Is Walmart’s March into Cities Helping or Hurting?

Posted on by Corporations and Health Watch

Cross-posted from Food Safety News.

Having saturated the rural landscape, shuttering local stores in small town America along the way, now, in the wake of stagnant sales and increased competition, Walmart desperately needs to expand into urban markets.

And what better urban market than one full of eight million people? While the big box retailer is eager to enter the Big Apple, challenges loom large. Given the negative reputation Walmart has earned for being hostile to workers among other problems, many New Yorkers are skeptical, to put it mildly.

To counter the opposition, Walmart is positioning itself as the solution to urban food deserts – areas where finding real food is next to impossible. But as Anna Lappé has eloquently argued, the big box chain isn’t the answer: “Let’s be clear, expanding into so-called food deserts is an expansion strategy for Walmart. It’s not a charitable move.”

Research Shows Walmart Kills Both Jobs and Food Access

Now a report released last month by Manhattan Borough President Scott Stringer concludes that not only would bringing Walmart to Harlem spell disaster for labor, but it could also make an already dire food access problem there even worse.

Based on data from Chicago’s negative experience, the report found that within two years of a Walmart store opening in New York:

– Between 48 and 66 fresh food retailers could go out of business, representing a net loss of between 56,500 to 82,000 square feet of food retail within a one-mile radius;

– Closure of these stores would represent a loss of 50 to 57 percent of the fresh food retail square footage added in recent years by New York City’s incentive program;

– All of this would negate more than $4 million in public finance investment and four years of effort to improve fresh food access in the area.

As Stringer explained, Walmart shouldn’t be undermining city programs to improve fresh food availability: “Walmart would be a bane, not a boon, to the health food economy of Harlem – or any other New York City neighborhood.”

Moreover, previous economic analysis has shown that Walmart’s promise of jobs doesn’t pan out either. In a report from last summer called “The Walmartization of New York City,” researchers at the City University of New York concluded that, “despite Walmart’s promises of jobs and lower prices for the community, the longer term impact is actually the opposite.”

Assuming Walmart opened the 159 stores needed to reach 21 percent grocery market share in New York City (the same proportion the company enjoys nationally), the impact would be a net loss of almost 4,000 jobs, and a loss of more than $453 million in wages per year for all remaining workers.

What about the new Walmart jobs? According to the report, 4,279 new low-wage Walmart workers would have to “rely on social services to make ends meet, costing New York taxpayers over $4 million per year” in health care benefits alone. This, in a city where the mayor has asked for $2 billion in budget cuts.

Current Walmart Locations Confirm Bleak Outlook

Other areas of the country have already had real world experiences to back up these projected findings. According to New York’s Food for Thought report, of all the employers in Ohio, Walmart has the greatest number of associates and dependents enrolled in Medicaid, which in 2009 cost taxpayers $44.8 million.

Similarly, a 2004 study found that for each of California’s whopping 44,000 Walmart employees, taxpayers had to spend $730 on health care and $1,222 on other forms of state and federal assistance such as (ironically) food stamps.

In 2006, Walmart entered Chicago and recently convinced local officials to approve two additional locations, including (after a long battle) on the city’s South Side. How have things fared so far in the original Chicago location? Not so well.

A three-year study released by Loyola University Chicago in 2010 revealed that Walmart had not enhanced retail activity or even employment opportunities. In fact, “the probability of a local retailer going out of business during the study period was significantly higher for establishments close to Walmart’s location.” Specifically, researchers found that a nearby business had about a 40 percent chance of closing over a two-year period – not very good odds.

If You Can’t Beat Them, Buy Them

Of course Walmart paints an entirely different picture, and is spending a ton of money to hide these sobering facts in a massive PR campaign. According to the Walmartization report, in the first half of 2011 alone, the company spent $2.1 million lobbying in New York, as much as they spent there in the past four years combined. There’s even a dedicated website complete with a “fact-checker” and the heartwarming tagline, “Helping NYC Save Money and Live Better.”

Philanthropy is another time-honored corporate tactic, often used to buy silence from critics, curry favor with community leaders, or, in this case, grease the wheels to gain entry into a reluctant-but-lucrative market.

