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DC Mayor Sides with Wal-Mart, Jobs, & the Free Market
September 12, 2013
Today, DC Mayor Gray announced that he will veto a bill that would require large retailers, including such stores as Wal-Mart, Target, and Lowe's, to pay employees a higher hourly wage than other businesses. In a letter to the DC City Council, Gray said:
I recognize that reasonable people passionately support [the Large Retailer Accountability Act of 2013]. And I strongly believe that all District residents should earn a living wage. However, after careful consideration, I have concluded that the bill, while well-intentioned, is flawed and will fail to achieve its intended goals.
He goes on to list six reasons for rejecting the bill, including that, if enacted, the bill would affect many more companies than just Wal-Mart (the target of the bill’s proponents) and it would result in the underserved consumers of the District's low-income areas to continue to pay more for everyday items (either in traveling longer distances or shopping at stores with smaller selections and higher prices).
What does this mean for DC residents?
Jobs Jobs Jobs. According to the DC Chamber of Commerce, if Wal-Mart builds the two or three stores, 900 jobs will be created and available for low-income and low-skilled District residents. That's more money in their pockets and gaining experience for the future. It's helping take people off of welfare and grow the local and national economy.
What does this mean for DC Government?
For those who believe that the economy creates jobs, they will see some $7 million in new government revenues. That's $7 million that you can use for road repairs (taking down some speed cameras), school reform (add some more kids to the Opportunity Scholarship Program), or (dare I say it) lower taxes for everyone. Other companies will also see DC as pro-business instead of a city picking winners and losers.
For those who think that government creates jobs, sorry. You will be disappointed in the increased revenue because you have convinced yourselves that your citizens who are getting a paycheck from a private, successful company is a bad thing. As a result, the DC Council seeks to override the Mayor in passing this bill, which would require large companies to pay employees $12 an hour instead of the city's minimum wage. They very well may succeed but, as I explored back in July, the consequences will hurt them, DC’s citizens, and DC reputation.
Why discriminatory wages are bad for DC:
Here's what I'm saying and I think that Mayor Gray is saying something similar (though we disagree on the solution): If you are going to make one business pay more for something because of government policy, you should make all businesses do so because that's fair. Be it a McDonalds or a vegan bakery, the government is not the arbiter of success. Success comes from hard work, specialization, local knowledge, and innovation. All of that can be found in the free market.
We will, again, see what develops and if DC will see this wage hike again.
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