Tuesday, November 19, 2013

The High Cost Of Low Wages

It is not a deep, dark secret that Walmart treats their workers very poorly.  They have been sued multiple times in multiple states for sexism, racism and many charges of illegal labor practices.  It's been a perpetual stain on the company's image, especially when one takes into consideration that the Walton Clan is worth billions of dollars each.

To add insult to injury, Walmart has received untold billions of dollars in tax subsidies, grants and other handouts from the taxpayers.

But that is not the only way taxpayers are supporting the Walton billionaires.  Because of the low wages they pay their workers, many Walmart employees are receiving public benefits, including food stamps and health care coverage, like BadgerCare.

But now a new story broke which puts Walmart even further beyond the pale.  They are now asking for food donations from their underpaid workers for their other underpaid workers:
A Cleveland Wal-Mart store is holding a food drive — for its own employees.
"Please donate food items so associates in need can enjoy Thanksgiving dinner," reads a sign accompanied by several plastic bins.

The Cleveland Plain Dealer first reported on the food drive, which has sparked outrage in the area.

"That Wal-Mart would have the audacity to ask low-wage workers to donate food to other low-wage workers — to me, it is a moral outrage," Norma Mills, a customer at the store, told the Plain Dealer.
Working America, a community affiliate of the AFL-CIO, lays out the problem even stronger terms:
When their paychecks don’t cut it, many associates turn to public assistance to make up the difference. Walmart’s low wages and insufficient scheduling are behind the enormous costs to the taxpayer incurred by each store. One Walmart Supercenter costs taxpayers $900,000 in Medicaid, SNAP, housing assistance, and other forms of public assistance.

But beyond the numbers are the associates themselves, juggling unpredictable schedules and light paychecks, who see the food bins as a sign that the company sees their struggle as the rule, not the exception:

An employee at the Canton store wasn’t feeling that Walmart was looking out for her when she went to her locker more than two weeks ago and discovered the food drive containers. To her, the gesture was proof the company acknowledged many of its employees were struggling, but also proof it was not willing to substantively address their plight.

The employee said she didn’t want to use her name for fear of being fired. In a dozen years working at the company, she had never seen a food drive for employees, which she described as “demoralizing” and “kind of depressing”.
Just last week, CNNMoney did a report showing that Walmart could easily give each of their employees a 50% raise and not break the bank. And while the usual corporate toadies will whine that their stock would fall, the article shows that Google gave their employees a 10% pay increase and their stock is now 60% higher than it was before the raise.

The poor pay and poor treatment that Walmart gave their workers led to the Black Friday protests last year, where workers went on strike for the day.  Walmart gave themselves a black eye by retaliating against these workers, threatening and punishing them.  On Monday, they got their other eye blackened by the National Labor Relations Board, who found that they had done so illegally and would be pursuing charges.

But it is not just Walmart that is the problem.  There has been a systematic failure in our economy in which large corporations are maltreating and underpaying their employees.

And the dissidence from this maltreatment is growing.

This was shown during the numerous one day strikes of fast food places over the past summer, including a few here in Milwaukee.  On Monday, hundreds of truckers that work at the Port of L.A. parked their trucks for the day in a one day action.

As a result of these unsustainable wages, there has been a movement across the country to raise the minimum wage to a living wage.  Recently, the people in the Seattle area voted to give the workers in and around the airport an increase in their minimum wage to $15 an hour.  Similar stories are found in other areas including San Francisco as well as the states of California and Washington.

In Milwaukee, a subdued version of a living wage act was introduced by Milwaukee County Supervisor David Bowen.  Bowen's resolution would require than any company contracting with the county would have to pay their workers a living wage - about $11 an hour.

On cue, the corporate special interests - in this case, the Metropolitan Milwaukee Association of Commerce - came out with their tired, worn out lines of how the market won't support a sustainable wage and that it would cost jobs.

This is, of course, so much poppycock.

And to show that it is so much poppycock, the Center on Wisconsin Strategy (COWS) and the American Legislative and Issue Campaign Exchange (ALICE) will hold a media conference call on Tuesday afternoon at 1 pm, in Madison, at which time they will release a report "about best practices of these living wage laws. Living wage policies have proven to be a highly effective tool for increasing wages and stimulating local economic growth, especially when federal and state governments appear unlikely to raise the minimum wage."

I will post the report at a later time.

Along with their event on Tuesday, Wisconsin Jobs Now will hold a town hall meeting this Thursday here in Milwaukee.  In their announcement, they include the findings of a study by UC - Berkeley that shows that "34% of Wisconsin's 28,000 fast food workers' families are forced to rely on public assistance to make ends meet. All that adds up to $166 million in our money that pads the profits of companies like McDonald's every year."

