Growing Opposition Frowns on Wal-Mart

The following article is in yesterday's issue of USA Today and includes a couple
comments from yours truly, Caroline Vernon.



When you finish reading this article, “Guess Who's Not Shopping at Wal-Mart This Christmas?”… Guess right and qualify to win! Get clues and details at: wakeupwalmart.com.




WASHINGTON – In a nondescript
office blocks from the White House, Paul Blank chats with staffers near the
start of another 12-hour workday. The beige walls are plastered with
hand-lettered, cardboard signs bearing slogans “Always High Costs. Always”
and “Buffy the Wal-Mart Slayer.”



The Ragin' Grannies sing their
protests against Wal-Mart at a Tucson store on Nov. 13.

By Wal-Mart Watch




Despite his 80-hour workweeks, Blank settles into a chair
looking energized.



This is more than a job to him, he explains. It's a
crusade.



Blank is the campaign manager for the
labor-union-backed

WakeUpWalMart.com. Behind the scenes at the headquarters
office, staffers work at a dizzying pace. Their goal: to reform Wal-Mart,
the biggest retailer in the world.



“There is a drumbeat every day
that's building,” says Blank, who previously worked as political director for
Howard Dean's presidential campaign. “The question of whether Wal-Mart is
good for America is being pushed to the forefront of a national
debate.”



As the holiday shopping season goes into full swing, Wal-Mart
is facing the most formidable opposition to a retailer since the
1930s, when a campaign was waged against Great Atlantic & Pacific
Tea (better known as A&P), which subsequently lost its domination of
the retail market.



In just the past year, two union-backed groups have
formed with the shared mission of challenging the megaretailer's business,
labor, environmental and social standards.



Another labor-supported
group, Wal-Mart Watch, is housed in a corporate-looking downtown Washington
office with plush leather chairs and curving stalks of pale green lucky
bamboo in the waiting room. The mostly young staff is dressed in jeans and
khakis. The organization has 36 employees, including 14 who work in the
field.



Both organizations have gotten or now get funding from labor
unions, which have tried unsuccessfully for years to unionize workers at
the retailer. Wal-Mart Watch was launched in April by Andrew Stern,
a union leader whose Service Employees International Union left
the AFL-CIO last summer.



The board includes Sierra Club Executive
Director Carl Pope and a Republican, Ed Goeas of the Tarrance Group, an
Alexandria, Va.-based polling group. Partners include such national groups as
Sojourners, American Independent Business Association, National Council
of Women's Organizations, Sierra Club, Teamsters and the United Food
and Commercial Workers International union.



WakeUpWalMart.com is a
project of the United Food and Commercial Workers International union and
gets its funding from the labor organization.



Praise and pressure




They're facing a giant foe – if Wal-Mart were a country, its
economic output would be the 20th largest in the world, according to a
recent speech by its CEO, Lee Scott. And as the anti-Wal-Mart
publicity machine intensifies, Wal-Mart is working to get its own message
out that the retail giant is good to its more than 1.2 million
workers, and also good for America.





Jae C. Hong, AP

A
demonstrator dressed as a Wal-Mart smiley face protests with a partner called
“Maiden Overseas.”



“For us, there is virtually no distinction between
being a

responsible citizen and a successful business,” Scott said in
a recent presentation. “They are one and the same for Wal-Mart
today.”



Now that Wal-Mart is facing stiff competition from the likes
of Target and Costco, the assault on its image could have an impact on the
retailer's bottom line.



“Is this campaign hurtful to Wal-Mart? Of course.
It's costing them megabucks. The financial impact on Wal-Mart is enormous,”
says Howard Davidowitz, chairman of Davidowitz & Associates, a New
York-based national retail consulting and investment banking firm.
“They're spending on public relations, getting their story out, spending
more time to get certain stores.”



But Wal-Mart, which refutes the
claim that the opposition is hurting it financially, has also gotten praise
from others. Wal-Mart this year was named one of the 30 Best Companies for
Diversity by Black Enterprise magazine.



An independent study by Global
Insight found that Wal-Mart saved each American household, on average, $2,329
in 2004. It found Wal-Mart also had a net positive economic impact in the
form of a 0.9% increase in real wages and the creation of 210,000 jobs
nationwide. Global Insight is a privately held economic analysis, forecasting
and financial information company.



“There are positive impacts,” says
Chris Holling, executive managing director at Global Insight. “Overall, there
did seem to be the impact of overall retail employment being higher. They
stimulate the retail industry.”



Still, pressure is coming from other
areas. Some states are trying to pressure employers such as Wal-Mart into
improving health benefits by publicizing the names of companies that have the
most employees in public health programs. The efforts are known as “Wal-Mart
bills,” and they're being championed largely by unions and Democratic
state legislators.



Among the retailer's woes:



Last month, a new
$1.8 million documentary, Wal-Mart: The High Cost of Low Price, by filmmaker
Robert Greenwald, takes a blistering look at Wal-Mart.



Movie trailer:
Wal-Mart: The High Cost of Low Price

Wal-Mart responds:Calls on filmmaker to
fix errors in trailer



The documentary will be seen at more than 7,000
screenings in churches, private homes, union halls and other locations, and
it claims in part that Wal-Mart doesn't pay workers enough and that
many must rely on public assistance.



Wal-Mart officials have said the
documentary contains inaccuracies, and they're also promoting another more
upbeat, independently made movie, Why Wal-Mart Works & Why That Makes
Some People Crazy.



