The Portland City Commission made an investment decision Wednesday that should have been left to the pros. It voted 5-0 to invest no more in the retail giant Wal-Mart, at least until the end of next year.
Call the move an attack of misguided conscience.
Maybe Wal-Mart doesn’t win medals as the nation’s best employer. Some say its wage scales are low, but they are generally in line with other stores in the discount retail business. It does offer health insurance.
It drives hard bargains with those who supply the goods it sells, but if suppliers were losing money on their sales, we suspect most would opt to sell their wares elsewhere. And, Wal-Mart is accused of being uber-competitive, of driving out locally owned stores in the communities in which it does business.
There’s no doubt Wal-Mart keeps a community’s merchants on their toes. Groceries and other goods are often cheaper at Wal-Mart than at the neighborhood store.
That doesn’t mean Wal-Mart is bad.
It serves a segment of the community, both as shopping destination and as employer.
If money is particularly tight, Wal-Mart is one of the places to shop. Even if money isn’t tight, it’s a place for people looking to save.
Aggressiveness with suppliers translates directly into lower prices for consumers. And, for some percentage of Wal-Mart employees, the pay the store offers may not be high, but it’s a lot better than zero.
Then there’s this: The city of Portland’s investment policy requires it to protect its money, ensure liquidity and earn a market-rate return. Wal-Mart helped it do that — so well that Portland owns about $36 million in Wal-Mart bonds.
Portland officials say they want “socially responsible” investing. The question is, socially responsible for whom? The guy in Portland’s tony West Hills? Or the family down below that chooses, from necessity, to shop at Wal-Mart?
Investment decisions should be left to investment professionals.