitors), and therefore increasing prices for consumers everywhere, then Wal-Mart could raise its prices in a commensurate way.  It would still undercut its competitors in pricing, because that's its successful business model.  But to suggest that they, alone, could just decide to raise their prices and they'd be just fine is absurd.  

        •  This is why we need to get unions in there (1+ / 0-)
          Recommended by:
          6412093

          If they can make an extra buck by screwing their employees they will.  Then everyone else (Target, Costco etc.) are left with having to do the same in order to compete.  It's a race to the bottom.

          If they are all forced to treat their employees better we pay a little more at the store but the country is a better place for it.

          Yes, it would force them to actually compete on quality rather than price.  It would change their business model and that would be a good thing for everyone - except their stockholders (maybe).

          Ted Cruz: The second coming of Christ, but not quite as good as Reagan (yet).

          by nuketeacher on Sun Nov 24, 2013 at 10:40:59 AM PST

          [ Parent ]

          •  What Wal-Mart's economic success demonstrates (0+ / 0-)

            is that there is customer demand for the notion that low price trumps all.  You and I may think quality is more important than cheap prices, which is why we don't shop there.  And yes, Target and Costco target a customer base different from Wal-Mart's.  Target is not a "low price trumps all" model -- they try to combine reasonable prices with reasonable variety and quality.  They are successful, too, which means that there's different customer demand for the different types of stores -- just like there's customer demand for both a McD's and a small neighborhood restaurant in the same area. Costco is s different model from both Wal-Mart and Target -- membership and bulk buys, more like Sam's Club.  

            If there were no customer demand for the "low prices trump all" model, Wal-Mart would be forced to change its business model.  

            •  Quality is only one reason (0+ / 0-)

              I don't shop at Walmart, and it's not even the biggest one.  I don't shop there because (a) I don't shop much of anywhere and (b) they're fucking evil.  Their employment practices are heinous and their supply chain is even more so.  Fuck them.

              I'll believe corporations are people when one comes home from Afghanistan in a body bag.

              by mojo11 on Tue Nov 26, 2013 at 10:20:38 AM PST

              [ Parent ]

  •  This diary frames the issue correctly (1+ / 0-)
    Recommended by:
    pdxteacher

    We need to pound this message home to Republicans.

    Here's the thing: Billionaires and millionaires don't see this as a problem.  They immediately recognize that it is the result of a wage system in which there are desperate people, IN AMERICA, willing to work for less than what it costs to live.  That's a great thing to them, and with a Republican government, they can foresee cutting government programs (food stamps etc.) so that each Walmart doesn't cost us nearly that much.

    But, to the rank and file Republican voter it is an eye-opener.  The message needs to be further refined to be: Here you have people that ARE working.  They are expending their entire capacity to earn working fastidiously (OK, they won't understand that word) at a real job, and they still need welfare to survive.

    Of course some will see it the same way as the billionaires see it, but many will not.

    Ted Cruz: The second coming of Christ, but not quite as good as Reagan (yet).

    by nuketeacher on Sun Nov 24, 2013 at 07:57:28 AM PST

  •  The rational boycott (1+ / 0-)
    Recommended by:
    AlexDrew

    This subsidy complaint can't just be about Walmart, but about any business that pays minimum wage. So, to be consistent, we must also cease eating in nearly all fast food restaurants (or any food service establishment that does not have wait staff we may generously tip), food courts, coffee shops, etc. We will stop doing business with most retail shops everywhere, chain and otherwise. We will wash our own cars and sew our own clothing. We will not hire household help or set foot in any office that uses cleaning services.

    The result should be that Walmart will only need to keep on that 54% of their staff that does not receive subsidies, and will no longer have an opportunity to exploit that other 46%. Win-win all around.

  •  Who are "we"? (1+ / 0-)
    Recommended by:
    Darth Stateworker

    "The economy is bad only in that we've allowed the economy of corporations and the economy of real, living human beings to become totally disconnected."

    Funny, I don't remember monopolistic business practices even entering into the discussion during the last few presidential campaigns.

    Perhaps that's because our political dialogue has devolved to the point where any criticism of corporations at all will brand you a "Marxist"?

    "We" didn't allow this. It's the expected, predictable outcome of 30+ years of Reaganomics. And as long as people keep voting Republican, which a huge number of people will, these policies will not only continue, but get worse.

