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By Gustav Wynn

April 24, 2012

Walmart was again in headlines this weekend for allegedly covering up widespread, prolonged, top-level corruption in their foreign practices after a major NY Times story examined massive evidence of bribery cover ups going back to September 2005.  For the biggest, worst-paying employer in the US, the news seems only to be beginning, but their plan is simple, operating on a five decade model of aggressive, “never-enough” growth is gradually seeking to replace workers in every city in the nation.

In the Big Apple, Walmart has been eerily quiet, after their attempt last year to get their gangrenous toe in the door was rejected. Grassroots coalitions joined local businesses and community leaders to stop the Walmart “trojan horse” despite million dollar ad campaigns peppering NYC radio with propaganda promising great shopping and lots of jobs.

This deceptive corporate frame-job hopes you ignore a long history of net job losses for communities, as a single Walmart box store can easily displace over 100 local businesses. Walmart jobs pay less, passing on savings to the customer as they take profits out of the local tax base. The displaced workers will not only increase unemployment claims in the area, but Walmart’s workers often need government handouts as well because the wages and benefits are abysmal.

Multibillionaire Mayor Mike Bloomberg was dubbed “Walmart Spokesman” for his support of the box-store bully last year. In this exchange, Bloomberg got snippy with a Daily News reporter daring to ask a Walmart rep to comment on recent charity to underprivileged NYC kids coinciding with their desire to build in the area.

The non-profit ALIGN paired labor groups and CUNY researchers to publish a study detailing how NYC could fare if Walmart achieved it’s typical 20+% marketshare. They estimated a roll out of 11 Walmart Supercenters, 34 Walmart Markets, and 114 Walmart Express stores –and a citywide net loss of some 3,980 jobs.

Lower prices paid by shoppers would translate to over $353 million annually in lost wages and $4 million per year shifted to taxpayers in social services costs. City newspapers noted Walmart’s “desperate for growth” model back in 2011.

But Walmart knows how to wait communities out, wear them down, groom friendly candidates and to build positive PR. Walmart waited eight years, outlasting the city council on the South Side of Chicago after a contentious battle there. Already at it for two years in New York City, their website paints a rosy, union-bashing picture of 100% positive comments, and the following elected officials portrayed as “on board”:

State Senator Diane Savino (D-North Shore/Brooklyn)

Assemblyman Matthew Titone (D-North Shore)

Assemblyman Lou Tobacco (R-South Shore)

Borough President James Molinaro

State Senator Andrew Lanza (R-Staten Island)

Councilman Vincent Ignizio (R-South Shore)

City Councilman Peter Vallone Jr.

Peter Koo, 20th City Council District (Flushing)

Eric Ulrich, City Council Member (Ozone Park)

Councilman James Oddo (R-Mid-Island)

Assemblywoman Nicole Malliotakis (R-East Shore/Brooklyn)

You can also see six different comments from Mayor Bloomberg’s Spokesman Andrew Brent. Even a Michelle Obama quote seems to praise Walmart for bringing healthy choices to urban areas.

When Killing Jobs is Called Creating Jobs

I remember well when Walmart tried to open a second store in my community, only about a mile or so from a existing Walmart, the onslaught of local business owners and protesters spilling out of the hall made the Walmart reps leave in the middle of the hearing.

Just like the sub-prime mortgage crisis, Walmart’s low-road business practices knowingly use everyday people’s eagerness for low prices against their own greater long-term good. Steven Restivo, Walmart’s director of community affairs gloats thusly:

“If we open a store and no one comes to shop there, or if we open a hiring center and no one applies for a job, we’ll have learned a really important lesson about New York City…we just don’t think that’s going to be the case.”

Walmart also responded to charges they would blanket NYC with 159 stores by noting their current “penetration” into other US communities took decades. Not much of a denial.

Foreign Corrupt Practices and Bag-Men

I was in Beijing in 2003 when Walmart was slated to open it’s first store in the city. English language press charged blatant corruption as the last bit of resistance was overcome. Walmart exports about 70% of it’s merchandise from China, ironically driving down wages even as it supports manufacturing jobs, but has increasingly been supplanting Chinese retail workers as 31 stores in China in 2003 has ballooned to 370 today.

Also bitterly ironic, Walmart touts “local sourcing” in China — but only when it pays to. In America, Walmart has destroyed local sustainable loops from coast to coast to profit beyond behemoth proportions. Anita Chan, editor of Walmart in China also notes Walmart brings to it’s Chinese stores ”a unique corporate culture and management ideology, which oddly enough are reminiscent of Mao-era Chinese techniques for promoting loyalty.”

In late 2005, the former secretary of the Communist Party and lead trade official in Yunnan province, Peng Muyu, who reviewed Wal-Mart’s building applications was convicted for bribery and abuse of public funds because his wife accepted over $15,000 in gifts from Zhou Jiali, a board member of Wal-Mart Management Service Co. Ltd.

Walmart denied complicity, although they did admit setting up the company with Zhou, who held a 30% share. As the controlling partner, for Walmart not to have known what was going on is just as troubling. After Zhou was herself arrested, it came out that she had previously been party to a bribery scandal involving the provincial governor. Walmart’s internal reports showed 90 cases of bribery in Asia just in the 18 months before 2006.

While visiting Canada last summer, I noticed a brand new Walmart construction site about in a farming region about an hour north of Toronto. The locals told me the community had resisted for ten years, knowing it would kill jobs on Main Street and export profits to Arkansas. Walmart kept at it though, until the tide finally turned in their favor. Their efforts included development of relationships with elected officials or candidates, one-sided media campaigns, and as usual, promising the impossible: lower prices for shoppers and more jobs.

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