A Weblog of Centrist Voices in American Politics
|
|
|
A Weblog of Centrist Voices in American Politics | |
|
July 27, 2006Living Wage Mandatory only for Big Bad CompaniesThis does not strike me as an especially good idea: Chicago requires big-box stores to pay 'living wage' Brushing aside warnings from Wal-Mart Stores Inc., City Council approved an ordinance Wednesday that makes Chicago the biggest city in the nation to require big-box retailers to pay a "living wage." Now on the basis of allowing state-by-state and city-by-city laboratories, I'm willing to tolerate seeing what happens. Maybe for some of the bigger companies they are close enough that it won't be a huge deal. Home Depot pays substantially more than Walmart in labor costs, for example. But be ready for each company to crunch the numbers, and bail on any store where they don't add up. The bottom line question is this: will this fiat make things better for Chicagoans? Will more blue-collar Chicagoans earn better wages while consumer options are sustained, or will some jobs go away and consumers end up with fewer shopping options and higher prices? If you are Walmart, would you consider closing any inner city stores and starting up Walmart buses to bring low-income customers to lower suburban prices? That might even be an entrepreneurial opportunity. Maybe you could turn a profit if you could get 20 people to pay $10 round trip for thrice daily 20 mile van trips from Chicago to the nearest open Walmart. Or maybe you try harder to build walmarts on suburban public transit spokes. Posted by Brian Keegan at July 27, 2006 06:55 AMComments
This is a ridiculous law, akin to the Delaware health care law. To force bigger companies to play by different rules than a smaller one is a joke. This will only hurt employees of the companies in question because, if you are forced to pay double for each employee, typically you will have half the number of employees. Or move the store, as mentioned in the original post. Although I am convinced, like the Delaware law, that this wont pass muster when it hits the state Supreme Court. Posted by: Dan at July 27, 2006 10:38 AMMayor Richard M. Daley and others warned the living wage proposal would drive jobs and desperately needed development from some of the city's poorest neighborhoods and lead giants like Wal-Mart to abandon the city. Daley's right. This is dumb with a capital "D". Posted by: Tully at July 27, 2006 12:18 PMLaw should read: The Chicago City Council seems to be going out of its way to appear anti-business these days. A CCC alderman recently tried to pass a law outlawing trans-fats in all city restaurants with the caveat that if it hurt mom-and-pop restaurants, they'd be exempt (read: only rich, mean big fast food restuarants like KFC should have to ban trans-fats.) I think macroeconomics classes should be mandatory for all elected officials. And the first rule should be that wages and prices might happen to be linked. The funny thing is, Wal-Mart already averages $11 an hour in Chicagoland. Guess that wasn't good enough. Posted by: Scotch Drinker at July 27, 2006 01:33 PMI think Brian's most important point is that federalism's state- and city-level laboratories can provide excellent opportunities for experimentation from which policies can evolve from theory into actual documentation/evidence that can be examined. Regardless of whether Chicago's city council made a wise move, it's theirs to make. And when the lives of their working class vastly improve or large companies flee the city, the rest of the nation's cities and states will be able to examine the results, assess its wisdom, and determine whether or not they would want to enact something similiar themselves. Personally, I think it's going to disappoint everyone and chase businesses out of the city (that is, if they don't somehow find some other way to attract commerce), but like the Massachusetts universal health care experiment, I welcome the opportunity to finally get some real data instead of just more theoretical predictions. Posted by: Bobby at July 27, 2006 02:06 PMMass health care experiment is vastly different in that it does not target a specific industry or business. I would say that Walmarts arguments will be mostly targetted at the 90k square foot rule, since McDonalds, ExxonMobil and other conglomerate owned franchises are unfairly NOT being targetted like this. Posted by: Dan at July 27, 2006 03:19 PMIt's interesting that WMT is always the target in cases like these. Why NOT McDonald's? I'm guessing MCD doesn't pay an average of $11 per hour in Chicago. Why do the political elite find WMT such an attractive target? This seems pointedly anti-progressive given the fact that WMT provides a ton of low skilled jobs, low prices and one-stop shopping, three things that have to be very advantageous to lower income families. I'm not even sure how rhetorical this question is. Why do the elites despise WMT so much? Posted by: Scotch Drinker at July 27, 2006 03:34 PMI also expect that this doesn't work that well. Here's another idea. What if Walmart respond by making its stores smaller, so that they are, say only 89,990 square feet. They could make several departments be in dependent stores, Walmart is despised so much because its the most obvious low-moving target of a symbol of capitalism. Personally, I would bw Ok with paying a little more so walmart could pay its employees a little bit more anf give hm, say, better health plans. But ultimately, it's just a market. Everyone who understands a little economics or has worked in retail knows that retailing is the front lines of capitalism, and that discount retailing is the Russian front. Posted by: BK at July 27, 2006 04:21 PMWalMart has not really played the social welfare game as well as some of those other companies. They have been slow to come to the table of supporting social issues and are number one in terms of sales. Walmarts problem has been its tendency to avoid the social issues. I think they are changing; but it is what has them in the bullseye. Posted by: Jim M at July 27, 2006 04:23 PMWalmart won't build smaller stores anymore. They don't see as much profit in them and it makes their operational cost higher. I think the smallest they even consider now is 100,0000 sq ft. I think they have a Neighborhood Market concept that is smaller; but