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April 22, 2012 12:30 PM Wal-Mart’s Big, Fat Bribery Scandal

By Adele Stan

The New York Times is out today with a couple of monster investigative stories, one on a major bribery scandal involving officials of Wal-Mart and the Mexican government, and another on the American Legislative Exchange Council, of which Wal-Mart remains a stalwart member, even as a cadre of big corporations make their exodus from the group that peddled the legislation that became Florida’s infamous “Stand Your Ground” law.

The Wal-Mart story, reported by the outstanding David Barstow (who was among the first to report on ties between the Tea Party movement and militia groups), centers on revelations about years of bribes paid to Mexican officials in Wal-Mart’s quest for “market dominance” in Mexico. In 2005, a lawyer who had overseen the permitting process for construction of Wal-Mart’s Mexican stores provided Wal-Mart honchos with detailed evidence of shady dealings, Barstow writes, setting off an internal investigation that documented “suspect payments totaling more than $24 million.” According to Barstow:

The lead investigator recommended that Wal-Mart expand the investigation.
Instead, an examination by The New York Times found, Wal-Mart’s leaders shut it down.

“Neither American nor Mexican law enforcement officials were notified,” Barstow writes, explaining:

Under fire from labor critics, worried about press leaks and facing a sagging stock price, Wal-Mart’s leaders recognized that the allegations could have devastating consequences, documents and interviews show. Wal-Mart de Mexico was the company’s brightest success story, pitched to investors as a model for future growth. (Today, one in five Wal-Mart stores is in Mexico.) Confronted with evidence of corruption in Mexico, top Wal-Mart executives focused more on damage control than on rooting out wrongdoing.

And it’s no wonder that Wal-Mart is targeted by labor: Wal-Mart is so ruthlessly anti-union, the Wall Street Journal reported, that “[a]fter butchers at a Jacksonville, Texas, Wal-Mart voted to unionize in 2000, Wal-Mart eliminated all U.S. meat-cutting departments.”

For Wal-Mart in 2012, April would seem to be the cruelest month, given Barstow’s epic New York Times investigation, and the media attention on its continued involvement in the anti-labor, pro-gun, anti-immigrant ALEC. Then there’s David Moberg’s though-provoking piece in The American Prospect on “the Wal-Mart effect” on global economics, labor practices and local economies. Here’s a taste:

Beyond its economic impact, Wal-Mart is notorious for censoring the books and recordings it stocks, excluding some presumably for their progressive political leanings and demanding bowdlerized versions of others. As historian Bethany Moreton recounts in To Serve God and Wal-Mart, the company has promoted an amalgam of evangelical Christianity and free—market ideology in colleges and elsewhere and draws much of its management from this cultural milieu. More recently, it has ventured into electoral politics with large political donations, mobilization against politicians supporting the Employee Free Choice Act (including heavy-handed pressure on its own employees), and the promotion of its own version of “Wal-Mart Moms” as a key swing constituency (an implicit buffer against attacks of its treatment of employees).

Perhaps news of Wal-Mart’s bribery scandal — whose cover-up looks an awful lot like an obstruction-of-justice scandal — will convince company executives to cut their PR losses, and finally quit ALEC.

Comments

  • j on April 22, 2012 3:00 PM:

    Like a lot of multi national corporations they seem to think they are above the law, I really hope the law gets to them.

  • Rick B on April 22, 2012 3:31 PM:

    Wal-Mart bribes its way with cash to officials so they will permit new locations? Gee, what a surprise.

    David Cay Johnson in his book "Free Lunch" points out that Wal-Mart's annual profits are almost identical to the amount of tax forgiveness local governments have given them in exchange for relocating to where ever they are now. Anyone who doesn't think that involved direct cash to County and City Supervisors simply doesn't understand Wal-Mart. Then, of course, Wal-Mart can lower prices low enough to run the local businesses out of business because they do have to pay local and state taxes.

    The result is that city and county officials get rich or add to their wealth, middle class shoppers get lower prices, and the net number of jobs in the city or county drops and the ones that remain are paid less.

    American free market capitalism at work. It works best by screwing the employees and bribing local officials. Always has and always will.

  • Rabbler on April 22, 2012 3:32 PM:

    Buying influence? Shocking. Only Wal-Mart would do such a thing.

  • dweb on April 22, 2012 4:56 PM:

    Read the Times article carefully. It indicates that not only did WalMart execs pay off Mexican politicians and bureaucrats to speed store openings ( their goal was to dominate the market so quickly that competitors couldn't catch up)....it also helped its favored suppliers avoid paying Mexican sales taxes.....

