Labor & Economy

Walmart’s Philanthropy Model: Charity and Poverty

Published

January 28, 2013

Last year, Walmart gave $918,000 through its foundation to 33 California nonprofits. Amongst the types of organizations: job training, homeless shelters and health groups (see list below).

I scratched my head when I read this. Of course we want to see vital social service groups impacted by severe government funding cuts survive in this economy. Many of us have attended fundraisers for, or donated to these groups ourselves.

But there was something about the nature of the groups that caught my eye. I wondered: Why is Walmart funding groups that provide for such basic needs? Why is a corporation suddenly funding healthcare groups? Altruism? A love for Obamacare? Or is there something else?

Here’s what strikes me about Walmart’s seemingly benign charity efforts: The type of groups they’re funding addresses basic needs (jobs, health, shelter) that good jobs actually fulfill. Walmart, of course, is notorious for not providing such jobs.

It’s also not surprising to see that the location of the groups in Walmart’s charity hit list magically aligns with neighborhoods they are targeting for expansion. Walmart has proposed to expand in Chinatown and Pico-Union, amongst other neighborhoods, making their donations in those communities all the more suspect.

Walmart is funneling almost a million dollars into nonprofits while creating a workforce increasingly dependent on public welfare and unable to meet their own basic needs as part-time servants to the kingdom of cheap goods.

What could Walmart do with $918,000? For one (using Walmart’s definition of 34 hours a week as full-time) Walmart could hire nearly 37 new full-time employees at a living wage rate with benefits. From a worker reinvestment perspective, Walmart’s 2012 contributions could raise the hourly wage of 160 full-time workers from $8.75 to $12.00 without any impact on Walmart’s profits; these workers would be able to staff three Walmart stores at a level of 53 workers.

Walmart could argue that without a living wage, they could create 59 new full-time positions at their common rate of $8.75 an hour (54 percent of full-time workers with a year of tenure earned less than $9 an hour in a 2001 study), 22 more jobs than the living wage calculation. However, this figure fails to include the more than $86 million in annual taxpayer subsidies from Californians to Walmart’s impoverished workforce in the form of food stamps and other social services.

Charity should not be a bribe to facilitate expansion at any cost. Walmart’s company values are reflected in the fact that a corporation whose net sales exceed the GDP of Norway would rather give charity to the poor than end the poverty it creates. This is cynical and tragic. Walmart is choosing to have a workforce on welfare when they have the resources to provide quality jobs for their associates, jobs that would allow workers to sustain their families and avoid putting a burden on consumers. Instead, as our country’s largest employer, it chooses to place the burden on the American public.

Per The Lead Type blog, the full list of Walmart’s L.A. County grant recipients includes: