BENTONVILLE, AR — Wal-Mart, Costco, Sam’s Club, K-Mart, and Target are challenging the Economic Independence Act, passed this February, which requires “big box” stores to phase out outlets in or near low-income neighborhoods, and help nurture local businesses to replace them.
“We in the big box community are committed to ensuring our investors’ rights, in accordance with the U.S. Constitution,” said Wal-Mart C.E.O. Lee Scott. “We will definitely fight this with all the resources at our disposal, which are, by the way, considerable.”
Housing and Urban Development Secretary Rene Oswin vowed to defend the legislation. “You know something’s wrong when the earnings of poor folks end up in the pockets of Wal-Mart shareholders in Manhattan,” said Oswin. “This act has finally put a stop the flow of money out of these communities. To backtrack now would be disastrous.” Oswin predicted the big-box reatailers’ challenge would fail.
The act prescribes a two-stage withdrawal process for the stores from lower-income neighborhoods, which are defined as neighborhoods with a median household income under $30,000. In the first two-year phase, the stores will become wholesalers, able to sell only to smaller local businesses at heavily discounted prices. The local businesses can buy from whichever supplier they want. By the end of a second eight-year phase, the stores will be completely dissolved.
“We have nothing to lose but our chains,” said Marlo Lewis of Big Boxes Out, a citizens’ group that was instrumental in pushing for the Economic Independence Act, and which is now promoting a second act, the Full Economic Independence Act, to eliminate all chains with more than ten outlets from lower-income neighborhoods, along a similar ten-year timeline.
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way to go! progressallugha!
Comment on November 12, 2008 02:03 pm