I’m betting that 1,000+ new jobs were just frittered away by a state legislature in a poor, rural county. I have to admit to you that I’m not certain of this outcome, but have seen it happen over and over…a legislative body passes a law hoping to do one thing and usually ends up with a completely different outcome than what they had anticipated.
Wal-Mart was planning to build a new distribution center in Princess Anne, MD. These facilities and the efficiency of their distribution system are some of the main reasons why Wal-Mart has won the battle with K-Mart and the other major retailers. Having their DCs in largely rural areas is part of this winning strategy.
This past week the Maryland Legislature passed a bill into law that singled out Wal-Mart, forcing them to pay 8% of their salary in the state to medical expenses. The law was crafted in a way so that Wal-Mart’s large size resulted in it being the only company affected by it. The anti-Wal-Mart forces combined to pass this legislation.
Princess Anne, MD is a very rural town (population 2,313) in Somerset County (population 25,863), which is one of the poorer counties in the state. The medium household income is less than $30,000 and 19.2% of the county is classified below the poverty rate. A planned new 1 million square foot DC with 1,000 higher paying jobs could have a very positive impact upon an area such as this. Wal-Mart announced such a plan last year after it secured the land for the project.
My bet is that Wal-Mart will scrap those plans after this vote, moving the facility to either neighboring Delaware or Virginia. The state lines of each are less than 25 miles on either side of Princess Anne.
Why can’t our state legislators let the free market work, rather than trying to intervene, usually really messing things up?
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