    So the average Mexican citizen got screwed twice....bribed government -- and lack of revenues for government to address crucial problems of education, sanitation, environment, policing, transportation and trash collection.

    Your free market forces at work!

  • schtick on April 22, 2012 5:20 PM:

    What do expect from a company flying American flags with signs saying "Buy American" when selling products made in China? They would still be doing it if there hadn't been a stink about it. That is why I do not shop for anything at Walmart, plus the fact they screw their employees right along with their shoppers.

  • Ron Byers on April 22, 2012 5:40 PM:

    If memory serves bribing foreign officials is a Federal offense. Knowing President Obama though, the guilty Walmart officials don't have anything to worry about. Let by-gones be by-gones.

  • Gandalf on April 22, 2012 6:50 PM:

    Fuck you Ron. Equateing this to Obama is beyond stupid.

  • Doug on April 22, 2012 8:02 PM:

    In some foreign countries, "bribes" are simply the way business is done and in those few countries where that IS the case, the DoJ usually turns a blind eye to such actions on the part of US businesses operating there.
    This is different and should be investigated. If found guilty, I'm certain the Waltons can afford any fines that may be levied. Photos of them in orange jump suits, however, would be priceless...

    Mr. Byers, and others, fail to recognize that there were valid, if perhaps not overwhelming, reasons for the current administration NOT instituting criminal investigations of members of the Bush administration in 2009 and 2010: the economy and the ACA. Not to mention (then)Speaker Pelosi's 2006/7 statement that impeachment was off the table.
    I trust Rep. Pelosi's pronouncements on what can, and CANNOT, get through the House, especially when she's in charge. If she said impeachment was off the table, I believe there must have been a very good reason for her saying that. Nor do I believe, although it DOES have some validity, that Rep. Pelosi took impeachment off the table simply to prevent the appearance of it being a partisan effort. Impeachments almost ALWAYS begin as partisan efforts.
    The first two years of the Obama administration were occupied by the stimulus efforts and crafting and passing the ACA. First the stimulus in 2009, followed by lesser legislation. The same pattern occurred in 2010; the ACA followed by (somewhat) lesser legislation.
    The Speaker, unless his name's Boehner, runs the House. If the Speaker says impeachment is off the table there is probably a very good reason for it. I can think of 65-70 reasons: the Blue Dog caucus. Without that caucus none of the progressive legislation passed during 2009-10 would likely be on the books.
    Then there's the optics of impeachment, if you will. The Nixon impeachment proceedings were originally pushed almost exclusively by Democrats. As more crimes were unveiled and those crimes linked to the WH, THEN Republicans began also get behind impeachment. Had Nixon NOT resigned, he WOULD have been impeached, he WOULD have been tried by the Senate and he WOULD have been convicted. That's why he resigned.
    The Clinton impeachment again began as a partisan effort, this time by the Republicans. If I remember correctly a few Democrats signed on, but not in significant numbers. There were sufficient votes in the House to pass articles of impeachment, but nowhere enough votes in the Senate to convict. Which is why the effort was dropped.
    What do Mr. Byers, and the others like him, think would have happened had articles of impeachment against GWB even been drawn up in the House in 2006? I can make a very intelligent guess. The Republicans, aided by the Blue Dogs, would have prevented their passage. Nor, I think, would any preliminary investigations have changed that outcome by more than a vote or two.
    It will be interesting to find out, in a decade or so, just how much WASN'T done between the 2006 and 2010 elections because the House Democratic "majority" didn't exist WITHOUT the Blue Dogs. I rather think GWB's non-impeachment and the failure to investigate the Bush administration AFTER 2009 were due as much, if not more, to that reliance on BD votes than any squeamishness on the part of the Obama administration. I could be wrong, of course.
    ...but I don't think so.

  • Cha on April 22, 2012 11:41 PM:

    Thank you, Gandalf! Ron Byers doesn't know f**k all about President Obama.

  • HMDK on April 23, 2012 11:59 AM:

    Doug, that's a fine analysis. And I agree with it.
    It's still a shitty excuse for sweeping the deaths of thousands under the rug, however. And I'm still reeling from the fact that appearantly most people, of any political stripe, are willing to swallow it.

  • Lex on April 23, 2012 3:50 PM:

    I'll believe anything will be done about this when and only when something is actually done about this.