Wal-Mart's Health Scare

Wal-Mart (WMT), the former poster child for corporate villainy, once again has surprised both its critics and its corporate peers by backing President Barack Obama's plans to force employers to provide health insurance to workers, the Wall Street Journal reports. This show of support from the nation's largest private employer could give much-needed momentum to "one of the most-contentious aspects of legislation taking shape in Congress to fix the health system" and help provide coverage for the 46 million uninsured Americans, the paper notes. It's also making many CEOs choke on their coffee this morning. As the WSJ describes, the National Retail Federation, the industry's main lobby, said it was "flabbergasted" by Wal-Mart's move. The New York Times meanwhile shines a spotlight on the growing number of people who are forced into personal bankruptcy by huge medical bills. Three-quarters of them actually had health insurance to begin with, the NYT writes, reflecting that, "even as Washington tries to cover the tens of millions of Americans without medical insurance, many health policy experts say simply giving everyone an insurance card will not be enough to fix what is wrong with the system." Advocates argue that any universal health insurance program must guarantee a "base level of coverage" for all those it covers.

Sticking with health issues, a federal advisory panel yesterday voted to recommend a ban on Percocet and Vicodin, two of the most popular prescription painkillers in the world, because of the damage they can cause to the liver, the NYT reports. Both drugs contain a narcotic combined with acetaminophen which, when taken in high doses, has been identified as a leading cause of liver damage. People who take Percocet and Vicodin for long periods often need higher and higher doses to achieve the same pain-relief effect, the advisory panel noted. The ruling doesn't guarantee a ban from the Food and Drug Administration but this expert advice normally governs the agency's thinking. The panel also recommended that the recommended daily dose of Tylenol—one of Johnson & Johnson's best-selling products and another that contains acetaminophen—be cut from 4,000 to 2,600 milligrams. The company said it "strongly disagreed" with the ruling.

Good news, investors. The Dow Jones Industrial Average gained 11 percent in the quarter that just ended, and the blue-chip index is up an even more impressive 29 percent from the 12-year low hit on March 9, the WSJ reports. The S&P 500 stock index had an impressive Q2 as well, finishing up 15 percent for the quarter, and it is up 1.8 percent for the year. Then why all the worried looks? Simply because few Wall Street watchers are convinced the bounce-back signals a full-blown recovery. "At current levels, the market is well through pricing even a tepid economic recovery," an equity strategist at Deutsche Bank tells the WSJ. "Earnings are going to have to deliver." And while the markets look fine when viewed through the lens of the past three months, the extended picture is ugly. Business Week chooses to conduct a half-year stock market report, likening the past six months to a jarring roller coaster ride. "Halfway into a tumultuous 2009, investors are no doubt ready for their summer vacations," Business Week writes. But there is one crucial positive development: Credit is flowing again. "No one could get credit six months ago," Brian Reynolds, chief market strategist at WJB Capital Group, told Business Week. Now, "we're shoveling money at companies."

While there may be signs of hope for investors, there's nothing but pain, it seems, for the nation's newspaper publishers. Gannett, the nation's largest newspaper publisher and the owner of USA Today, will cut between 1,000 and 2,000 jobs at local dailies across the country as advertising revenues continue to fall precipitously, the WSJ reports, citing a source familiar with the plan. "The impending move, which follows several aggressive cost-cutting efforts by Gannett over the past year or so, reflects the gloomy near-term outlook for an advertising recovery," the WSJ writes, adding that Gannett cut 4,600 positions last year and instituted unpaid leave for employees earlier this year when ad revenues failed to recover. The NYT, citing a blog that covers Gannett, says the cull could be even larger. "On Gannett Blog, a former Gannett editor who closely follows the company, Jim Hopkins, quotes an unnamed person in the company as saying that it will announce on July 8 that it is eliminating 4,500 United States newspaper jobs, and cutting salaries in its broadcast division," the NYT writes in its Media Decoder blog.

Finally, Fortune has rounded up a midyear edition of its Dumbest Moments in Business, and half way through a tempestuous 2009 there's quite a lot of competition, it seems. Our favorite: South Carolina Gov. Mark Sanford's proud rejection of $700 million of federal stimulus funds for his state "based on his fiscal conservative principles." Of course, as Fortune notes, in hindsight that turned out to be the second-dumbest thing Sanford did this year.