Walmart scares California city away from minimum wage increase

Walmart helped kill a minimum wage increase in Desert Hot Springs, California, on Tuesday. The retail giant had threatened to pull back from opening a new store in the town if Desert Hot Springs raised its minimum wage to a planned $10.20 in January, with dollar increases to follow in the next two years. On Tuesday, a new city council was sworn in and promptly took the minimum wage off the agenda:

“When we look at other cities that have passed these ordinances like this is Los Angeles, Chicago, and Seattle these are large cities with a strong local economy. Right now we are at the point to have the potential to expand for economic development with other jobs that our community needs, and it is our job as a council to make sure that we are also attracting business that will bring good paying jobs for our residents," said Zavala.

Only council member Joe Mekee voted to keep the motion on the agenda. All the other council members voted to remove it.

This is nothing new for Walmart, which helped kill a bill that would have raised the Washington, D.C., minimum wage for big box stores to $12.50 in 2013 (the District subsequently raised its minimum wage to $11.50). Before that, Walmart helped kill a big box minimum wage increase in Chicago in 2006, again threatening not to open stores that would supposedly create lots of jobs. But, as Bryce Covert points out:

The scare tactics are based on the fear that Walmart’s refusal to open stores will cost jobs. But that’s not likely the case. After Chicago’s bill was defeated and Walmart’s doors opened, economists found that the company’s arrival often led other businesses to close, and the result was that Walmart destroyed nearly as many jobs as it created.

Way to go, Desert Hot Springs.