Jeff's Lunchbreak

Once gain, I received an e-mail forward that I wanted to respond to. This one had the subject, "To sum up", but looks like a previous incarnation had the title of "Wal-Mart vs. The Morons (NOT A JOKE)". For anyone interested, I've quoted the entire e-mail below the fold.

It began with a set of facts on how big and successful Wal-Mart is. I didn't fact check all the claims, but they look reasonable, and besides, the actual statistics aren't critical to the point the e-mail was trying to make. That point was this:

You may think that I am complaining, but I am really laying the ground work for suggesting that MAYBE we should hire the guys who run Wal-Mart to fix the economy.

It then listed a series of supposedly broken government programs, claiming that the government had had so many years to get the programs running properly, but had failed.

It closed with some general anti-government complaining. I have refutations to a few of those elsewhere on this site, but in this entry, I'm going to focus on the question of whether or not captains of industry are good role models for government.

First of all, keep in mind that industry and government have different roles. Per the Constitution, the intended role of our government is as follows:

We the people of the United States, in order to form a more perfect union, establish justice, insure domestic tranquility, provide for the common defense, promote the general welfare, and secure the blessings of liberty to ourselves and our posterity, do ordain and establish this Constitution for the United States of America.

I highlighted a couple of those. When TANF (the new name for Welfare after the Clinton era reforms) enrollees have dropped from 12 million to 4 million since 1996 and overall TANF costs have been cut in half at the same time, even though the poverty rate in the U.S. has held fairly constant over that period and income inequality and wealth inequality have both been increasing since the 1970s, I think it's important to remember that government is not there just to ensure the welfare of the wealthy and business owners. It's there to ensure the welfare of everybody in the country.

• Wikipedia - Temporary Assistance for Needy Families
• The Atlantic - Why U.S. Income Inequality Is More Frightening Than Europe's
• Mother Jones - It's the Inequality, Stupid: Eleven charts that explain what's wrong with America
• FactCheck.org - Santorum's Distorted 'Dependency' Claims

Industry doesn't have that role. Industry's goal is to turn a profit. Perhaps more kindhearted business owners will treat their employees well, but they're under no obligation to do so. To see just how bad unregulated business can get, consider the early days of the industrial revolution. Pick up any Charles Dickens novel and you'll see the conditions in London at the time. In the U.S., it got so bad for coal miners in West Virginia that they had an armed uprising in the Battle of Blair Mountain. Andrew Carnegie is infamous for his union busting tactics, including the Homestead Strike. The Ludlow Massacre was part of the deadliest strike in U.S. history. And if you want modern examples, just look to the sweatshops in the developing world. History has shown that industry will exploit labor when it can if it means higher profits for the people at the top.

• Wikipedia - Battle of Blair Mountain
• Wikipedia - Homestead Strike
• Wikipedia - Ludlow Massacre
• Wikipedia - Nike sweatshops
• New York Times - Lives Held Cheap in Bangladesh Sweatshops

So what about Wal-Mart? They're certainly successful, but they're not without their detractors, either. Here are a couple pages describing alleged business practices of Wal-Mart.

• PBS - Store Wars: When Wal-Mart Comes to Town, Business Practices, Page 1
• PBS - Store Wars: When Wal-Mart Comes to Town, Business Practices, Page 2

Here's a quote from the second page of that article, by Al Norman of an organization named Sprawl-Busters.

But that's part of the Wal-Mart saturation strategy. They place their stores so close together that they become their own competition. Once everybody else is wiped out, then they're free to thin out their stores. Wal-Mart has 390 empty stores on the market today. This is a company that has changed stores as casually as you and I change shoes.

Here are a couple articles on the wages Wal-Mart pays its employees.

• Daily Kos - Walmart: America's real 'Welfare Queen'
• Winning Words Project - Walmart Pads Their Payroll With Your Tax Dollars: Call On Congress To Stop Them

The first of those quoted another article, claiming "as many as 80 percent of workers in Wal-Mart stores using food stamps." The second, while not being the most professional of presentations, at least lists all its information sources. It makes the same case - that Wal-Mart pays its employees wages that are too low for people to survive on, so those employees are forced to take advantage of government programs like food stamps. To quote one passage from that page:

In fact, they could pay ALL of their 1.4 million US employees an extra $5,000 per year and not only pull them out of poverty and above the "low income" line, but still keep over SEVEN BILLION DOLLARS in profits for themselves and their shareholders.

The page claims that, in effect, Wal-Mart is receiving an indirect subsidy from the government, since their employees can only survive by getting taxpayer money. And just keep in mind the previous articles I linked to. By driving other stores out of business, Wal-Mart is one of the few games in town for low-skilled people to get jobs. They don't have the freedom to simply quit and find a different job that pays them better.

Since this reply is already getting a little long, I won't focus on all of the claims of failed government programs. But that first one did jump out at me.

a.. The U.S. Postal Service was established in 1775. You have had 237 years to get it right and it is broke.

As the e-mail stated, the Postal Service has been in operation for over 200 years. I'm not nearly that old to have first-hand experience, but from what I've read, it sounds like it's been operating well over most of that period. In fact, it's really only been recently that it's started to run into problems, in large part due to e-mail and other digital technologies displacing old fashioned paper mail. First class mail dropped 29% from 1998 to 2008. That's a pretty hefty decline. Granted, a law passed by the 2006 Congress forcing the Postal Service to set aside benefits payments for future retirees hasn't helped. But to make a claim that the government hasn't been able to get the Postal Service right even after 200 years is pretty misleading.

• Esquire - Do We Really Want to Live Without the Post Office?
• Wikipedia - United States Postal Service
• U.S. News & World Report - In Defense of the Post Office
• PolitiFact.com - Ad from Save America's Postal Service claims rule from Congress is causing USPS's financial problems

So, this e-mail extolled the virtues of a company that is successful as a business, but that doesn't display the virtues I'd like to see in government. And then in its list of examples of failed government programs, the very first example was misleading. And it completely failed to even list good government programs, like NASA (underfunded as it is), the National Science Foundation, the Food and Drug Administration, the National Institute of Standards and Technology, etc. More broadly, I think there's a history of private industry exploiting workers, from the Industrial Revolution on up to Wal-Mart's business practices. While that's good for the bottom line for businesses, it's not the way to run a government that's tasked with promoting the general Welfare.

So, I think it's safe to chalk this up as just another right wing e-mail forward without much substance.