Friday, September 15, 2006

Chicago's Big Box Living Wage, RIP

Revised and improved at 12:40 pm on Friday.
Archpundit, who usually is more thoughtful than this, is way wide of the mark in his discussion of the politics and public policy of Chicago's thankfully short-lived, Big Box Living Wage ordinance.

First, let’s look at the politics of the Mayor’s veto of the living wage ordinance [sustained by the City Council earlier this week]. This is a plus for Cong. Jesse Jackson, Jr. if he runs for Mayor in 2007? I don’t think so. Junior needs a united African-American base behind him to win. For starters, Daley will keep a significant portion of the black vote, even if Dock Walls, Dorothy Brown and Junior are all in the 2007 Mayoral race. That is just a matter of Daley’s history of working with all ethnic and racial groups and spreading around the spoils of victory, as illustrated, for example, by the way John Stroger and he traded support for each other over the years. Stroger supporting Richard M. Daley over Harold Washington, Hynes over Obama, Dixon over Moseley Braun, etc. Former Cook County Board President John Stroger is one of the few African-Americans I know who has always voted like an Irishman.

About half, or maybe more, of the black aldermen voted against the Big Box living wage law. Some of that may have reflected playing footsie with the Mayor. But, a good chunk of it was voting their Ward. Whatever, an issue that divides the African-American community and their aldermen can’t be good for Junior. Cong. Jackson can’t mimic what one of Illinois' most colorful Senators, Everett Dirksen, said, “Some of my friends are for this bill, some against it and I am for my friends.”

SEIU will try, but they are not going to chase the aldermen out of office over Big Box, and they aren’t going to hurt the Mayor much on this issue. Economic development is good for white wards, Hispanic wards and Black wards. In short, it is good for the City. Yes, economic development has not been evenly distributed through-out the City, giving minorities on the south and west side of the City the short end of the stick. However, the Big Box living wage would only have made things worse, inhibiting Big Box stores and their ancilliary commercial development from coming to the City. This would have been especially true with respect to Big Box stores avoiding the south and west sides of the City, where the Living Wage would have put the labor pool in those areas [relatively unskilled; a number of ex-offenders] at a major disadvantage relative to other parts of the City and nearby suburbs. Of course, Ald. Moore's 49th ward is not too close, in any sense, to the south and west wards. How is that for a coincidence?

Mayor Daley may be a Johnny-come-lately to doing something about economic development on the south and west sides of Chicago, but as Judge Easterbrook[7th Circuit Court of Appeals]says, wisdom come lately is better than wisdom not come at all. Advantage Daley.

Even if Daley doesn’t get a majority of the vote on the first round of the Mayoral election in February, 2007, unless he gets indicted- or somebody very, very close to him does-- he wins the election run-off with the runner-up in April, 2007. And, Big Box doesn’t help Junior or hurt the Mayor. Yes, it helped Joe Moore [the Alderman from "Big Labor"], Acorn and their Lake Front liberal supporters get their fifteen minutes of fame—and gave SEIU a rallying cry, but that is it. The living wage law might play in Santa Fe and San Francisco, but neither location is a good model for Chicago or any other City. Perhaps the phrase Sante Fe Democrats will become as popular with Republicans as San Francisco Democrats.

In terms of public policy, the Big Box Living Wage hurts those it purports to help, no matter how good SEIU is at organizing. The black majority wards are starved for economic development and jobs-- and the people, as well as a number of their the aldermen, in those areas get it: People are not better off being unemployed at $13 per hour than they are being employed at $7.70. A modern day Adam Smith might write, "Empower the people." And, there is nothing more empowering of individuals than the free market.

Smith might also write, today, about the dignity of getting and holding a job. There is a great benefit to having a real job even if it is only "entry level." It gives you on the job training, lets you learn some universal requirements for getting and keeping a job; and lets you move up from there. Alderman Ike Carothers [29th Ward] made eloquent arguments of this type when he spoke at the first City Council vote about the detrimental impact of the Big Box Living Wage.

You don’t need a Ph. D. in economics to figure these things out. Indeed, Milton Friedman, Nobel Laureate in Economics, remarked recently that some people earn a Ph. D. in economics and never learn to think like an economist [Paul Krugman of the New York Times comes to mind, as Paul is constantly trying to repeal the laws of supply and demand] and others have little or no formal training in economics and they get it from the get go. [7th Circuit Judge Richard Posner comes to mind]. If you want to help low income people, it is better to understand the laws of supply and demand than to try to repeal them.
Jeff Berkowitz, Show Host/Producer of "Public Affairs," and Executive Legal Recruiter doing legal search can be reached at