Wal-Mart to Pull Out of D.C. After Minimum-Wage Vote
Reposted from New York Magazine
For decades, Walmart has been known in the retail industry for its hard-line negotiating tactics. As the world’s largest retailer, it’s massive enough that it can offer to pay a ridiculously low price, threaten to walk unless its price is met, and watch suppliers trip over themselves to shrink their margins. So it shouldn’t be surprising that Walmart conducts its governmental relations the same way.
Earlier, Walmart threatened to pull three planned stores from Washington, D.C., killing thousands of potential jobs in the district, unless Washington’s city council abandoned a bill called the Large Retailer Accountability Act, which required companies that made more than $1 billion in annual revenue and have at least 75,000 square feet (read: Walmart) to pay employees a raised minimum wage, $12.50 an hour instead of the regular $8.25. Yesterday, D.C.’s city council passed the bill anyway.
Lydia DiPillis at Wonkblog thinks there will be “negative consequences” from the D.C. city council’s decision to go ahead with the bill, whether it’s in the form of lower property taxes, missing multiplier effects, and abandoned sites where the Walmarts would have stood. She points out that D.C. residents may go to Walmarts in the Maryland and Virginia suburbs now, instead of in D.C. proper, and that the stores that have been scuttled were likely to have the lowest profit margins for Walmart anyway.
That may be true. But D.C.’s decision to ward off Walmart is still a victory. In an era when suppliers, governments, and municipalities have all been scared into acquiescing to Walmart because of its size and job-creating potential, it also took tremendous courage. D.C.’s council members knew how many jobs a Walmart could bring to town and how good creating those jobs would look on their political record. But they also knew that despite Walmart’s white-washing PR campaign, those jobs were likely to be barely subsistence-wage, terribly depressing, and offset with jobs lost at local businesses. D.C. didn’t prohibit Walmart from setting up stores in the district (and there will still be three, even after the abandoned ones), but it did put in place what amounted to a fairly expensive penalty for doing so.
Not all jobs are created equal. But in politics, they often get equal weight. It would have been easy for D.C.’s city council to bow to Walmart’s threat, repeal or soften the minimum-wage hike, and brag to constituents about their job-creating success. Instead, they made a brave, values-driven decision about what kinds of jobs they wanted in D.C. and set policy accordingly. That’s the right of every municipality, and it’s an impulse that should be exercised much more often.
Lydia DiPillis at Wonkblog thinks there will be “negative consequences” from the D.C. city council’s decision to go ahead with the bill, whether it’s in the form of lower property taxes, missing multiplier effects, and abandoned sites where the Walmarts would have stood. She points out that D.C. residents may go to Walmarts in the Maryland and Virginia suburbs now, instead of in D.C. proper, and that the stores that have been scuttled were likely to have the lowest profit margins for Walmart anyway.
That may be true. But D.C.’s decision to ward off Walmart is still a victory. In an era when suppliers, governments, and municipalities have all been scared into acquiescing to Walmart because of its size and job-creating potential, it also took tremendous courage. D.C.’s council members knew how many jobs a Walmart could bring to town and how good creating those jobs would look on their political record. But they also knew that despite Walmart’s white-washing PR campaign, those jobs were likely to be barely subsistence-wage, terribly depressing, and offset with jobs lost at local businesses. D.C. didn’t prohibit Walmart from setting up stores in the district (and there will still be three, even after the abandoned ones), but it did put in place what amounted to a fairly expensive penalty for doing so.
Not all jobs are created equal. But in politics, they often get equal weight. It would have been easy for D.C.’s city council to bow to Walmart’s threat, repeal or soften the minimum-wage hike, and brag to constituents about their job-creating success. Instead, they made a brave, values-driven decision about what kinds of jobs they wanted in D.C. and set policy accordingly. That’s the right of every municipality, and it’s an impulse that should be exercised much more often.
Good riddance.