Posted on 07/14/2006 4:02:49 AM PDT by Chi-townChief
Target is putting plans to build three South Side stores "on hold" -- and making veiled threats to close existing Chicago stores -- if the City Council mandates wage and benefit standards for "big-box" retailers, African-American aldermen warned Thursday.
The saber-rattling is intensifying as the clock winds down toward a July 26 showdown vote on plans to make Chicago the nation's first major city to establish a "living wage" for stores with at least 90,000 square feet of space operated by retailers with $1 billion in sales.
Minneapolis-based Target becomes the second retailing giant to threaten to pull out of the lucrative Chicago market in a last-ditch effort to stop an ordinance championed by organized labor that breezed through the City Council's Finance Committee 15-6 and has attracted support from 33 aldermen.
WAGE WAR
The current federal minimum wage is $5.15 an hour. Illinois' minimum wage is $6.50
Most Chicago area Wal-Mart employees average $10.99 an hour, with just a few making the starting wage of $7.25 an hour, Wal-Mart spokesman John Bisio recently said.
As of 2004, Target in many cities had a starting salary of about $7 an hour, published reports said. A few Target workers outside Illinois said they recently started with salaries as low as $6.25 an hour, according to postings on the Target Union! (www.targetunion.org) Web site for store employees.
Wal-Mart has threatened to cancel plans to build as many as 20 Chicago stores over the next five years if retailers are required to pay employees at least $10 an hour and $3 in benefits by July 1, 2010.
'It would be devastation for us'
Mayor Daley is taking the threat seriously. He has challenged aldermen who oppose Wal-Mart's 20-store expansion to describe how they would replace the 8,000 lost jobs.
Target failed to return calls on the admonition communicated to aldermen of the 5th, 9th and 34th wards in recent days. Target real estate executive Chris Case was scheduled to meet with African-American aldermen Thursday, but the meeting was canceled because of scheduling conflicts.
Ald. Carrie Austin (34th) said a Target pullout would be devastating to the 32-acre shopping mall at 119th and Marshfield that developers had hoped to build, with help from a $23 million city subsidy. Home Depot would likely follow Target out the door. As many as 1,000 jobs would be lost, Austin said.
"It would be devastation for us. Our largest employer in the 34th Ward is the Police Department. The second-largest for us would be Jewel. We have no other resources," Austin said.
Referring to the anti-Wal-Mart movement that gave birth to the big-box ordinance, Austin said, "If you want to bully up on Wal-Mart, you've got to bring in the other ones, and damned if you do on them. If they suffer from it, too bad. If you want to control Wal-Mart, you should go about that a different way."
Accused of 'bullying tactics'
Ald. Leslie Hairston (5th) said she has a letter of intent from Target to build a new store at Marquette and Stony Island in her ward. But the developer has told her the store is "on hold" and that Target may close existing Chicago stores if the big-box ordinance goes through.
Hairston called it little more than a scare tactic. And even if the threat turns out to be real, she's standing firm in support of organized labor.
"Wal-Mart and Target could pay their people a living wage. Then we wouldn't have this problem, and people could actually live on the money they made," Hairston said.
Ald. Joe Moore (49th), chief sponsor of the big-box ordinance, accused Target and Wal-Mart of using "bullying tactics" to stop a train that has already left the station.
"It's an idle threat. ... They're clearly trying to ... intimidate members of the City Council. I am very hopeful that members will hold firm. ... The votes are still there," Moore said. He predicted 33 votes for the ordinance, "maybe more," even though Daley has been buttonholing aldermen to try to stop it.
Ald. Howard Brookins (21st) is still searching for a big-box retailer to replace the Wal-Mart his colleagues nixed at 83rd and Stewart.
Brookins said Wal-Mart executives have told him they may take the lead of the riverboat casinos that ring Chicago and run free shuttle buses to their suburban stores if the big-box ordinance passes.
"I don't know if it was in jest, but they did say it. ... That is an option that they could employ. They could set up locations to have pickup and dropoff. I don't think that is that farfetched," Brookins said.
fspielman@suntimes.com
Ann Coulter recently said, "conservatives believe in God. liberals believe they are God." A timeless truth restated.
Excellent assessment.
The effect of a price floor on a commodity is to render worthless anything whose market value would be below that price floor. The only way that price floors raise the value received by sellers is by reducing the competition from people who would sell for less.
Minimum-wage laws won't necessarily put people out of work (e.g. I suspect that if the minimum wage were $0.01/hour, raising it to $0.02/hour probably wouldn't cost anyone his job) but the only way they can cause anyone's wages to go up is by putting people out of work.
Any money the government would save as a result of a minimum wage getting some people off Section 8, etc. would be more than offset by having to pay welfare benefits for the people it pushed out of their jobs.
For some reason, many people seem to think businesses are in competition with workers, and minimum-wage laws shift the playing field in favor of the workers. The problem with such thinking is that workers aren't in "competition" with their employer--they're in competition with other workers and potential workers.
The real effect of minimum-wage laws is to increase the competitive advantage that workers whose productive value would exceed the minimum wage have over those workers whose productive value would be less. If an employer has a choice between hiring ten workers who each cost a total of $10/hour (including benefits, etc.) or fifteen that cost $5/hour, the employer would likely choose the latter option unless the more productive workers agreed to work cheaper. But if the employer can't hire any workers for less than $10/hour, that puts the less productive workers out of a job, and so the more-productive workers can demand and receive wages that will cost the employer $10/hour since their competition was eliminated.
