Some things are a bit hard to grasp. One of them is intra-national protectionism.
Most forms of protectionism try to shield businesses within a country from competition outside, using tariffs or price controls to “even the playing field,” so to speak. What these laws do is make goods more costly for consumers within the protected country, in effect taking wealth from consumers and awarding it to the protected businesses.
In the United States’ capital district, politicians are in the process of pushing through a “living wage” bill that would apply only to big box stores like Costco and Walmart. While Costco and Walmart will be required to pay their employees a minimum of $12.50 an hour, other companies in the district could still pay wages as low as $8.25.
Doesn’t seem exactly fair, does it? The bill has been pushed by organized labor to supposedly help smaller retailers, but — surprise, surprise — exempts unionized grocery chains such as Giant and Safeway.
On the one hand, the Washington, D.C. city council is punishing Walmart, forcing it to pay more than its competitors for labor. On the other hand, the city has spent $40 million in direct subsidies to the company and another $28 million to advance projects that involve building six new Walmarts.
“I can’t imagine that they will proceed on any of the unbuilt stores if this bill passes,” says Grant Ehat, the principal of the company building the two Walmart projects already underway.
Mayor Vincent Gray expressed his hope to “find a way to, say, thread the needle” between the company and the council.
Or our nation’s capital might experiment with common sense laws, equally applied.
Yes, Common Sense. I’m Paul Jacob.