    "I never meant to say that the Conservatives are generally stupid. I meant to say that stupid people are generally Conservative. -- John Stuart Mill (March, 1866)

    by Blood on Sun Nov 24, 2013 at 08:00:00 AM PST

  •  It seems there's a fundamental misunderstanding (4+ / 0-)

    by some here about the purpose and function of a corporation.  Some people have the mistaken assumption that a corporation is supposed to act in the good of society as a whole or to provide jobs to people.  That is simply not the case.  Legally, the purpose and function of a for-profit corporation is to make a return on investment for the people who own it -- who invested capital in it.  If it's closely held corporation -- if there are only one or two owners -- they can do whatever they want with it, because it's solely their property. They can disregard profits in the name of doing good for society if they want, because it's only their own investment that they are losing.  If it's a publicly traded company, however, the officers have a fiduciary duty to act in the best interests of the corporation, owned by the shareholders - who are not the same people as the owners.  If officers do not act in the best interests of the corporation (remembering that the purpose of the corporation is to make a return on investment for its shareholders), shareholders can sue the officers and directions.  Those are basic, basic principles of corporation law.  See here for an American Bar Association summary.  That's a good summary of the law that some people here deny exists.

    If the officers of Wal-Mart knowingly did things that they personally thought were good for society as a whole at the expense of the profitability of the corporation, they can be legally held liable for a violation of their fiduciary duty to the corporation.  Read that ABA summary.  Officers of a corporation can have the corporation act as a "good corporate citizen" if it does not negatively affect profitability.  (That's why corporations never sponsor charitable events anonymously.  They aren't doing it solely for altruistic reasons -- the publicity is generally good for the corporation.)  If an officer knowingly does things that negatively affect the corporation's profitability, that officer can be sued for a violation of his/her fiduciary duties.  

    If you want to talk about putting pressure on a corporation like Wal-Mart, you have to understand the parameters of what you are dealing with.  Wal-Mart has operated under a business model of low costs above all (a different business model from Costco) and that business model has been successful in the sense that it has generated a good return on investment.  If you want them to change that business model, they you have to make it so that that business model is no longer profitable -- by people refusing to shop there, for example.  That's how to affect the Wal-Mart business model -- convince its customers to shop elsewhere; convince Wal-Mart customers  that they'd rather pay more if it means that employees are paid more.  However, as long as a huge segment of society values low prices above all, it will be very difficult to change the Wal-Mart business model.

    •  Excellent commentary. I do think WalMart (1+ / 0-)
      Recommended by:
      Treetrunk

      and its ilk are vulnerable to divestment and shareholder activist campaigns (as you'll read in m post elsewhere in this thread), much as divestment contributed to ending apartheid in South Africa. However, it's a long-term strategy and not one that will create miracles overnight.

  •  Walmart: we don't pay no stinkin' taxes. (2+ / 0-)
    Recommended by:
    pdxteacher, Treetrunk

    We create low-end taxpayers to do that for us.

  •  i've boycotted them since 2008 (1+ / 0-)
    Recommended by:
    6412093


    and boycotted Whole Foods for its equally destructive policy against union organizing.

    "Kossacks are held to a higher standard. Like Hebrew National hot dogs." - blueaardvark

    by louisev on Sun Nov 24, 2013 at 08:10:06 AM PST

  •  "American capitalism is profiting itself to death" (0+ / 0-)

    Ah, the dratted contradictions of Capitalism...

  •  I've posted elsewhere on how it is possible for (3+ / 0-)
    Recommended by:
    pdxteacher, d to the f, Treetrunk

    Kossacks with a conscience to 'divest' of stocks and bonds in companies their retirement funds (IRAs, 401-Ks and the like) might hold. Often funds like mutual funds or Exchange Traded Funds (ETFs) will hold shares in these corporate villians. (Earlier I posted about dumping CBS for its 60 Minutes bullshit and JPMorgan Chase for its rape of the American economy.)

    As WalMart is a pubicly-traded company, it is entirely possible to divest oneself of it. I think the attack on WalMart needs to come from both angles: consumers and investors.

    Now for the details. WalMart trades on the New York Stock Exchange under the ticker symbol 'WMT'. It is usually pretty easy to find out whether one or more of your funds holds investments in WMT by going to the funds' websites and finding a tab labelled 'Holdings' (or 'Components' or some such). I've found from personal experience that sometimes you do have to do a little digging to find out what your retirement funds really own or control but it can be done.

    By the same taken, those with some discretionary funds desirous of putting them to good social purpose might consider buying one or more shares directly in WMT, as paradoxical as that might seem at first blush. Why? WMT's shares right now trade for about $70/share, so you can easily buy 1 share with brokerage commission for under $100. Once you have bought a share of WMT directly, you are now a 'part owner' and as such can vote on company policies, raise hell at annual meetings and let your concerns be known through WMT's Investor Relations department. (For various reasons, when your mutual funds own WMT, you don't have the same 'ownership' status directly with WMT. But you can still complain to your fundss management about their holdings.)

    I've discovered that, to my dismay, my IRAs have about $25 worth of WMT between them (about 1/3 of a share). I do not own any shares of WMT outright, nor would I ever consider doing so, barring some divine miracle. But I'm now going to be looking to find mutual funds and ETFs that do not invest in WalMart that I can shift these funds away from WMT and in the direction of companies like CostCo (ticker = 'COST' and its price/share is about $125). I've found that I already own about $5 worth of CostCo stock, so I'm already starting to move in the right direction.

