Wal-Marting Philanthropy




B

y 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 corporate philanthropy.”  









The
Walton Family 



B

entonville, 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
Bank…the 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 



A

ccording 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 that direction.


 





Bill
Berkowitz is a freelance writer covering conservative  issues
and policies.