Employees receive no tax deduction for the donations, as they do by giving to a charity directly. When soliciting employee contributions to PACs in exchange for charitable donations, companies typically say they want to increase voluntary participation in the political process and support pro-business candidates. Many companies offer a one-for-one match and donate the money to a charity of the employee’s choosing. Coca-Cola and HP both do this. Wal-Mart goes further. It offers a two-for-one match, and the contribution must go to the Associates in Critical Need Trust, or ACNT, a charity the company started in 2001 to help its own store workers facing financial distress. Wal-Mart gave the ACNT about $3.6 million in double-matching funds in the year that ended January 31, according to an audit of the charity’s financial filings.
Wal-Mart to HP Reap Worker Political Donations Through Charities - Bloomberg
So I talked a bit on the podcast, with the fabulous Liza Featherstone, about the story of Walmart employees being expected to donate food to their needy colleagues and how this demonstrates something about the corporate culture at Walmart that Bethany Moreton has explained so well.
Well, this is an even more fascinating twist on the whole story.
In To Serve God and Wal-Mart, Moreton lays out the company's twin narratives--the exploitation of (mostly female) caring labor for low wages, and the growth of Walmart as a political-ideological powerhouse. This latest report twines them both together perfectly.
Walmart asks its employees to donate to its political work (which is not tax-deductible, though few Walmart associates probably make enough for tax deductions to matter, managers might) and will match that donation two-to-one to a charity. So: appealing to the workers' better natures by offering a big charitable donation in exchange for a small political one.
But the charity has to be the one that Walmart chooses--and it's the one that Walmart controls, set up to donate to its own employees "facing financial distress."
Yes, that's right. Instead of giving the associates a raise, Walmart prefers to donate to a "charity" of its own making, creating a fund to help out a few associates rather than spreading some wealth across the board.
And that charity serves as a way to exploit workers' feelings of care and support for one another to raise funds for its political lobbying--which focuses on "pro-business" policies that mostly harm those same workers.
"Wal-Mart has been vocal on issues including the minimum wage," the article notes.
In 2009, IntercontinentalExchange Group Inc. (ICE), which operates global commodity and financial products marketplaces, asked the FEC for an advisory opinion on starting a double-matching program. The commission split evenly on the matter and issued no opinion. According to an audio recording of the meeting that April, three of six commissioners concluded double-matching would “skew the incentives” and “undercut the voluntariness” of contributions to the PAC. One said a double-match would “smack of buying off the contributor,” noting it could open the door to five-to-one matching or more.
So, while the practice as a whole is legal, the FEC is a little iffy as to whether double-matching "undercuts the voluntariness" of the money employees give to the political network. And "Tying the PAC and the charity could confuse donors," according to a "former official at the Wal-Mart Foundation and associates charity," who spoke anonymously.
The article notes that most of the people who contribute are managers rather than hourly associates, possibly because hourly associates don't make enough money to make donations, charitable or otherwise, and also possibly because as Moreton notes, managers at Walmart are likely to have been picked for ideological reasons, from ideologically-aligned programs that Walmart funds at colleges and universities, and so on.
So they may well agree with the political direction that Walmart is steering them in. But even if they don't, the company's come up with yet another way to turn any potential care and solidarity they might have with their fellow workers to its advantage.
