by Bill Berkowitz
Z magazine, February 2006
By now, almost everyone knows the story
of Wal-Mart, the world's largest retailer, private employer (it
has more than 5,000 stores; 3,400 in the U.S.), and the largest
company based on revenue, with more than $280 billion in sales.
Wal-Mart's discounted prices, however, come with a heavy price
tag. Workers are underpaid and overworked in sweatshops overseas,
while their non-union counterparts in the U.S. often cannot afford
healthcare. When Wal-Mart comes to town, many small businesses
close down, permanently changing the "civil fabric"
of local communities. The company's bottom line is dependent on
soaking up hundreds of millions of dollars in taxpayer subsidies
extracted from cash-strapped county budgets. A May 2004 study
by the Washington, DC-based Good Jobs First entitled "Shopping
for Subsidies: How Wal-Mart Uses Taxpayer Money to Finance Its
Never Ending Growth" found that the company siphoned more
than one billion dollars in economic development subsidies from
state and local governments across the country. Wal-Mart has also
been the target of a flood of lawsuits; it is currently the defendant
in the largest sex-discrimination class-action lawsuit ever, a
suit representing more than 1.5 million women.
Wal-Mart, and the Walton family that
runs the company founded by Sam Walton, devotes a significant
portion of its holdings to boosting conservative political candidates
and a conservative social agenda centered on the privatization
of public education.
The National Committee for Responsive
Philanthropy (NCRP) offers some context in its report, "The
Waltons and Wal-Mart: SelfInterested Philanthropy:" "Philanthropic
grant-making and campaign contributions to political action committees
(PACs), as well as to candidates, increasingly represents the
surplus capital of the wealthy, which they can devote to promoting
their sociopolitical worldview."
The NCRP report notes, "Corporations
and their foundations in 2004 contributed $12 billion in cash
and in-kind donations to charities." A "lack of government
regulation over the reporting of those contributions," makes
tracking "the true amount of corporate gifts nearly impossible."
It is "even more difficult,"
the NCRP report maintains, "to uncover the true intent behind
many corporate philanthropic projects." While companies benefit
in a number of ways when gifts to non-controversial charities
are acknowledged and publicized, donations to politically charged
campaigns and causes often raise the hackles of both stockholders
and customers. In recent years "little government oversight
and a general lack of transparency" have become the spawning
grounds for "the misuse and abuse of corporation philanthropy,"
as witnessed by scandals involving Enron and Tyco International,
which included "questionable board and executive uses of
The Walton Family
Bentonville, Arkansas is home to the Walton
family and the Wal-Mart corporate empire. Andy Serwer reported
in an extensive profile in the November 15, 2004 Fortune magazine
that the family controls "about 39 percent [4.3 billion shares]
of Wal-Mart stock, worth some $90 billion, which makes them by
far the richest family in the U.S."
According to the NCRP report, "although
all family members have had business ventures and wealth independent
of their inheritance, the bulk of the family's fortune is managed
together by Walton Enterprises." On an annual basis, the
Walton's $90 billion "produces dividends upward of $800 million."
When Sam Walton died in 1992, he left
"the bulk of his wealth" to his wife, Helen, and their
four children. According to the NCRP, Sam Robson Walton is the
eldest son and has been chair of the Board of Wal-Mart Stores
Inc. John, who recently died, was "the activist in the family,
working to fund political campaigns for school vouchers and charter
schools and directing much of the family's charitable giving."
Jim, the youngest son, "is CEO of the Walton family's financial
division, Arvest Holdings, which owns Arvest Bankthe largest bank
in Arkansas." He also "heads" Walton Enterprises
and owns the local newspaper in Bentonville. Alice is apparently
the only Walton child that "does not directly control any
of the family enterprises."
With strong encouragement from Helen,
Sam Walton started his family foundation with $1,000 in 1987.
By the time Sam Walton died five years later, he left the foundation
$172 million. NWANews.com's Mark Minton pointed out in November
2004 that, according to the Walton Family Foundation's tax return
filed that same month, it "held assets worth $733.9 million
at the end of 2003."
While assorted members of the Walton
family have established their own philanthropic projects, the
Walton Family Foundation and the Wal-Mart Foundations are the
flagship foundations. The Walton Family Foundation already gives
out more than $100 million a year-much of it to opponents of public
school education-and it may receive as much as an additional $20
billion when Helen dies.
