Rick Snyder Sticking it to Stickers

Governor Snyder Talks to League Members During 2013 Michigan Municipal League Capital Conference. CC license: BY-NC-ND 2.0
Governor Snyder Talks to League Members During 2013 Michigan Municipal League Capital Conference. CC license: BY-NC-ND 2.0 | Source

Item pricing law

One of the items addressed in Rick Snyder’s State of the State speech was a decades old item pricing law which requires retailers, like grocers and hardware stores, to put a price tag on every single item sold.1

Snyder and other business leaders feel the law is outdated and that the burdensome regulations they place on businesses are no longer necessary.2

Republican Narrative

The Republican position can be tricky, because it often sounds pretty good.  To really analyze it, though, requires understanding the difference between the Republican Agenda and the Republican Myth.

The Agenda is always very simple; reduce taxes on business and the wealthy, reduce regulations and other free-market barriers, and reduce spending. The Myth is where the magic happens. The Myth the Republicans present is that if we follow the Agenda we will all be transported to a wonderful magical fairyland that is overflowing with joy and prosperity. Trouble is, they don’t ever say exactly how or when that will happen.

The problem isn’t that their agenda can’t have benefits, it is that their Myth presents benefits as if there is no other possible outcome. But why? Why should we expect or believe that reducing taxes on a business means they will hire American workers rather than expand overseas or that they won’t just stuff that money into the pockets of executives. Similarly, why should we believe that removing the item-pricing law will have any positive effects for workers or consumers?

The point of looking at this issue isn’t about whether it is right or wrong – it is simply an example through which to look at Rick Snyder and see if he follows the Republican Narrative (its Agenda and Myth).

The Agenda

Does he follow the Agenda? Let’s look. Snyder’s take on the law is that it dictates “needless regulations that cost consumers and throw up barriers to competition”.3 Linda Gobler, president and CEO of the Michigan Grocers Association, says it would be a “huge, huge repeal of a burdensome law”.3 Wow, double huge, it must be really terrible. Lindsay Huddleston, Walmart’s Michigan Ambassador, considers repealing the law to be “priority number 1” for the Michigan market.4 And a report done by the Anderson Economic Group, cited by Snyder says the law costs retailers around $2.2 billion a year.5

The Myth

And how about the Myth? Snyder’s reason for the repeal includes, “revitalizing our economy”.3 Jeanne Norcross, a Spartan Stores spokesperson (Spartan operates 100 stores in Michigan) says repealing the regulation would enable “a business to redeploy those resources to grow the company and creates more jobs instead of doing duplicative jobs that are costly”.4 Linda Gobler says, “repeal of the law would free up money for retailers to make hires, reinvest in their stores or lower prices”.6  Well, hey, that sounds great!

Magical Fairyland

Give businesses more money and they will do good things for you – that is the epitome of the Republican Myth. But as always seems to be the case, the Agenda is clear and direct while the Myth is just a set of vague possibilities. Businesses get a very clear message - regulations will be cut and they'll save money. But, to workers and consumers they say the savings could be reinvested in the businesses, used to hire new workers, or cut costs. Well, which is it? Why and how does it have to be any of them? Versus, say, reinvesting in executive bonuses? Why can’t these businesses say specifically what they will do with the savings?

Let’s look a bit more closely at what businesses are saying. Linda Gobler says the law is a “job killer”.6 Really? How is that? She goes on to say that, “If you have someone putting little stickers on cans, it takes away from the time they could be spending stocking shelves or providing customers service”. So what? Time is time. It sounds like the only thing that could kill jobs is to take the law away.

Jim Hiller, who runs seven markets in Metro Detroit says, “it is a monumental waste of consumers’ money”.6 Monumental? I think that is a bit dramatic. And personally, I don’t mind paying a little extra for groceries if goes towards someone's paycheck. If you want to talk about monumental wastes of money let’s talk about something like bank fees to organizations run by dudes making $10 million a year. Either way, does Jim Hiller sound like someone who isn’t going to cut hours or workers. I mean, if he wants to save consumers money, he would have to right?

Can't have it both ways

But therein is the problem. This $2.2 billion business leaders call a needless burden, isn't money being burnt in a barrel - it is paychecks. If employers aren’t going to cut hours, and aren’t going to cut employees, than they won’t save money, and so why do they even care? Sure, some of them have said they can roll those hours cut into other activities like customer service, and I think some really will, but Walmart? I'm sorry, Walmart, but I have a hard time believing you’d take customer service over money.  And forgetting about what anyone says, just think about from your own experience what happens when work is cut? I don't know about you but in my experience, when work is cut, hours are cut. That's just the way things go.

I am really not writing this with any intention of disparaging the business persons mentioned or the business community as a whole. Nor am I really meaning this as an assault on Mr. Snyder, Republicans or conservative ideals. In truth there are some components of the Republican Agenda that I think have a lot of value. I like the idea of having a leaner (and definitely more efficient) government as I like the idea of having a more competitive environment for businesses. My concern, which I hope I articulated, is that in the Republican Agenda, the direct and specific benefits for us regular folks are lost. Too often, the benefits, it seems are, at best, wishful thinking, and at worst, magic tricks.

Notes

1. For additional information on the item pricing law see:

"Michigan's item pricing law" by the Detroit Free Press. http://www.freep.com/article/20110121/NEWS06/101210401/1008/NEWS06

and this Michigan.gov site http://www.michigan.gov/ag/0,1607,7-164-17337_17291-134114--,00.html

2. "Our view: Time to scrap item-pricing law." Midland Daily News, 25 Jan 2011. Web. 26 Jan 2011. <http://www.ourmidland.com/opinion/article_b7909bf4-28ae-11e0-862f-001cc4c002e0.html>.

3. Householder, Mike. "Snyder wants to put item pricing on shelf." Macomb Daily 23 Jan 2011: 1a. Print.

4. Martinez, Shandra. "Will Gov. Rick Snyder's plan to drop 'Item Price Law' save billions or cost thousands of jobs?." Mlive.com. N.p., 21 Jan 2011. Web. 26 Jan 2011. <http://www.mlive.com/business/west-michigan/index.ssf/2011/01/will_gov_snyders_plan_to_drop.html>.

5. "Michigan's Item Pricing Law: The Price Tag for Retailers and Consumers." Anderson Economic Group, 11 Dec 2010. Web. 26 Jan 2011. <http://www.andersoneconomicgroup.com/Portals/0/upload/MRA_ItemPricing_Public.pdf>.

6. Trop, Jaclyn. "Sticker shock: Plan to repeal pricing law launches debate." The Detroit News, 21 Jan 2011. <http://www.andersoneconomicgroup.com/Portals/0/upload/www.detnews.pdf%20item%20pricing%2012111.pdf>.


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