Careful What You Wish For

An object lesson in what can happen when there is too much government interference in straightforward market competition, as reported by the Sacramento Bee.

An excerpt.

“There are reasons to be concerned about the likes of Wal-Mart – big-box stores that pay low wages so they can undercut local businesses.

“But a land use ordinance is not the right vehicle for that debate. The Sacramento City Council should listen to its Planning and Design Commission, which is overwhelmingly recommending that it repeal a requirement that proposed superstores undergo a complex economic impact analysis, including wage and benefit differences with existing retailers.

“The edict, enacted in 2006, has been a bust – ineffective and harmful to the city’s economy at the same time.

“While the ordinance applies to any retail store exceeding 90,000 square feet with more than 10 percent of the space for groceries, it exempts membership stores that are similar, such as Costco. Companies can get around the rules by opening grocery stores in the same shopping center as their general store.

“The rule hasn’t stopped city residents from shopping at superstores, but has cost the city sales tax revenue. While no such stores have opened in Sacramento since the ordinance took effect, at least three have set up shop just outside the city limits.

“The Region Builders and Sacramento Metro Chamber of Commerce say the ordinance puts the city at a competitive disadvantage. The strongest opponents of repeal are labor unions that have long battled with nonunion Wal-Mart, accusing it of mistreating workers and causing blight.”

About David H Lukenbill

I am a native of Sacramento, as are my wife and daughter. I am a consultant to nonprofit organizations, and have a Bachelor of Science degree in Organizational Behavior and a Master of Public Administration degree, both from the University of San Francisco. We live along the American River with two cats and all the wild critters we can feed. I am the founding president of the American River Parkway Preservation Society and currently serve as the CFO and Senior Policy Director. I also volunteer as the President of The Lampstand Foundation, a nonprofit organization I founded in 2003.
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