Oped on Maryland health care tax on WMT

[southsider2k5]

Don Luskin

 

http://www.smartmoney.com/aheadofthecurve/...?story=20060113

[Rex Kickass]

Do you really think American innovation has improved since federal and state governments went after Microsoft (MSFT: 27.03, -0.16, -0.6%) on antitrust grounds? If you ask me, the technology economy was a heck of a lot more vibrant back in 1999 when Microsoft was still, supposedly, a monopoly. Its stock price sure was.

 

Doesn't he mean, before the tech bubble burst?

 

Americans pay in either case. Wal-Mart's medical plan is poor enough that a lot of these same Wal-Mart employees who choose to work there (and I love the smugness in that phrasing - as if a lot of people are beating down Wal-Mart's doors for a job in the highpowered industry of sorting women's clothing by size and color) often have to rely on state or federal aid to cover their health care costs.

[Cknolls]

I may be overlooking something, but can someone tell me what Amendment

 

state a person's right to healthcare. Just asking.

[YASNY]

If you can't get socialized medicine one way, you legislate business to do it for you. BTW, I've heard Kentucky is talking about following in Maryland's footsteps on this one.

[Balta1701]

I may be overlooking something, but can someone tell me what Amendment

 

state a person's right to healthcare.  Just asking.

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.

(yes, I know it's not an amendment...but anywho...)

[Balta1701]

If you can't get socialized medicine one way, you legislate business to do it for you.  BTW, I've heard Kentucky is talking about following in Maryland's footsteps on this one.

I believe I read that multiple states are considering similar bills. If memory serves, the nubmers were in the dozens.

[YASNY]

I believe I read that multiple states are considering similar bills.  If memory serves, the nubmers were in the dozens.

 

Apparently, Kentucky's Gov. Fletcher forgot he's a republican.

[southsider2k5]

(yes, I know it's not an amendment...but anywho...)

 

I hope you just forgot the green on that one... otherwise that is a stretch that Hawk wouldn't even call

[mr_genius]

(yes, I know it's not an amendment...but anywho...)

 

 

you're reading a lot into that

[Balta1701]

Apparently, Kentucky's Gov. Fletcher forgot he's a republican.

No, he just realized that someone is going to have to pay those medical bills, and if the options are Wal-Mart or the Taxpayers, he's going to pick Wal-Mart every time.

[Rex Kickass]

I hope you just forgot the green on that one... otherwise that is a stretch that Hawk wouldn't even call

 

No more than using the whereas clause in a law authorizing military force to justify wiretapping hundreds or thousands of people without a warrant.

[EvilMonkey]

If Walmart would just close up shop in Maryland altogether and leave the state, I think that would stop this witchhunt. Lets see MD deal with all the unemployment they will have to cover once the thousands of people are unemployed. PLus healthcare. And Maryland is such a small state that most people could get to a store in a neighboring state if they really needed to.

[Mplssoxfan]

We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.

 

Um, Balta, that's from the Declaration of Independence, not the Constitution. I think you maybe wanted to quote the Preamble to the Constitution, not that I wish to put words in your mouth.

 

We the people of the United States, in order to form a more perfect union, establish justice, insure domestic tranquility, provide for the common defense, promote the general welfare, and secure the blessings of liberty to ourselves and our posterity, do ordain and establish this Constitution for the United States of America.

[Mplssoxfan]

If Walmart would just close up shop in Maryland altogether and leave the state, I think that would stop this witchhunt.  Lets see MD deal with all the unemployment they will have to cover once the thousands of people are unemployed.  PLus healthcare.  And Maryland is such a small state that most people could get to a store in a neighboring state if they really needed to.

By my count, there are at least 23 Wal-Marts in the state of Maryland (and I forgot to search for Sam's Clubs), so I doubt that they're leave the state. Maryland may be a small state, but it isn't that small. For someone who lives in, say, Glen Ellyn (chosen at random, BTW), you can probably get to Indiana or Wisconsin just as quickly than someone who lives in Towson MD can get to another state. I sure wouldn't make the drive. I'd just go to Target or Costco.

 

The danger to Wal-Mart is if a great deal of states start jumping on the bandwagon, which they probably will. I doubt many votes are lost on taking on Wal-Mart. Don't know for sure, just a hunch.

[jackie hayes]

This appears to be an awfully stupid law. There is no guarantee that health care access will become equitable, only that they'll spend more -- they could just improve the benefits for those who have full benefits now. And what principle makes workers in smaller firms not deserving of health care benefits? (And I mean "smaller", not "small" -- 10,000 employees is a damn large threshold.)