In December, Walmart announced a combined gift of $250,000 to five various New York City charities, including a home food delivery service and a soup kitchen. Of course $250K is chump change to a company whose net sales topped $405 billion in 2010, but to these five groups it no doubt means a lot. Moreover, in its press release, Walmart made sure to point out the company’s “more than $13 million” in donations in New York City since 2007. (Similarly, Walmart pledged to donate $20 million to Chicago charities.)

But Walmart will need a lot more than a few million dollars in tax-deductible contributions to make up for all the job losses, decrease in available fresh food (and even increased obesity) that could befall New Yorkers.

Other cities should also brace themselves, as the company is opening four stores in Washington, D.C. later this year, with additional area sites planned. Other locations on the agenda include Boston and San Francisco. But mostly the company is keeping quiet about its urban expansion agenda, at least publicly. Last year in Boston, the company was said to be “quietly chatting up city officials” while scouting neighborhoods.

I shudder to think of the consequences to American’s already suffering urban populations if Walmart succeeds in duplicating its rural retail takeover. What to do about it? Support the United Food and Commercial Workers, which has an important campaign called Making Change at Walmart. See also the Big Box Tool Kit, which is chock-full of news and practical resources. Communities can work together to fight back, we just have to act before it’s too late.

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Johnson & Johnson to Pay $158 Million to Settle Lawsuit on Improper Marketing

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The drug company Johnson and Johnson, according to the New York Times, last week said that it would pay $158 million to settle a 2004 Texas lawsuit that accused the company of improperly marketing Risperdal, an antipsychotic drug, to state residents on the Medicaid health program for the poor, including children. The lawsuit accuses the company of pushing Risperdal as “appropriate and safe to treat a broad range of symptoms in populations and disease states for which it had no F.D.A.-approved indication, including in the child and adolescent population.”

Lobbying in Action: PepsiCo Fights Guidelines for Marketing to Kids

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In a posting on theatlantic.com, Marion Nestle reports that Pepsi spent millions this year to fight a set of proposed standards that would regulate how products are presented to kids. Lobbyists are supposed to report what they do and how much money they spend doing it, but this information is not easily available to the public. CBS News reports that PepsiCo spent $750,000 to lobby the government last quarter. This comes to roughly $3 million annually, a drop in PepsiCo’s annual $30.6 billion sales in the U.S. – $57.8 billion worldwide.

The Manufacture of Lifestyle: The Role of Corporations in Unhealthy Living

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What causes unhealthy lifestyles? In a new article now online at the Journal of Public Health Policy, I make the case that corporate business practices such as product design, marketing and retailing and corporate political practices such as lobbying, campaign contributions and sponsored research are fundamental causes of the of the lifestyles associated with the growing global burdens of non-communicable diseases and injuries.

By focusing attention on lifestylers, the organizations and institutions that shape lifestyles, as well as on the behaviors associated with unhealthy living (e.g., tobacco use, high fat, sugar and salt diets, excess alcohol consumption and so on), we expand our options for developing health-promoting public policies.

The figure below, described in detail in the article, illustrates some of the pathways by which corporate practices influence lifestyle.

This boy sells cigarettes at a small shop in Bangladesh, where over 40 percent of the population is under the age of 15 — a target consumer market for Philip Morris International.

In the article, I suggest four actions that public health professionals can take to advance policies that reduce unhealthy lifestyles.

1. Encourage governments to set advertising standards prohibiting promotion of unhealthy products and making misleading health claims.

2. Strengthen laws making corporations liable for the health-related damage associated with products they produce and promote.

3. Actively promote healthier, more sustainable lifestyles, addressing the demand for unhealthy products as well as the supply.

4. Demand political reforms that reduce corporations’ privileged voice in public policy.

The Occupy Wall Street movement and its critique – a world where fewer than one percent of the population determines the living conditions for the other ninety-nine per cent – suggests the potential to mobilize people in opposition to a corporate-controlled world. Our generation’s public health challenge: Can we find ways to link the Occupy Wall Street spirit to the task of overcoming the corporate control of lifestyles that are killing us?

 

Image Credit:

1. Campaign for Tobacco-Free Kids

A New Deal for Public Health in Britain: Whose Responsibility is the Health of the Public?

