Wal-Mart Versus Brain-Damaged Accident Victim

19:52 Thu 27 Mar 2008. Updated: 09:56 28 Mar 2008
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Contrary to what you might expect, this post is not a rant against Wal-Mart per se. I was prompted to write it after reading this CNN article about Wal-Mart suing a disabled woman who was an ex-employee. The summary is that she was in a bad accident, was covered by Wal-Mart health insurance for her treatment, then successfully sued the person responsible for the accident—at which point Wal-Mart sued her to recover that money, because her employment contract entitled them to recoup the money they spent on health insurance in that fashion. The CNN article raises some questions about this, but I think they’re the wrong questions.

Wal-Mart won the case, although since a chunk of the money had been spent, they weren’t able to recover all of it.

The article asks why the corporation would pursue such a course:

In 2007, the retail giant reported net sales in the third quarter of $90 billion.

Legal or not, CNN asked Wal-Mart why the company pursued the money.

The juxtaposition of those two lines (which are indeed next to each other in the article) makes it clear where they’re coming from.

However, the question reveals a fundamental misapprehension of what corporations are: legal entities whose sole reason for existing is to accumulate wealth for their shareholders. That’s it. Anything else is either PR or regulation. So if a corporation can increase profit in some way, its officers are legally bound to do that unless they think it’ll be bad in the long run—”bad” meaning bad for future profits.

I’m not defending the individuals involved here. Their moral agency is still intact, and they choose between their obligation to the corporation, their desire to keep/do their jobs, and their qualms (or lack thereof) at extracting money from this woman and her family. But while any of the individuals can be criticized in moral terms, I do not think that the corporation per se can be. It has one goal, to make profit. It is a legal entity that has been created for that purpose. If we wish to rein in its rapacity, we need explicit laws/controls to do so.

(I also don’t naively believe that corporations really are these pure money-making devices whose officers only act in their interests. They’re controlled by humans, who have all the human failings, and who routinely further their own greed by screwing the corporation whose interests they are supposed protecting—CEOs with ridiculous compensation packages do this all the time, because the market for major corporate officers is ridden with biases and conflicts of influence.)

The question of why a corporation like Wal-Mart would act so greedily is one with an obvious answer: to make more money. Any discussion of this which involves morality must involve larger questions about how we structure our legal entities and our society, and certainly doesn’t come down to the idea that some companies are “evil” and others “good”, at least not in terms of their motivations. Some definitely do worse things than others, but this is not a question of character.

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