Obama vs. Romney: How Costco, Staples and Walmart Are Voting

Big Box RetailersFor years, Barack Obama's critics have positioned him as the scourge of big business, claiming that the he has excessively regulated Wall Street, tried to unfairly raise taxes on corporations, and generally undermined the foundations of capitalism with a collection of ill-conceived, "socialist" policies. Last week, however, the co-founder of one of America's biggest companies offered a rebuttal to the Obama-as-villain argument, arguing that the President's economic policies offer a roadmap for long-term growth and stability.

Last Wednesday night, Jim Sinegal, co-founder of Costco, took to the floor at the Democratic National Convention. While not as well-known as Michelle Obama or Joe Biden, Sinegal's position as a captain of industry put him in an ideal position to rebut the attacks on Obama's economic policies.

Job Creators and Entry-Level Workers

Sinegal began by referencing a popular Republican touchstone: job creators. Pointing out that Costco (COST) has created 116,000 American jobs and plans to create another 7,000 within the next year, he carefully positioned his company as a force for sustainable job creation -- and, consequently, an expansion of the middle class. Citing Costco's relatively high wages and impressive benefits for the retail industry, he argued that "we're not just giving Costco people jobs, we're empowering them to build careers and support middle-class families."

This notion that companies should be concerned with the economic stability of their lower-level employees flies in the face of conventional wisdom: last year, the average CEO made 380 times as much money as the average worker. Similarly, Sinegal's dismissal of executives who focus on short-term profit laid the groundwork for a defense of Obama's economic planning. "At [Costco], we recognize that job creation requires time and investment and commitment to the long term," Sinegal told the DNC audience. "It requires companies that plant and grow, not executives who reap and run."

As for business-friendly policies that could encourage long-term growth, Sinegal's investment suggestions read like an Obama wish-list. Noting the need for investment in education, transportation, and sustainable energy, he pointed out that "these are the investments that businesses want. These are the building blocks of President Obama's plan for the future. And that's why I'm proud to stand with him."

Staples Sticks It to Obama

Sinegal's speech was a clear rebuttal to last week's RNC address by Tom Stemberg, co-founder of Staples (SPLS). Like Sinegal, Stemberg was quick to establish his company's position as a job creator, noting that Staples employs "nearly 90,000" people, and "helps entrepreneurs and small businesses get started on their own."

But while Stemberg noted Staples' benefit to other entrepreneurs, his real focus was on his own company's story, and on Mitt Romney's part in its success. Stemberg painted the former business consultant and private investor as a man who "really got excited at the idea of saving a few cents on paper clips," and was involved with Staples almost from the beginning. Drawing a distinction with Obama, Stemberg asked the audience, "Who would make a better president: Someone who knows how to save a dollar on pens and paper or someone who knows how to waste $535 million on Solyndra?"

Clever budgeting aside, Romney's business experience has been a mixed blessing on the campaign trail. On the one hand, it has given him a great deal of experience with managing companies. At the same time, however, Bain Capital's many decisions to shutter factories has sometimes placed Romney in an uncomfortable position when he discusses his plans to build American businesses.

Stemberg hearkened back to Romney's experience as a business builder, noting that Bain Capital worked for five years with Bright Horizons Day Care, a company that now "employs over 19,000 people," and Steel Dynamics, which "employs 6,000 people." Ultimately, Stemberg argued, Democrats "don't get it because they don't believe in the spirit of the entrepreneur. They don't understand what it means to risk money to create something new."

Walmart Weighs In

While the founders of Costco and Staples both offered interesting angles on the presidential candidates, the biggest retail influence in this election season may come from a company whose owners have largely remained mum. The Walton family, owners of Walmart (WMT), have eschewed public statements in favor of private contributions.

In addition to significant contributions to a variety of Republican congressional campaigns, the Walton heirs have lined up behind Mitt Romney. Jim Walton, chairman of Arvest Bank and son of Walmart founder Sam Walton, has given $200,000 to Mitt Romney's PAC, Restore Our Future, and $2,500 -- the maximum allowable direct contribution -- to Romney's campaign. His sister, Alice Walton, has done the same.

