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Invisibleafoaf
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Walmart and Free Market Capitalism
    #4695143 - 09/22/05 02:45 PM (11 years, 6 months ago)

seperated from the original thread:

Quote:

cb9fl said:
Walmart is anything but an example of free market capitalism




What about Walmart runs contrary to free market capitalism?


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Offlinecb9fl
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Re: Walmart and Free Market Capitalism [Re: afoaf]
    #4695216 - 09/22/05 03:03 PM (11 years, 6 months ago)

http://www.tompaine.com/articles/walmarts_free_market_fallacy.php?dateid=20050421

Quote:

Back at home, Wal-Mart?s free market mantra stops at the water?s edge of the public till. By one estimate, Wal-Mart has pulled in $1.5 billion dollars in taxpayer funded subsidies (see www.walmartwatch.com) . And that's at the low end, because subsidies are sometimes hard to track based on the lack of public reporting requirements. Wal-Mart is happy to cash in on government largess like property tax abatements, infrastructure support, free land and just straight-out cold cash?all of which are the antithesis of ?free market? ideology.




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OfflinePhred
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Re: Walmart and Free Market Capitalism [Re: cb9fl]
    #4695301 - 09/22/05 03:15 PM (11 years, 6 months ago)

And this is wrong because... ?

So in Wal-Mart's lifetime the government handed them $1.5 billion in cash? How much corporate tax have they paid in that same period of time? If it is less than $1.5 billion I can see why people would criticize them. But of course it is many MANY times more than $1.5 billion.

Phred


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OfflineRedstorm
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Re: Walmart and Free Market Capitalism [Re: Phred]
    #4695313 - 09/22/05 03:19 PM (11 years, 6 months ago)

I stil don't understand why they should get subsidies, regardless of how much they pay in taxes.


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Offlinecb9fl
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Re: Walmart and Free Market Capitalism [Re: Phred]
    #4695323 - 09/22/05 03:20 PM (11 years, 6 months ago)

Are you seriously arguing that Walmart represent free-market capitalism?


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It is better to be hated for what you are than to be loved for what you are not. -Andre Gide

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OfflinePhred
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Re: Walmart and Free Market Capitalism [Re: Redstorm]
    #4695333 - 09/22/05 03:23 PM (11 years, 6 months ago)

Who says they do? Some Marxist parrot ranting at TomPaine.com.

Do you believe you -- Redstorm -- have the right to legally minimize the tax you pay? If you answer yes, why do you believe Wal-Mart doesn't have the same right?





Phred


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OfflinePhred
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Re: Walmart and Free Market Capitalism [Re: cb9fl]
    #4695342 - 09/22/05 03:25 PM (11 years, 6 months ago)

Quote:

Are you seriously arguing that Walmart represent free-market capitalism?




How could I argue that? Free market Capitalism is decided on by the State, not the players subject to the laws of the State.




Phred


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OfflineRedstorm
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Re: Walmart and Free Market Capitalism [Re: Phred]
    #4695352 - 09/22/05 03:31 PM (11 years, 6 months ago)

Quote:

Phred said:
Who says they do? Some Marxist parrot ranting at TomPaine.com.

Do you believe you -- Redstorm -- have the right to legally minimize the tax you pay? If you answer yes, why do you believe Wal-Mart doesn't have the same right?

Phred




Of course I believe in minimizing my taxes. That is why I disagree with a private entity getting tax breaks that are either then passed onto others to be paid, or plopped down on top of the huge national debt. If I am forced to pay all of my taxes, so should they.


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OfflinePhred
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Re: Walmart and Free Market Capitalism [Re: Redstorm]
    #4695393 - 09/22/05 03:42 PM (11 years, 6 months ago)

So when the government sent everyone a few hundred bucks a few years ago (Bush's first tax cut) you never cashed the check?

If you could buy a house in one state which offered you a five year break on property taxes as an incentive to live in that state rather than the one you live in now, you would reject the offer out of hand? What about those states (or municipalities) which give preferential mortgage rates or matching downpayments to first time home buyers? What about government-subsidized student loans?

The fact remains that you will pay far FAR more in taxes in your lifetime than you will ever receive in government services. On those rare occasions the government provides you an opportunity to partially offset those taxes, it is not being "anti-Capitalist" to do so. Lord knows it's a pitifully small offset at best.




