How Walmart gets rich off welfare abuse

Alice Walton's mugshot from her 2011 DWI arrest in Texas. (photo: AP/Parker County jail)

By Carl Gibson, Reader Supported News

28 July 14

readersupporednews.org

orget about the guy at the grocery store using food stamps to buy lobster.

Walmart, the world’s largest retail company, is even more dependent on government welfare so it can make jaw-droppingly obscene profits. In fact, government handouts are the main reason Walmart is so profitable, and the billion-dollar corporation’s business model is centered around the continued dependence on social safety net programs. Walmart’s welfare abuse is costing taxpayers billions of dollars per year. It’s time to get them off the government teat and make them start paying their own way. 

Paying Workers Poverty Wages

When Walmart pays its workers so little that they need food stamps to survive, they’re also investing in a steady profit stream. Even though their prices are roughly the same or even more than their local competition, Walmart’s excessive marketing of “low prices” makes them a first-choice supermarket for people living in poverty, including their employees. Its 1.4 million employees alone account for a huge revenue source for Walmart, as the company is the largest private-sector employer in the US.

Employee wages are so low that during the last holiday season, one Walmart in Ohio held a food drive for its own employees so they could have a decent Thanksgiving dinner. This video of Walmart workers sharing their own stories in time for last year’s Black Friday protests included footage of one worker talking about how other workers often had to loan each other money so they could pay their bills on time.

Walmart’s insistence on paying its workers so little is especially despicable, given that the company could pay workers much more without even changing any of its prices. The think tank Demos crunched the numbers and found out that if Walmart simply stopped spending billions every year on buying back its own stock to drive up the value of stock options owned by executives, it could pay workers an average of $14.89 per hour without increasing prices by a cent. 

Excessively Compensating Executives

As the recession wears on for most of America, Walmart’s profits have soared to $16 billion on revenues of over $473 billion. Because of the company’s ousting of local competitor supermarkets in cities and towns across America, the working poor have few options when grocery shopping, often with the help of food stamps. Out of all of its revenues, food stamps accounted for $13.5 billion in sales for Walmart just last year. Walmart is using their soaring profits to give “performance-based” pay raises to executives, and using the performance pay loophole in the US tax code to dodge their federal tax obligations. The Institute for Policy Studies learned that taxpayers have had to pay for $104 million in the last six years (beginning at roughly the same time as the recession) for Walmart’s performance-based pay bonuses that topped out just short of $300 million. This would be enough in tax dollars to pay for 33,000 impoverished children’s free/reduced school lunches over the same time period.

Taxpayers cough up over $6 billion each year to pay for the social safety net programs that Walmart workers depend upon, like food stamps and Medicaid. Walmart’s abuse of the “accelerated depreciation” tax loophole costs US taxpayers another $1 billion per year, meaning the company gets to write off capital investments faster than they’re actually used. The Walton family itself, which makes just as much in 3 minutes of dividends as one of their hourly employees makes in an entire year, lists those dividends as capital gains, paying a preferential tax rate. That alone costs US taxpayers another $607 million.

As Americans for Tax Fairness (ATF) discovered, the annual $7.8 billion that Walmart leeches off of US taxpayers could instead be used to hire 105,131 teachers. In Alice Walton’s home state of Texas, $813 million could fund hiring 12,000 more teachers. Walmart chairman Rob Walton could see to it that the company pays employees fairly, saving taxpayers in his home state of Arizona $176 million. That alone could hire 2,500 more teachers in Arizona’s schools. Page 10 of the ATF report lists how much each state would gain in new tax dollars for public education if Walmart and the Walton family weaned themselves off of government welfare programs.

It’s time we stop demonizing the victims of this recession who use meager amounts of food stamps to stay fed, and focus on the real problem. Corporations who depend on government welfare, like Walmart, along with big defense contractors like Boeing, GE, and Verizon, have no business draining much-needed tax dollars that should be spent on essential programs like public education.

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Carl Gibson, 27, is co-founder of US Uncut, a nonviolent grassroots movement that mobilized thousands to protest corporate tax dodging and budget cuts in the months leading up to Occupy Wall Street. Carl and other US Uncut activists are featured in the documentary We're Not Broke, which premiered at the 2012 Sundance Film Festival. Carl is also the author of How to Oust a Congressman, an instructional manual on getting rid of corrupt members of Congress and state legislatures based on his experience in the 2012 elections in New Hampshire. He lives in Sacramento, California.

New photography, Photoshop instructors at GCC

Acclaimed photographer Rand Hust will teach Beginning Digital Photography, ART 128, this fall at GCC.   This course covers the exploration of basic camera techniques, lighting, composition, digital photography and digital photo editing.  ART 128 meets Tuesdays from 2-5:20 p.m.

