Bert Caldwell: Living wage plan might kill jobs instead

If not changed, a proposed initiative that would require Spokane’s “big box” retailers to pay workers a living wage should itself be put in a big box, and buried. A city scratching for revenue should not be encouraging stores that generate millions in sales-tax proceeds to locate or expand elsewhere.

Nor should it be spoiling for the inevitable lawsuits that would follow voter approval. The Fire and Police departments have that base covered.

Fortunately, efforts to find an alternative to the version approved by the Spokane City Council a week ago are already under way. The initiative’s sponsor, the Peace and Justice Action League of Spokane, will hold off gathering the signatures needed to get its proposal on the ballot while it works with the council and business interests to modify and clarify the plan.

“We are certainly willing to adjust our sights a little bit,” PJALS’s Rusty Nelson says, noting that initiative backers will meet with Spokane Regional Chamber of Commerce officials later this month. But he added that PJALS remains dedicated to the initiative’s objective: helping Spokane’s working poor.

Nothing wrong with that. And there’s nothing egregious about the proposed wage levels; 135 percent of Washington’s minimum wage for retailers that offer benefits, 165 percent for those that do not. That translates into $10.30 per hour with benefits, $12.58 without. Try living on that.But there is something wrong with limiting application of the law to stores larger than 95,000 square feet, a threshold that encompasses Wal-Mart, Target, Fred Meyer and J.C. Penney, among others. None of the dozens of living wage ordinances adopted thus far around the country use square footage as a trigger and, as a Chamber-commissioned legal review warns, the proposal may violate both the Washington and U.S. constitutions.

Stand by for the rush to the courthouse, with vague benefit criteria another potential legal problem. Stand by, too, for the gradual movement of large retailers to Spokane County, Spokane Valley, Liberty Lake, or any other jurisdiction not so foolish as to show their golden geese the gate. In Chicago, Wal-Mart and Target have already threatened to cancel new store construction if the city adopts a living wage ordinance that sets its threshold at 90,000 square feet. That could cost the city 10,000 jobs over the next five years. Even for a city Chicago’s size, that hurts.

Doug Orr, the Eastern Washington University economics professor who testified on behalf of the PJALS plan, concedes retailers could walk, and take a sizable chunk of sales-tax revenues with them.

“It’s a really powerful threat,” he says. But, he adds, retailers have more to lose moving away from their customer base than they have to gain avoiding what for many would be a minor overall increase in their cost of doing business.

Wal-Mart’s willingness to spend millions building a South Hill store over the objections of the surrounding neighborhoods illustrates the power of “gravity modeling” when the gravity is consumer dollars, he says.

However, most population growth in the county is outside Spokane, which has successfully counteracted that centrifugal force by filling its downtown with unique shops and restaurants. How long will the center hold if new stores are built on the urban fringe, instead of the core?

Orr also downplays the potential loss of workers by smaller retailers who pay less than the proposed big box living wage. That assumes a pretty high level of worker loyalty, although Spokane employees are unusually dedicated to their jobs and their employers.

That wages in Spokane are too low is undeniable, but that is not the fault of Wal-Mart or any other big store. The chamber and other business groups have been focused for years on improving incomes for all workers, and there has been progress. More is needed.

The community could live with a good discussion about how that can be achieved. Maybe the PJALS initiative, and its willingness to hear out business leaders, will get that conversation going on a level all can understand.