Is Wal-Mart turning blue -- blue enough to pull President Obama's healthcare chestnuts out of the fire?
If the nation's largest employer is signing on to the president's agenda, his efforts to pass healthcare reform will have won an important ally. The company employs 1.4 million "associates," has stores in more than 400 congressional districts and maintains a powerful lobbying operation in Washington.
For years, Wal-Mart has been a poster child for low wages, skimpy health insurance and conservative red-state values. Just a year ago, Wal-Mart managers organized meetings in hundreds of store to warn employees that if the Democrats won the White House, the company would face a disruptive unionization campaign.
But now, Wal-Mart supports a key, controversial plank in the health insurance reform plan: an employer mandate that would require big firms to "pay or play" -- either offer their workers an insurance plan or require a company to pay as much as $750 a year per employee to the government for coverage.
This "pay or play" plan puts Wal-Mart on the side of the unions and liberals and has evoked a virtual declaration of war from the National Retail Federation, whose officers reported themselves "astonished" at what they considered Wal-Mart's "catastrophic" endorsement of a government mandate that most retailers -- once including Wal-Mart -- have long considered anathema.
So why Wal-Mart's big switch?
Critics have pounded Wal-Mart for years for its violation of the country's labor laws, for its low wages and for its failure to offer a health insurance plan that more than half of its employees would actually purchase. During the presidential campaign, Obama told a cheering union audience that "the battle to engage Wal-Mart and force them to examine their own corporate values and ... policies ... is absolutely vital."
Criticism of this sort has had a real effect on the company's fortunes. One of its own surveys found that almost 10% of those polled refused to shop there for essentially political reasons, and the company has been stymied in its effort to put a new generation of "supercenters" in coastal California, in Chicago and in liberal cities such as Boston, Washington and New York. Two years ago, Wal-Mart slashed the number of store openings in the U.S. by a third. Its stock price has been flat for almost a decade.
