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.

HERE ARE THE FACTS:

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As we wrote over the summer, traffic has been down at Mother Jones and a lot of sites with many people thinking news is less important now that Donald Trump is no longer president. But if you're reading this, you're not one of those people, and we're hoping we can rally support from folks like you who really get why our reporting matters right now. And that's how it's always worked: For 45 years now, a relatively small group of readers (compared to everyone we reach) who pitch in from time to time has allowed Mother Jones to do the type of journalism the moment demands and keep it free for everyone else.

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