EDITORIALS>>Wal-Mart does right
Wal-Mart Stores, the worldís largest retailer with $11 billion in earnings and 1.7 million employees, quit fighting its critics and joined them, more or less. It has overhauled its health-insurance program, and while it is not yet the pacesetter of the merchandising and marketing business in its humanity for workers, it no longer merits the label ďheartless.Ē Even its harshest critics, as The New York Times reported yesterday, acknowledge that it has made giant strides. Even better things lie ahead. The company now pronounces itself serious about undergirding the health and wellbeing of its workers and maybe even the nationís.
That is more than just good news for Wal-Mart employees, hundreds of thousands of whom were on public assistance two years ago. It promises benefits for all of us indirectly. Wal-Mart is an exemplar for business, which has been headed in exactly the opposite direction: eliminating or reducing medical coverage for employees.
Since it became the largest retailer in 2000, Wal-Mart has been under a microscope for its treatment of its workers and sometimes its suppliers. The AFL-CIO and some of the largest unions, notably the Service Employees International Union and the United Food and Commercial Workers, led a campaign against the giant that clearly tarnished its image. They charged that Wal-Martís double whammy of substandard wages and skimpy benefits shifted the burden to taxpayers. States began to examine their public-assistance rolls to see how many were employees of Wal-Mart and other big companies. A search in Arkansas in 2005 showed that the families of 3,971 of Wal-Martís 45,106 Arkansas workers were on public assistance, mainly Medicaid for children. A California study in 2004 showed that Wal-Mart workers cost that stateís welfare programs $86 million a year. Several states passed laws seeking to force Wal-Mart to enhance its benefits.
Wal-Mart organized a massive public-relations campaign to counter the unions and consumer groups. Then the CEO, H. Lee Scott Jr., consulted a few people and decided to heed rather than fight the critics. He talked to the former president, Bill Clinton, who told him to look beyond the motives of Wal-Martís critics and consider how the company could become a better employer. Others told him good health insurance should be considered not a burden but a chance for the company to secure its workforce. Healthier and happier means higher productivity.
Scott cut loose the executive who had written a famous memo about ways to curtail or deny health benefits, put an overachieving female executive in charge and asked her to fix it. She looked at other companiesí benefit packages and talked to health-care experts.
The company now offers an array of insurance options for its workers, and they are cheaper and more accessible. Wal-Martís large workforce of part-time workers now can more easily, after a year, obtain coverage for themselves and their families.
Now Wal-Mart is throwing its considerable weight behind the drive for universal health insurance. That surely lifts the prospects for a universal system in 2009, when the current national administration will be out of office. Any of the Democratic candidates and two or three of the Republicans, most notably our own Mike Huckabee, would be apt to preside over that historic reform. Wal-Martí political clout will help.
The company also is contemplating entering the health insurance business itself, which one would assume would mean the introduction of efficient and low-cost insurance into the market. With or without national health insurance, which like Hillary Clintonís plan is almost certain to be based on private employer-based coverage, that has to be a good thing.