Wal-Mart Joins the Ranks of the Health-Care Corporatists


In May, Reason science correspondent Ron Bailey warned of the coming "health-care corporatism," writing that "the country's major health care producers, including insurance companies, hospital and physician organizations, pharmaceutical companies, and health care labor unions, promised President Barack Obama they would reduce the growth rate of their future incomes by 1.5 percent over the next ten years." Now you can add another corporate behemoth to the list of supporters of advocating more government involvement in health care: Wal-Mart. Today, the nation's largest retailer released a letter supporting an employer mandate.

At first glance, the idea of the notoriously cheap chain favoring liberal reforms might seem like a shock. But it really isn't a huge surprise considering that Wal-Mart CEO Lee Scott partnered with the Service Employees International Union's Andy Stern to push for universal health care more than two years ago.

Why would Wal-Mart do this? In part, because it's a good PR move. The company has long been the target of complaints that it treats its labor force shabbily. Partnering with a big union like the SEIU and supporting universal coverage allows the company an opportunity to soften its corporate image.

But it's also a good from a competitive standpoint. Wal-Mart, the nation's largest employer, can afford the costs imposed by an employer mandate. Smaller competitors are likely to find it harder—and they're not too happy about Wal-Mart's announcement. The Chamber of Commerce released a scathing response. From Jeffrey Young's report in The Hill:

"Some businesses make the decision to use the government as a weapon against their competition," James Gelfand, the Chamber's senior manager for health policy, said in a statement. "We do not agree with this method — the government is a blunt instrument and taxes have extreme unintended consequences, negatively affecting the economy as a whole."

As David Brooks writes in his column today, this is exactly what you ought to expect in a free-spending government dominated by the legislative branch. "Barack Obama, the most riveting of recent presidents, is leading us into an era of Congressional dominance. And Congressional governance is a haven for special interest pleading and venal logrolling." Wal-Mart recognizes this, and is trying to grab any advantage while it can.