The President Should Make Wal-Mart Part of the Minimum Wage Debate

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A member of the Rude Mechanical Orchestra joins a protest against WalMart on Black Friday, November 23, 2012, in Secaucus, New Jersey, as part of a nationwide demonstration for better pay and benefits.
(AP Photo/Mel Evans)

This post originally appeared on the Demos blog.

“No family should work full time and live in poverty.”

That’s been President Obama’s rallying cry on the stump, persuasively arguing for an increase in the federal (and state) minimum wage. Yet on Friday, President Obama plans to visit a Wal-Mart in Mountain View to celebrate their efforts to become more energy efficient. That’s a mistake. Wal-Mart, the country’s largest private employer, pays (at the highest estimate) 825,000 workers less than $25,000 a year, the line at which a family with two children working full-time falls into poverty.

And that is a choice the company is making. Wal-Mart could give all of those workers a raise now. Last year, Demos found that for what it spent buying back its own stock Wal-Mart could pay all of its workers over $25,000 a year. Wal-Mart spent $7.6 billion on stock repurchases in 2013, which do nothing to boost the company’s productivity or profits. The Walton heirs alone, already some of the wealthiest people in the country, made $2.6 billion from that round of share buybacks. Buybacks aren’t of long-term use to the company, even for its shareholders. On the other hand, a raise across the retail sector would boost growth and create over 100,000 new jobs.

Early today, Pam Ramos, a Wal-Mart worker in Mountain View, wrote a must-read piece for Salon on the implications. Key quote:

I want the president to help us and tell Wal-Mart to pay us enough to cover the bills and take care of our families. That doesn’t seem like too much to ask from such a profitable company, a company that sets the standard for jobs in this country. And I hope it’s not too much to ask from a president who believes that income inequality is the defining challenge of our time.

It isn’t too much to ask. The country has a clear vested interest in lifting those families out of poverty and boosting the economy as a result. The president should echo the language he’s used to lift up high-road employers like Costco and (more recently) Gap and encourage Wal-Mart to pay its low-wage workforce more, like he did during the State of the Union:

“Profitable companies like Costco see higher wages as a smart way to boost productivity and to reduce turnover,” the president said. “But there are a lot of Americans who don’t work somewhere like Costco and they’re working for wages that don’t go as far as they once did.”

A lot of those workers who aren’t working for decent wages are working for Wal-Mart. The president is talking the talk on the minimum wage and it’s having an impact. He should hold the country’s largest employer to the same standard.

Joseph Hines joined the communications department of Demos in June 2012. He has previously interned in the offices of Senator Barbara Boxer, state Senator Mark Leno and the mayor of San Francisco, as well as for the campaigns of Oregon Governor John Kitzhaber, the Sierra Club and Congressman Kurt Schrader.
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