File Under: Good Idea that Will Never Happen

The fall out continues from the Big Box Living Wage Ordinance here in Chicago. Mayor Daley continues to threaten a veto and Target is pulling out of a planned development on the South Side. The point Mike Doyle at Chicagocarless.com raises is the crux of the matter: a local ordinance such as Chicago’s runs up against the regional and decentralized nature of American political economy. We don’t know the costs and benefits of a “big box free” Chicago, but it seems we’re going to find out.

The executive director of NeighborSpace, the organization I’m working with this summer and during the year as an intern, had an interesting solution of sorts to the controversy. In Chicago we have what’s called Open Space Impact Fee Fund. Certain developers building in certain areas that will negatively impact open space or increase building density are required to pay into an open space fund. That fund can then be used for any open space related project. NeighborSpace often has applied for funds from this source for land acquisitions and other projects.

So why not have something similar for big box stores called the Big Box Impact Fee? Every new Wal-Mart or Target development would pay a certain amount of money into a new fund that was run independent of City Council influence, much like the Open Space Fund. It would be used in the community area (not the aldermanic ward) that the big box store was opening in to fund job training, business development, or commercial area revitalization programs.

It seems that Wal-Mart and Target would be most amenable to such an approach. What Wal-Mart and Target fear is not the increased costs of doing business that a wage ordinance brings but the precedent and the change in power dynamics it brings. Big box stores in the Wal-Mart mold survive and thrive because they have a large pool of desperate people who need any work they can get. Wal-Mart and Target hold the upper hand in the labor market. They are more than willing to bear increased non-wage costs (see the promise to run shuttle buses from Chicago to suburban Wal-Marts) to maintain the power status-quo. An impact fee, even if it were similar in costs to higher wages, would likely be readily accepted by the big boxers.

Short a regional or state level big box wage ordinance, creative proposals such as this might be the best way forward.