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Taxpayers Subsidize Poverty Wages at Walmart, McDonald’s, Other Large Corporations, GAO Finds

Nov 18, 2020

Commentary: Many full-time workers employed by some of America’s largest and most profitable corporations receive wages so low that they qualify for Supplemental Nutrition Assistance Program (SNAP, or “food stamps”) benefits and Medicaid, according to a report released today by the Government Accountability Office (GAO).

The report, “Millions of Full-time Workers Rely on Federal Health Care and Food Assistance Programs,” commissioned by Sen. Bernie Sanders (I-Vt.), found that 5.7 million Medicaid enrollees and 4.7 million SNAP recipients who worked full-time for 50 or more weeks in 2018 earned wages so low that they qualified for these federal benefits. An estimated 12 million wage-earning adults enrolled in Medicaid and 9 million wage-earning adults living in households receiving SNAP benefits worked at some point in 2018.

“At a time when huge corporations like Walmart and McDonald’s are making billions in profits and giving their CEOs tens of millions of dollars a year, they’re relying on corporate welfare from the federal government by paying their workers starvation wages. That is morally obscene. U.S. taxpayers should not be forced to subsidize some of the largest and most profitable corporations in America. It is time for the owners of Walmart, McDonald’s and other large corporations to get off of welfare and pay their workers a living wage,” said Sanders. “No one in this country should live in poverty. No one should go hungry. No one should be unable to get the medical care they need. It is long past time to increase the federal minimum wage from a starvation wage of $7.25 an hour to $15, and guarantee health care to all Americans as a human right.”

GAO sent questionnaires to state Medicaid and SNAP agencies and analyzed data from 15 such agencies across 11 states. Each agency reported the 25 most common employers of Medicaid enrollees and SNAP recipients. Among the 15 agencies, Walmart was in the top four employers of program beneficiaries in each and every one. McDonald’s was a top-five employer of employees receiving federal benefits in 13 of the 15 agencies. GAO’s analysis across the states it examined reveals that multi-billion-dollar firms employed tens of thousands of workers at wages so low, taxpayers effectively provided nutrition support and health insurance that would be unnecessary if they paid living wages.

Notoriously low-paying and dangerous dollar-store chains also appeared throughout these lists, with Dollar Tree ranking among the top 15 largest employers of employees receiving benefits in all 15 agencies, and Dollar General among the top 10 in nine different agencies.

Across nine states–Arkansas, Georgia, Indiana, Maine, Massachusetts, Nebraska, North Carolina, Tennessee, and Washington – these large corporations employed the following numbers of SNAP recipients in February 2020:

·       Walmart – 14,541
·       McDonald’s – 8,783
·       Dollar Tree – 4,515
·       Dollar General – 4,488
·       Amazon – 4,218
·       Burger King – 3,326
·       FedEx – 2,622
·       Wendy’s – 2,237
·       Subway – 2,231
·       Taco Bell – 2,114
·       Uber – 2,032
·       Target – 1,783
·       Dunkin’ Donuts – 1,564
·       Home Depot – 1,305
·       Lowe’s – 1,154
·       Family Dollar – 570
·       CVS – 545
·       Walgreens – 355

Across six states–Georgia, Indiana, Maine, Massachusetts, Oklahoma, and Rhode Island–the following large corporations employed these approximate numbers of Medicaid enrollees in February 2020:

·       Walmart – 10,350
·       McDonald’s – 4,600
·       Amazon – 4,154
·       Dollar Tree – 2,964
·       Target – 2,754
·       Dollar General – 2,625
·       Home Depot – 2,237
·       CVS – 1,939
·       Burger King – 1,679
·       Dunkin’ Donuts – 1,278
·       Wendy’s – 1,059
·       FedEx – 1,046
·       Walgreens – 1,009
·       Subway – 973
·       Taco Bell – 868
·       Lowe’s – 611
·       Uber – 591