Gee, does all of this give you the idea that workers are getting fed up with the status quo?  It is time and beyond time for companies to start respecting their workers and paying them a living wage instead of keeping them mired in poverty.

Not only will it help keep people in their homes and food on their tables, but it will also stimulate the economy and lower taxes.

Now who could argue with that?


  1. This is the Wisconsin that Scott Walker envisions. Walmart, Menards, Target and other big box retailers are the top employers in this state. Walker set the stage for this by demeaning public employees, driving teachers into retirement and restricting pay advancements and reducing take home pay for public employees across the state. In so doing he took $1 billion in purchasing power out of our economy and killed any possible job growth. When people no longer have discretionary income beyond food, shelter and clothing the economy dies. Demand creates jobs not tax breaks for corporate donors.

    1. All is true. It is also true that tax breaks for donors increases the amount of donations.

      What's it going to be then, eh? Jobs or donations to buy campaign advertising?

    2. I just wanted to clear something up. Walker with Act10 took $1BILLION out of our economy. which is true.

      However, ACT10 has been in effect three years now, so effectively, he has taken $3 billion out of our economy.

  2. Essentially corporations like Walmart are off-loading their costs onto us so they can fatten their profits. It is we who pay the increased taxes and find money to contribute to the food, clothing and toy drives that should be coming out of the corporations' pockets.

    We need to push the idea that the cost of doing business includes paying their employees a living wage. If your business model cannot support that, then you shouldn't be in business.

    This is no different than them paying their suppliers at a level where these businesses stay in business. Even Walmart knows that if they pay these companies too little, then these suppliers will not be around to put product on the shelves.

    No different from the workers. A living wage is the price they need to get "to stay in business."

    There is something else we need to do. When those on the right defend this system, we need to call them out as suckers. They are down with paying additional taxes so a private business can make bigger profits. There is just no other word to describe them.

    1. In this day and age you are exactly right to defend the populace; wealth is created through work. Lincoln was right all along.
      Since Reagan our economy--and our country--has been slowly yet aggressively been taken over by the big money. We once again live in a guilded age where the rich few dominate the poor masses. This is exactly why people like La Follette found their power.
      Democracy was more genuine then, when there was freedom to choose among your media.
      Your observation that big business can't operate any more (without paying any taxes or paying workers a living wage, paying executives insane salaries, while making their corporation compete against overseas slave wages) is true in the extent that we let this happen.
      To have a truly functioning country and economy these problems need to be corrected. This country was founded as a reaction to the oppression that our former European masters demanded.

  3. Well what are all these working poor going to do when Badger care is cut in January? I lose mine too. My husband works 2 jobs I work 1 for a national retailer and go to school. Because I'm not full-time I don't qualify for their insurance but couldn't afford the hefty $500/mo anyway. What are all these families going to do? I PAY for Badger care $180/mo. A lot of working families do. Didn't that count for anything?

  4. Walkout Wednesday 10pm $10.00 minimum wage! Come back Friday 6am.
    Thanksgiving off in honor of family, community and solidarity! All retailers, spread the word!

  5. You work where you work, in part, because that's the best job you can get. You shop where you shop, in part, because that's where you get the best products for the best price. If you could work somewhere else at a better job and for more money, you would. When a company employs you, they must pay you at least whatever you would make working elsewhere, doing similar work, or you would not work there. When a company sells to you, they must charge you at most what others would charge you, otherwise you would shop elsewhere. Go work somewhere else for another dollar an hour--you will still have the same complaints against your new employer as you currently have against Walmart. Go shop somewhere else for a dollar less for something at a different store--you will still have the same complaints about the store where you shopped. Walmart exists and succeeds mostly because they are cheap, and that's what people want. Serving the customer is what businesses do. Employing people is ancillary to running a business; it is NOT what the business does, and it is NOT why the business exists. You work where you work, because in all probability, that's the best job you can get. Blaming someone for hiring you is nonsense. You shop where you shop, because in all probability, they offer you the best products at the best price; otherwise, you would be a fool not to shop elsewhere. Blaming someone for selling to you cheaply is nonsense. One more time: businesses exist for the sole purpose of serving customers with products and/or services. As the business grows, it may hire employees to help to serve its customers, but the customers are the reason for the business to exist; the businesses do not exist to employ people. If you don't like this, why not employ a bunch of people and pay them yourself? What's that? You don't have the money? Well, if you did have the money and if you did invest it in a business, I would bet you dollars to doughnuts that you and your stockholders would expect a return on investment, no? The banks from which you borrowed would expect to be paid back, with interest. You expect the companies in which you have your 401-K invested to turn a profit, don't you? Yes, people work at Walmart, and as I've said, other places, too for low wages, because that's the best they feel that they can do. That's not Walmart's fault. If you believe that someone should be paid more than they are worth, go pay them. I'll wait.