Letters to The Garden Island about the “high cost of low prices” at Walmart have certainly generated some interesting responses in the comments section online. I seldom shop at Walmart (I think I was there once this year), but that
Letters to The Garden Island about the “high cost of low prices” at Walmart have certainly generated some interesting responses in the comments section online. I seldom shop at Walmart (I think I was there once this year), but that is more because my needs most often require visits to Home Depot. Since the difference in wages earned at Home Depot is only about 50 cents an hour more, it isn’t as if I earn any “points” by boycotting Walmart, which I am not doing, nor am I suggesting anyone else do so.
However, Ms. Garcia’s claim that the average Hawaiian Walmart associate makes $15.23 an hour should be examined because organizations, such as IBISWorld, a publisher of “business intelligence,” claim the average Walmart worker receives $8.81 an hour. Perhaps there is a difference in who is a worker and who is an associate?
Anyway, let us assume workers and associates are the same thing; that they all work 40 hours per week; and use Ms. Garcia’s numbers, which would mean the average employee makes just over $30,000 in a year. Let us examine the wage distribution of 30 Walmart employees. If only one of those employees makes $100,000 a year, to achieve an average of $30,000, the other 29 will make just over $27,000 a year, which is below the poverty level for a family of four in Hawaii. Or you could assume two employees make $50,000 per year, which means the remaining 28 make about $28,500, which is just above the poverty level.
When I was in high school (a long, long time ago – in a land far, far away – 1968), I had a part-time job at the fairgrounds and another taking photos for the local weekly newspaper. I was paid $1.25 an hour. If you locate an inflation calculator on the Internet, you will find that $1.25 then is equivalent to more than $19 an hour in today’s dollars. I was better paid as a teenager raking up trash at the fairgrounds than the average Hawaiian Walmart employee is today.
But then, maybe poverty in Hawaii isn’t all that bad? Perhaps that poverty is alleviated through other programs?
Consider that in Hawaii, a family of three that makes $43,000 a year could qualify for food stamps of around $400 a month. Also note this family will probably qualify for the earned income tax credit, which allows a tax refund in excess of the withholding tax paid which could be as much as $6,000 a year. It appears that, for this family, Walmart pays $30,000 but the government may pay up to $11,000 more. The U.S. House Committee on Education estimated in 2013 that each Walmart employee cost taxpayers $3,015. Is this what folks who complain about “welfare cheats” envision? Does this family have some moral responsibility to turn down assistance? Or, is it Walmart that is cheating?
Many corporations limit the number of hours an employee can work in a week to avoid regulations requiring they provide benefits. For example, in Hawaii, employees who work 20 hours in a week must be provided employer-paid health insurance. Reports confirm that nationally Walmart does limit the number of employee hours. If Walmart does this in Hawaii, does it mean more children will receive health care through state agencies? Do Walmart employees have to go to the emergency room for health care?
The website that Ms. Garcia pointed us to touts the fact that Walmart matches contributions to the employee’s 401(k) up to 6 percent. How does someone making poverty wages contribute to a 401(k)? Is an investment in a 401(k) going to pay off?
If you maxed out your 401(k) contributions (using old rules) on a yearly salary of $100,000 for 20 years that account might now be worth $500,000. However, retirement advisors explain the “rule of 4 percent.” When you retire, if you want your retirement funds to last through your life expectancy, you can withdraw only 4 percent of the value of your fund. Is $20,000 per year enough to retire on Kauai? Is it realistic to believe an employee making $15 an hour has a 401(k) worth $500,000? Who pays for their retirement?
Those union pensions become a bit more attractive — at least those that haven’t been gutted by the recently passed Cromnibus Bill written by Citigroup lobbyists (One has to wonder how those pensions became so underfunded that this action was required, but that may be beside the point, unless you think about how this applies to Social Security). I do not understand people who are angry that the unions enabled pensions, which workers contributed to, allowing workers to have an adequate retirement. Often those same angry people praise the wealth accumulated by the Walton heirs. I don’t understand that either. What did the heirs do to deserve that wealth other than to be members of a fortunate family.
The six Walton heirs control more wealth than the bottom 30 percent of Americans. Some estimates are as high as 42 percent. There are estimates that, combined, the heirs make $3.6 billion a year. If there are one million Walmart employees, their wages could be increased by $3,000 per year and the heirs would still take home $100,000,000 each.
The Walton Family supports a lobbying group called the American Legislative Exchange Council (ALEC). State Farm Insurance is a member of this group while Google, and others, just recently resigned their corporate memberships. ALEC is one of the groups promoting the idea that Social Security is not going to be there for “you” – generally a member of Gen-X or Gen-Y – when you retire. ALEC wants to solve the Social Security problem by doing away with it and turning your retirement funds over to private banks.
These same banks caused the 2008 economic crash through their reckless investment in financial instruments that none of us understand. They are the same banks that run the Food Stamp EBT program. Yes, even what many of you consider to be charity has to pay a cut to the bankers. The banks achieved this “vig” through their membership in ALEC or organizations like ALEC that constantly pound the drum for “privatization” because government, which you and I elect and are therefore responsible for, can’t do anything right.
When you shop at Walmart, are you shopping against your own best interests? Do you have a solution to the problem? Is it a problem?
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John Zwiebel is a Kalaheo resident.
