October 10, 2011

SB 469: Jerry Brown upholds economic freedom in California

By SB 469: Jerry Brown upholds economic freedom in California

Author: Timothy Sandefur

Governor Jerry Brown today vetoed SB 469, a bill which would have required Wal-Mart to prepare “economic impact reports” about the economic effect of opening Wal-Mart Supercenter grocery stores before they could get permits to do business. The reason for such a requirement would be to boost the power of unions, which, unable to compete fairly against Wal-Mart, are trying to exploit government power to bar competition against union labor.

In an article published in 2009, union advocate and UCLA law professor Scott Cummings revels in the manipulation of land-use power to force companies to do business the union way: “Land use authority remains at the heart of local power,” he writes. “This power can be vast since virtually every business requires some sort of land use permit to operate…. [T]he ubiquity of land use has led groups from across the political spectrum to use it to foster their policy goals, even if those goals have little in common with traditional [land use] problems.” Mobilizing Local Government Law for Low-Wage Workers, 2009 U. Chi. Legal F. 187, 203-204. Cummings is encouraged by such abuses of land use regulation, seeing in them the opportunity to “provide[] a politically legitimate way for city council members to oppose Wal-Mart because of concerns about its labor practices and negative community effects.” Id. at 212.

That is, by imposing a superficially fair requirement—which in fact is designed to misleadingly cast Wal-Mart as an economic threat to communities, when it is actually a boon—the “economic impact report” requirement helps bias any discussions over proposed Wal-Mart Supercenters. This provides an intellectual mask for a vulgar scramble for power. Supercenter grocery stores actually bring an abundance of low-cost goods and services to working class consumers, and therefore improve their standard of living—not to mention dramatically improving job opportunities. But by making Supercenters appear like nuisances, the “economic impact report” can motivate opposition that benefits those who follow union political bosses: “Wal-Mart has chosen not to go through the economic impact report process created by the Superstores Ordinance as a condition of development,” Cummings notes. “As we suggested above, that may be counted as a victory for its proponents: by keeping Wal-Mart Supercenters out of Los Angeles, unionized grocery workers gained leverage to negotiate a better collective bargaining agreement in 2007.” Id. at 241. Or, in plainer language, the result was to force Los Angelinos to pay more for products and services they need, in order to benefit unions that cannot compete economically.

Fortunately, this effort to impose the EIR requirement statewide has not passed muster. But as the union’s war on Wal-Mart—a war on economic opportunity and the standard of living—continues, we can expect to see more such efforts in the near future.

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