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Workers' Nightmare: 'All Companies Should Be Like Wal-Mart'

Reported by Judy - December 18, 2005

Neil Cavuto's Gang of Rich Guys discussed a frightening scenario for American wage-earners Saturday (December 17, 2005): All companies should be like Wal-Mart.

During "Cavuto on Business," Jack Welch, former CEO of General Electric, praised Wal-Mart as "one of the greast companies that ever existed." Welch said the publicity over Wal-Mart's business practices is essentially a "union fight." He compared Wal-Mart to General Motors, saying that company is hamstrung by union rules and high wages and that is why it can't compete with foreign car-makers. Never mind the fact that GM's obtuse management insists on manufacturing behemonths like the Hummer at a time when Americans are buying more fuel-efficient imports.

Professional rich guy Ben Stein called Wal-Mart "the best friend of the American consumer since Henry Ford. It's essentially taken mass production and brought it to retailing. Wherever Wal-Mart exists, the consumer basically has a 20 percent pay increase because his dollar buys 20 percent more. ... True, they don't pay benefits like (some other companies), but (they pay) a lot better than usual small town retailers. ... This is about the consumers and the unions and the consumer comes first." Well, as Henry Ford figured out nearly 100 years ago, consumers and workers usually are the same people, and if they earn enough to buy what they produce, everybody benefits.

Greg Hymowitz, the panel's only Democrat, called the suggestion that other companies imitate Wal-mart "shocking." He tried to counter the gushing nonsense with a few facts: Wal-Mart sales associates earn $2,000 below the poverty lilne, 1 million former employees of Wal-Mart -- all women -- have sued the company in the largest class action lawsuit ever, Wal-Mart employees need $2.5 billion in federal subsidies to exist. "We're all subsidizing Wal-Mart," he said.

None of the others even acknowledged the subsidy issue, but Meredith Whitney claimed that the poverty level statistics were misleading because they are for a family of four and some Wal-Mart employees might be single so "they're not below the poverty line." Without offering a single number or example, Whitney also claimed that "the average wage is actually much higher than elsewhere."

The whole discussion was chilling. Imagine a nation of Wal-Mart's and what that would mean: Workers earning wages below the poverty level, most of their wages going back to the company to buy groceries and kids' clothes, suppliers forced to produce what Wal-Mart wants to sell, massive imports of goods produced in sweatshops overseas, health insurance too expensive for workers, rampant sex and race discrimination against women and people of color, violations of child labor and overtime rules that end in agreements giving the company two weeks advance notice of inspections, bullying city councils to extract tax breaks for new stores, and billions in subsidies in the form of welfare payments to help the workers subsist.

It's not a union fight. It's a people fight.

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