Phred


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Offlinecb9fl
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Re: Walmart and Free Market Capitalism [Re: Phred]
    #4695412 - 09/22/05 03:49 PM (11 years, 6 months ago)

It's not like Walmart just stumbled upon some money. They lobby politicians to pass laws and regulations allowing them to take advantage of the taxpayer. They actively discourage free-market capitalism in favor of corporatism.


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It is better to be hated for what you are than to be loved for what you are not. -Andre Gide

"Generosity is nothing else than a craze to possess. All which I abandon, all which I give, I enjoy in a higher manner through the fact that I give it away. To give is to enjoy possessively the object which one gives."


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OfflineRedstorm
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Re: Walmart and Free Market Capitalism [Re: cb9fl]
    #4695434 - 09/22/05 03:55 PM (11 years, 6 months ago)

I'm looking at their Financial Statement for 2004. If you know anything about accounting you can figure out how much they ayed by looking at it.

http://library.corporate-ir.net/library/11/112/112761/items/146737/WAL-MART_final.pdf


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OfflinePhred
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Re: Walmart and Free Market Capitalism [Re: cb9fl]
    #4695475 - 09/22/05 04:05 PM (11 years, 6 months ago)

Quote:

They lobby politicians to pass laws and regulations allowing them to take advantage of the taxpayer. They actively discourage free-market capitalism in favor of corporatism.




As I said already, it is not those subject to the laws of the State who determine whether or not that state is a free market state or a corporatist one, it is the State. The US was subsidizing industry long before Wal-Mart joined the game.

The players are faced with a certain set of rules -- determined by the State -- and do the best they can to play the game while being hobbled at every turn by those rules. And yes, in a democratic society part of playing the game includes petitioning to change the rules (lobbyists).

Wal-Mart succeeds by doing what everyone in the retail business must do in order to succeed -- sell stuff for more than you buy that same stuff for. If there was no such thing as Communist China, Wal-Mart would buy their stuff from the next cheapest place. Maybe India, maybe Mexico, maybe Peru. Who knows? It's not as if Communist China's only customer is Wal-Mart. I know I've seen stuff made in China in stores other than Wal-Mart.

Surely you are not attempting to argue that Wal-Mart's competitors are not also eligible for tax breaks or that they are not also offered incentives for opening new outlets. In fact -- as the article you linked points out -- Wal-Mart appears to be unique in that it is the only one faced with active State opposition to their operations. I don't recall ever seeing an article about K-Mart or Sears Roebuck being prevented from building a store in New York, for example.


Phred


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Offlinecb9fl
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Re: Walmart and Free Market Capitalism [Re: Phred]
    #4695509 - 09/22/05 04:15 PM (11 years, 6 months ago)

I'm pointing out that two wrongs don't make a right. People are sometimes quick to point out the horrible poor living off the system and yet fail to realize large corporations like Walmart are some of the worst offenders. The US steals from every one of my paychecks. Walmart is not only exploiting that but further encouraging it which is just as wrong as if they had stolen directly from me. The line between some large corporations and the US government is severely blurred. Fighting against bureaucracy and large government in some cases equates to fighting large corporations.


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It is better to be hated for what you are than to be loved for what you are not. -Andre Gide

"Generosity is nothing else than a craze to possess. All which I abandon, all which I give, I enjoy in a higher manner through the fact that I give it away. To give is to enjoy possessively the object which one gives."


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Re: Walmart and Free Market Capitalism [Re: cb9fl]
    #4695641 - 09/22/05 04:45 PM (11 years, 6 months ago)

Quote:

People are sometimes quick to point out the horrible poor living off the system and yet fail to realize large corporations like Walmart are some of the worst offenders.




But Wal-Mart doesn't "live off the system". The system lives off it (and other taxpayers). That's the essential difference.

I downloaded that .pdf file and took a very quick skim through the first part of it. Do you know what their profit margin is? Under 3.5 per cent. Do you know what their effective tax rate is? Around 35.5 per cent.

