Wal-Mart Struggles to Expand in Chicago - NYT

Wal-Mart Struggles to Expand in Chicago - NYT

In the room behind the City Council chambers during the Jan. 13 meeting, a high-ranking Wal-Mart official asked Mayor Richard M. Daley if he was committed to the company’s plans to expand beyond its only store in Chicago.

Mr. Daley replied with a curt profanity and walked away, according to a source who witnessed the exchange but did not want to be identified for fear of angering the mayor.

The mayor’s response at that meeting revealed his frustration over a rare instance in which he has been unable to get the council to support his position. Although Mr. Daley has voiced support for more Wal-Mart stores in the city for years, the world’s largest retailer is still unable to break ground on more outlets.

Before walking out of the back room encounter with Rolando Rodriguez, Wal-Mart’s regional general manager for Illinois and northern Indiana, Mr. Daley urged the company to do a better job of swaying public opinion, the source who witnessed the conversation said.

Citing the recession and the need to create jobs, Mr. Daley in recent months has encouraged Wal-Mart to make another push for the city’s approval. But those efforts have stalled, with neither the mayor nor a majority of aldermen willing to expend the political capital to overcome organized labor’s opposition to nonunion Wal-Mart.

While Wal-Mart’s allies say new stores could help combat high unemployment, critics want the company to promise higher wages and health insurance for all workers. They also say the retailer’s arrival swamps competitors, destroying as many jobs as it creates.

Wal-Mart officials are so confounded by their lack of success in Chicago that they plan to bus people from inner-city neighborhoods to shop at their stores outside the city, said Alderman Anthony Beale and other council members who want the company to build stores in their wards.

Mr. Beale is pushing to win over reluctant aldermen to Wal-Mart’s side. “We are losing billions of dollars a year to suburban area stores,” said the alderman, who hopes to have a Wal-Mart as part of a 270-acre development in his Ninth Ward on the Far South Side. “How do you in good conscience vote against any type of job in this economy?”

Wal-Mart’s store in the Austin neighborhood on the West Side employs 430 people, said John Bisio, a company spokesman. Mr. Bisio also said the store inspired other new retail outlets in the neighborhood since it opened in September 2006.

Efforts to broker a deal for a new store in the Chatham neighborhood failed again on Jan. 11. The council had rejected the Chatham plan in 2004 at the same time that aldermen approved the West Side Wal-Mart.

Almost six years later, the issue remains divisive, especially in the predominantly black neighborhoods where Wal-Mart wants to open five Supercenters that sell groceries as well as other retail items.

Mr. Daley could merely instruct his top planning aide to sign off on the new Wal-Mart in Chatham, but he has balked at doing so. “We’re leaving it up to the aldermen,” Jacquelyn Heard, the mayor’s spokeswoman, said this week.

For Mr. Daley, allies say, forcing the issue would feed criticism that he rules Chicago like a monarch. But he has unapologetically decided other controversial issues by fiat — for instance, he ordered the midnight bulldozing of runways at Meigs Field in 2003.

By deferring to the aldermen, Mr. Daley also avoids a direct confrontation with the unions. They did not support his re-election bid in 2007 and spent millions of dollars to help unseat several of his council allies in that election.

With another election a year away, many aldermen are also not eager to make themselves targets of the unions. In the 2007 election, labor’s financing and manpower for council challengers dwarfed the support provided by the mayor and pro-business groups for their allies.

More than a dozen black churches and labor unions countered Wal-Mart’s newest lobbying effort by creating a group called Good Jobs Chicago. The organization has placed advertisements on billboards in the 9th and 21st Wards demanding that large retailers provide “living wages” and “affordable health care.”



The racially charged nature of the issue was evident at an event on Monday to celebrate the Rev. Dr. Martin Luther King Jr.’s birthday. Speakers at the rally in Hyde Park noted that Dr. King was killed while fighting for workers’ rights and derided Wal-Mart’s unwillingness to negotiate with its critics, according to a news release from Good Jobs Chicago.



“You should have seen them wheeling and dealing to build five plantations in Chicago,” the Rev. Booker Vance said in the release.

Besides promising more jobs, Wal-Mart officials said their Supercenters would address the problem of “food deserts” — neighborhoods without places to buy fresh fruit and vegetables.

Pat Dowell, an alderman in the Third Ward, was first elected in 2007 with union support and said she would prefer a Roundy’s grocery store at 39th and State Streets over a Wal-Mart.

“I’m going to address the issue of the food desert by bringing in a company that is responsible,” she said, noting that Roundy’s is a union employer.

But some aldermen said the economy had become so bad that they should re-consider their opposition to Wal-Mart.

Alderman Sandi Jackson of the Seventh Ward, who was once a Wal-Mart critic, said this week that she had recently switched sides. In 2007, she campaigned with union support and said she backed an ordinance requiring “big box” retailers to pay higher wages and offer benefits. Mr. Daley had used his veto power for the only time in his 21-year tenure to defeat that ordinance in 2006, setting off the election battle with the unions.

“I still believe paying a decent wage is appropriate, but now is not the time to be taking action that would keep out the jobs that five Supercenters would bring,” Mrs. Jackson told the Chicago News Cooperative this week. “Not one person has told me to vote against Wal-Mart coming into Chatham, the 9th Ward, the 34th Ward or any of the other food deserts in the city.”

She predicted that thousands of people would line up for a shot at one of approximately 400 jobs available at any new Wal-Mart.

“People are willing to take any job,” she said. “To get money to put food on the table is more important than dickering over a dollar here or there.”

The alderman is the wife of Representative Jesse L. Jackson Jr., Democrat of Illinois, and the daughter-in-law of the Rev. Jesse Jackson, who loudly criticized Wal-Mart when it first tried to enter the Chicago market. Alderman Jackson said she had not discussed the issue with her father-in-law; he did not return calls seeking comment.

Even some union leaders seem weary of the battle and reluctant to engage in another confrontation with the mayor. “We’re in a different time,” said Dennis Gannon, president of the Chicago Federation of Labor. “There should be some resolution so we can move ahead as a city. We don’t want to go through what we went through. We really kind of divided the city.”

But Mr. Gannon expressed frustration at Wal-Mart’s unwillingness to sit down with labor leaders to come to a compromise.

Ms. Heard, the mayor’s spokeswoman, and Mr. Bisio, the Wal-Mart spokesman, declined to comment when they were asked about Mr. Daley’s abrupt termination of his discussion with Mr. Rodriguez.

“Our passion and conviction to better serve Chicago customers has not diminished,” Mr. Bisio said. “We remain hopeful.”