Wal-Mart and Mrs. Shank

Last week the Internets and cable news shows were abuzz with the story about an older woman who had suffered brain damage as a result of an auto accident. The woman, Debbie Shank, who was not at fault in the accident, sued the trucking company and won. After all legal fees, medical expenses, etc. were paid, Shank was left with approximately $417,000 in a trust fund to pay for future living expenses. Her employer, Wal-Mart, sued Mrs. Shank for $450,000.

Wal-Mart has long been a favorite target of (mostly Democratic) ire. One pundit, Keith Olberman, named Wal-Mart his "worst person in the world" several times last week because of its actions. The widespread news coverage of the situation reached as far as facebook, where some of my friends joined the group "Debbie Shank has paid enough."

I don't deny the sadness involved with Mrs. Shank's unfortunate situation. Certainly no one would take any form of pleasure in seeing a woman's life ruined because of one accident. I wholeheartedly sympathize with the Shank family, and I think the charitable organizations that are cropping up to support her future expenses symbolize the inherent goodness in everyone.

However, I do think Wal-Mart was wrong to acquiesce in this instance. By abandoning their pursuit of the money they paid to cover Mrs. Shank's medical bills, Wal-Mart inadvertently opened themselves up to future cases involving high medical costs. The result of establishing such a precedent will be higher medical premiums for all Wal-Mart employees.

For a much better analysis of the case, see J.H. Huebert's article (via LRC).

Quite predictably, the media focused on the emotions of its viewers and failed to present any factual refutations to Wal-Mart's case. By presenting Wal-Mart as the big, bad money-grubbing capitalist institution wringing every last dollar out of a helpless woman, I'm guessing the media captured widespread support for its anti-Wal-Mart stance. Particularly troubling is the argument that Wal-Mart should abandon its case because "it's not like they need the money anyway."

As Huebert notes, by abandoning its pursuit of its lawful claim to Shank's money, Wal-Mart has committed the Randian sin of "the sanction of the victim." In other words, by not recovering the money it is contractually obligated to collect, Wal-Mart has mistakenly endorsed itself as an evil institution. Wal-Mart's primary duty is to provide the best quality health care at the lowest possible price to all of its employees, not to improve its image through acquiescence.

There is a more subtle point to be made here, however, and it is this: individuals who subscribe to the belief that the collective is the proper way to fulfill human need ultimately end up using the collective (in this case, Wal-Mart's health plan) to fulfill individual needs. The result of such actions is higher premiums for everybody. In contrast, when individuals are allowed to define, pursue, and achieve their own needs (i.e. Wal-Mart's pursuit of profit) the collective benefits in the form of lower health care premiums.

Rather than dwell on the unfortunate circumstances facing Mrs. Shank for the rest of her life and fingering Wal-Mart as an institution seeking to compound her woes, I would like to see Keith Olberman and the rest of the Wal-Mart critics instead focus on the real heroes in this case: individuals voluntarily donating to Deborah Shank's cause. Before succumbing to their emotions and lashing out at "evil" institutions for that institution's lawful pursuit of their property, the anti-Wal-Mart crowd would be better served to think through the entire case...and hopefully understand that they are indeed serving their collective brethren by supporting Wal-Mart.