I am not sure how well it has done. Posted by: Jim M at July 27, 2006 04:27 PMWhy do the political elite find WMT such an attractive target?I would suggest that one unspoken reason is that WalMart just seems so "low class" and "southern country" (maybe there a better adjectives). Posted by: c3 at July 27, 2006 06:55 PM Did it ever occur to people that Wal-Mart is unpopular because...it pays low wages, drives small stores out of business, and provides very little in the way of health insurance? Nothing really cultural at all, actually. Posted by: Elrod at July 28, 2006 01:51 AMI think this is a very good idea. It's about time for lawmakers to recognize that Walmart is a despicable parasite and make them give back to the society and to the workers they've screwed over. If they close down, they close down. Then more mom and pop type places can open up - not that there's a shortage of stores in Chicago anyway. My only complaint is that a living wage should be mandatory at ALL stores, not just Walmart. But this is a good start. Posted by: Clint at July 28, 2006 04:24 AMMy point, to those above, is that: In a free market society, Walmart has every right to do what it does. Once we start making special rules for one store, business or industry, we are no longer a free market society and are moving ever closer towards the socialist style "democracy" seen in France. And we all know how well thats been working for them. Posted by: Dan at July 28, 2006 07:23 AMHow many of the "mom and pop" stores supposedly closed down by Walmart actually provided health insurance or paid much more than the minimum wage to their employees? Posted by: PatHMV at July 28, 2006 08:34 AMPat, I would hazard a guess that, of the few teenage employees they did have, none were paid more than minimum. And certainly none had health insurance. Posted by: Dan at July 28, 2006 08:40 AMExactly Dan. Clint (and others), it's very empting to think that this is really a swell start, that big bad businesses like walmart can be made to pay higher wages and that such acts will have only good effects and no worrisome adverse effects. But if you spend some time watching how retail works, how the world works, and understanding the interconnected relationships in our economy, you come to believe it's just not that simple. What exactly is the panacea that is represented by the wholesome image of "mom and pop" stores? Realistically, if Walmart moves out of a city area, how many mom and pop stores are needed to replace it, and how exactly do they spring up? Then, how do such stores compete for business when their merchandise costs are 10, 20, 30% or more higher because they don't buy in bulk? Experience tells us that people will travel to save money. It's far more likely that low-income consumers will resent local stores if their goods cost substantially more than they expect when they see the ads from the sunday paper for bigger retailers. If retail teaches you anything, it's that most ofthe competition occurs on PRICE. Service, atmosphere, and quality are simply not in the same ballpark, especially with low-income consumers. So what's likely to happen is that few high wage jobs are actually created, while the low-income consumers in the area have fewer shopping options, pay more for most purchases, and also face more inconvenience in shopping. Here's the thing: low-income residents in urban areas with limited mobility DO need decent jobs. But they also need low prices and one-destination shopping. I'm no Walmart apologist. I worked in the trenches of retail for over a decade, in a union that zealously protected employees regardless of whether they deserved protection from "evil" management or truly deserved the boot because they were awful employees. Walmart is not unionized, pays pretty crappy wages compared to the rest of the retail sector, and provides a pretty weak benefit package. IMO, laws and regulations that target Walmart are unlikely to have the effect expected by politically zealous and economically naive reformers who think you can remove one thread from a sweater. We'll see, but I'll be very surprised if this reg helps much. I'm far more supportive of the notion that liberal-minded reformers aught to try pushing very hard to unionize Walmart workers. Even though I know that unions are prone to protecting the undeserving along with the deserving, and passing more cost along to consumers, I support it anyway. Working in retail is a fundamentally tedious, fairly miserable job for hourly workers. So I'd like to see them get a raise. Posted by: bk at July 28, 2006 08:41 AM
Concerning health insurance, since when did health insurance become a right when getting a job?
As usual, the discussion of WMT turns into a morality discussion instead of a market discussion. And as usual, no thought is given to what mandated wages per business means on the prices that that business' customers will pay and what those likely higher prices means to those who can least afford it. I agree with Bobby. I'm all for empirical tests to see how this all plays out. I'm just glad it's happening in Chicago and not Dallas. Posted by: Scotch Drinker at July 28, 2006 12:48 PMWasn't it Walmart who shipped a buttload of water, food and other supplies to Katrina victims in very short order? Parasites. Posted by: WHQ at July 28, 2006 02:36 PMGreat job http://phentermine-online.cq.bz/ phentermin16 Posted by: phentermin16 at August 8, 2006 09:05 PMGreat job http://nclub.info/ nclubinfo17 Posted by: nclubinfo17 at August 16, 2006 05:54 PM |
Archives
March 2007
February 2007 January 2007 December 2006 November 2006 October 2006 September 2006 August 2006 July 2006 June 2006 May 2006 April 2006 March 2006 February 2006 January 2006 December 2005 November 2005 October 2005 September 2005 August 2005 July 2005 June 2005 May 2005 April 2005 March 2005 February 2005 January 2005 February 2004 January 2004 December 2003 November 2003 October 2003 September 2003 August 2003 July 2003 June 2003 May 2003 April 2003
Recent Entries
Some Smart Surging
Democratic Disgrace Obama: Tastes Great or Less Filling Should United States Attorneys be Professionalized? Don't you dare change your mind! Erin Go Open Thread NCAA tournament thread Blog that Brouhaha to death, AMIIGAF! Why Communism Grew Big: WWI Mythology Part 1 of 3 (LONG) The Right Immigration Questions
|
