Wednesday, July 21, 2004
Costco, Wal-Mart duel in political arena
Warehouse-store giants give money to opposing parties
By MICHAEL FORSYTHE AND RACHEL KATZ
BLOOMBERG NEWS
Executives at Costco Wholesale Corp. and Wal-Mart Stores Inc., competitors in the $76 billion U.S. warehouse-club market, have taken their rivalry to a new level: national politics.
Costco Chief Executive Officer Jim Sinegal, 68, is a Democrat who says President Bush's $1.7 trillion in tax cuts unfairly benefit the wealthy. He opposed the Iraq war and supports Sen. John Kerry of Massachusetts for president. And he's the only chief executive of a company in the Standard & Poor's 500 Index to donate money to independent political groups formed to oust Bush, Internal Revenue Service records show.
Wal-Mart, the world's largest retailer and owner of Sam's Club warehouse stores, gives more money to Republican candidates than any other company does. Its top three managers, including Chief Executive H. Lee Scott, donated the individual maximum $2,000 to Bush, and Jay Allen, vice president for corporate affairs, raised at least $100,000 to re-elect the president, earning him the Bush campaign's designation of "Pioneer."
Wal-Mart -- two-thirds of whose 3,580 stores are in the "red states" that voted for Bush in 2000 -- is backing White House policies on everything from trade to limiting overtime pay.
"Wal-Mart is extremely strong in Republican strongholds; they are a red-state retailer," said Amy Bonkoski, an investment adviser at Cleveland-based National City Corp.'s private-client group, which manages about $26 billion, including Wal-Mart and Costco shares.
"Costco is stronger in Democratic states. Costco is a friend to labor. Unions hate Wal-Mart."
The differences are based on more than ideology: Each retailer has a stake in the election's outcome in areas from health care to the minimum wage to the way unions can organize work forces.
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My thread hijack work is complete. 
