Saturday Afternoon with the Wall Street Journal

March 30, 2010

Given the internet and my lack of faith in contemporary journalists, I rarely read newspapers anymore. Except for the Wall Street Journal. In fact, it’s one of the few if not the only major newspaper that has not lost circulation in recent years.

A few days ago I decided to spend some time reading the weekend edition of the Journal. As a business professor I should really spend at least an hour a day reading it front to back, noting articles to talk about in class; others to link to for my students. That’s hard to do given the different demands on my time.

At any rate, I decided to take some time Saturday afternoon to leisurely read the paper. I was amazed at how chock full of controversial material just the first section of that day’s Journal was.

For instance:

--A few years back when the anti-Wal-Mart frenzy was at its peak, the city of Chicago refused to allow the big retailer to put a new store within the city limits. As I recall, Wal-Mart instead located nearby just over the city limits in a suburb. In reality, Wal-Mart has for the most part ringed Chicago with suburban stores. Except for one Wal-Mart in Chicago, the core city has lost sales taxes, jobs, and a place for lower income people to shop. Now, things have changed: ministers from Chicago’s South Side – most of them black – are pressuring the Chicago city council to permit a Wal-Mart Supercenter in a middle class neighborhood called Chatham Market. Some of these ministers earlier opposed Wal-Mart. But there are hard economic realities: the article quotes a Wal-Mart executive as saying that Chicagoans are going to the suburbs to spend a half a billion dollars each year at Wal-Marts. I don’t know what Chicago’s sales tax is, but if it’s 10% and all those stores were in the city, that would total $50 million in tax revenue. Of course, not all of those stores would be inside Chicago, but you get the idea. Also, the executive said, 2,400 Chicagoans commute to the suburbs to work at Wal-Mart stores. Plus, many lower-income people have to leave town to take advantage of Wal-Mart’s prices. Despite the recognition of advantages of having Wal-Mart in Chicago, there are still opponents. For instance, the inappropriately-named Good Jobs Chicago Coalition wants Chicago employers of more than fifty people to legally be required to pay a “living wage” of $11 dollars per hour. Wal-Mart sees it differently. They start people a few dollars below that; however, that changes over time: the average wage for non-management people at Chicago’s only Wal-Mart is $11.30. That’s more than what the Good Jobs coalition wants. I think the ministers see that, too. Besides, I’d trust the guys who know the realities of the free market to determine wages rather than a group of Chicago community organizers.

--I’ve written earlier that this health care bill is a complex Rube Goldberg scheme that has flaws, contradictions, potential lawsuits, and gaps in care that we’re going to be discovering and discovering and discovering as things go in effect. First, we found out that the bill designed to cover all uninsured children with pre-existing conditions doesn’t. Now, here’s another problem: the bill requires establishment of high-risk pools to cover people with health problems who are currently uninsured. The bill says the pools have to be set up in 90 days. Right. We could get to the moon in less than a decade but it seems that the people charged with organizing these pools are finding that 90 days may not be enough time to set them up. Aren’t you glad they passed the bill so we could find out about all this neat stuff?

--On Page A6 of the weekend Journal was a story about a federal regulation requiring contractors who remodel older homes to have special federal lead-paint certifications, to spread plastic all over the place while working, and to wear special clothing to offset the alleged dangers of lead in paint in older houses. Are you kidding me? We rip things up on our 107-year-old farmhouse and don’t worry about things like that. Wasps, yes; lead paint, no. The EPA claims over a quarter of a million children over a five year period ending in 2004 had elevated lead levels in their blood. I doubt it. The EPA is the group, after all, that is not really tuned into reality. They’re the ones who want to tax the air we breathe and to regulate cow flatulence. Please. If any kids suffered the effects of lead paint like the EPA says, I doubt if it was from a remodeling job. But here’s real the kicker: this all goes into effect April 22. April 22!!!! As in a few weeks. The EPA says it has trained 50,000 individuals to remodel in the EPA way and they say another 50,000 will be trained by April 22. But an industry association says so far only 135 of the 212,000 contracting businesses and 14,000 of the 236,000 individual contractors have been certified. Whom to believe? They had better figure something out quickly because when this goes into effect, contractors face fines of $37,000 per day for noncompliance. Have any of these EPA people ever worked in the private sector?

--Also on Page A6 is a great picture that illustrates much of what I’ve written above. It’s from Ellicott City, Maryland, and it’s a picture of an eight-car train wreck.