COLUMN: Always low wages, always

By Jack McMillin

Two weeks ago, Chicago’s Mayor Daley vetoed Chicago’s Big Box Ordinance. This ordinance would have required “big box” stores such as Wal-Mart and Target to pay workers a minimum of $10/hr with additional benefits of $3 per hour by the year 2010. The bill would have effected stores with more than 90,000 square feet of floor space and stores owned by companies that have $1 billion in sales annually.

This was Daley’s first veto in 17 years as mayor. Polls showed the ordinance, which was passed on July 26, had the support of Chicago residents. Mayor Daley said that the ordinance “would drive jobs and businesses from our city, penalizing neighborhoods that need additional economic activity the most.”

The federal minimum wage, which is $5.15 an hour, has not been raised in nine years. While Illinois has a state minimum wage of $6.50 per hour, this is a pittance more. Let’s do some math. If you work forty hours a week for 52 weeks a year (no vacation!) at the federal minimum wage, you make $10,712 for that year. Imagine trying to support your family on that kind of budget. If the big box ordinance had gone into effect a parent working forty hours a week every week of the year would be making $27,040. That’s not much, but it’s a closer to a fair wage.

Opponents of the ordinance like to claim that a fair wage would reduce job availability and therefore opportunities. Exactly which opportunities? Does anyone really think that someone working full time for $10,712 a year has a chance to make it into the middle class? What is far more likely is that someone with wages that low is going to be locked into a cycle of wage slavery, living from paycheck to paycheck with no money to save, no time to rest and no chance for a better job. Can we really not afford to pay people better wages? Five of the 11 richest people in America, whose combined net worth equals around 80 billion dollars, are members of the Walton family. Our tax dollars fund the occupation of Iraq to the tune of $267 billion a week.

I spoke with Deborah Rupp, Professor of Labor and Industrial Relations and Psychology. She does research in the area of organizational justice. According to Professor Rupp, “there are decades of research that shows that if employees are treated in an unfair way both distributively (their pay) as well as procedurally (the processes that are put in place to determine their pay), these sort of factors have a very strong affect on their attitudes at work … their psychological well-being, and their physical well-being.”

According to Robert Greenwald’s film “Wal-Mart: The High Cost of Low Prices,” Wal-Mart costs $1.5 billion dollars in taxpayer support. In lieu of paying a salary that would allow workers to support themselves or providing an affordable health care plan, Wal-Mart encourages its workers to apply for welfare, food stamps and Medicaid. One Wal-Mart manager in the documentary reports being given lists of government aid programs to tell his workers about. In short, Wal-Mart shifts the cost of taking care of its workers to the taxpayer. Adopting the language of the right, Wal-Mart is a corporate “welfare cheat” – it could cover its own expenses, but it relies on government programs instead.

One of the arguments opponents of the Big Box Ordinance gave was that it would keep stores such as Wal-Mart from opening locations in Chicago. Indeed, Wal-Mart and Target have blackmailed the city by announcing that as a result of the ordinance, they would stop development in Chicago. This is a bluff. The markets in Chicago are simply too big to be ignored, even if you have to bother with paying your workers more.

But even if the threats were true, that shouldn’t stop the ordinance from passing. Keeping Wal-Mart out ought to be a policy goal, not something to avoid.