Rim Country Camera Club President, Dr. Harold Rush, will teach Intermediate Digital Photography, ART 228, and Beginning Photoshop, ART 187.  ART 228 emphasizes advanced photographic methods such as panorama, micro photography, cave photography, and portraits.  This course will include local field trips.  ART 228 meets Mondays from 2-5:20 p.m. 

Beginning Photoshop, ART 187, teaches how to process digital photos using Adobe Photoshop CS6.  Students should be competent in basic computer skills.  ART 187 meets Thursdays from 5:30-9 p.m.

Gila Community College fall semester begins August 18^th.  Registration is taking place now.  For students age 55 and older, tuition is waived.  The campus is located at 201 N. Mud Springs Road.  For more information call (928) 468-8039.

Latest from malevolent, moronic Republicans

Wingnut Week In Review: Hey, You Got Your Plane Crash In My Benghazi!

July 25, 2014

Terrance Heath 

Right-wing reaction to issues in the news this week brought to mind a classic 1980s Reese’s Peanut Butter Cups commercial, but with a wingnut spin on the famous line: “Hey, you got your Malaysian airliner in my Benghazi!” 

Across the wingnut-o-sphere, right-wingers tried desperately to link the Malaysian airliner shot down over the Ukraine to… Well, you name it:

• Fox News Host Megyn Kelly falsely claimed the Federal Aviation Administration (FAA) has not limited flights over the Ukraine, in an attempt to bash President Obama for the FAA’s temporary ban on flights to and from Israel.
• The FAA decision to prohibit U.S. airlines from flying to or from Israel’s Ben Gurion International Airport also inspired an epic Glenn Beck rant.
• Rush Limbaugh linked President Obama’s response to the Malaysian Airlines crash to the administration’s response to the Benghazi attack.
• RedState founder Erick Erickson invoked Benghazi by tweeting, “Thankfully the president didn’t blame a YouTube video.”
• Radio host Laura Ingraham mused that President Obama is focused on foreign affairs like the Malaysian airliner crash to distract the media from covering immigration.
• Fox News pundit and WorldNet Daily columnist Erik Rush now thinks Obama shot down Malaysia Airlines Flight 17.
• Former Republican presidential candidate Ron Paul blamed the U.S. and EU for the Malaysian Airlines crash, and said the U.S. may be using it to start a war with Russia.
• The American Family Association’s Bryan Fischer tweeted that President Obama is using the Malaysian airlines tragedy “to press the radical homosexual agenda.”

Here’s the best of worst in wingnuttia this week:

• Sean Hannity invited Palestinian-American leader on his show, just to yell at the guy. This is what passes for journalism on the right.
• Glenn Beck says the Boston Marathon bombing victim he falsely accused of being a Boston Marathon bomber can’t sue because he became an “involuntary public figure” when Beck accused him of being a terrorist.
• It looks like Right-wing radio host and Georgia GOP congressional candidate Jody Hice wasn’t able to disappear all of his archives in time for his bid to replace Rep. Paul Broun (R, Georgia). Hice told his listeners that the second amendment gives citizens the right to own “cannons and bazookas and missiles. In a radio interview with Liberty conservatives, Hice also suggested a “Second Amendment solution” to the border crisis.
• NRA News commentator Billy Johnson floated the idea of “gun required zones” and requiring kids to show “gun proficiency” to advance to the next grade. Who needs final exams when a drive-by or a school shooting could qualify you for graduation?
• Tea-party backed Texas state Rep. David Simpson got an earful of tea party mendacity when he had the temerity to suggest that the child refugees at our southern border deserve compassion.
• The gang at “Fox & Friends” was outraged that emergency services actually respond to 911 calls from undocumented migrants.
• Univision anchor Jorge Ramos schooled Bill O’Reilly on his “absurd” and “useless” idea to send the National Guard to the US/Mexico border.
• Creationist Ken Ham called for the end of the U.S. space program; because extraterrestrials are already damned to hell, so there’s no point in spending money to look for them.
• Center for Immigration Studies policy analyst Stephen Stenlight told a gathering of Florida tea partiers that President Obama not only deserves impeachment, but  “being hung, drawn and quartered is probably too good for him.”
• It may not come to that. Conservative columnist Gina Miller called on God to intervene and remove President Obama from office. Miller fears her prayers will go unanswered, that God will not intervene, because “America worships the ‘proud’ flaunting and writing into law of homosexuality and other sexual deviancy,” and Obama may be God’s “judgment on this wayward nation.”

