The New York Times tries to make a story out of nonstory: free-market groups that quite naturally defend the largest, most successful business in the U.S., Wal-Mart, from government regulation, get a tiny fraction of their funding from the Walton Family Foundation (not even from Wal-Mart itself). At least from what can be discerned from the article, none of this money is earmarked for Wal-Mart related research, and some of it is specifically earmarked for causes, like education reform, that have nothing to do with Wal-Mart.
The story does have a classic line. After spending almost the entire article raising suspicions of whether the free market groups are being unduly influenced by Walton family money, and discussing whether they should disclose the contributions in their publications, the article offhandedly mentions that labor unions give prodigious funding to anti-Wal-Mart organizations. Is this an "astroturf problem," as the article tries to avoid implying, or at least something that raises at least as many issues as the Walton Family Foundation funding the likes of AEI?
In response, Chris Kofinis, communications director for WakeUpWalmart.com, an arm of the United Food and Commercial Workers Union that gives money to liberal research groups, said: "While we openly support the mission of economic justice, Wal-Mart and the Waltons put on a smiley face, hide the truth, all while supporting right-wing causes who are paid to defend Wal-Mart’s exploitative practices.”
UPDATE: In the highly unlikely event the Walton family thinks it's buying the Heritage Foundation's allegiance to Wal-Mart for less than $5K a year, it's obviously mistaken. Gues the Times' reporter was too lazy to bother checking whether the think tanks he cites as being potentially subject to Wal-Mart's influence have been cheerleaders for Wal-Mart when the companies' policies conflict with the think tanks' free market ideology, which would be the real test of influence-buying.
FURTHER UPDATE: And here's AEI's (and one of my favorite blogs, Overlawyered.com's) Ted Frank criticizing Wal-Mart in yesterday's Washington Post, surely not something that could have conceivably escaped the Times's attention! Looks more and more like the Times published an anti-Wal-Mart press release as a "news" story.
Incidentally?
In 100+ degree heat.
To protest a place that pays an average of over $10 an hour for people to work in air conditioning.
That would be about ~$400k/year. At one institution, that would fund less than 2 research staff members, which doesn't sound like it buys a lot of influence. Spread over a lot of institutions, it is even less. Some context in the article would be appropriate.
Furthermore, the article says "like the American Enterprise Institute, the Heritage Foundation and the Manhattan Institute".
Looking on MediaTransparency.org for how much was given by the Walton Family Foundation and for what between 1985 and 2005:
AEI:
2004: $27900 Charitable
2003: $80000 Charitable
Heritage:
2004 $5000 Charitable
2003 $5000 Charitable
2002 $5000 Education
2001 $5000 Education
2000 $5000 Charitable
1998 $5000 Charitable
Manhattan Institute
2004 $95000 Charitable
2003 $75000 Charitable
2002 $176000 Education
2000 $50000 Education
So, either MediaTransparency.org is simply missing
a lot of donations, or over the last 6 years,
the total going to those three organizations is:
$528,900. While the article did say "like" those
three organizations, it is misleading to quote
$2.5M when only $0.5M went to those three.
I think it is even more surprising that no money
went to those three organizations in 2005.
Why single them out in the article now?
Again, I am assuming accuracy on the part
of MediaTransparency.org, but tallying these
donations is their main mission.
De, why now? Probably because Media Transparency fed the story now to a gullible (or sympathetic) reporter.
Isn't it just such a wonderful, happy coincidence that the recipients just happen to churn out policy argument drivel that supports Wal-mart.
You don't give funding to people who are busy telling you that you're the Antichrist.
...and it's funny that the major complaints about these guys is their small connection to Wal-Mart, while there's a big lack of comment about methodology.
But don't you see Mr. Bernstein's point? None of the money is specifically earmarked so there is absolutely no reason to believe that any of those "think tanks" (more often holding pens for washed out academics and wanna be under secretaries of commerce) tailor their position papers to match what their funders want.
See, there is no "specific earmarks." Heck, for all they know they just might be funding people who say they are the Antichrist. That is the conceit of Mr. Bernstein's argument.
