Walmart – The Queen of Corporate Welfare
President Ronald Reagan introduced American voters to the derogatory term “welfare queen” while campaigning for the country’s highest office. According to Reagan, this was a woman who supposedly used manipulation and fraud to collect huge welfare payments. He claimed that there were a lot of them living in the United States. The real welfare queens appear to belong to the business world. As economists assess corporate America and investigate the actions of major companies, it is clear that Walmart is the queen of corporate welfare.
Walmart – The Queen of Corporate Welfare
The owners of Walmart, the Walton family, are the country’s richest family. In fact, they have more money than Warren Buffet and Bill Gates do combined. Forbes reports that the family has $130 billion. Despite the family’s vast wealth, they choose to let America’s taxpayers supplement the salaries of their many workers. In most parts of the country, Walmart’s low wages qualify its workers for government subsidies like food stamps and healthcare. According to rumors, the company’s managers and higher-ups actually advise workers to request these government programs.
Raking it in with Food Stamps
Not only do many of Walmart’s employees qualify for the country’s food stamp program, but the company also rakes it in by accepting food stamps. In 2013, Walmart earned approximately $13.5 billion in food stamps. This was about 18 percent of the food stamp market. The Los Angeles Times confirms that Walmart earns more than half of its annual sales from groceries, so the food stamp market is a major help to the company’s bottom line.
The Presence of Walmart Bankrupts Mom and Pop
It’s been well documented that when Walmart moves its operations into smaller towns, the company causes mom-and-pop stores to close down. Representatives for large corporations say that companies like Walmart boost local economies, but this is proving to be false. Studies show that Walmart is much better at increasing its own profit margins than it is at helping the economies of local communities.
In 2003, the LA City Council commissioned an economic study involving Walmart. It found that the retailer is usually a net loss for a community when a store is added to it. The study determined that big companies like Walmart cost states around $9 million in healthcare expenses. Its presence also results in a loss of pensions and retirement benefits.
The Other Abuses of Walmart
The company’s other abuses range from human rights violations to wage theft. In 2006, a Walmart factory in Bangladesh was accused of hiring underage workers. The children confirmed that managers slapped and beat them. They also claimed that they worked 12 to 14 hours a day. When it comes to stealing wages, Walmart has purportedly forced employees to purchase their own uniforms. In addition, Walmart workers in Pennsylvania sued the company for forcing them to work through their breaks.
Wonkette reports that Walmart also takes advantage of taxpayers in the form of security. Instead of covering the costs for decent security, stores contact their local police departments. Walmart stores call police officers to take care of everything from shoplifters to teenage loiterers.
How Much Does the Tax Code Benefit Walmart?
Because the nation’s tax code favors the wealthy as well as major corporations like Walmart, financial estimates show that the company receives more than its fair share of benefits from Uncle Sam. The company’s tax breaks and subsidies total more than $7.8 billion annually. The company receives taxpayer subsidies under the housing program, supplemental nutrition assistance program and even Medicaid.
Too many members of Congress are available for purchase. In 2015, the company spent more than $6 million on lobbying efforts. For major corporations like Walmart, this is money well spent since they’ll recoup these costs and more.
Walmart uses tax loopholes and breaks to write off its capital investments. The country’s richest family also manages to avoid paying about $600 million in federal taxes annually because they qualify for reduced tax rates on capital gains.
The Money to Lobby Effectively
Thanks to legislation, Walmart has turned into the queen of corporate welfare. When it comes to taxes and loopholes, the company is operating legally, but it’s important to note that the country’s current tax laws did not come about in a vacuum. Relentless corporate lobbying, campaign contributions and threats made against legislators are why these laws exist. To learn more about Walmart becoming the leader of the corporate welfare pack, head to the PersonalMoneyStore.com.