[Mb-civic] Wal-Mart's Culture Of Crime And Greed

[ean at sbcglobal.net]

TomPaine.com - March 30, 2005
http://www.tompaine.com/articles/walmarts_culture_of_crime_and_greedphp
?dateid=20050404

Wal-Mart's Culture Of Crime And Greed 

by Jonathan Tasini

Thomas Coughlin, the Wal-Mart vice chair who was recently dismissed
for padding his expense account, is not just a public relations
problem for the retail behemoth. He's a product of the Wal-Mart
corporate culture. He's also not alone: Numerous other execs have
been dismissed recently for various corporate crimes. Jonathan Tasini says
that manipulation, greed and wrongdoing in the name of profit are as much
a part of the Wal-Mart business model as are those low, low prices.

The Beast of Bentonville (better known as Wal-Mart) is grappling with a
spate of management dismissals and investigations over the past few months
that appear rooted in internal petty thievery. But rather than a few bad
apples being rooted out, it's clear that crime, greed, wrongdoing,
malfeasance and cronyism are deeply embedded in the Wal-Mart business
model. Indeed, Wal-Mart could not survive without manipulating the system
and breaking the law.

In case you didn't catch it, Thomas Coughlin - a former vice chair of the
company and at one time a potential future CEO candidate - was forced to
resign from the board because of, as the British Financial Times reported
on its front page, an "alleged unauthorized use of corporate-owned gift
cards and personal reimbursements that appear to have been obtained from
the company through the reporting of false information on third-party
invoices and company expense reports. The amount in controversy is
estimated to be in the range of $100,000 to $500,000." Translation: the
guy padded his expense accounts.

In the current investigation, three other employees, including a
company officer, were also dismissed.  And back in December, three
other executives and four employees were fired for violating
"unspecified" company rules. I would venture to guess that those
rules had nothing to do, for example, with treating workers badly
(that kind of conduct actually calls for a promotion at the Beast of
Bentonville, or at least a one-time visit to the company's executive
washroom) but with other financial wrongdoing.

But why should this be surprising? The culture of Wal-Mart
encourages and condones misbehavior among its leaders every day. Let
me tick off just the highlights - or lowlights, as the case may be.

Less than two weeks ago, the Beast paid $11 million to settle charges that
it used hundreds of illegal immigrants to clean its stores. In February,
those nice family-values people from Bentonville agreed to pay a pathetic
$135,000 and change to settle charges of child labor violations. Think
about it: a corporate culture that tolerates endangering children. As an
aside, when the child labor deal was announced, I wrote  that the level of
the fine was scandalous; the whole sweetheart deal is now under
investigation by the Department of Labor's inspector general.

Wal-Mart is facing the largest gender discrimination lawsuit in
history - involving 1.5 million women. I hear the company is deeply
engaged in talks to settle the case for obvious reasons: it's guilty
as hell. The depositions in the lawsuit, detailed in Liza
Featherstone's new book, Selling Women Short, make it crystal clear
that the company, as a matter of policy, consistently broke the most
basic laws of workplace equality.

Not enough? Workers have been illegally fired for trying to form a
union, and Wal-Mart spends millions to thwart workers basic rights,
giving its union-breaking staff priority on resources (like corporate
jets) over even higher-placed managers. In 2000, meat cutters at a
Wal-Mart in Texas voted for the union - and Wal-Mart promptly violated the
law by shutting down the meat- cutting department in the store and, for
good measure, closing every other meat-cutting department in 180 other
stores, just to make sure they had stamped out any smell of unionism. Even
the National Labor Relations Board - no friend of labor - saw through the
company's actions and charged the Beast with illegal behavior.

And, to top it off, the Beast's business model could not operate
without the connivance of the authoritarian regime in China. You
probably never heard of a guy named Wang Jun, but he's one of
Wal-Mart's main men in China. Aside from being involved in a company
called Poly Technology, which is the weapons-trading arm of the
People's Liberation Army, Jun runs a Chinese state- sponsored
investment company and ensures that Wal-Mart's wishes are known and
satisfied by those running the Communist Party. In China, Wal-Mart
has a ready supply of underage children and under-waged adults to
produce its products. The point here is that Wal-Mart is no
free-market miracle: Its profits are a result of an artificial
suppression of wages. Wal-Mart could not operate in a truly free
market - if such a thing even existed. Instead, Wal-Mart is in
cahoots with the Chinese government, raking in profits by condoning
the violation of basic international labor standards.

Greed is a theme with the Wal-Mart family. The family, worth a
combined $95 billion, has given a stingy one percent of its wealth to
charity. By comparison, Business Week, writing about Bill and Melinda
Gates in a November cover story on the country's philanthropists, observed
that the Gates made "history this year by giving their estimated $3
billion Microsoft Corp dividend to their foundation. It's one of the
largest donations in history by a living donor. To put it into
perspective, that one gift is three times bigger than the amount that
America's richest family, the descendants of Wal-Mart Stores Inc founder
Sam Walton, has given during their entire lifetimes."

The company's reaction to this record of law-breaking has been
predictable: It's just a public relations problem - the standard
response at a company that has built its image on myths. CEO Lee
Scott, backed by millions of dollars of advertising on television and in
print publications like The New York Review of Books, recently embarked on
a public relations tour. Speaking in Los Angeles, he told business
leaders, "We've got nothing to apologize for."

When you see all the law-breaking, malfeasance and greed around you,
and your corporate leader thumps his chest in pride, a natural human
reaction might be, "Where's my taste here? If my company routinely
violates the law or runs right up to the edge of the law at every
opportunity to squeeze out more profits, what's a few hundred
thousand dollars in inflated expenses, morally speaking?"

Coughlin and the other management schlubs who have been shown the
door are not anomalies. They are a reflection of a culture stretching back
to Sam Walton himself - a man who was a classic bully, willing to trample
on the little guy and make a profit off of the poverty of millions of
people. That's the Wal-Mart way.


[Jonathan Tasini is president of the Economic Future Group and writes his
"Working In America" columns for TomPaine.com on an occasional basis.
Tasini will be participating in an April 6 nationally broadcast debate on
the question "What's Good for Wal-Mart is Good for America?" Details at
http://www.economist.com/events/walmart/ .]

--


-- 
You are currently on Mha Atma's Earth Action Network email list, 
option D (up to 3 emails/day).  To be removed, or to switch options 
(option A - 1x/week, option B - 3/wk, option C - up to 1x/day, option D - 
up to 3x/day) please reply and let us know!  If someone forwarded you 
this email and you want to be on our list, send an email to 
ean at sbcglobal.net and tell us which option you'd like.


"In times of universal deceit, telling the truth is a revolutionary act."
   ---   George Orwell


-------------- next part --------------
An HTML attachment was scrubbed...
URL: http://www.islandlists.com/pipermail/mb-civic/attachments/20050407/28746651/attachment.html