I once went to "symposium" on Wal-Mart at UCLA that *shockingly* turned out to be one big pro-union rally with a few hapless economists invited as punching bags. I think I prefer the pro-Wal-Marts just because they don't hiss at you if you disagree with them.
Yaaaawwwnnnn...
By the way I believe the post title was summing Kofini's comments, not the good professors point of view. It would be the equivalent of Walton Foundation "while we are fighting for the freedom of American's to dictate business with their own capital and improve their quality of life WakeUpWalmart.com is a nefarious organization trying to destroy American businesses and stagnate the economy - and in the end ruin the American way of life."
If this is the case--and I don't doubt it is--then what, other than manifest bias, is the motivation for this story as written. I could see the merit in a story that discussed the issue generally, but to write a story suggesting that Wal-Mart is engaged in scandalous behavior and that this is somehow uniquely horrible when it is apparently well known that this is common practice in the world of think tanks on both sides of the political aisle is simply disingenuous. Another reason I visit the Times' website only occasionally.
Yes, they can start out as a checker ---paid the minimum wage and encouraged by the company's HR department to apply for food stamps and state-sponsored health care for the poor--and finish their careers as a greeter (paid the minimum wage, on foodstamps and medicare).
Quite a career.
As for the article, I doubt that you have to bribe people at AEI, the Manhattan Institute, etc. to write pro-big business pro-corporation pieces, it comes naturally to them. So, I don't think this is the story of the century.
That said, I don't mind the NY Times pointing out these institute's authors' failure to disclose the donations they are receiving from the Walton Family Foundation. It never hurts to remind the public of the biases and ties of these groups with big businesses whose agendas they shamelessly cheerlead.
As opposed to PIRG or DNC staffers, who can slave away at or below the minimum wage, making up the difference with welfare payments, and then move on to a socially beneficial position in an artists commune or as a stilt-wearing activist making cameo appearances at anti-globalization or pro-Hizbollah rallies. Before, of course, finishing their careers as a washed-out (if unwashed), unreconstructed hippie-wannabe, continually nattering on about how they made the world a better place for free love and STDs.
Quite a career, that.
Mr. Cooke, on what facts are you basing your opinion on?
I have done business with a number of Wal-Mart executives (e.g., those who probably pull in over $200,000 annually) who started out in low-level positions. $200,000 is a tidy sum, especially in Arkansas. Not every cashier becomes CEO, of course, but in my experience Wal-Mart seems to cultivate long-term careers better than most companies, and to reward employees fairly. Your remarks are just plain inaccurate, and you should give them some serious thought.
...and come out ahead of union picket "employees" who make less money per hour, have to stand out in 104 degree heat, and who won't have a job or any sort of advancement to look for once the union decides to stop paying for those pickets.
Not every job needs to be paid $15 an hour. Not every position is worth more than minimum wage. They're getting paid what the jobs are worth. If they're good at what they do, they get promoted. If they suck, they get to make a couple of hundred bucks a week and get to live in Mom's basement, or look for other employment.
If you're only smart enough and talented enough to be a checker at a big-box store (sliding bar codes over the scanner or occasionally calling in a price check), then you missed the boat a long time back in the employability race.
...and there's damned few people who are "only" that good.
I've written for AEI for fourteen months now. I have no knowledge of who the biggest donors are (or whether anyone in particular has earmarked money for my position), and noone has ever vetted anything I've written to ensure that it is consistent with a the position of a donor (or, indeed, the positions of other scholars, who I haven't hesitated to contradict when I've disagreed with them). And on matters like asbestos reform and patent reform where the business community has conflicting positions, it's quite likely that some of our donors disagree with other of our donors, though I have no idea whether that is actually the case. Moreover, the minute someone at AEI tells me that I can't write something because it conflicts with a donor's wishes is the minute I quit my job and double or triple my salary at a law firm, because if I'm going to write for clients rather than for academic research, I sure as heck want the market rate, which is why I find it ludicrously silly when people accuse me of being bought and paid for.
This is still true with respect to monopsonies in the labor market-- the defenders of free markets are virulently anti-union, even though a union can be defended just as a large corporation can as nothing more than an agglomeration of workers organizing together for common benefit.
The point is, at some point, free market advocates changed their definition of the free market so as to be broad enough to include markets where corporations-- but not where organized labor-- have the inordinate power as the sole or major buyer or seller of something.