    Sorry to go on at such length and, for the finance experts out there, please forgive my bastardization-simplification of the work you do.

  •  The Plutonomy marches ahead still (2+ / 0-)
    Recommended by:
    CharlesInCharge, jbsoul

    One more "shock" and "workers" will feel like erecting a statue to Naomi Klein. Paper-maché will probably be all we will be able to afford by then, after paying for food, water and air.

    I have to admit: The propaganda and manipulations and sheer mind-fucking that brought us to this place have been masterful.

  •  Has anyone on this thread explored (2+ / 0-)
    Recommended by:
    AlexDrew, Treetrunk

    the difference between a privately held business and a publicly traded business?

    According to Forbes magazine of the 27 million businesses in the US only 1% are publicly traded on a stock exchange. http://www.forbes.com/...

    So what does this tell me? Companies like walmart are outliers. And that even takes into account that koch industries is privately held. And for those who post on Daily Kos who want Hillary to run for president, she was a corporate lawyer on the board of walmart during the time her hubby was governor of Arkansas. She developed many of the policies and procedures followed by walmart today.

    The walmartization of the US has been a bad thing. It didn't happen overnight and it won't be reversed overnight. I live in northwest Arizona. It is rural in nature although there are 2 Safeways, a K-mart, and a Smith's including a walmart supercenter. Walmart drove Albertson's out.

    Just like any consumer I try to find wholesome food at a decent price. Sometimes that is at walmart, sometimes at one of the other markets. The problem is with consumers who have drank the kool-aid and think walmart is the greatest thing since sliced bread. It's obviously not. It's a curse.

    Knowledge is Power. Ignorance is not bliss, it is suffering. If you like hypocrite Obama, you'll love hypocrite Hillary.

    by harris stein on Sun Nov 24, 2013 at 11:03:54 AM PST

  •  What a great diary (0+ / 0-)

    Well said, sir. Well said.

  •  Sooooo, Walmart is a Moocher? (0+ / 0-)

    And who shops at a moocher store?

    And who blames our problems on moochers?

    And who continues to shop at Walmart?

    Hah.

    I see.

    Ugh. --UB.

    "Daddy, every time a bell rings, a Randian Libertaria­n picks up his Pan Am tickets for the Libertaria­n Paradise of West Dakota!"

    by unclebucky on Sun Nov 24, 2013 at 03:46:35 PM PST

  •  Ridiculous Wages (0+ / 0-)

    The CEO of Walmart earns as much in a year as the take home pay of 796 average Walmart employees and the Company still expects the American Tax Payer to subsidize their payroll by providing Food Stamps to their underpaid workers.  There is no reason Walmart cannot pay higher wages and stop resorting to accounting tricks to avoid paying their employees time and a half when they require them to work on National Holidays.  This company should be avoided by shoppers and shunned by investors.  The American people simply cannot afford to reward greedy companies who take from taxpayers while providing substandard no benefit jobs to the public.  Every average job Walmart creats costs the American Tax payer money.  They have had a free ride long enough.

  •  A VICIOUS CIRCLE... (0+ / 0-)

    Well, allow me to rephrase that. It's a vicious circle that's detrimental to the well-being of Walmart's lowly employees, but it works out just swell for the corporation itself. Invade a community and get all sorts of tax breaks from the local government for deigning to give the people in the area the wondrous shopping experience that is Walmart. Shut down the local small businesses who formerly made their living providing such goods and services, causing unemployment to rise. Pay your employees such paltry wages that most of them are living below the poverty line, which in turn causes them to apply for taxpayer-funded entitlement programs like SNAP. Then count all your profits from your workers and unemployed local residents who spend their food stamps and unemployment checks in your stores. Yes, it all boils down to a fortuitous scam for Walmart, a plan that's so clever, it verges on the diabolical. Ah, the Circle of Life... Hakuna matata, Walton family. The rest of you poor slobs can go pound sand.

  •  Our Nation's (0+ / 0-)

    biggest problem is that of almost complete apathy and ignorance among the citizens.

    "It is the responsibility and duty of everyone to help the deserving underprivileged and less fortunate among us."

    by sichuan on Sat Apr 18, 2015 at 11:20:43 AM PDT

  •  Walmart does what it does so that the Waltons (0+ / 0-)

    don't have to shop there. Do you think they get their groceries or clothing from their own stores? Nope, no cheap Chinese crap for them.

    Trina L.C. Sonnenberg: Author http://www.lulu.com/commerce/index.php?fBuyContent=8676921 Work is not work when you love what you do.

    by tlcpro on Mon Apr 20, 2015 at 03:06:52 AM PDT

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