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What Kind of Walmart Do We Want For Our Country?

The Huffington Post

On a talk show this past Sunday, Walmart worker Greg Fletcher spoke about the realities of struggling to provide for his family on the company's infamous low wages. David Frum, a conservative columnist atNewsweek, pointedly asked Greg whether he got the Earned Income Tax Credit, a tax refund meant to supplement the earnings of low-wage workers.

The good news is that it doesn't have to be this way. There is nothing inevitable about Walmart's low wages, because plenty of retailers, including Costco, are profitable while paying a decent wage. In fact, a new report by Demos asked what would happen if all large retailers in the U.S. raised their starting wage to $25,000 a year (a quite modest benchmark). The researchers found that 1.5 million workers and their families would be lifted out of poverty. The cost would equal just 1 percent of total annual sales, presumably something these companies can absorb, given that many have been making record profitsduring the recovery (Walmart alone made more than $15 billion in profits last year). Moreover, study after study shows that when workers are paid more, they are more productive and stay on the job longer, cutting retraining and turnover costs. Still, let's say retailers passed on half the cost to consumers; Demos estimates we'd pay a mere 15 cents more in each shopping trip, or $17.73 a year.

Most compelling, the wage boost would generate $4 to $5 billion in additional annual sales for retailers -- bringing us back full circle to Henry Ford's simple yet profound recognition that his workers were also his customers. At a time when our country is struggling with unprecedented levels of inequality and an economy that can't seem to get out of first gear, we desperately need this extra buying power.