Chicago now has this great new law:
The measure requires retailers with more than $1 billion in annual sales and stores of at least 90,000 square feet to pay workers at least $10 an hour in wages plus $3 an hour in fringe benefits by mid-2010.
Does this mean a 16 year old kid must be paid 10 bucks per hour plus benefits from day one? Possibly, although I haven’t seen the law.
Naturally, this will drive discount stores out the area, making poor people the big losers.
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Many Latin American countries have similar laws, so I guess Chicago aspires to become a banana republic. Latin countries place huge burdens on large, efficient corporations, while exempting small, inefficient ones. As a result, productivity, and hence living standards, are very low.
Interesting enough, CNN was asking their viewers to let the TV station know if this measure is going to alleviate the economic situation for many people in Chicago or if it is not economic sense… you can very well imagine what most people will say…
This in conjunction with the hike in the Chicago sales tax will push most consumers to make purchases outside of the city where the suburbs have lower sales taxes and are Republican (in other words are only marginally less hostile to the marketplace.) Until Cook County mandates a hike in sales tax (as of the beginning of 2006 they mandated that any political entity within Cook County that does not have a smoking ban in place will have one imposed by the county government, so a precedent exists to “harmonize” tax policy just as county government did with smoking ban policy.)
Cook County, Illinois, home of regulatory entrepreneurs!!
Another irony.
When Walmart was recently considering openning a store (would be the first one) in Chicago in a poor neighborhood some activists protested. The activists started their protest at the last Brach’s candy factory, which was being shut down and moving to Canada (hmmm, sugar subsidies?!) The protest then moved to the location that Walmart was considering in order to protest the fact the Walmart would move into the area. These people were protesting the loss of jobs and then protesting the introduction of new jobs!
The people who actually lived in the area had arranged an ad hoc counter protest complaining that they needed more businesses to come into the area, not protesters preventing those businesses from coming to the area. The protesters (white, rich, and transplanted suburbanites) seem to have won, the locals (poor, black, and born and raised inner city folk) as usual, for Chicago, lost.
I don’t think that 16 year old kid will need to worry about job prospects for much longer. All youth employment opportunities will disappear once “living wages” drive them out of the labour market.
Chicago gangs can expect a recruitment boom soon…
Could it be the same boom-bust cycle constantly played with zoning laws, just another flavor? First you drive big businesses out of the area, buy the land for pennies on the dollar, then repeal the law (this would make the same area profitable again for big retailers), and sell the prime real estate lots back to them at a profit. Follow the money.
City poor people don’t generally vote Republican. Republicans in the suburbs don’t want poor city people in their neighborhoods. There seems to be a tacit agreement between city Ds and surburban Rs to cede the big cities to the Ds by voting welfare money to the cities if it will keep the poor people out of the suburbs.
The middle middle class families are being forced out of the cities by real estate prices and the dedstruction of city public schools. The only families who can afford to live in the big cities are the ones who can afford to send the kids to private school and those who are on public subsidies.
Seattle demonstrated that the poor people in ghetto areas can be run out of the city and the area rebuilt with condos for rich people. Since red lining is prohibited the minority housing is effectively red lined by the placement of subsidized housing.
This is the price poor people pay for being economically ignorant. Politicians know this and take full advantage of it. You have to keep the people poor and stupid so they’ll keep voting for you.
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