Tilting at the Wal-Mart windmill

Even Democrats who are former chairmen of the pro-business DLC (e.g. Joe Lieberman, Evan Bayh) are joining the anti-WalMart cause. Sebastian Mallaby writes that “none of these Democrats can resist dumb economic populism.” Here’s the evil that Walmart has visited upon our fair land:

For a party that needs the votes of Wal-Mart's customers, this is a questionable strategy. But there is more than politics at stake. According to a paper for theNational Bureau of Economic Research by Jerry Hausman and Ephraim Leibtag, neither of whom received funding from Wal-Mart, big-box stores led by Wal-Mart reduce families' food bills by one-fourth. Because Wal-Mart's price-cutting also has a big impact on the non-food stuff it peddles, it saves U.S. consumers upward of $200 billion a year, making it a larger booster of family welfare than the federal government's $33 billion food-stamp program.

Is this good politics for the Democrats? Here are Paul Gigot and Kimberly Strassel on the Journal Editorial Report:

Gigot: Democrats are picking another fight with business. At least a half dozen of the party's presidential contenders have appeared at protests across the country this summer, denouncing the retail giant Wal-Mart for what they say are substandard wages and health-care benefits. It's a rallying cry many Democrats believe will prove powerful in the midterm elections. But could it backfire?

Kim, explain this to me. This is a company that employs something like 1.3 million Americans; 127 million Americans shop there at Wal-Mart during the week. Yet Democrats think this is terrific politics. Why?

Strassel: I don't think it's terrific politics with the general public or the people who work at Wal-Mart. What it is, is it's meant to suck up to the unions who are powerful in elections. And this is a union issue. This hasn't been talked about enough in the Wal-Mart campaign. What you have here are unions that are very unhappy. They have never been able to organize the largest employer in the country. But more importantly, Wal-Mart's success, its phenomenal low-cost structure, is putting a lot of pressure on their own employers. And that is causing lost jobs, fewer stores, shutdowns. And so, what you have here are unions, who are now trying through laws, like these Wal-Mart laws you've seen around the country, and through political pressure, to force Wal-Mart to actually have to take on the high cost structure that their own employers have.

Point of note: more people shop at Wal-Mart every week than voted in the Presidential election. Thus, most Democrats will (as usual) say one thing to union supporters and another to the rank-and-file workers who depend on Walmart for low-cost goods.

More – Via New Editor: “Walmart’s a diversion”