I'm surprised this hasn't been diaried yet, according to my attempts at search, so I'll lay it out there.
Wal-Mart came out today as a co-signatory of a letter sent to President Obama saying it would support a healthcare reform policy that would require large employers to offer health insurance to workers. Others joining Wal-Mart chief executive Mike Duke in the letter were Andy Stern, the president of Service Employees International Union and John Podesta, the CEO of the Center for American Progress.
Predictably, the U.S. Chamber of Commerce has come out denouncing the concept of the employer mandate, but this is a pretty big deal for the Bentonville retailer. Follow me below the fold, and I'll give you a little opinion on why I think Wal-Mart embraced this policy plank that would seemingly raise its costs, and what the impact might be for Democrats.
Let me say first off that I realize that some reading this will find their knee-jerk anti-Wal-Mart buttons pushed by this, and your feelings are justified. I'm agnostic about Wal-Mart personally. I don't think they are inherently evil, but they are very, very good at pricing, process and eliminating cost and waste from their supply chain. Those things will naturally put them at cross purposes with someone's interests somewhere. But shopping there really does save my family scads of money, and the company really has seemed to make sincere efforts at eliminating some of its most offensive practices -- albeit belatedly and imperfectly.
But I hope the discussion can stay on point and avoid the more generalized anti-Wal-Mart rants because this development could have some positive impacts.
First, all that is good and bad about Wal-Mart derives from its internal mission to improve efficiency and control costs. The healthcare industry, which is perhaps most waste-fraught segment of our economy could learn a few things from the way Wal-Mart does things, at least on the administrative or distribution-channel side. No, that does not mean I would like to see Wal-Mart hospitals and doctors. That's the clinical side of the business, a whole different animal that I don't think anyone in Bentonville wants anything to do with.
Second, Wal-Mart never does anything that is not in the best interest of Wal-Mart first. So this announced support for an employer mandate must be considered through the lens of how it benefits the company. I'd say its along the lines of Henry Ford's realization that by paying his workers a better wage, he would gain them as buyers of his cars. Wal-Mart, I believe, wants at some level to become a retailer of health benefits (not necessarily a bad thing, IMHO; see my first point above). In fact, through its Sam's Club stores, Wal-Mart is already a distributor/retailer of certain limited-benefit products, and in recent years, it had a marketing agreement with Humana to allow the insurer to post kiosks in the stores where Humana agents would market to and sign up senior citizens for its Medicare Advantage health plans and Part D prescription drug plans. An employer mandate, with Wal-Mart in some capacity as a general agent, would bring the company a new revenue stream, and perhaps a way to build new business-to-business relationships.
Finally, the fact that this announcement came by way of a letter signed to President Obama should be viewed as a net political gain for the forces supporting healthcare reform. It signals that the two Senators from Arkansas, Mark Pryor and Blanche Lincoln, won't be fence-sitters on a healthcare reform bill that has an employer mandate as its centerpiece. You can safely put them in the "yes vote" column, at least on this topic.
On balance, this looks like a good development. Peoples' suspicion about the giant from Bentonville is well-placed, but not so much on this issue.