“Our aim was to create a theme of dueling movies, to
create a dialogue of issues,” Wal-Mart spokeswoman Mona Williams
says.



In October, a memo from a Wal-Mart benefits executive leaked
to Wal-Mart Watch suggested the retailer could lower its health care costs
by dissuading unhealthy people from working at its stores.



Wal-Mart
countered by saying the memo was a snapshot in time of the debate going on at
Wal-Mart, and all around the USA, as companies cope with rising health
costs.



The company also says it insures more than 568,000 associates
and more than 948,000 people in total, who, as of January, will pay
as little as $25 a month for individual coverage and $65 for
family coverage. And 160,000 associates now covered by insurance had
none before joining the discount retailer.



Mounting challenges




Other criticisms against Wal-Mart are long-standing.
The

anti-Wal-Mart groups say employees don't qualify for health care
or can't afford it. Wages are too low, they say, and the
retailer discriminates against women. (Wal-Mart is facing the
largest class-action lawsuit in history from 1.6 million current and
former female employees who are suing for
discrimination.)



Anti-Wal-Mart organizers also say the company hurts
communities, small businesses and the environment.



But Wal-Mart
officials say such criticism is coming from union groups whose real goal is
to shore up their own membership.



“The groups are watching out for their
own interest,” Wal-Mart's Williams says. “They wake up every morning
thinking, 'How can we hurt Wal-Mart?' Why are they doing this? To what end?
Organized labor is so splintered. This is that one thing that seems to unify
members: a war on Wal-Mart.”



Counters WakeUpWalMart.com spokesman
Chris Kofinis: “What's uniting us is Wal-Mart's own negative
effect.”



Meanwhile, Wal-Mart says it pays an average wage of $9.68 an
hour, which is almost twice the minimum wage of $5.15. And Wal-Mart
says the proof is in how many people want to work at Wal-Mart: A
store opening in August in Oakland had 12,000 applicants for 400
jobs.



Cindy Galati, 45, is a district manager in St. Louis who has
worked at Wal-Mart for 24 years, starting as a cashier. She bristles at
the anti-Wal-Mart publicity.



“You have a small group of special
interests who want to portray to the world what we are not,” Galati says. “We
are a good company and want to do the right thing. How do I feel? I take
personal offense at it.”



Both of the labor-backed groups challenging
Wal-Mart are trying to drum up support in local communities where Wal-Mart
stores are located. Over the past four decades, Wal-Mart has grown from a
small chain to a global enterprise with 5,000 stores in 10
countries.



Wal-Mart critics include former shoppers such as Caroline
Vernon, 44, of Davenport, Iowa, a stay-at-home mother of four who this year
became a community activist at WakeUpWalMart.com.



“I used to shop at
Wal-Mart all the time,” Vernon says. “Wal-Mart has just been exposed. There
has been a snowball effect. It's really about what vision of America do you
have, big-box retailers as the only way to shop or mom-and-pop stores?
Mom-and-pop is what America is all about.”



And that's just how the
Wal-Mart activists hope to apply pressure, by relying on local community
members. This fall, Vernon and others went to their local Wal-Mart and handed
out fliers criticizing the retailer's health care coverage.



Wal-Mart's
counteroffensive



The retailer is launching a counteroffensive, an
approach summed up by CEO Scott in a presentation this year. “After a year of
listening, the time has come to speak, to better define who we are in the
world,” he said.



Analysts such as Mark Husson of HSBC Securities says
the company has typically not responded because it hadn't felt as
threatened.



In January, the company launched a website,
http://www.walmartfacts.com, that touts statistics to counter critics' claims. Among
the statements: “Wal-Mart offers affordable health care benefits to
our associates.”



The company is doing more to muster political
support. Wal-Mart has doubled its number of Washington lobbyists to eight and
ratcheted up political spending.



Wal-Mart gave $1.5 million in 2002
through its political action committee, making it No. 82 on the list of top
donors. In 2003-04, Wal-Mart gave $2.2 million. That boosted it to No. 22 in
the ranking of top donors, according to the Center for Responsive Politics,
a non-partisan research group in Washington. The bulk of the money
has gone to Republicans.



This fall, Wal-Mart hired public relations
firm Edelman to help

devise its strategy and create an instant-response team
at company headquarters in Bentonville, Ark. They've also hired Michael
Deaver, who helped shape former president Ronald Reagan's image.



Says
analyst Husson: “They do feel unfairly maligned.”



But he also says the
attacks are not unexpected as the company expands from its stronghold in the
so-called red states to the blue states – urban, mostly Democratic states
largely on the East and West coasts, where Wal-Mart stores are not as
plentiful.



“They have to open and get coverage in states that are more
urban, blue states,” he says.



Still, organizers also say their
struggle is larger than changing Wal-Mart. For some, the goal is also to
force a debate on larger social issues – issues such as advancement for
women, affordable health care for workers and better pay for
all.



“Wal-Mart is facing a perfect storm of negativity,” says Kofinis
of WakeUpWalMart.com. “People are rallying around this movement. It's not
just workers. It's rippling out and becoming a real debate
about values.”



But Wal-Mart officials say the critics overlook all the
good that Wal-Mart does.



“We help give struggling families a sense of
pride, because our prices enable their children to start school with fresh
supplies and new basketball sneakers, so they are no different from other kids,” Williams says. “Wal-Mart is good for America, because we are
the great equalizer for the people of this country, and no one else
has stepped up to that role.”