Wal-Mart and Banking

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In a just world, Wal-Mart would have received the corporate death penalty long ago and we’d be done with it. (For reasons why: see T.A. Frank’s piece here, or the essay “Inside the Leviathan.”) But given that Wal-Mart’s not going anywhere anytime soon, I should say I’m fairly persuaded by David Leonhardt’s twopart argument as to why Wal-Mart should be allowed to open its own banks.

A Wal-Mart banking system that becomes insanely popular isn’t likely to put low-wage workers out of work—it will just hurt other banks—and it is true that many low-income families don’t have checking or savings accounts because, as I reported here, of steep fees and barriers to entry. Perhaps Wal-Mart could use its magic to lower those fees and barriers and help more people get savings accounts, which in the abstract would be a good thing. (No doubt the store could figure out ways to screw borrowers over, though.)

Perhaps progressive legislators can strike some sort of compromise: Wal-Mart gets the right to open its own banking services, but in return they’ll be required to offer the sorts of not-entirely-profitable services that regular banks don’t ever offer yet low-income families often need—such as payday lending—that would enable many poorer workers to escape the exorbitant fees they have to endure on the secondary lending market. That seems pretty unobjectionable.

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It is astonishingly hard keeping a newsroom afloat these days, and we need to raise $253,000 in online donations quickly, by October 7.

The short of it: Last year, we had to cut $1 million from our budget so we could have any chance of breaking even by the time our fiscal year ended in June. And despite a huge rally from so many of you leading up to the deadline, we still came up a bit short on the whole. We canā€™t let that happen again. We have no wiggle room to begin with, and now we have a hole to dig out of.

Readers also told us to just give it to you straight when we need to ask for your support, and seeing how matter-of-factly explaining our inner workings, our challenges and finances, can bring more of you in has been a real silver lining. So our online membership lead, Brian, lays it all out for you in his personal, insider account (that literally puts his skin in the game!) of how urgent things are right now.

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