Christie could bring border traffic to standstill

July 17, 2014

Posted by Andy Borowitz

IOWA CITY (The Borowitz Report)— Testing the political waters in Iowa today, New Jersey Governor Chris Christie said that if he is elected President, he would bring the flow of illegal immigrants over the U.S.-Mexico border to a virtual standstill.

“There are ways of keeping people from getting to where they want to go,” Christie said, claiming that he was the only Republican hopeful with the hands-on experience necessary to fix the border crisis.

The New Jersey governor was vague about how he would halt traffic over the border, but exuded confidence that he was the right man for the job.

“I’d make a few phone calls,” he said. “It would get done.”

Photograph by Jessica Kourkounis/Getty.

Single women key to Dems Senate victory

Poll Suggests Democrats Need New Populism Message To Keep The Senate

July 23, 2014

Isaiah J. Poole

Campaign for America's Future
ourfuture.org

If Democrats want to keep control of the Senate this fall, a new Democracy Corps memo says that it will have to target a progressive populist message to single women and the “rising American electorate” that acknowledges that the economy remains rigged against working people.

“Unmarried women are, perhaps, the most important target for Democrats across this Senate battleground,” says the memo, which is based on a survey of 1,000 likely 2014 voters in 12 battleground states.

In these states – Alaska, Arkansas, Colorado, Georgia, Iowa, Kentucky, Louisiana, Michigan, Montana, New Hampshire, North Carolina and West Virginia – Democrats are being held back by “a serious underperformance with unmarried women” during this cycle when compared to their support for President Obama and Democrats in 2012. “But engaging in a populist economic debate and attacks with a strong emphasis on women’s issues brings these critical voters back in the fold,” the report says.

A key conclusion of the report:

An “in your shoes” populist narrative about people’s economic struggles, a policy agenda about finally helping mothers in the workplace and making sure those at the top are paying their fair share, and, most important, a critique of Republicans for their polices that hurt seniors and women, result in significant gains with unmarried women and other key targets when matched against the Republican agenda and could prove the difference between a majority and minority-leader Harry Reid come next January.

An example of an “in your shoes” narrative that wins voters says that “people are drowning because jobs don’t pay enough to live on” and says that we need leaders “who can live a day of our lives” and dedicate themselves to improving the lives of working people rather than those “who show up with the big money.” That means helping people with affordable college, job training, child care, an increase in the minimum wage and equal pay for women.

Forty-eight percent of unmarried women and 47 percent of rising American electorate respondents (which include African Americans, Latinos and millennials as well as single women) find that message “very convincing.” That’s compared to the mid-30-percent of polled voters who found “very convincing” a message that centered on a call to “repeal Obamacare, cut regulations and lower taxes.”

In addition, “attacks on Republicans on women’s health and on their opposition to pay equity are very powerful and show that women are an amazing vulnerability for Republican candidates.”

The Supreme Court decision on the Hobby Lobby case has made possible a potent attack line for women who would be repulsed by support for allowing businesses to decide what forms of health care should or should not be available to them, the report says.

The report also says there is overwhelming support – 73 percent in favor vs. 24 percent opposed – for a constitutional amendment overturning the Supreme Court’s Citizens United ruling on money in politics.

Democracy Corps concludes that Democrats do have “a clear path forward,” including the ability to “go toe-to-toe in races that might otherwise be written off,” with a new populism agenda directed at working women and men.

‘I Want You to Live in My House’

Christa Hillstrom

YES! Magazine / News Report

Published: Friday 25 July 2014
nationofchange.org

Even American children are ashamed of how we are treating migrating Central Americans. The message is chilling.

"You matter."

"We are working hard to make sure you are able to stay in this country."

"Come and live in California!"

It's not exactly the incendiary rhetoric we've grown accustomed to in the last few weeks, as American leaders clash over the question of what to do with tens of thousands of child refugees fleeing violence and poverty in their home countries of El Salvador, Honduras, and Guatemala.

The messages above—along with more than 1,800 others—have flooded the website TheyAreChildren.com since it was launched last week by the California Endowment and partner organizations. The aim is to bypass severe political condemnation from those who are calling for the immediate, no-questions-asked deportation of the children (see Alabama Rep. Mo Brooks' proposal of buying them all one-way tickets for a $27 million bargain).

Instead, letter-writers are sending kids messages of encouragement, compassion, and solidarity. Hundreds of notes submitted by ordinary people—many of them children and members of faith communities—will be translated and delivered through service providers to children in detention facilities "to make sure these children know that thousands of people are praying for them and extending support and compassion," said Anne Stuhldreher, the project's coordinator.