It isn't hard to see why a Romney presidency would be attractive to the Waltons. The former Massachusetts governor has proposed abolishing the estate tax, which is currently pegged at 35% but will rise to 55% in 2013. Moreover, he has suggested maintaining the current 15% capital gains and dividend tax rates; Obama, on the other hand, has proposed raising both to 20%-35%.

As a family, the Waltons are worth an estimated $60 billion -- more than the bottom 41.5% of all American families combined. Christy Walton, the youngest of the bunch, was born in 1955, and it seems likely that all six are contemplating the eventual need for estate planning. Based on the estate tax alone, a Romney presidency could save them billions -- an amazing return on their relatively modest $405,000 investment.

Bruce Watson is a senior features writer for DailyFinance. You can reach him by e-mail at bruce.watson@teamaol.com, or follow him on Twitter at @bruce1971.

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grandma

I worked for Target for 7 and 1/2 until i was one month short of 70 yrs old... so I retired... but they had retirement benefits, health insurance after 6 months... and target is hiring ..and money isn't bad.. better than most. and if you are a good worker.. you will be offered a job after xmas.. if you come to work during xmas extra employee time... pay attention to your lead person's instruction... and don't assume you know the rules.. each company has their own rules.. Have a smile on your face..when you do an interview.. don't complain.. because right away you are in the crosshairs out the door.. Target is in business to make money like all retail businesses.. I enjoyed my 7 and 1/2 yrs at target.. but the heavy work was starting to show on my body.. and it is a younger person's work.. I pulled the plug and retired.. so go in and apply.. if you have some experience in retail,, and can pass a drug test.. you could get an interview.

October 28 2012 at 2:38 AM Report abuse rate up rate down Reply
Darin C

yeah, I am not going to Costco anymore. Jim, you have to be crazy to fall for another 4 years of FAILURE that we have endured. Can't sit by a President who tells Vladmir Puton that once he gets re-elected his hands will be free to do more? Do More what Mr. Obama....spend money, put troops in places that they don't belong. And now we aren't securing our embassies like we should be. If it's your responsibility then please do something about it instead of telling us we have an ongoing investigation 5 to 6 weeks later. THOSE PEOPLE DON"T WANT US THEIR....can you not figure this out? What happened to we are going to bring everyone home. Well I tell you what I am tired of serving this country who has a president who LIES. And I am tired of going over seas time after time when I am told that this is the last time. What a joke, and people here don't realize how lucky they have life. Try to get a job after you have spent the last 9 years serving your country. Putting my life on foreign soil for people who 'Don't care" . Please take the troops out of the areas that we don't need to be in. It's a waste of time, and am tired of seeing our fellow service men/women come home in body bags.

October 21 2012 at 11:35 PM Report abuse -1 rate up rate down Reply
LC, CPA

Another 'failed' company (AOL/Huffington Post) 'favoring' a failed President... How, typical. While I am a member of Costco, And, I do admire Jim Senegal's accomplishments as founder and CEO of Costco, I must conclude he is sadly delusional when it comes to the benefits to America of Obummer's Presidency. Both Senegal AND Warren Buffet have reaped large benefits from capital gains. But why? Because they invested their (and other peoples) money building businesses!. The lower capital gains rate was put in place to encourage investors to do just that...Invest. In doing so they hoped to profit from dividends and profits causing their investments to grow. Jim Senegal sold 132,000 shares of Costco stock grossing $12,750,000 in August and September of this year. Normally, he sells 16,000 shares a month. Why the 'big increase' now? Because next year the capital gains tax rate will go up (Bush tax rates) dramatically. Do I begrudge Senegal his 'rewards' for his efforts in building Costco. No. Many entrepreneurs lose all or part of their investment. Not to mention years of their lives struggling to build their businesses (The government DID NOT build this business.) If Obummer is re-elected 58% of small businesses (What Senegal was BEFORE he succeeded.) say they could NOT build their business today under Obummer! I cannot why such an intelligent man like Jim Senegal would support such a president. Obummer wants to not only 'redistribute' MY income to those that did not earn it, he wants to redistribute America's wealth to poor countries around the world because he thinks America doesn't 'deserve' it. Read Obummer's own words if you think I'm wrong! Following Obummer's thinking and policies, we, the USA, will become just like Spain and Greece, failing socialist 'utopias'. Perhaps with the same rioting now taking place as their country self destructs... And on the same 'Hope and Change' ideas, Electric cars that cost $75000 to produce and that only sell if 'subsidized' by government (you and I the tax payers) tens of thousands of dollars. Costco, one of the first companies to install 'charging stations for vehicles that only go a few miles between charges, yanked those same charging stations out when they discovered just how much it cost them to provide 'free' electricity for them. Electric cars...another failed attempt by government to 'determine' the future by elite 'central planners', rather than 'market forces. Solyndra, and countless boondoggles brought to you by the 'elite governing class'. Paid for by you and your grandchildren. Now, I don't know what kind of mental disorder Jim Senegal must suffer from in order to support this Marxist Obummer, but please leave me and my children and grandchildren out of it.. I want an America where they can achieve and prosper based on their own efforts and hard work, not on some government handout. Obummer is not the answer... Our founding father knew the answers and we should return to their principals.

