Obama administration officials today announced a proposed $1.25 billion settlement to resolve racial discrimination claims by potentially tens of thousands of black farmers who were denied equal access to U.S. Agriculture Department loan programs.
The settlement addresses claims from black farmers who were excluded from participation in an earlier settlement with the government over USDA loan discrimination. Late-filed or incomplete paperwork meant thousands of farmers were left out.
The settlement announced today by Associate Attorney General Thomas Perrelli of the Justice Department and Secretary Thomas Vilsack of the Agriculture Department sets up a nonjudicial claims process through which individual farmers may demonstrate entitlement to damages awards and debt relief.
Perrelli called the settlement a “great landmark” that highlights his department’s commitment to civil rights. The discrimination was part of a “troubling” and “sordid” chapter at USDA, Vilsack said, and the Agriculture Department is looking to move forward to reduce complaints and modernize.
The settlement is contingent on congressional authorization, for which there is a March 31 deadline. A range of attorney fees—between about 4% and 7%, or $49 million to $89 million—is part of the settlement agreement, according to Perrelli. He called it a “relatively complicated” set of attorney fee provisions that address prior and future work. Judge Paul Friedman of the U.S. District Court for the District of Columbia, who has presided over the case, will have the final say on fees.
“Bringing this litigation to a close has been a priority for this Administration. With the settlement announced today, USDA and the African American farmers who brought this litigation can move on to focus on their future,” Attorney General Eric Holder Jr. said in a statement. “The plaintiffs can move forward and have their claims heard—with the federal government standing not as an adversary, but as a partner.”
Whole Foods Markets (WFMI) CEO John Mackey (pictured), unsurprisingly, is passionate about health. Leading the country's largest and most respected chain of natural groceries, he's often credited with bringing natural-foods stores to the mainstream. On a personal note, he has been a vegan for many years and has adopted a diet free of vegetable oils, sugars and almost any processed food. So when he launched a plan to give his employees discounts on health insurance if they maintained lower readings for blood pressure, cholesterol and body mass index, it should have barely made a blip in the annals of corporate wellness.
But Mackey's plan is drawing fire, in part because his wellness program, some charge, comes off as heavy-handed and focuses too much on what have been called “arbitrary” measures such as body mass index (BMI) — or essentially how fat we are. Others say the plan is taking criticism simply because of Mackey's outspokenness on health.
Most famously, he wrote an op-ed blasting the U.S. health care reform effort in The Wall Street Journal in August, 2009. In the piece, he called the reform bill “Obamacare” and “a massive new health care entitlement.” He suggested the government instead adopt a series of reforms designed to encourage companies to provide health care for their employees. Among them, he suggested tax-free status for all health care premiums, fewer coverage mandates and other changes.
Finally, he said government should make it easy for taxpayers to give money to charities to cover the uninsured. In conclusion, he wrote, “We are all responsible for our own lives and our own health. We should … use our freedom to make wise lifestyle choices that will protect our health.”
Employee Biometric Screenings
Mackey's new health insurance discounts — in his words “empowering and fun for employees who enjoy a challenge” — fit right in with his corporation-knows-best attitude. Those who want to take part can undergo biometric screening, which will determine what discount level they'll receive: Bronze, silver, gold or platinum. The maximum discount is 30%, and to qualify, employees must have a BMI of less than 24, cholesterol levels below 150 mg/dL and blood pressure of 110/70.
Those with a BMI over 30 would not qualify for the program at all. They would, of course, still be eligible for health insurance — just without an extra discount. The bronze level provides a 22% discount.
For any other CEO, these initiatives might have passed with little notice. Corporate wellness programs have become a given, with discounts on gym memberships and cheery marketing for healthy options in corporate cafeterias. Many company executives have made news with far more shocking employee health tactics, including weight-loss contests and quit-smoking support groups. A few have even refused employment to smokers and told existing employees to quit, or lose a job.
The Peacock CEO
By comparison, Mackey's moves hardly seem controversial. But this is Mackey, the rare peacock of a CEO. His outsize personality, so politically at odds with the majority of his customer base, doesn't just invite, but begs, response from liberal media outlets. So they seize on the news, spinning it into the controversy they expect from a man like Mackey. The Village Voice headline proclaims, “Whole Foods' John Mackey Finds a New Way to Antagonize Customers,” pointing out, “the National Association to Advance Fat Acceptance is not amused.”
At The Big Money, Dan Mitchell doesn't like the plan, calling the choice of BMI, blood pressure and cholesterol “arbitrary,” a bad way to measure overall health. He worries that “the inevitable conclusion from this: Whole Foods theoretically would give discounts to near-death anorexics, who would be judged 'healthier' than their larger counterparts.” He suggests Whole Foods provide a discount for healthy grocery items for all employees.
Judging from the details of the Whole Foods wellness program, Mackey, it seems, knows best which lifestyle choices are good for health. What he doesn't know so well, is how to communicate his wisdom to the sort of person who's likely to work for, or shop at, Whole Foods. He once famously criticized his own company's stores for selling “junk food,” for instance, getting a lot of flak from his stakeholders.
Boycotts and “Buycotts”
Mackey was also surprised by the firestorm kicked up by his op-ed criticizing the reform effort in the Journal. In reaction, groups of liberal and conservative Whole Foods shoppers staged simultaneous boycotts and “buycotts,” which had no discernible effect on Whole Foods sales, but had a quite far-reaching effect on the talking points of conservative pundits in the first few weeks of September 2009.
Michelle Malkin, for instance, encouraged her readers to “buy a few Whole Foods items” in order to stand up for Mackey's opposition for health care, “I think it's worth it.” Malkin isn't, however, the prototypical Whole Foods shopper, nor, for that matter, the prototypical employee.
This is a company that encourages the sort of autonomous, bottom-up store organization that would seem more at home in the Socialist Party than the Republican Party. Lower-level employees help select and evaluate their bosses, even having a say on the store's product mix. Mackey pays himself a dollar a year. No executive makes more than 19 times the average employee's wage of $16.50 an hour.
“Right-Wing Hippie”
On the other hand? Mackey is as far from the left as you can get. He believes that corporations — and not governments or nonprofits — are the best way to provide for the well-being of the people. Companies should make enormous profits to put them to use for the betterment of humanity, he believes.
Says Nick Paumgarten in this New Yorker profile of Mackey: “The right-wing hippie is a rare bird.” And this right-wing hippie is simply roosting in his favorite nest with his latest plan. It's not even the first time he's offered inducements for his employees to be more healthy. His company conducts a three-month-long contest each year with prizes for the team whose members exercise and use mass transit the most.
Paumgarten concludes: “It sometimes sounds as if he believed that, if every company had him at the helm, there would be no need for unions or health care reform, and that therefore every company should have someone like him, and that therefore there should be no unions or health care reform.”
Saving Employees From Themselves?
That, in essence, seems to be the inspiration behind the latest Whole Foods wellness plan. It's myopic, paternalistic and with a generosity of intention that belies its know-it-all spirit.
Mackey thinks he's saving his employees from themselves. In reality, he's just giving a little bonus to those who are already most like himself — making employees in his own image a little tiny bit richer. It's not quite a God complex. But it's a nice, slim, start.
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