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The recently empowered coalition government in Britain has adopted a new and controversial approach to public health. In 2010, the secretary of state for health, Andrew Lansley, released a white paper declaring that “Responsibility Deals” would be used to promote health lifestyles and reduce the public health and financial impacts of chronic diseases. Lansley specifically states that the deals are “a Conservative response to challenges which we know can’t be solved by regulation and legislation alone. It’s a partnership between Government and business that balances proportionate regulation with corporate responsibility.” The policy approach raises the ongoing issue of deciding what role government should play when it comes to protecting public health.

Similarly it begs the question of what role, if any, representatives from food, alcohol, and tobacco corporations should have when it comes to writing health policy.

It just takes a little Nudge, or does it?

The approach is founded on an idea that Geof Rayner and Tim Lang of the Centre for Food Policy at City University in London argue is an extension of neoclassical economics, where rational consumers make smart choices, and in so doing support free and responsive markets. Nudge, as this approach is called, comes out of an eponymous book by Thaler and Sunstein. Positioned as an alternative to regulation and the “Nanny State,” Nudge argues that policy interventions like legislation, taxing, regulations, and bans are ineffective and costly for governments to implement and enforce. Instead, government should work with private industry on matters of health promotion and rely more on social marketing and industry-sponsored programs such as a bank sponsored “public” bike-rental scheme in London.

“Responsible” Dealings

The responsibility deal focused on diet and physical activity has three objects, or what it calls pillars. These are:

One: To enable, encourage and incentivize consumers to adopt a better diet and to increase their levels of physical activity as part of a positive decision to lead a healthier lifestyle.

Two: To enable and encourage people to drink sensibly and responsibly.

Three: To extend the scope and effectiveness of occupational health services through businesses, especially for small and medium-sized businesses, with an emphasis on maintaining a healthier lifestyle amongst the whole workforce and thereby reducing sickness and absence.

To date, roughly 400 corporations have signed on to, or pledged, promote these goals. In keeping with the theme of voluntary action and self-monitoring, each of these corporations has drafted and submitted its own pledge to the British Department of Health. In April of this year, each will also submit a self-assessment of their success meeting their goals. As an example of the type of commitments made, 40 of the “partners” as the corporations are referred to by the Department of Health, have agreed to start calorie labeling schemes of foods eaten out of the home. McDonalds is the largest retail outlet to sign on.  Others among the 40 corporations include Starbucks, Burger King, Pizza Hut, KFC, and several of the large supermarket chains. The Department of Health estimates that by 2012, 8000 food outlets in Britain will have calorie labels on their menus. While this is a move, perhaps nudge, in the right direction, it is a far cry from the scale of change likely needed to create real gains in public health. No aspect of this responsibility deal standardizes or mandates the size and/or placement of the calorie labels. No one other than the corporations themselves will be checking the accuracy of the calorie counts posted.

New York City’s experience provides a useful comparison. In New York, the calorie labeling regulation passed in 2007 applies to roughly 10 percent of the city’s 23,000 restaurants. The city’s legal battle with the food industry over the law shows that in a regulatory context with enforcement, details about the placement, accuracy, and size of calorie labels generate significant debate. For New York, the devil in these details of implementation was believed to be critical to the policy’s impact. Britain’s approach is to be hands-off on these issues.

Medical and Public Health Professionals Respond

Not surprisingly, responsibility deals raised more than eyebrows in the British medical and public health communities. Several of what would have been key partners in this collaborative approach to promoting health have refused to participate. This pushback from health advocates and professionals includes academics (like Lang and Tahyer), the British Medical Association, the British Association for the Study of the Liver, the British Liver Trust, Alcohol Concern, the Institute of Alcohol Studies, and the Royal College of Physicians. A consortium of NHS members, public health professionals, and concerned member of the public called Big Society NHS has critiqued the deals, stating that:

“The model of intervention promoted places government regulation as the last step. Once again shirking responsibility and leaving patients susceptible to corporate promotion of profits over health. In short these reforms neglect and dilute patient care, through the systematic fragmentation of the NHS, decrease in government responsibility and increase in privatisation.”

Other concerns of these constituent groups include:

  • The potential for government and private industry collusion behind closed doors on public health policy
  • History shows that private industry’s profit motive will prevent it from acting in ways that protect and promote health
  • That several of the resource allocating mechanisms of the reform will exacerbate, rather than reduce, health inequalities
  • The government white paper outlining the reform fails to include plans for monitoring the impacts of the policy
  • The government white paper outlining the reform fails to include plans for recourse or regulation if it turns out that Responsibility Deals don’t improve public health

What about US?