September 27 2012 at 12:24 PM Report abuse rate up rate down Reply
LC, CPA

Another 'failed' company (AOL/Huffington Post) 'favoring' a failed President... How, typical. While I am a member of Costco, And, I do admire Jim Senegal's accomplishments as founder and CEO of Costco, I must conclude he is sadly delusional when it comes to the benefits to America of Obummer's Presidency. Both Senegal AND Warren Buffet have reaped large benefits from capital gains. But why? Because they invested their (and other peoples) money building businesses!. The lower capital gains rate was put in place to encourage investors to do just that...Invest. In doing so they hoped to profit from dividends and profits causing their investments to grow. Jim Senegal sold 132,000 shares of Costco stock grossing $12,750,000 in August and September of this year. Normally, he sells 16,000 shares a month. Why the 'big increase' now? Because next year the capital gains tax rate will go up (Bush tax rates) dramatically. Do I begrudge Senegal his 'rewards' for his efforts in building Costco. No. Many entrepreneurs lose all or part of their investment. Not to mention years of their lives struggling to build their businesses (The government DID NOT build this business.) If Obummer is re-elected 58% of small businesses (What Senegal was BEFORE he succeeded.) say they could NOT build their business today under Obummer! I cannot why such an intelligent man like Jim Senegal would support such a president. Obummer wants to not only 'redistribute' MY income to those that did not earn it, he wants to redistribute America's wealth to poor countries around the world because he thinks America doesn't 'deserve' it. Read Obummer's own words if you think I'm wrong! Following Obummer's thinking and policies, we, the USA, will become just like Spain and Greece, failing socialist 'utopias'. Perhaps with the same rioting now taking place as their country self destructs... And on the same 'Hope and Change' ideas, Electric cars that cost $75000 to produce and that only sell if 'subsidized' by government (you and I the tax payers) tens of thousands of dollars. Costco, one of the first companies to install 'charging stations for vehicles that only go a few miles between charges, yanked those same charging stations out when they discovered just how much it cost them to provide 'free' electricity for them. Electric cars...another failed attempt by government to 'determine' the future by elite 'central planners', rather than 'market forces. Solyndra, and countless boondoggles brought to you by the 'elite governing class'. Paid for by you and your grandchildren. Now, I don't know what kind of mental disorder Jim Senegal must suffer from in order to support this Marxist Obummer, but please leave me and my children and grandchildren out of it.. I want an America where they can achieve and prosper based on their own efforts and hard work, not on some government handout. Obummer is not the answer... Our founding father knew the answers and we should return to their principals.

