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Mr. Walton Goes to Washington

Filed under: Imported

If a corporation intends to cheat employees out of their wages, violate labor laws, hire illegal immigrants, and discriminate against women and disabled people, it might be wise to have a few powerful political friends in Washington. That's the realization that Wal-Mart, the world's biggest corporation, is belatedly coming to, according to today's Wall Street Journal. In recent years the company has transformed itself from a corporation that famously disdained the scrum of politics to one of the top influence peddlers on K Street. Since the WSJ is subscription only here's a few choice grafs:

In Washington, Wal-Mart has five lobbyists on its payroll, and a bench of hired guns led by Thomas Hale Boggs Jr., one of Capitol Hill's best-known lawyer-lobbyists. The company's political action committee was the biggest corporate donor to federal parties and candidates in 2003, with more than $1 million in contributions -- up from $182,000 during the 1997-98 election cycle, according to Federal Election Commission disclosure reports. Wal-Mart's PAC ranks as the second-largest in Washington, according to the Center for Responsive Politics, a nonpartisan organization that tracks political giving. ...

Unlike most corporations, which contribute to both parties in rough proportion to Congress's partisan split, about 85% of Wal-Mart's checks go to Republicans. And recently Mr. Allen was named a "Pioneer" by the Bush campaign, meaning he has raised at least $100,000 by getting friends and colleagues to make contributions of up to $2,000 each.

The story goes on to detail how Wal-Mart has beefed up its presence in Washington dramatically since 1999--after its attempt to move into the banking business was thwarted by Congressional regulators.

Congressional allies rushed to offer advice, including Trent Lott, then Senate majority leader. Mr. Lott arrived in Bentonville in late 1999 with a simple message, according to a congressman who attended the meeting: Increase your profile and open your wallet.

So Wal-Mart executives set out to beef up their political action committee -- an account made up of voluntary employee contributions that executives use to make political donations. (Federal law prohibits direct corporate contributions to party committees and candidates.) At an August 2000 meeting attended by thousands of Wal-Mart managers, buckets were passed around for donations, as well as forms authorizing automatic paycheck deductions for the PAC.

For some employees, the pressure to contribute became a point of contention. "With my district manager sitting 3 inches over my shoulder, you think I didn't sign up?" recalls Jon Lehman, a Wal-Mart manager who quit in November 2001 and is now working with union organizers to enlist Wal-Mart workers. Current Wal-Mart employees, who asked not to be named, also report feeling pressured to give to the PAC.

Mr. Allen says Wal-Mart doesn't force workers to give to a PAC; such an action would be illegal. "I regret" that employees felt pressured, says Mr. Allen. "That is not the intent at all."

Wal-Mart managers boosted PAC contributions to $703,500 in the 1999-2000 election cycle from $230,800 in 1997-98. When Sen. Lott issued a call for help for Republican candidates in the late summer of 2002, Wal-Mart's PAC donated $50,000 in September and $101,000 a month later -- mostly to Republicans. "They came through, and people knew it," recalls a former Republican senatorial aide.

(Thanks to Perry.)

Posted by Paul Demko at March 24, 2004 4:01 PM

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