Ok, while I also support a guaranteed basic income, I feel the need to side with the Wal-Mart haters here. Our case is more sophisticated than you've presented here.
Our case is not, "Wal-Mart pays wages that are too low to live on, therefore they're leeching from the public dole, therefore they're capital-E Evil."
Our case is a basic case against neoliberalism itself, the principle that the outcomes of unregulated markets are just deserts. We are, as in many other cases, pointing out the fundamental lie of neoliberalism: that unregulated markets aren't. Wal-Mart pays wages that are too low to live on, therefore, whatever increased productivity (which isn't very much, frankly) we can say they're adding to the total economy, however much they're reducing the theoretical additional dole burden, they are not an independent firm earning profits on a "free" market without government disturbance. They are, at a fundamental level, receiving a public subsidy.
Now, in our view, there are plenty of good reasons for the State to give a firm public subsidy. However, since we of the Left are, by definition, pro-labor and anti-capital, we cannot and do not hold that "in order to increase profits by decreasing wages" is such a reason. It can't be, after all; think of what it means for a Low Wage Subsidy to exist: both Wal-Mart's workers and the taxpaying public are thus making pro-bono donations to the owners of Wal-Mart at a net-negative benefit to their/our selves.
Why is this a net negative for the public? Don't we receive lower prices at Wal-Mart via this subsidy? Well yes, but even if we assumed that everyone shops at Wal-Mart in order to realize that gain, it's financially impossible that the drop in prices thanks to the subsidy is equivalent to the value of the subsidy. If it was, Wal-Mart wouldn't be realizing any additional profits by taking the subsidy, and the company would thus refuse it!
The only way the "Food Stamps subsidy" of Wal-Mart makes sense for the fiduciary interest of Wal-Mart itself is if the subsidy acts as a transfer of wealth from the public and the workers to Wal-Mart. This isn't just the kind of behavior that had Karl Marx calling for revolution, it's the kind that made Adam Smith cry out against state favors for business and in favor of genuinely free markets.
Thus, in conclusion, if Wal-Mart is not an independent firm but a publicly-subsidized one, how can we possibly say that the public does not have a moral, financial, and political stake in their business practices? Does the public not have the right to regulate the spending of its own money? Certainly, we ought to be able to pass a policy saying that any business accepting State funds - possibly even at more than one level of remove - has an obligation to use labor and environmental practices the public finds morally acceptable.
(By the way, "free market" is a term that really cannot make any consistent sense if we use it to mean that capital owners are free and labor sellers are forced by threat of starvation and also jail to work or die. At the very least, a "free market society" has an obligation to legalize vagrancy and, in general, remove all State-imposed penalties for the crime of being poor!)
they [Walmart] are not an independent firm earning profits on a "free" market without government disturbance.
Of course they aren't. They follow OSHA and all the other regulations. They pay a corporate income of 35% of their profits and their employees pay federal and state income taxes on their pay.
They are, at a fundamental level, receiving a public subsidy.
If Walmart stops employing a given minimum wage employee, that employee costs government MORE in aid, not less. So even though for every min wage employer Walmart takes on, gover...
Note: Originally posted in Discussion, edited to take comments there into account.
Yes, politics, boo hiss. In my defense, the topic of this post cuts across usual tribal affiliations (I write it as a liberal criticizing other liberals), and has a couple strong tie-ins with main LessWrong topics:
The issue is this: recently, I've seen a meme going around to the effect that companies like Walmart that have a large number of employees on government benefits are the "real welfare queens" or somesuch, and with the implied message that all companies have a moral obligation to pay their employees enough that they don't need government benefits. (I say mention Walmart because it's the most frequently mentioned villain in this meme, but others, like McDonalds, get mentioned.)
My initial awareness of this meme came from it being all over my Facebook feed, but when I went to Google to track down examples, I found it coming out of the mouths of some fairly prominent congresscritters. For example Alan Grayson:
Or Bernie Sanders:
Now here's why this is weird: consider Grayson's claim that each Walmart employee costs the taxpayers on average $1,000. In what sense is that true? If Walmart fired those employees, it wouldn't save the taxpayers money: if anything, it would increase the strain on public services. Conversely, it's unlikely that cutting benefits would force Walmart to pay higher wages: if anything, it would make people more desperate and willing to work for low wages. (Cf. this this excellent critique of the anti-Walmart meme).
Or consider Sanders' claim that it would be better to raise the minimum wage and spend less on government benefits. He emphasizes that Walmart could take a hit in profits to pay its employees more. It's unclear to what degree that's true (see again previous link), and unclear if there's a practical way for the government to force Walmart to do that, but ignore those issues, it's worth pointing out that you could also just raise taxes on rich people generally to increase benefits for low-wage workers. The idea seems to be that morally, Walmart employees should be primarily Walmart's moral responsibility, and not so much the moral responsibility of the (the more well-off segment of) the population in general.
But the idea that employing someone gives you a general responsibility for their welfare (beyond, say, not tricking them into working for less pay or under worse conditions than you initially promised) is also very odd. It suggests that if you want to be virtuous, you should avoid hiring people, so as to keep your hands clean and avoid the moral contagion that comes with employing low wage workers. Yet such a policy doesn't actually help the people who might want jobs from you. This is not to deny that, plausibly, wealthy onwers of Walmart stock have a moral responsibility to the poor. What's implausible is that non-Walmart stock owners have significantly less responsibility to the poor.
This meme also worries me because I lean towards thinking that the minimum wage isn't a terrible policy but we'd be better off replacing it with guaranteed basic income (or an otherwise more lavish welfare state). And guaranteed basic income could be a really important policy to have as more and more jobs are replaced by automation (again see gwern if that seems crazy to you). I worry that this anti-Walmart meme could lead to an odd left-wing resistance to GBI/more lavish welfare state, since the policy would be branded as a subsidy to Walmart.