GAO Study Shows How Taxpayers Subsidize “Starvation Wages” of Corporate Giants

Pinpointing a reality denounced as “morally obscene” by Sen. Bernie Sanders, a new government study shows how some of the nation’s largest and most profitable corporations — including Walmart, McDonald’s, Dollar General, and Amazon — feast upon taxpayer money by paying their employees such low wages that huge numbers of those workers throughout the year are forced to rely on public assistance programs such as Medicaid and food assistance just to keep themselves and their families afloat.

According to a statement from Sanders’ office, the study he commissioned the Government Accountability Office to carry out — titled “Millions of Full-time Workers Rely on Federal Health Care and Food Assistance Programs” — found that an estimated 5.7 million Medicaid enrollees and 4.7 million SNAP (Supplemental Nutrition Assistance Program) recipients who worked full-time for 50 or more weeks in 2018 earned wages so low that they qualified for these federal benefits. In addition, 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.

Upon the study’s release Wednesday, Warren Gunnels, staff director and policy adviser for Sen. Sanders, tweeted: “The real looting in America is the Walton family becoming $63 billion richer during a pandemic, while paying wages so low that 14,541 of their workers in 9 states need food stamps — all subsidized by U.S. taxpayers. Yes. The Walton family is the real welfare queen in America.”

According to the Washington Post:, based on the GAO report:

Walmart was one of the top four employers of SNAP and Medicaid beneficiaries in every state. McDonald’s was in the top five of employers with employees receiving federal benefits in at least nine states.

In the nine states that responded about SNAP benefits—Arkansas, Georgia, Indiana, Maine, Massachusetts, Nebraska, North Carolina, Tennessee and Washington—Walmart was found to have employed about 14,500 workers receiving the benefit, followed by McDonald’s with 8,780, according to Sanders’s team. In six states that reported Medicaid enrollees, Walmart again topped the list, with 10,350 employees, followed by McDonald’s with 4,600.

In Georgia, for example, Walmart employed an estimated 3,959 workers on Medicaid—an estimated 2.1 percent of the total of non-elderly, non-disabled people in the state receiving the benefit. McDonald’s was next on the list, employing 1,480 who received Medicaid, or 0.8 percent of the total of non-elderly, non-disabled people on the program.

“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,” said Sanders in a statement. “That is morally obscene.”

With the individual wealth of high-ranking executives and members of billionaire families like the Walton’s, who own Walmart, soaring even as front-line, minimum wage employees and their families struggling to stay afloat amid the devastating Covid-19 pandemic, Sanders argues that the stark contrast should be a wakeup call for those who have refused to see how unjust and economically backward it is for the federal government, meaning taxpayers, to subsidize the cruel wages that massive profitable companies force their workers to accept.

“U.S. taxpayers should not be forced to subsidize some of the largest and most profitable corporations in America,” said Sanders. “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.”

“No one in this country should live in poverty,” Sanders added. “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.”