A couple of days ago, I wrote a brief article about Wal-Mart's (NYSE:WMT) attempt to skirt city government and construct a Supercenter in Inglewood, Calif. The world's biggest retailer sponsored a ballot initiative that would not only have let it build the store with no traffic review and no environmental oversight, but also prevented changes to the plan unless another election was held and two-thirds of voters agreed.
Yesterday, Inglewood's voters rejected that initiative by a margin of 60% to 40%. I'll no doubt be branded a hippy-commie-pinko for saying this, but I am glad to see 04-A go down in flames. I'm all for free enterprise, but not at the cost of local control.
Shareholders and shoppers may disagree, but it is the duty of civic governments to regulate their communities. They have every right to reject a company if they are concerned about issues like low wages, union-busting, and skewed competition to established grocers like Safeway (NYSE:SWY) and Albertson's (NYSE:ABS).
We should note that Wal-Mart could have built the store without 04-A. The Inglewood government had already reversed its ban on big-box retailers. So why did Wal-Mart go through with it? Because it could. And that's the scary precedent for California.
Ballot initiatives are meant as a democratic safety valve for disenfranchised citizens. It's a perverse exploitation of the process when a company with the economic clout of an entire nation plays the victim and tries to spend its way around local ordinances. (Anyone else see the paradox in the fact that Wal-Mart was paying signature collectors more than it pays its retail employees?)
Even Fools who disagree with that ethical stance ought to realize the potential for economic backlash against the firm's tactics. Wal-Mart's success at the expense of its competitors and suppliers already generates enough bad press. It should avoid alienating the public -- and higher government authorities -- through political bullying. There may be more at stake than the $1 million thrown away in Inglewood.
Discuss Wal-Mart's politics on the Fool's discussion board.
Fool contributor Seth Jayson hopes Inglewood and Wal-Mart can reach a mutual agreement after all this fuss. He owns no stake in any firm mentioned above. View his Fool profile here.
