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Edwards making Wal-Mart wages, benefits a 2008 campaign issue

A presidential campaign has a way of focusing national attention on a few key issues. In the campaign for the 2008 election, it can be expected that voters will hear debates over a plan for Iraq and the Middle East and a new energy policy for $3-a-gallon gas.

Another likely topic — if former vice presidential candidate John Edwards continues to create a buzz over a possible candidacy — will be Wal-Mart and its treatment of its employees, particularly health care benefits and wages.

Edwards visited Pittsburgh last month as part of a union-backed program called "Change Wal-Mart, Change America," which is sponsored by another union-connected group called Wake Up Wal-Mart.

Some of Wake Up Wal-Mart's message can be discounted as bitterness over unsuccessful efforts to organize Wal-Mart workers. And, as the nation's largest employer, Wal-Mart is a natural target for critics.

But, to those hearing Edwards and others connected with the Change Wal-Mart national campaign, the retail giant's policies and treatment of its employees does raise issues. There is evidence that Wal-Mart's pay and benefits policies drive other companies to follow suit — if they intend to compete and survive.

Critics contend that this constitutes a race to the bottom and poses a threat to America's middle class.

With 1.3 million employees, multibillion-dollar profits and a trade relationship with China that is larger than that of all but a few countries, Wal-Mart clearly has a major role in the U.S. economy.

Its defenders say the company provides millions of jobs and offers low prices that save consumers money. The company also is recognized for leading edge inventory-control and transportation technologies as part of its obsession with lowering costs.

Its critics, however, point out that the company's low prices come at a high cost, mostly in terms of driving jobs overseas while driving many small-town merchants and other retailers out of business. Labor-oriented critics also point to below- average wages and health benefits as the human costs associated with the company's quest for low prices.

In addition, some state and federal politicians have begun to examine what the giant retailer is costing taxpayers in terms of subsidized development and taxpayer financed health care such as Medicaid, which a significant number of Wal-Mart employees are eligible to receive.

A controversy arose in recent years when it was reported that some Wal-Mart officials had encouraged and assisted their employees in tapping into Medicaid.

Rising health care costs are a serious challenge to most employers, and it is understandable that many smaller companies find it difficult to offer their workers competitive benefit packages. But Wal-Mart, whose profits top $10 billion, can clearly afford to provide reasonable health care benefits and wages to its workers.

Costco, the principle competitor to Sam's Club, Wal-Mart's warehouse division, offers a stark contrast to Wal-Mart by paying wages that are on average 40 percent higher than those at Sam's Club. Costco also provides health benefits to about 80 percent of its employees, while Wal-Mart covers about 60 percent of its workers. Employee turnover at Cosco, not surprisingly, is less than half that of Wal-Mart's.

Reacting to negative publicity in recent years, Wal-Mart has hired a leading national public relations company and has added a small army of Washington lobbyists to its payroll. But union efforts to focus attention on Wal-Mart's pay and benefits policies will not be easily muffled or pushed aside.

Edwards, a former U.S. senator and successful trial lawyer, said he dropped Wal-Mart stock from his investments during his 2004 bid for the Democratic presidential nomination. Then, as now, he connects with voters through his concern for the challenges facing low- and middle-income Americans. Edwards is convinced that America — and by extension Wal-Mart — can do better.

Edwards is not likely to be the only presidential aspirant who will focus on the health care crisis in America — as well as the role that Wal-Mart plays in driving thousands of American jobs overseas while also driving down wages and benefits at many companies across America.

Wal-Mart's PR efforts and high-priced lobbyists are unlikely to prevent the company's overall impact on America from becoming a topic of the next presidential election. And that's a good thing, because despite the short-term benefits of Wal-Mart's low prices, the bigger picture cannot be ignored.

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