Plenty of Americans expressed shame when their compatriots blockaded buses full of children in Murrieta, Calif., earlier this month. In an attempt to ward off the kids' arrival, protesters surrounded vehicles full of women and children, ranting, "Go home!" and "We don't want you!" reported Raul A. Reyes in the Huffington Post. "As far as we know, the children are aware of the broader public conversation, seeing both welcoming and hostile signs while riding on buses," Stuhldreher said. "The need for compassion and support became even clearer after that small, extreme minority expressed hostility toward these kids in need."

Across the country, people are already challenging the hostility—most recently, in faith communities. In what the New York Times this week called "the backlash to the backlash," religious groups—including evangelicals, Catholics, Unitarian Universalists, and Jewish communities—have pushed back against what many consider heartless reactions to a humanitarian crisis.

In Chicago, for example, Cardinal Francis E. George has offered shelter. And last week, surrounded by representatives of faith communities, Massachusetts Governor Deval Patrick announced his state's willingness to accept the children and linked it to Christian values. He likened the situation to the 1939 rejection of Jewish children fleeing Nazi Germany—more than a quarter of whom died in concentration camps when they were sent back to Europe.

"We have rescued Irish children from famine, Russian and Ukrainian children from religious persecution, Cambodian children from genocide, Haitian children from earthquakes, Sudanese children from civil war, and children from New Orleans from Hurricane Katrina," Gov. Patrick said. "The point is that this good nation is great when we open our doors and our hearts to needy children—and diminished when we don't."

Meanwhile, in California, Stuhldreher said the letter-writing campaign has also found strong resonance with families. "I think when parents hear about this they think about their own kids," she said.

At this week's National Council of La Raza convention held in Los Angeles, participants were invited to sit down and write letters in person. Stuhldreher said many parents asked their children, "Remember the children from Central America I was telling you about?" They would discuss the issue before the children started writing, she said.

"Generous acts from average citizens don't routinely generate headlines," White House press secretary Josh Earnest told the Times yesterday. "But they accurately reflect the values of the vast majority of Americans."

Kids are Americans, too. And in this case, we might look to them for some guidance.

To submit a letter, visit TheyAreChildren. Check out some of our favorite messages below. 

Christa Hillstrom wrote this article for YES! Magazine, a national, nonprofit media organization that fuses powerful ideas and practical actions. Christa is web managing editor of YES!

Walgreens - a story of greed and betrayal

July 24, 2014

Richard Eskow

Campaign for America's Future

ourfuture.org

 

Walgreens is the pharmacy that, at least according to its website, can be found “at the corner of Happy & Healthy.” If its executives have their way, however, it may soon be found near the intersection of Ziegelackerstrasse and Untermattweg in Bern, Switzerland. By acquiring the much smaller Swiss company that is located near that corner, the American company can dodge millions in American taxes.

What would that mean for the 4,200 employees who work at Walgreens headquarters in Deerfield, Illinois? Probably nothing, as Deerfield’s local newspaper (a branch of the Chicago Sun-Times) explains. “Inversion,” as these maneuvers are called, doesn’t actually mean a company moves anything. Like the Panamanian flag fluttering on a second-class freighter, all it tells you is that a vessel for hire has found a new and more compliant registry.

Call it the “Inversion Evasion.” Walgreens would become a “Swiss company” for tax avoidance purposes only. The combined corporation would do a small percentage of its business there. In all other respects, however, the corporation would remain fully American – headquartered here, making most of its profits here, and continuing to use its lobbying dollars and campaign money to distort the American political process. (Michael Hiltzik of the Los Angeles Times has more detail on the process.)

All of which raises the question: How does it feel to be the CEO of a “defector corporation”? Do such executives face the opprobrium of society as they continue to frequent fine dining establishments and enjoy the fruits of this land that has given them so much?

So far, apparently not. But that may be changing. The inversion trick hasn’t received much public attention, but it’s quickly moving into the spotlight. Illinois Sen. Richard Durbin has already written a letter suggesting that Walgreens could become the subject of a boycott it if decides (“pretends” might be a better word) to become a Swiss corporation.

Durbin couldn’t resist a jab at that “corner of Happy & Healthy” slogan either. That’s just the latest of many Walgreens tag lines, including “Be well” and “The pharmacy America trusts.” (Write your own joke, as Ed McMahon used to say.)

So far these moves have taken place under the public’s radar. But “defector CEOs” may be beginning to feel the heat. That’s usually when they call on cooperative (if not downright obsequious) journalists like Andrew Ross Sorkin of the New York Times. Sorkin’s phone must have rung recently, because he has dutifully inflated and set aloft a puff piece on behalf of Heather Bresch, the CEO of a pharmaceutical company called Mylan and the daughter of United States Sen. Joe Manchin of West Virginia.