September 27 2012 at 12:21 PM Report abuse rate up rate down Reply
LC, CPA

Another 'failed' company (AOL/Huffington Post) 'favoring' a failed President... How, typical. While I am a member of Costco, And, I do admire Jim Senegal's accomplishments as founder and CEO of Costco, I must conclude he is sadly delusional when it comes to the benefits to America of Obummer's Presidency. Both Senegal AND Warren Buffet have reaped large benefits from capital gains. But why? Because they invested their (and other peoples) money building businesses!. The lower capital gains rate was put in place to encourage investors to do just that...Invest. In doing so they hoped to profit from dividends and profits causing their investments to grow. Jim Senegal sold 132,000 shares of Costco stock grossing $12,750,000 in August and September of this year. Normally, he sells 16,000 shares a month. Why the 'big increase' now? Because next year the capital gains tax rate will go up (Bush tax rates) dramatically. Do I begrudge Senegal his 'rewards' for his efforts in building Costco. No. Many entrepreneurs lose all or part of their investment. Not to mention years of their lives struggling to build their businesses (The government DID NOT build this business.) If Obummer is re-elected 58% of small businesses (What Senegal was BEFORE he succeeded.) say they could NOT build their business today under Obummer! I cannot why such an intelligent man like Jim Senegal would support such a president. Obummer wants to not only 'redistribute' MY income to those that did not earn it, he wants to redistribute America's wealth to poor countries around the world because he thinks America doesn't 'deserve' it. Read Obummer's own words if you think I'm wrong! Following Obummer's thinking and policies, we, the USA, will become just like Spain and Greece, failing socialist 'utopias'. Perhaps with the same rioting now taking place as their country self destructs... And on the same 'Hope and Change' ideas, Electric cars that cost $75000 to produce and that only sell if 'subsidized' by government (you and I the tax payers) tens of thousands of dollars. Costco, one of the first companies to install 'charging stations for vehicles that only go a few miles between charges, yanked those same charging stations out when they discovered just how much it cost them to provide 'free' electricity for them. Electric cars...another failed attempt by government to 'determine' the future by elite 'central planners', rather than 'market forces. Solyndra, and countless boondoggles brought to you by the 'elite governing class'. Paid for by you and your grandchildren. Now, I don't know what kind of mental disorder Jim Senegal must suffer from in order to support this Marxist Obummer, but please leave me and my children and grandchildren out of it.. I want an America where they can achieve and prosper based on their own efforts and hard work, not on some government handout. Obummer is not the answer... Our founding father knew the answers and we should return to their principals.

September 27 2012 at 12:21 PM Report abuse rate up rate down Reply
chuck taylor

I knew there was another reason I don't shop at Wal-Mart and now after reading this I will not purchase my office supplies from Staples.....That's my vote

September 15 2012 at 10:24 PM Report abuse rate up rate down Reply
redmonkeydzn

Only after the last tree has been cut down,
Only after the last river has been poisoned,
Only after the last fish has been caught,
Only then will you find that money cannot be eaten...

September 13 2012 at 2:30 PM Report abuse +1 rate up rate down Reply
rkeeeballs

Those 1%er's sure do stick together like a bowel movement !

September 13 2012 at 11:08 AM Report abuse +1 rate up rate down Reply
lkemer

I never did care for Staples, now I know why. On the other hand, I always loved shopping at Costco. I will definitely not shop at Walmart due to the fact, that as rich as they are, they want someone in the white house that will screw the middle and lower class income families by raising taxes on them, while lowering taxes on the rich. And all the while, it's the middle and lower income families that bring the most money into Walmart's pocket.

September 13 2012 at 2:05 AM Report abuse +1 rate up rate down Reply
1 reply to lkemer's comment
grandma

I haven't shopped at either place, but after finding out that marriott and Stapes is a mormon companies. I won't shop there... Mormon companies only hire mormons.. was anyone aware of that? 1982,, I moved to las vegas because my husband wanted to retire there.. it took me 5 months to find a job.. because companies I put a resume out.. no call back.. then I found it most of the small businesses I applied, were
mormon... Las Vegas was 60% mormon when I moved there.. and all the city and country reflected the 1910 attitude. So I did a blind ad and sent a resume..and I was hired.. at a warehouse job.. Made better money than I thought I would get.. and I had training to run the IBM equipment. I stayed there 5 and 1/2 yrs.. untill I started my own business. and left.

October 28 2012 at 2:46 AM Report abuse rate up rate down Reply
Mile-Hi CSI

http://www.dailyfinance.com/2012/09/10/obama-vs-romney-how-costco-staples-and-walmart-are-voting/

Check this out! Seriously people! Research the truth! Slick used car salesman ( strictly a figure of speech ) fast talking Romney is gonna bite you where it hurts!

September 13 2012 at 12:08 AM Report abuse +2 rate up rate down Reply