You won't find 21st Century Breakdown at your local Wal-Mart (NYSE:WMT), but isn't that a 21st century breakdown, in and of itself?

Green Day's new CD, which made its debut at the top of the charts this past week, isn't being stocked by Wal-Mart. The world's largest retailer has a policy of refusing to stock music that requires "parental advisory" stickers.

The usual workaround is for recording artists to put out a clean version of the disc, but Green Day and its Warner Music Group (NYSE:WMG) label aren't going to play that game.

"They want artists to censor their records in order to be carried in there," Green Day singer Billie Joe Armstrong told the Associated Press. "We just said no. We've never done it before. You feel like you're in 1953 or something."

This is certainly a lousy time for Wal-Mart to be preachy. Green Day was the musical guest on Saturday Night Live this past weekend, the band is kicking off a stateside tour this summer, and the lead-off single "Know Your Enemy" is taking over the airwaves. These are the events that trigger buying interest, and Wal-Mart is going to blow every single potential sale.

Wal-Mart's policy is just bad business, and it will have to change if more bands follow Green Day's lead. After all, if Green Day has been able to sell more than 200,000 copies of the CD in its first week without Wal-Mart's blessing, other established acts are unlikely to compromise when their labels press them for a clean version.

I give this policy another year or two tops at Wal-Mart. It has to change, mostly because it is insanely hypocritical. Wal-Mart already sells R-rated DVDs and M-rated video games, because missing out on the handsome revenue from moving copies The Reader or Halo would simply be too great. So what's the difference? If anything, one can argue that a graphic R-rated flick or a violent M-rated shoot-'em-up game leaves more of an impression than a singer does by letting a few expletives fly.

Wal-Mart is the leading bricks-and-mortar retailer of prerecorded music. Will it stay that way if it misses out on more top-selling CDs? Forget about justifying the double standard. This is just going to be bad for the discounter's store traffic and bottom line.

Sure, companies have a right to draw the line. Netflix (NASDAQ:NFLX) and Blockbuster (NYSE:BBI) don't have to rent porn to be successful, but they would be have been toast if they'd drawn the line between PG and PG-13 titles. Apple (NASDAQ:AAPL) can block App Store programs it finds offensive, but iTunes would never have taken off if it was playing the role of Moral Police in digital music.

In short, a Wal-Mart without M-rated video games, R-rated DVDs, and steamy romance novels wouldn't be the same successful company it is today. It's time for the company's music-vetting policy to change with the times. 

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Longtime Fool contributor Rick Munarriz once had his band signed to Sony's Columbia Records label. Things didn't exactly pan out, but he's not bitter. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. He owns shares of Netflix. The Fool has a disclosure policy.