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DC's Walmart Minimum Wage Law Would Hurt the Poor


DC has just become the latest battleground over Walmart’s business practices. The retailer recently announced plans to open a number of stores in the city, but the District government has been throwing obstacles in its path. On Wednesday, the city council approved the Large Retailer Accountability Act by an 8 to 5 vote. The bill would force any non-unionized retailer with more than $1 billion in revenue and more than 75,000 square feet of retail space (read: Walmart) to pay employees at least $12.50 an hour. Minimum wage in DC is $8.25.

Washington Mayor Vincent Gray now has ten days to veto the bill. On the eve of the vote, Walmart executive Alex Barron wrote in a Washington Post op-ed that the retailer would cancel its current plans to build three locations in the District if the law passed.

If the bill stands—or if the Walmart opponents manage to override a Mayoral veto—it’s the city’s residents who will ultimately suffer. Democratic Councilman-at-Large Vincent Orange, a key backer of the legislation, argued that, “The question here is a living wage; it’s not whether Wal-Mart comes or stays….We’re at a point where we don’t need retailers. Retailers need us.”

Mr. Orange is dead wrong. The three stores Walmart is threatening to cancel are all badly needed retail and grocery options in underserved and poorer areas of DC that don’t have many options. As Ezra Klein, no lover of Walmart, writes:

[S]everal of the locations where Wal-Mart has committed to open have very little in the way of retail around them, and Office of Planning Director Harriet Tregoning has emphasized that small businesses in the vicinity should be able to prepare for it. Currently, many District residents are skipping over those small stores anyway on their way out to suburban Wal-Marts; keeping them in the neighborhood might open up opportunities for complementary businesses – such as restaurants or auto-repair shops — to open around them. Finally, many of the developments had been searching for anchor tenants for years; it’s unclear that Wal-Mart could be easily replaced, leaving the sites fallow.

DC is already an incredibly expensive place to live, and a lack of outlets for affordable basic commodities makes scrimping that much harder for middle class and poor residents. Cheaper prices at Walmart mean that in terms of purchasing power everybody in DC gets an immediate pay boost.

Blue politicians who oppose Walmart in DC—and in Chicago, New York and Los Angeles before it—do so with good intentions to help low-paid hourly workers afford life in their overpriced metropolises. Blue-model economic governance has often looked for ways to increase prices for certain producers through things like farm subsidies, taxes, regulation and construction controls. For those that can’t pay, they provide offset subsidies like food stamps.

So one of the main reasons there’s a case for living wage laws at all is that a combination of bad urban policy, overstuffed bureaucracies, excessive regulation and government-endorsed economic cartels have all driven up the cost of living so much that people can’t afford to live on the national minimum wage.

Instead of raising the minimum wage or fighting discount retailers—steps sure to make everything more expensive and create further problems—cities like DC should be working aggressively to bring down the cost of living so that more people can live on the wages they earn.

[Walmart image courtesy of Wikimedia Commons]

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  • Kavanna

    Cronyistic plutocracy is the real point of the Democratic party today. DC is now where New York is, only more so: the poor are on welfare, the cronyists are on top, and the independent and salaried middle class are squeezed out.

    Wasn’t that the point?

    • Corlyss

      “The transformation of the DC area into a gold-plated, recession-proof enclave in the last 20 years has been astonishing.”

      It’s been like that since WW2. Recessionproof DC is not nearly that new.

  • Corlyss

    “DC’s Walmart Minimum Wage Law Would Hurt the Poor

    They don’t care, just like they didn’t care about Michelle Rhee’s reforms. It’s the People’s Republic of the District of Columbia. I suspect this has more to do with unions and the limousine liberals in the Northwest’s figuratively-gated communities and the gentrified area in SE around the Congress and the Library of Congress. Those folks have always been supporters of reparations and think its perfectly fine for most of the DC population to be on welfare.

    Personally, I think the statute would be struck down as a bill of attainder since they exempted all the union stores. If Walmart needs the DC poor’s business, then I would expect the world to reverse rotation on its axis.

  • circleglider

    Didn’t the failure of the Soviet Union prove once and for all that centralized economic planning doesn’t work?

    • Nick Bidler

      ‘course not, because that would mean admitting fallibility.

  • Corlyss

    When Jim Cramer described the arrival of Walmart as the “first time poor people could buy a nice suit appropriate for job interviews,” suddenly a lot of things about their success and the limo liberals unyielding hostility to Walmart became clear.

  • dawadu

    DC Council members are people who refuse to let facts get in the way of their opinion and in this case WalMart is bad and hurts the poor.

  • Andrew Allison

    Re: “Blue politicians who oppose Walmart in DC—and in Chicago, New York and Los Angeles before it—do so with good intentions to help low-paid hourly workers afford life in their overpriced metropolises.”
    I big to differ. They do it, and thereby deny workers jobs which they would willingly take, because of political pressure from the businesses which would be hurt by the competition.

    • Corlyss

      Amen! I often wonder what child’s fairy story some of WRM’s charitable, give-em-the-benefit-of-the-doubt opinions come from.

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