Why did this happen? And why was it limited to corporations?
Some of you seem to have missed the point that Bernstein made quite clearly. Unless AEI is taking a position on Wal-mart inconsistent with its free market beliefs (which it is not), there is no reason to suspect undo influence.
This was two sentences buried in the usual recycled propaganda about too many lawsuit, the out of control plaintiff's bar, etc.
And to claim that corporate shills over at the American Enterprise Institute are "scholars" is just a bit much, don't you think?
I just love to see stuff like this. Especially when it is written by puffy guys sitting at a desk somewhere.
Why don't all of those companies just hire some pinkertons and go back to the good old days of cracking skulls of anyone who tries to unionize. I guess that is the theory.
Wal-Mart has monopsony power (i.e., its only competitors are too small to matter) in many markets. The latest example is its refusal to sell DVD's unless studios promise not to sell content at lower prices to Apple for use on i-pods. The studios have to go along, because Wal-Mart controls such a large percentage of DVD sales.
I am not saying that this means that automatically free market types should necessarily oppose Wal-Mart. But it does mean that-- if they are still concerned about monopoly and monopsony power-- they shouldn't "quite naturally defend the largest, most successful business in the U.S", which is what you actually said.
And I don't think you can deny that many economic libertarians express less concern about large concentrations of corporate power than was traditionally the case. Again, I ask, why is that?
Without any malice aforethought, could you tell me just what the "large percentage" of DVD sales from Wal-Mart is, and where you obtained it? In a contest between Wal-Mart and Apple, why should I favor Apple, which with its overpriced iPod seems to be something of a monopolist itself?
The only difference that I can discern between my fellow academics in political science and Washington think tanks is that many of the former suffer from the comical illusion that their research is untainted by the vulgar political bias that characterizes the latter.
As for "monopoly" problems, there is no official barrier to entry into retail, hence there cannot be a monopoly, unlike, say, the official barriers into opening medical schools or other such services that are in high demand and face an artificially restricted supply. (If walmart could enter the medical market my doctor friends would have to trade in their Hummers and multiple country club memberships for mere Honda's and one solitary club membership -- the HORROR.)
There is, however, a unofficial barrier to effective entry into the retail jumbo store market. This barrier arises from the various taxes, regulations, import controls, labor laws, environmental laws, zoning laws, etc, that make it very hard for a young man with ambition, brains and work ethic to challenge Walmart. The only competitors to Walmart all existed before it got big. They all have huge legal departments to fend off interference with the state. They all benefit from laws that FORBID small stores to pool resources. These entities, such as Target and KMart, offer plenty of competition, but, sadly, Walmart is faster and better.
I just bought a bunch of groceries at Walmart. And I am so happy it exists. Hurray for Walmart!! (For snobs out there: We buy our meat, fruits, wine and mineral water at WholeFoods, but that's cause we city critters have dem dar high falutin' tastes...)
In fact, Krugman has explicitly come out against the "Living Wage" movement. Krugman advocates "after-market" solutions to the problem of "redistributing" income. In other words, despite a lack "exploitation", some people can't hack the system, and to those the government is to make money payments. It's a simpler approach. It certainly has nothing to do with specific businesses such as Wal-Mart. The Democrats are probably making a major blunder in attacking Wal-Mart, a position that even leftist economists are going to have to repudiate.
So, you've got the left claiming "exploitation" and the right declaring its innocence. Then you've got the people who study economics as a profession declaring that they can't find any exploitation.
If every company that asked for and received a standard "most favored nations" clause is a monopsonist, the term loses all meaning. One finds it hard to believe that the movie studios are really powerless in negotiating with Wal-Mart and Apple; it's also difficult to believe that the movie studios object too greatly to being "forced" to explain to Apple that they can't provide a discount to a buyer sufficiently powerful that the Europeans seem to consider it a monopoly threat. Are these MFN clauses really a Wal-Mart monopsony problem or a problem of content-provider market power? If these MFN clauses are really Apple-targeted, the biggest effect I see is that Wal-Mart is effectively preventing Apple from using its market power to create barriers to entry to the market for middlemanning downloadable content.