Corporate Welfare for Wal-Mart / by kevin murray

In fairness, corporate welfare for corporations, defense contractors, and utility companies are endemic in America and the overall cost of this welfare is billons of dollars of wasted and distorted incentives from tax write offs to tax write downs and everywhere in-between.  This welfare is so prevalent, the crony capitalism is so disturbing, and the lobbying is so intensive, that I could go on a rant for pages.  Instead, I figure it was probably best to just focus on one large conglomerate, specifically Wal-Mart.  What makes Wal-Mart unique is that it is the largest corporation in the world by revenue (the next seven are all oil conglomerates!) and it is the second largest private employment corporation in the world (China Railroad Engineering Corporation is #1).  Wal-Mart is ubiquitous in America and it is an unusual man or woman that doesn't frequent their stores at some point during the month.  I am a member of Sam's Club (a subsidiary of Wal-Mart) and I can verify that Wal-Mart and Sam's Club pricing is as competitive as it comes, so from a consumer perspective it's very difficult to have an argument.


However, from a level playing field perspective, Wal-Mart does not play fair.  It hasn't played fair in a long time and I don't see Wal-Mart playing fair in the foreseeable future.  As in anything in life, there are major consequences for this distortion of the free market capitalist system.  In fairness to Wal-Mart I will say this, they couldn't take advantage of the system, manipulate the system, lobby within the system, if the government favoritism didn't exist.  That is to say, if there wasn't a door of entry to curry favor within government movers and shakers, than Wal-Mart would not be able to receive the benefits that it gets.  If there was no pot of gold to be raided, than the raiders would have nothing to aim for.  But alas, that clearly isn't the case.


Whether various government agencies are gullible, stupid, corrupt, unable to adapt to game theory, or a combination of all of them, I do not know.  I do know that Wal-Mart does not need free land, tax subsidies, subsidized financing, property tax breaks, subsidized infrastructure improvements, eminent domain workarounds in order to conduct its business.  Wal-Mart will work every angle to get these things because the smartest guys in the room are in Wal-Mart's room but they don't need those breaks in order to conduct or to accomplish their business!  It is therefore the height of hypocrisy to hand these things over to Wal-Mart and then to honestly believe that you as a government representative have been diligent in your job, and by consequence been fair to other businesses when in fact, you have been discriminatory in favor of Wal-Mart to the detriment of other competitors or competing businesses or usage ideas.


The more transparency that government representatives provide to its population, the better the negotiations will be when conducting proposed business with Wal-Mart or other like entities.  Ultimately, accountability starts at home; a true democracy is a raucous place, filled with the hustle and bustle of a cacophony of voices, in which a consensus will be fleshed out over time.  Wal-Mart wants its deals done in private, undercover, and for their publicity releases to be accepted as gospel.  The defense to that tactic is an open government filled with doubting Thomases.