At the heart of the responsibility deal controversy is the very old public health issue of jurisdictions at all levels of government needing independent decision makers to make the sometime tough and almost always unpopular choices that elected and appointed officials can’t. Time will tell if the responsibility deals create the positive impacts the conservatives claim they will. Or, if this collaborative approach including corporations in writing public health policy will backfire in the ways its critics claim.

For this writer the more salient questions are: do we have time to wait? Is saving money in the short-term on enforcing regulation really worth the potential damage to health and its consequences on public spending in the long-term?

As a final cautionary note, it is worth noting that elements of this approach have already worked their way across the pond. The US’s voluntary salt reduction program is modeled on one that originated in Britain. Given the unique powers and protections afforded to corporations in the US, one should wonder how irresponsible it might be to adopt these kids of deals in this context. It may seem like an impossible move today, but with the Tea Party brewing and a contentious election season on the horizon, it is worth keeping an eye on the latest in conservative, neoliberal, health policy.

 

Image Credits:

1. Vissago via flickr.

2. Toban Black via flickr.

3. KR Colvin via flickr.

Montana High Court Upholds Ban on Election Spending by Corporations

Posted on by Corporations and Health Watch

The Montana Supreme Court, reports the Great Falls Tribune in Great Falls, Montana, restored the state’s century-old ban on direct spending by corporations on political candidates or committees in a ruling Friday that interest groups say bucks a high-profile U.S. Supreme Court decision granting political speech rights to corporations. The decision grants a big win to Attorney General Steve Bullock, who personally represented the state in defending its ban that came under fire after the “Citizens United” decision last year from the U.S. Supreme court.

Cleveland Sues State of Ohio Over Trans Fat Ban

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According to the Associated Press, the city of Cleveland sued the state of Ohio on Tuesday for the right to ban the sale of prepared foods that contain artery-clogging trans fats. The city filed suit in Cuyahoga County Common Pleas Court seeking to invalidate the state law blocking the ban. Mayor Frank Jackson said in announcing the lawsuit that the law unconstitutionally takes away the city’s home rule rights. The city ordinance passed last year would ban industrially produced trans fats in restaurant meals and grocery and bakery takeout items.

2012: The Year to Stop Playing Nice

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Cross-posted from Appetite for Profit.

Instead of a potentially depressing year-in-review post, I decided to look ahead. (But do see Andy Bellatti’s amusing compilation of 2011 food news.) Given all the defeats and set-backs this year due to powerful food industry lobbying, the good food movement should by now be collectively shouting: I am mad as hell and I’m not going to take it anymore.

If you feel that way, I have two words of advice: get political.

I don’t mean to ignore the very real successes: increases in farmers markets, innovative and inspiring programs such as Food Corps, and an increasingly diverse food justice movement, just to name a few. But lately, at least when it comes to kids and junk food, we’ve been getting our butts kicked.

And it’s not just because corporations have more money to lobby, of course they do. It’s that too often, we’re not even in the game. Or, we tend to give up too easily. While I know many food justice advocates who understand this is a political fight over control of the food system, sadly I cannot say the same thing about some of my public health colleagues. Too many nonprofits, foundations, and professionals are playing it safe, afraid to take on the harder fights.

A politician from Maine I interviewed for my book was complaining to me about how food industry lobbyists were in his state capital every single day, while public health sent the occasional volunteer. His sage advice to us advocates: “You may be out-gunned, but you have to bring a gun.”

Moreover, many groups have shown that you don’t always even need a bigger gun. The small but impressive organization, Campaign for a Commercial-Free Childhood proved that this summer when it won an important victory against Scholastic regarding its corporate-sponsored materials. How did they do it? A combination of smart campaigning and effective media. Not by playing nice.

Campaign for a Commercial Free Childhood Logo

Many public health folks I know are more comfortable with research and data than politics and lobbying. But if we are to make real progress, that has to change. Back in May, after a series of defeats, my colleague Nancy Huehnergarth wrote a great call-to-action. She noted how public health advocates and its funders are “very genteel” and that when industry lobbying beats us back, advocates just want more science, believing that the new data “will finally convince policymakers and the public to take action.” But it doesn’t work that way, as she explains:

The reality is that when going up against deep-pocketed, no-holds barred opponents like Big Food, Big Beverage and Big Agriculture, public health’s focus on science and evidence is easily trumped by money and messaging. If public health advocates don’t start rolling up their sleeves and using some of the same tactics used by industry, progress in this fight to create a safe, healthy, sustainable food system is going to move very slowly.

