Wal-Mart - Redemption or Public Relations?

Yesterday I posted on Wal-Mart's attempts to redeem themselves with the public by hiring Global Insight, an independent research company. Wal-Mart feels it has been unfairly characterized by activist groups and the media and decided to get to the real truth themselves. For the most part, the independent research verified most of the claims of Wal-Mart's critics. The retailer is responsible for driving down wages and putting local merchants out of business. In addition, they benefit from taxpayer funded subsidies that helped them build their distribution system, and taxpayers also pay nearly $900 per employee for Medicaid benefits the company encourages their associates to sign up for.

Wal-Mart is against the ropes and they know it, but don't feel too sorry for them. In fact, we should all question their motives and sincerity. They recently contributed $15 million in relief efforts after Hurricane Katrina, mostly in water, diapers, and other tangible items. Compared to the $285 billion in sales they recorded last year, that amount was less than one half of one percent. Hardly a noble gesture. In fact, the Sunday Business section in today's New York Times reports:

Bill Gates is no slouch in the charitable-giving department. Just last week, the foundation he founded with his wife, Melinda Gates, said it would donate $258 million to eradicate malaria, which kills 2,000 African children a day. All told, Mr. Gates has given away 37 percent of his vast fortune, Forbes magazine estimated last year.

The article goes on to state that Ted Turner, at last weeks United Nations Foundation conference, donated $20 million over the next four years to reduce measles deaths. It may not be fair to criticize Wal-Mart for the amount they give compared to others, but one does have to wonder if their corporate hearts were in the right place - or were they simply spending $15 million to buy a little public relations? Wal-Mart certainly isn't adverse to buying some political goodwill, so why would charitable PR be any different? Consider the following from the same New York Times article:

Once indifferent to politics, Wal-Mart's founding family has learned the value of having - and supporting - friends in high places.

One such friend is Gov. Arnold Schwarzenegger of California. Last year he vetoed a bill that would have forbidden employers to lock workers inside businesses, a practice Wal-Mart has used. Last month he vetoed a bill that would have required California to identify the employers of people who are paid so little that they qualify for government health services. Again, Wal-Mart is the No. 1 example.

While the governor was vetoing, heirs to Sam Walton were busy writing six-figure checks to his political causes. It began after Mr. Schwarzenegger vetoed the lock-in bill. John T. Walton, a Wal-Mart director who died four months ago, gave $200,000 to his political committee, the California Recovery Team, according to The Los Angeles Times and USA Today.

On the day Mr. Schwarzenegger vetoed the latest bill, Christy Walton, John's widow, wrote a $250,000 check to the governor's committee. Three weeks later, Wal-Mart's chairman, Rob Walton, gave $250,000 to the governor's campaign to limit the political activities of labor unions. (Wal-Mart itself, which is famously allergic to unions, chipped in $100,000 of its own.)

Political donations to Schwarzenegger begin the day he vetoes the lock-in bill? If the company was sincere about doing what is best for their employees and corporate America, they would have blasted the governor for his veto. America is not best represented by companies that think locking their employees in is acceptable. Wal-Mart is not a prison or high security government facility. It may portray itself as family friendly and community oriented, but it continues to act like the Beast of Bentonville - a title it justly deserves.