Wal-Mart's Bum Rap

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It's truly ironic how the most successful companies, those whose vision and effort change the world, are often the most vilified.

From the days of John D. Rockefeller and Standard Oil Trust, whose myriad offspring -- including ExxonMobil (NYSE: XOM) -- are still some of the largest companies in the world, to the ultimate corporate villain, Microsoft (Nasdaq: MSFT), jealous competitors, governments, and others have tried desperately to tear down success.

I recently penned a take in which I describe Wal-Mart (NYSE: WMT) as the most important technology company of the last 25 years. Unfortunately, by virtue of its sheer size and success, Wal-Mart is also the latest target of corporate envy, and a lightning rod for criticism.

Recently, a group called the Center for Community and Corporate Ethics (basically a troupe of ne'er-do-wells, consisting of such everyday folks as union leaders, environmentalists, and academics) took out a full-page ad in The New York Times criticizing Wal-Mart's employment practices. The group is claiming the giant retailer's low wages cost taxpayers $1.6 billion a year in additional government services for employees, and it is threatening legal action to "put the brakes on Wal-Mart." A good example of this legislation comes from my home state of Maryland, where out-of-touch lawmakers recently passed what became known as the Wal-Mart bill.

Obviously, legitimate issues deserve their time in court, and I'm not holding Wal-Mart totally blameless, but to think that a group such as the CCCE is anything more than an extortion racket with a legal charter is naive. Criticizing Wal-Mart over employment issues without acknowledging its role in raising customers' living standards is at the very least lazy and smells suspiciously like the beginning of a "money-grab."

Organizations and governments are laying the groundwork for lawsuits and legislation designed to siphon cash from shareholders into their own pet projects, following the model used against tobacco companies like Altria (NYSE: MO) and Reynolds-American (NYSE: RAI). What goes unsaid is the simple fact that people don't have to work at Wal-Mart if the pay and benefits are unacceptable. Last time I checked, there were other good companies out there (although at some, union dues will eat up a good portion of their higher wages).

All this bad press has created what some analysts call "headline risk" for Wal-Mart, which is reflected in a stock price floating near five-year lows. Certainly, there are real cash flow risks, primarily a multi-billion settlement from a gender-discrimination lawsuit, and more than 40 pending lawsuits related to unpaid overtime. And with the amount of cash Wal-Mart generates, the line of money-grabbers is just going to get longer. Shareholders beware.

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For more on Wal-Mart, try the following articles:

• Lovefest in Bentonville
• Has Wal-Mart Gone Terminal?
• What's the Deal with Wal-Mart?

Fool contributor Chris Mallon thinks Wal-Mart gets a bum rap. He shops at the giant retailer, and owns shares of Microsoft and Altria. The Fool has a strict disclosure policy .