The American Spectator

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The Wal-Mart Sell-Out

By Doug Bandow on 7.2.09 @ 2:36PM

Wal-Mart once was seen as a conservative, values-driven company.  Unfortunately, it has become a profiteeering rent-seeker, backing a federal employer mandate for health insurance as a means to hobble its competition.

Reports Timothy Carney of the Washington Examiner:

The New Republic's health-care blogger, Jonathan Cohn, came close to Wal-Mart's true motivation: "Wal-Mart has suddenly found itself ... dealing with unpredictable health costs and facing new competition from businesses that have found ways to spend even less on employee health benefits."

The most important part of that analysis can be put more simply: Wal-Mart sees a way to use government as cudgel with which to knee-cap smaller opponents.

You see, Wal-Mart already offers health insurance to all full-time employees and some part-time employees. Many of Wal-Mart's competitors do not do this, which is why the National Retail Federation opposes the mandate. An employer mandate imposes costs on Wal-Mart's competitors, possibly without imposing costs on Wal-Mart.

Cato health-care expert Michael Cannon wrote this week of when a Wal-Mart lobbyist explained the company's support for a federal employer mandate: "Target's health benefits costs are lower."

A mandate for employer coverage will have some standards, and if those standards--maximum employee cost, maximum deductible, minimum coverage--are stricter than what, say, Target offers, Target suffers, which is Wal-Mart's gain.

There's always good reason to be suspicious of proposals for new federal regulations.  There's especially good reason to be suspicious when some businesses are supporting those new regulations!