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Friday, November 23, 2012

Walmart's low wages mean extra food stamps and Medicaid costs for states

While there are reports of multiple protests by Walmart employees in more than a half dozen states at hundreds of stores, some are claiming that the workers are doing themselves a disservice by harming the hand that feeds them.

Well, here are a few things people should know: Those extra low prices come with a hidden cost. When those employees are paid a low wage, they are frequently subsidized by the state to help them make ends meet. It is why Walmart employees so frequently turn to assistance such as food stamps and Medicaid for their children.

In other words, we are subsidizing those low prices and wages through our tax dollars in a variety of ways. In addition to the costs associated with food stamps and Medicaid, Walmart often receives local and state incentives to build in a community.

Walmart, the world's largest retailer, is the largest private-employer in the tourism-dominated Myrtle Beach area - which just happens to have the lowest average annual wages in the country.

It's one of those situations where people who focus on the surface often ignore the hidden costs. The same thing happens with other retailers, not just Walmart. It happens in health care. We balk at "paying for" someone else's medical costs via health reform while not realizing that when people go to the emergency room without insurance and can't afford to pay, people with insurance pay higher rates and the federal government helps to offset those costs as well. That means all of us.

The same thing happens with an under-funded school system, such as the one in South Carolina that has never been fully funded at the state's minimum-required level. When poor students receive less-than-desirable educations, the odds that they will get into trouble or live in poverty later in life increases - and all those things bring more costs to the state, which have to be subsidized by taxpayers with the addition of new prisons and more expensive health care.

The same thing happens with the private home security systems. They rely upon the tax-payer subsidized city, county and state level law enforcement agencies, but when they produce a ton of false alarms - as they frequently do - they force those law enforcement agencies to check out the false alarms any way. That is a waste of man power that costs taxpayers extra money, and it takes away time those agencies could be using to make us safer.

So before you condemn the Walmart employees who are protesting over what they feel are bad or unfair labor practices, remember that there are hidden costs you may not realize that they just might be illuminating. Does it make sense for the taxpayer to have to spend so much money to subsidize Walmart employees while executives and owners of the company walk away with so much in profit and compensation? Does it make sense that the American taxpayer is being used to keep Walmart's prices low and the executives' salaries high?


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