OK, now for some good news. We are already seeing positive signs that indeed, the food movement is getting more political. Recent defeats are helping to mobilize people even more, as folks realize the food industry is not playing nice, so we can’t either. Here then, are just a few signs of hope for 2012:

1)  The growing political movement opposing genetically-engineered foods, which includes a huge Just Label It campaign with an impressive list of supporters. Stay tuned also for the 2012 ballot initiative in California to label GMOs.

2) Powerful nonprofit organizations (who don’t shy away from politics) getting involved for the first time in nutrition policy. For example, the Environmental Working Group’s recent report on sugary cereals called out the utter failure of Big Food’s voluntary nutrition guidelines on marketing to children. Given EWG’s one million-plus supporters, I can’t wait to see where they go with this issue in 2012.

3) Increasing coverage in mainstream media that food industry marketing (and not just personal responsibility) bears much of the blame for the nation’s public health crisis. Examples include a front page story in a recent Sunday edition of the San Francisco Chronicle and Mark Bittman’s weekly Opinionator column in the New York Times, which is consistently smart and hard-hitting.

4) Speaking of media, as traditional investigative journalism outlets have become more scarce, a new breed of reporters may be born from an innovative project just launched in November: Food and Environmental Reporting Network. Its mission is to “produce investigative journalism on the subjects of food, agriculture, and environmental health in partnership with local and national media outlets.” Judging from its first in-depth report on dairy CAFOs in New Mexico, I am looking forward to more in 2012.

5) Finally, the Occupy movement, while still very young, has already inspired a number of food politics offshoots. As I wrote after Food Day, several others have penned calls to action showing the deep connections between corporate control of the food supply and economic injustice. (If you read just one, Tom Philpott’s Foodies, Get Thee to Occupy Wall Street should convince you.) Also, the amazing grassroots organization Food Democracy Now (based in Iowa) recently organized an “Occupy Wall Street Farmers’ March” to bring the message that family farmers are also the 99%. (Read organizer Dave Murphy’s moving account of the successful event and watch the videos of the passionate speakers – I promise you will be inspired.)

There are many other amazing groups, farmers, and eaters organizing all over the country (and the world) to take back our food supply from corporate profiteers. We’ve got plenty of challenges ahead, with the farm bill up for renewal and more school food nutrition standards to fight for, just for starters. I am hopeful that next year we will see the food movement get even more political. I just hope I can also say, by the end of 2012, that it was the year more of my public health colleagues joined in.

 

Image Credits:

1.  Natalie Maynor via Flickr.

2.  Campaign for a Commercial-Free Childhood

3.  Just Label It Blog

4.  Environmental Working Group

Altria: A Good Stock Buy for 2012?

Posted on by Corporations and Health Watch

The shares of Altria Group, the leading cigarette maker in the U.S., rose 20% in 2011’s flat market, and it’s up 50% over the past two years, nearly four times the market’s gain, reports Barron’s this week. Two weeks ago, the stock of Altria, the parent of Philip Morris USA, hit a 52-week high. But, warns Barron’s, investors have largely ignored the risks accompanying the domestic tobacco business. U.S. cigarette sales are in a severe long-term decline. Shipments are down by a third over the past 10 years. In 2011 alone, cigarette volumes fell an estimated 3.8%, reflecting the weak economy and an ever-growing public backlash against smoking. “Operating conditions in the U.S. cigarette industry are more difficult than generally recognized,” says David Adelman, long-time tobacco analyst at Morgan Stanley. He isn’t recommending any of the stocks.

The Champion of Pain Killers

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Overdoses from painkillers now kill nearly 15,000 people a year and many experts doubt that they are effective in reducing long term pain. Yet a new investigation by Pro Publica, also published in the Washington Post, finds that an influential champion for painkillers is the American Pain Foundation, the nation’s largest advocacy group for pain patients. But 90% of the Foundation’s 2010 income came from the drug and medical device industry and its positions closely follow those of its corporate donors.