 

This is just grandstanding.

[Rex Kickass]

Affordability.

 

You're right it oughta be buisnesses with over 100 employees.

[jackie hayes]

What do McD's and the supermarket chains spend (% wise) on health care? These aren't exactly mom & pop stores. 10,000 is FAR too high for the legislature to argue that they didn't want to put large costs on small business. Anyway, the affordability excuse is weak for this particular law; providing comparable health insurance is more difficult for small businesses because they can't get the same rates, but the law only stipulates that a certain percentage must be paid towards health care -- not that some certain benefits must be provided. It's not clear that such a restriction is any tougher on small businesses.

 

It's a 'stick it to Walmart' bill, which will play well in a state as liberal as Maryland. (A Repub gov, I know, but that's an anomaly.) Those who want good, equitable health care should try to distinguish that general goal from particular laws. This law just sucks.

[YASNY]

I believe Wal-Mart had planned a big new distribution facility in Maryland. I'd guess that they are rethinking that decision already.

[mmmmmbeeer]

Costco prides themselves on paying their employees very well with both a strong pay rate and benefits package. If any sane person were given the choice they'd rather work at Costco than walmart. Costco is certainly competitive with Sams Club and WalMart considering they have gained marketshare while Walmart expanded as well. They are effective because they get the best employees which enables them to accomplish more with less. Perhaps WalMart should use this b.s. law as an opportunity to reorganize and reevaluate the way they structure their workforce....go for the more productive workers and compensate them appropriately, meeting the guidelines set forth in the law, instead of paying s*** to thousands of marginal employees.

[southsider2k5]

If Walmart would just close up shop in Maryland altogether and leave the state, I think that would stop this witchhunt.  Lets see MD deal with all the unemployment they will have to cover once the thousands of people are unemployed.  PLus healthcare.  And Maryland is such a small state that most people could get to a store in a neighboring state if they really needed to.

 

I would be willing to bet that Wal-Mart makes up that 8% by either closing facilities or laying off employees. You can't tell me that Wal-Mart is going to just sit by and absorb an 8% hit to their bottom line. Heck I wonder how many of their stores in MD even have an 8% profit margin to lose? I also wonder if it would be consolation to be jobless knowing that someone else has insurance.

 

Also I wonder if this will survive constitutional muster since the law was obviously passed just to hit WMT without actually specifying WMT...because the lawmakes had no doubt when they put the description of companies that this law was supposed to effect that it would only be WMT.

[Rex Kickass]

It's 8% of payroll, not 8% of the bottom line.

[YASNY]

All this does, is give incentive to Wal-Mart to keep payroll lower. Thus, less hiring and lower raises. They can always blame the Maryland legislature for poor raises accross the board.

[NorthSideSox72]

All this does, is give incentive to Wal-Mart to keep payroll lower.  Thus, less hiring and lower raises.  They can always blame the Maryland legislature for poor raises accross the board.

 

Agreed. If it's 8% of payroll, then reduce payroll when possible. Of course, given their business model, Walmart is probably already pretty lean on personnel, since they would see that as a cost center.

[Balta1701]

All this does, is give incentive to Wal-Mart to keep payroll lower.  Thus, less hiring and lower raises.  They can always blame the Maryland legislature for poor raises accross the board.

You're making several assumptions there...first, that Wal-mart actually gives significant raises with time (I don't know their pay schedule, and for all I know it differs with stores), and second, that somehow the stores could operate with less staff, which is probably untrue.

 

My father used to run a couple of grocery stores, and he taught me one thing about the retail industry - it's almost always boom/bust, for one simple reason; when stores first open, they can expand rapidly because all of their employees are new hirees, and are getting paid lower wages. Then, as the expansion period stops, several things happen simultaneously - the product can get a little stale because everyone has seen it, so sales go flat, and secondly...their payroll numbers start to rise because their stores have been open longer.

 

Wal-Mart has really been the company that has defied this trend, for a couple reasons. One, they're still expanding, and they keep finding new ways to expand (i.e. the supercenters, etc.). Second, Wal-Mart keeps a very high turnover rate in most of its stores, so that its employees don't hang on for that long. Third, by putting other stores which could pay better out of business, Wal-Mart becomes the only game in town, so that people can't really leave if Wal-Mart doesn't give them large enough raises to support their families.

[YASNY]

The only thing I'm assuming here is that if expenses cut into profits, they'll cut expenses whereever possible. Payroll seems like an obvious target under the circumstances.