Considering their annual sales are in excess of $250 billion, the fact that over their lifetime they have received 1.5 billion -- not even in CASH, mind you, but in tax "breaks" and other incentives -- from various levels of government is such a laughably tiny amount as to invite ridicule for anyone who attempts to use it as some kind of condemnation. For 2003 and 2004 alone they payed over 9.2 billion dollars in taxes. They'll pay over 5 billion in 2005. So in the last three years alone they will have paid close to ten times the amount in CASH the amount tompaine.com claims they received in "tax breaks, incentives and subsidies" over their entire lifetime. And -- as you are well aware -- a tax "break" is far from the same thing as someone handing you cash. It's just having less seized from you than is normally the case.

I repeat -- it is not Wal-Mart who sets the rules. It's the State. Do you not think Wal-Mart would gladly forego all future "breaks", "subsidies" and "incentives" in exchange for having the corporate tax levels for US-based companies reduced by a few percentage points? Because (as someone who spent more than a few years in the corporate world) I KNOW they would.

Quote:

The line between some large corporations and the US government is severely blurred.




Even if this is true, it's the State doing the blurring.

Quote:

Fighting against bureaucracy and large government in some cases equates to fighting large corporations.




How did you arrive at this startling conclusion?




Phred


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Offlinedaimyo
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Re: Walmart and Free Market Capitalism [Re: Phred]
    #4695676 - 09/22/05 04:55 PM (11 years, 6 months ago)

Help me understand...
I thought the 1.5 billion figure was yearly breaks? Any sources on this?
If they make 250 billion wouldn't 35% be 87 billion give or take? Or is the tax taken from another number?


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OfflineRedstorm
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Re: Walmart and Free Market Capitalism [Re: Phred]
    #4695957 - 09/22/05 06:00 PM (11 years, 6 months ago)

Quote:

I downloaded that .pdf file and took a very quick skim through the first part of it. Do you know what their profit margin is? Under 3.5 per cent. Do you know what their effective tax rate is? Around 35.5 per cent.




Be careful when you're talking about accounting. 3.5% may seem miniscule, but not only does it amount to a huge amount of money, but I bet it's comparable to most other companies in the superstore field.


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Re: Walmart and Free Market Capitalism [Re: Redstorm]
    #4696196 - 09/22/05 06:49 PM (11 years, 6 months ago)

I worked in the corporate world for many years. 3.5% is a damn slender profit margin, believe me.

And I used the numbers to illustrate a point: profit margin of 3.5% or less, effective tax rate of ten times that. Did it escape your attention that Wal-Mart will pay 5 billion smackers in tax this year? That's a hefty chunk of change. $5 billion pays one hell of a lot of welfare checks.




Phred


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OfflineRedstorm
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Re: Walmart and Free Market Capitalism [Re: Phred]
    #4696218 - 09/22/05 06:53 PM (11 years, 6 months ago)

Yes, I saw the income taxes paid on the income sheet.

I just don't see why average citizens should have to pick up the tab for subsidizing a private company.


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OfflinePhred
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Re: Walmart and Free Market Capitalism [Re: daimyo]
    #4696227 - 09/22/05 06:55 PM (11 years, 6 months ago)

Quote:

I thought the 1.5 billion figure was yearly breaks? Any sources on this?




Nope, not yearly. If it was yearly I can guarantee the author would have emphasized it. As for sources, the only source he provides is an anti-Wal-Mart website. Looking through their list of articles, none of the titles appear to deal with government largesse to Wal-Mart and I sure as hell am not going to read every one of them. If the asshat who wrote the article can't provide a better link than that, I'm not going to buy his figure.

Quote:

If they make 250 billion wouldn't 35% be 87 billion give or take? Or is the tax taken from another number?




Corporate taxes are based on profit, not gross sales.




Phred


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OfflinePhred
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Re: Walmart and Free Market Capitalism [Re: Redstorm]
    #4696248 - 09/22/05 06:59 PM (11 years, 6 months ago)

Quote:

I just don't see why average citizens should have to pick up the tab for subsidizing a private company.




Nor do I, which is why I've been a Laissez-faire Capitalist for three decades now. The point is that the way the State has set things up, any company which DOESN'T play the game has no chance in hell of prospering. To blame Wal-Mart (or any other company) for doing what they must is childish.




Phred


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