Despite donations to Planned Parenthood
and $5 million for the establishment of Walton Arts Center near
the university campus in Fayetteville, Arkansas, the Walton family
has been a champion of alternatives to public education. It has
supported the establishment of charter schools and private school
choice. "It gave a string of grants totaling nearly $3 million
to the national Knowledge is Power Program, which recruits teachers
to create public college prep charter schools in underserved communities,"
Minter reported. "The gifts included donations to 21 such
schools around the country."
According to the NCRP report, "almost
all political contributions made by Wal-Mart Stores Inc., Political
Action Committee for Responsive Government, and individual family
members, are directed toward Republican candidates for public
office or Republican political committees. Of $2.1 million given
in 2004, $1.6 million went to the GOP, while less than $500,000
went to Democrats.
Newsweek reported that WMF has consistently
ranked first in total giving based only on cash contributions.
Wal-Mart reported that WMF gave more than $170 million in 2004,
up nearly $60 million from two years earlier. According to the
company's figures, "more than 90 percent" of its donations
go through its local stores.
Although the foundation prohibits the
funding of "faith-based organizations whose projects benefit
primarily or wholly their membership or adherents," nevertheless,
"churches and other houses of worship receive a large percentage
of grants," according to the NCRP report.
Schools for Profit
According to its 2003 IRS tax filing,
the Walton Family Foundation (WFF) was the 63rd largest foundation
in terms of assets ($733 plus million) and 25th largest in terms
of giving ($107 million).
The WFF concentrates its giving on three
spheres: "systematic reform in education," focusing
on K-12; "the northwest region of Arkansas"; and "the
Delta region of Arkansas and Mississippi." The WFF also concentrates
on funding charter school initiatives, Educational Options Scholarship
Initiatives, school improvement, and Arkansas education. Before
his death, John Walton was "one of the nation's leading private
individual funders of charter schools and voucher initiatives."
The NCRP, looking into the WFF's penchant
for spearheading the privatization movement, asks: "Why is
the richest family in the world so committed to education and
specifically to school choice, when they themselves mostly attended
public school to apparently good effect?
"Some critics argue that it is the
beginning of the 'Wal-Martization' of education, and a move to
forprofit schooling, from which the family could potentially financially
benefit. John Walton owned 240,000 shares of Tesseract Group Inc.
(formerly known as Education Alternatives Inc.), which is a forprofit
company that develops/manages charter and private school as well
as public schools."
The WFF provides more than $1 million
to each of the following socalled school reform/choice groups:
the American Education Reform Council, the Center for Education
Reform, Children's Scholarship Fund, Colorado League of Charter
Schools, and the Florida School Choice Fund. The Children's Educational
Opportunity Foundation of America (also known as Children's First
America) received $10.3 million in 2003 and $8.3 million in 2002.
The WFF has also supported the Washington,
DC-based Black Alliance for Education Options (BAEO), an African
Americanheaded group that "works to advertise and market
the school voucher movement to African-American families"
(www.baeo.org). In October 2002 BAEO received a $600,000 grant
from the Bush administration. "We want to change the conversation
about parental choice by positively influencing individuals who
are resisting parental choice options and get them to reconsider
their outlook," Undersecretary of Education Gene Hickok said
when he announced the grant. The Black Commentator characterized
the BAEO as "the school vouchers propaganda outfit created
by the far-right [Harry and Lynde] Bradley Foundation."
In addition to its support for the "school
reform" movement, the WFF "funds pro-voucher think tanks
like the Goldwater Institute and the Manhattan Institute for Policy
Research." In a short piece, titled "John Walton and
the Walton Family Foundation," People for the American Way
point out, "On the legislative front, John Walton personally
contributed $2 million to the failed 2000 Michigan voucher initiative
as well as $250,000 to California's Prop 174 in 1993, another
unsuccessful voucher initiative. Walton also bankrolled the California
effort through his American Education Reform Foundation, as well
as an unsuccessful 1997 voucher campaign in Minnesota."
The National Committee for Responsive
Philanthropy concludes its report by pointing out that, "Wal-Mart
and the Walton family have only recently begun to translate their
vast wealth into political power." While Sam Walton expressed
little interest in national politics, his progeny have moved in
Bill Berkowitz is a freelance writer covering
conservative issues and policies.