As Ed Kilgore reported earlier, this week Washington, DC’s Mayor Vincent Gray vetoed an anti-Walmart big box living wage bill. I’ve written about the bill before, here and here. It’s possible that the bill may yet become law; next week, the council will hold a vote to override the mayor’s veto. The anti-Walmart forces need only one more vote to overcome the veto. We’ll see what happens.
I’ve been dismayed by some of the commentary I’ve seen about Mayor Gray’s veto. First of all, there’s Mayor Gray himself: he called the bill a “job killer.” And yet, as I’ve written, research shows that it’s Walmart that’s the job killer, not living wage laws. Studies of living wage laws in other cities, as well as studies of minimum wage laws generally, tend not to show significant disemployment effects.
In terms of Walmart’s impact on jobs, look at what happened in my own city of Chicago. In 2006, the city council passed a similar big box living wage bill, which then-mayor Richard Daley vetoed. Since then, 10 Walmart stores have opened here. You want to know what the unemployment rate is here in Chicago? Also 10! — 10.3 percent, to be exact. The reasons for Chicago’s terrible economy are of course complex, and I’m not arguing that the proliferation of Walmarts caused it. But they certainly don’t seem to be helping, and it’s possible they are hurting. After all, the largest, most rigorous study of the impact of Walmart on local labor markets showed that for every two jobs Walmart creates, it kills nearly three.
Moving on, Slate’s Matthew Yglesias celebrated the veto, crowing that it “died a justified death.” His brief post contained a couple of highly problematic statements that I will address here.
Yglesias welcomes Walmart’s arrival because, he says, “the city has a lot to gain from more stores and more competition.” This is a fairly classic example of someone taking take a deliberately simplified, highly stylized principle from neoclassical economic theory — “more choice, more competition = always good!” — and then completely ignoring the specificity, complexity, and context of real life and mistaking the abstraction for empirical reality. In reality, Walmart tends not to create more “competition” and “choice,” but to destroy it. It is such a huge player that has the power to make and break markets, and to put its competitors out of business — and it often does. Read Charles Fishman’s excellent book on Walmart for more.
Or, to understand how this works from a theoretical perspective — how maximizing individual “choices” can lead to collective outcomes that are far from optimal, or even dysfunctional — I strongly recommend Tom Slee’s wonderful No One Makes You Shop at Walmart. It’s a great little book that teaches basic principles of game theory-type economics, yet reclaims them in a form that is usable for market skeptics and collective action fans on the left.
In his post, Yglesias says he supports a significant increase in the minimum wage — as do I. In fact, he supports many progressive economic policies — see this recent post of his advocating a guaranteed minimum income, for example. He also acknowledges that “Safeway, Giant, and their unionized workers have a lot to gain by blocking Walmart from entering the market” — as indeed they do. Walmart’s entry may well mean that those decent union jobs are destroyed, to be replaced by Walmart’s notoriously low-paid, no-benefit jobs.
Based on this post, and also this previous one, Yglesias’s argument seems to be that expanded consumer choices should trump the threat Walmart poses to workers. Particularly in this economy, I think that’s unconscionable.
Yglesias’s position — and the position of other pro-Walmart Democrats like Vincent Gray, Rahm Emanuel, Jason Furman (Obama’s Chairman of the Council of Economic Advisors), and many others — represents a steely indifference to the fate of organized labor that is deeply troubling. Even in its greatly diminished state, organized labor — still — is the backbone of progressive politics in this country. It acts as what John Kenneth Galbraith referred to as a “countervailing power,” fighting against corporate interests and the rich and for working people. It is the largest, most well-organized, most well-funded progressive organization we have — by far. And the support that labor gives to progressive candidates — in donations, in boots-on-the-ground volunteers — is crucial to their success. No other progressive groups can match it in scope or power.
That’s why developing a strong labor movement is crucial to reviving progressive politics in this country. It’s also why supporting policies that will strengthen Walmart and lay waste to union jobs is so terribly destructive and short-sighted. I don’t know, I suppose Yglesias and his ilk have a different theory of politics than I do. Maybe they think the politics fairy will magically create a strong mass movement that causes our leaders to enact the progressive policies we all want. Or maybe they believe that we should simply trust benevolent elites to do the right thing. Because that’s worked out so well for us in the past.
But in the real world, the labor movement is the most important mass movement we have in this country that is fighting for progressive economic values. It’s not nearly enough, but it’s the best we’ve got. That is why progressives should support it.
No, it doesn’t mean that every progressive should back every labor cause, but I think we should have a strong predisposition toward supporting labor — especially when the fights, like the one in DC against a corporate predator like Walmart, are this easy. On the micro level — supporting unionized grocery workers who might easily lose their jobs if Walmart muscles in? Especially in this economy? That’s an easy choice. Also, on the macro level — strengthening unions so that unions can continue advocate for progressive policies? And weakening Walmart until it agrees to higher labor standards? That also makes a lot of sense.
As always, I completely understand why Republicans and conservatives love them some Walmart. But when liberals support pro-Walmart policies, there is a huge disconnect. They say they want one thing — a higher minimum wage! a guaranteed minimum income! good jobs! decreased economic inequality! And yet they are strongly supporting policies that will virtually ensure that they will get the exact opposite: jobs with miserable wages, no benefits, and no prospects for advancement; the further immiseration of working people in this country; and the tragic, slow-motion obliteration of one of the most powerful politically progressive institutions this country has ever known.
I truly don’t get it.