The headline given to Sorkin’s piece reads “Reluctantly, Patriot Flees Homeland for Greener Tax Pastures.” That’s a droll and inventive formulation that can be applied to many situations, as in: “Reluctantly, Loving Husband Flees Wife for Younger Woman.”

Sorkin credulously reports that Bresch loves her country and “left” it (there’s no evidence she’ll physically relocate) with great regret, a rhetorical inversion that was received with mordant amusement in knowledgeable quarters. Bresch is unable to mount a coherent defense for her actions, despite Sorkin’s tender ministrations. The usual “taxes are too high” trope is dug up, but when pressed by Sorkin she’s unable to name a tax rate that would persuade her to keep the company in the U.S.

Maybe that’s because she doesn’t have a real complaint. Statutory corporate tax rates – that is, the “official” rate – are high in the United States, but the actual rate paid by corporations is quite low. It’s just that there will always be a country out there willing to charge a little less, no matter how low our rates, in return for the chance to channel some funds out of the U.S. economy.

The policy choice is simple: Either end “inversions” or be condemned to an endless race to the bottom on tax rates. That’s a race the American people are doomed to lose.

Mylan and Bresch defected for an initial gain of 4 percent on Mylan’s tax rate, according to Bresch herself, with the expectation that this advantage will roughly double in future years. (Bresch told Sorkin that Mylan’s rate would drop from 25 percent to 21 percent and then to the “high teens.”)

For that, Bresch and her colleagues are prepared to renounce their corporation’s American “citizenship.” (If corporations are “persons,” as is the current legal fiction, they’re certainly not very loyal ones.)

Now Walgreens seems poised to join that list. Walgreens CEO Greg Wasson unashamedly told analysts on a recent investor call that the company is actively exploring use of the inversion tactic. Like virtually all CEOs, Wasson is highly compensated. And, like most of them, he collects that compensation even when he has a very bad year. From the looks of things, he also shares with his peers a certain lack of patriotism.

What do Americans, especially older Americans, picture when they think of Walgreens? A 1950’s-style corner drugstore, perhaps. A luncheonette counter, some stools, maybe a gleaming blender for whipping up milkshakes …

But today’s Walgreens is a $72 billion enterprise, and a quarter of that income comes directly from the American taxpayer through Medicare and Medicaid programs. (See Americans for Tax Fairness/Change to Win for more on Walgreens.)

And when Americans think of Swiss corporations, they may think of multinational banks, or watches, or fine chocolate. They probably aren’t picturing the pharmacy that sells them aspirin, shampoo, and prescriptions. They’re certainly not likely to imagine a corporation that earns its wealth from American customers, profits from American government programs, and delivers its products over American roads – all while scheming to evade American taxes.

n some ways the Walgreens case is even more objectionable than Mylan’s. Walgreens would immediately have a tax advantage over its competitors. At least Heather Bresch can claim that “We were one of the last ones in our sector to do this … If you put on your business hat, you can’t maintain competitiveness by staying at a competitive disadvantage.”

Greg Wasson can’t even say that.

That’s not to defend Mylan. Pharmaceutical companies benefit from government research, government rules, and government reimbursement. But the first Walgreens was opened in 1901 at the corner of Bowen Avenue and Cottage Grove in Chicago, Illinois. If that’s not an American company, what is?

If Mylan is a story of greed, Walgreens – provided it goes through with its Swiss plans – is a story of betrayal.

Bresch is right about one thing: CEOs who put on what Bresch calls their “business hats” – which is, after all, their fiduciary responsibility – will continue to find this form of “silent defection” extremely attractive. The end result? Executives whose companies were born of American ingenuity and which make their profits from American customers (including the government) will nonetheless be obliged to troll international waters for opportunities in low-cost tax havens.

And then they’ll defect.

“Inversion,” a loophole born of backroom dealing in lobbyist-infested Washington, can be fixed. It was legislated into existence and it can be legislated away. There are proposals to do exactly that from Sen. Durbin and Sen. Carl Levin, among others. In a rambling phone interview with Ron Fournier of the National Journal, Sen. Joe Manchin argued for outlawing defections like the one his daughter led for Mylan, and also suggested it should be illegal for non-American companies to sell pharmaceuticals to Medicare and Medicaid.

It’s time for Congress to call our nation’s errant businesses back home. In the meantime, we need to call out their CEOs for behavior that amounts to disloyalty and moral turpitude. “When I run into their executives,” said Durbin of defecting companies, “I chide them.”

Everybody should. And if that doesn’t work, let the boycotts begin.