Target Corp. Blackmails Chicago Over Wage Law
As Progressive States highlighted a few weeks ago, the Chicago City Council approved a groundbreaking ordinance to require all large retailers in that city to pay a living wage of $10 per hour plus $3 in benefits.
In retaliation, the Target Corp. is making a blackmail threat to cancel the opening of stores in three predominantly African-American Southside Chicago neighborhoods unless the mayor vetoes the ordinance. Advocates for the Chicago law are calling on allies to call Target's CEO and end this political bullying.
Adding to community anger is the fact that Target already operates seven stores in the city and opened one in a a predominately white Northside community just two weeks ago, leading to charges of discriminatory redlining by the corporation.
What makes it clear that the threat is political blackmail and not merely a calculated business decision is the fact that the company admits that its Chicago Lincoln Park store is its most successful in the country-- and economic analysts note that big box retailers have been pushing hard to get access to urban consumers in recent years: "I think Target is making these threats to try to scare Chicago into scrapping this law," said Annette Bernhardt, deputy director of poverty programs at Brennan Center for Justice at the New York University Law School. "Everyone knows they'll expand into the city. That's where the untapped market is."
Target already operates stores in cities like Sante Fe which has a comparable minimum wage rates of $9.50 per hour, so the argument that the marginally higher wage rates in Chicago will make or break the new stores in that city is just not credible.
Advocates are especially suspicious since Target is aiming to intimidate predominantly black communities and elected leaders with its threat, paralleling nasty threats and racial manipulation by Wal-Mart during that company's campaign to enter Chicago and fight the new ordinance. In fact, the parallel is so close that advocates challenging Target have dubbed the company "Tar-Mart" for resorting to the same kinds of heavyhanded tactics used by Wal-Mart that have angered so many community groups.
This is shaping up to be a defining political divide in the city, of grassroots forces mobilizng against an establishment, represented by Mayor Daley, too willing to accomodate special corporate interests. From community groups like ACORN to the unions, activists see Daley giving into the threats by Target and Wal-Mart which would open up what Chicago Federation of Labor President Dennis Gannon labels "World War III" in the City.
To protest this heavy-handed blackmail, use these resources to call or write Target CEO Robert Ulrich to demand that he stops these threats against the poor communities of Chicago.
Update: Here's how high-profile this fight is-- AFL-CIO leader John Sweeney personally met with Daley to urge him not to veto the Retailer Living Wage Ordinance.















I suspect that the intent is to target council members in areas that are highly sensitive to the loss of low-paying jobs. Lincoln Park is an affluent neighborhood and would be less amenable to that pressure. The city is more sensitive to the loss of sales-tax revenue. I am very surprised at the actions of Target in this regard. I had considered them an acceptable alternative to Walmart, where I have refused to shop for a decade due to their labor attitudes. No more.
August 10, 2006 5:36 AM | Reply | Permalink
Target is just as anti-union as Walmart, but they don't have the economic power to squeeze vendors the way Walmart does. Walmart closed a store in Quebec when some workers unionized and got rid of its entire butchering operation when some meat cutters joined a local.
This technique of foregoing revenue to punish workers is self defeating. If it becomes anything more than an odd instance Wall Street will start to take notice. Both Walmart's and Target's stocks are doing poorly.
If there really is a good opportunity for a big box store in a neighborhood and Walmart and Target don't want to pay the mandated wage levels, some one else will and make a profit doing it.
--- Policies not Politics
Daily Landscape
August 10, 2006 6:14 AM | Reply | Permalink
And Daley's supporting Target. I often wonder if a call for a nationwide moratoriam on TIF funding and an implementation of a "fair share" tax on street and sewage construction for new store developments might not bring about some corporate behavior modification.
August 10, 2006 7:53 AM | Reply | Permalink
If Target is going to have lower cost competition from big box stores a few miles away in the suburbs, then opening these stores in the city would appear to make little sense. If the city wants these low skilled jobs moved to the suburbs, raising the minimum wage is the way to do it.
The sons of the prophet are noble and bold,
and quite unaccustomed to fear.
But the bravest by far in the ranks of the Shah
was Abdul Abulbul Amir
August 10, 2006 2:15 PM | Reply | Permalink
Yeah, right. Everytime raising the minimum wage is suggested, dire predictions of economic catastrophe are heard across the land - if Target wants to play hardball then threaten them with rescinding their FIT funding and enacting a fair share infrastructure tax on them.
If Target is building in the city, it means they've got the suburbs saturated and they need fresh pastures to grow.
August 10, 2006 2:24 PM | Reply | Permalink
You are absolutely right to focus on the issue of blackmail. Isn't it funny that the same pundits and editorialists (Yes, Chicago Tribune, I'm talking about you) who thunderously declare that one must never submit to terrorist blackmail and denounce as appeasers any who are less bellicose than they are (behind their keyboards, of course) -- can't even imagine another course of action than submitting to corporate blackmail. Corporation makes a threat - nothing to do but submit.
Enough of that.
Still, I don't imagine that this will turn out so well. Chicago's aldermen are a notoriously crooked bunch and I'm sure that there are at least ten of them who are vying with each other to sell this thing out in return for some crappy little favor from Daley to buy their vote. They know Daley is weakened by scandal and has to deal. This couldn't have happened (and didn't happen) years ago, because Daley was stronger then.
Labor has to flex its muscles here in a big way to prevail. Here's hoping they can pull it off.
August 10, 2006 6:04 PM | Reply | Permalink
This is a very weak threat which is why it's had so little effect.
Yes, the Targets and Walmarts could move to the near-in suburbs and attract city customers, but if it's easy enough for customers to get there, it's easy enough for workers, too. So at worst, the situation is no worse than it is now.
The city might lose a little tax revenue, but that's the only downside.
August 10, 2006 6:06 PM | Reply | Permalink