Punishing Wal-Mart's Greatness
June 18, 2007
Irvine, CA--In July 2005 Wal-Mart applied for a limited bank charter, called an Industrial Loan Charter, that it believed would enable it to save money on the billions of credit card and debit card transactions it processes annually. Last week, after the FDIC announced yet another delay to its application--until January 2008--Wal-Mart withdrew its application.
"While Wal-Mart critics are celebrating the company's decision, this is in fact a sad day for American business," said Alex Epstein, a junior fellow at the Ayn Rand Institute. "The type of charter Wal-Mart was seeking has already been rubber-stamped for Target and other Wal-Mart competitors. Yet the government--influenced by anti-capitalist activists and Wal-Mart's envious competitors--singled out Wal-Mart for punishment.
"Critics say that they feared Wal-Mart, if permitted to open a limited banking operation, would later expand into other areas of banking. But by what kind of perverse standard would this be a bad thing? For one of America's most efficient, talented companies to bring its ingenuity to the banking business is something we should applaud--not condemn and stonewall."
Alex Epstein was a writer and a fellow on staff
at ARI between 2004 and 2011.