Since the former scenario will put people out of work, who will then have to be funded out of general tax revenue, it seems the choice is either higher prices and higher taxes, or just higher taxes (which may end up not being higher, since the government has to subsidize workers less than it has to subsidize non-workers).
Personally, I'd like to see something like the following: every citizen over 18 receives a personal tax credit of $x/year. Every dollar of income earned is taxed at y%. If a person earns less than $x/y% per year, the government pays them $x minus y% of what they earned. If they earn more than $x/y%, they remit the difference. Eliminate nearly all other welfare programs.
Right now, the eligibility rules for welfare compel people to live inefficiently, or at best eliminate all incentives for them to do otherwise. If you tell people that they're not allowed to save any money, and give them enough food stamps that they don't need to shop economically, they'll make no effort to economize. If, on the other hand, you tell people that every dollar per month they manage to shave off their living expenses will be an extra $12 per year they can do with as they want, a lot of people would find themselves able to live on much less than they had been.
In addition to the obvious direct benefits, this would also help people move up in the world and stop being dependent on government. The only real way for a poor person to move up in the world is to learn to be efficient with money. Unfortunately, people on welfare are discouraged from learning that skill. If people were encouraged to be more efficient with their money, they'd be able to advance themselves.
Good points.
I think America United was making a joke--hence the quote marks around "French".
After all, it's not pronounced Tar-get, it's Tar-zhay with a "French" accent.
No need to get snippy about it! ;-p
Some people think knowing everything about Target is the pinnacle of knowledge. I pity them.
And the sweet irony is that of the 30,000 job applicants at the EP walmart, 29,500 of them were city residents and 500 were suburbanites (actually figure cited in the Sun-Times).
The city of Chicago is really "in touch" with the interests of their residents, aren't they? lol.
If people refuse to work hard and live cheaply, instead consuming government money, the fault is with the government that allows it, not with the company that pays them what they're worth.
I assume that by this time, you've discovered that your information is no longer accurate-- either by reading this thread, or actually doing some research.
Are you saying the Dayton family has sold the stores to France? http://powerlineblog.com/archives/007946.php
Dayton is one of the beneficiaries of the Dayton's (now Target) department store fortune. He himself has never worked in the private sector and has spent most of his adult life in politics. As a subject, Dayton is Minnesota's contribution to the psychiatric profession. As a politician, Dayton is the expressive form of the Democratic Party
Haven't read the Powerline article, but just skimmed through it. I found the passage you quote, and it is correct-- as far as it goes. That's how his family made their fortune.
I'm sure he still owns shares of the Target corporation, as do I. You might even, also-- either directly or as part of a mutual fund.
He, and his family, no longer have any say in how Target corporation does business. When DHC was taken public (I have no idea the date), the Dayton family effectively sold a good portion to thousands of shareholders-- not the French specifically.
Are you saying the Dayton family has sold the stores to France?
I see no reference in the quoted article to "sold the stores to France".
Target is a publicly traded company-- it's not "owned by the French". In deference to this commonly bantied belief, however: AXA, a French corporation, owns roughly 5% of Target's outstanding shares. Hardly a controlling interest, by any stretch of the imagination. (Gleaned this from a Snopes.com article.)
It's kind of a toss-up which of those legends offends those of us that work with/for Target (I'm a contractor and my wife is in store management) more: Being French-owned, or under the thumb of Mark Dayton.
You've managed to assign both in one post. Congratulations.
Then you read the thread wrong... my post was to a post that said someone would not shop at Target because it was a French Corporation and I replied that to the best of my knowledge it was not, but linked to the Dayton Family (didn't remember his name in the post, just the incident where he left DC for fear of being bombed after 911).... no where did I demean Target or their employess, actually I love Target Stores and wish they would build one in our new mall that is going in, but evidentally our City fathers chased away out of greed.
I know you happen to be correct Egon. I needed to add my two cents. I hate it when someone posts something that is so full of errors regarding Target. I'm a shareholder and I do not appreciate Arizona Carolyn defaming this great American company. Thanks for sticking up for it.
good column in today's Tribune on the opinion page.
http://www.chicagotribune.com/news/opinion/chi-0607170133jul17,1,3013332.story?coll=chi-opinionfront-hed
I beg to differ....mechanics in the city of Chicago garages start at $38 an hour(machinist union). Most make over 40 with all the years they've accrued. I know this first hand.
disclaimer: I'm not in a union.
I actually assumed that you were correcting the French legend, but were replacing it with the Dayton one.
Since a couple days had passed, I looked beyond your response (to a very early post) and saw that you hadn't been corrected by the end of the post.
As I stated, I was assuming that, by then, you had read the remainder of the thread and had been corrected of the Dayton legend. If not, at least you would be brought to the conclusion that it was contested, by my response to you.
You responded with the Powerline quote, as well as the "sold it to the French quote".
I apologize for the misunderstanding. I'm growing weary of correcting a great number of insidious anti-Target rumors and propaganda. As with any company, it definitely has its faults; but, by and large, it is an excellent corporation-- staffed by a great many good people-- some of them Freepers.
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