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Wal-Mart's Welfare Dependency
Published on Friday, November 7, 2003 by the San Francisco Chronicle
Wal-Mart's Welfare Dependency
by Sally Lieber
 

Our governor-elect and the Legislature are about to embark on another cycle of budget discussions. In normal budget times, it is a moral obligation for lawmakers to spend taxpayers' funds wisely. During the worst budget crisis in California's history, it is imperative. Every dollar spent should be used strategically, effectively and toward meeting our obligation to protect our most vulnerable citizens and to educate the next generation.

That is what makes recent revelations about Wal-Mart, one of the world's wealthiest corporations and the largest private employer in America, so disturbing. Wal-Mart is one of many large corporations that skimp on health care for their employees. Inadequate health insurance coverage, high deductibles and cost-sharing that is out of reach for low-wage workers add to the corporate bottom-line. Wal-Mart also reportedly carefully controls the number of workers who achieve full-time status and higher benefit levels.

In the marketplace, where one of these giants is competing against a small business that is responsible to its workers and to the community, the giant will win every time.

Who picks up the tab for this lack of responsibility? We all do. Wal-Mart provides its workers with access to a Web-based service that allows a county social services worker to immediately verify income and employment. Such access can help to qualify workers quickly for Medi-Cal benefits, food stamps and other taxpayer-funded aid.

While the use of this fast-tracked system may help deliver government services to those who qualify for them; it can also raises a number of concerns: In an environment of low wages and meager benefits, it can be seen as encouraging big business to make taxpayer-funded services a part of their business plan.

The use of this system obscures information consumers need to make informed decisions. When consumers buy back-to-school clothes at Wal-Mart they should know whether they are encouraging a business practice that relies on siphoning taxpayer dollars out of education and other state needs.

Lawmakers must also consider whether it is appropriate for large, wealthy corporations to become welfare-dependent and should close any loopholes that lead to inappropriate use of scarce human service resources. Nothing should encourage corporations to "game the system'' or to claim unfair advantages.

It is helpful here to contrast our expectations of individuals with those we have for major corporations. When an individual uses Medi-Cal benefits, they may become subject to California's Medi-Cal Estate Recovery Program. Under this program, the state places liens against the assets of elderly, low- income Californians to recoup the costs for Medi-Cal coverage. Advocates have cited the example of the state of placing a lien on an aging mobile home.

If we expect the lowest-income Californians to reimburse the state when they receive benefits, then it makes sense to hold large, wealthy corporations similarly accountable. Despite turbulent economic conditions this year, Wal- Mart reported record profits and sales. Wal-Mart's earnings were more than $2. 5 billion, on total sales of $71 billion in the first quarter and more than $2.3 billion on total sales of $62 billion in the second quarter.

Our budget difficulties force to think about what kind of accountability we expect from each other -- and to begin to define good corporate citizenship in terms of what it is, rather than simply what it is not -- as honest partnerships, not just the absence of wrong-doing. Those we serve should expect nothing less.

Assemblywoman Sally Lieber represents the South Bay.

2003 San Francisco Chronicle

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