Angry New Yorker

Thursday, March 03, 2005
40 Minutes To Wal-Mart

At last weekend's Angry New Yorker Roundtable the topic of Wal-Mart in Queens was on the agenda. Reasoned perspectives on both sides were presented, and surprisingly no consensus developed by the time we had to leave. However, Steve Malanga, whose opinion we value and trust, convinced a number of our participants today that allowing Wal-Mart in would be a positive. And, as usual, our Roundtable added ideas to the mix. For instance, we thought it'd be possible to give Wal-Mart a "trial period" of several years at a smaller footprint size and contingent on a lease preventing them from certain selling items. That way both sides would be allayed.
True to form, Congressman Weiner, District 9, has strongly opposed Wal-Mart coming to Queens , spouting the usual populist rhethoric. (See Weiner Says No To Queens Wal-Mart Store, The Wave, Dec. 16, 2004, available here). On the other hand, here's the Post op-ed that convinced a number of our roundtablers:


?I?N the eyes of New York's pols, stopping Wal-Mart was supposed to be a victory for small stores in Queens and for the city's working people who were about to be "exploited" by the big, bad retailer. But the real victor was Nassau County, which like other suburban locales has benefited hugely over the years from the city's efforts to keep out big-box stores — an effort that started long before Wal-Mart came on the scene.

To understand just how big a winner Nassau is, consider a few statistics:

Queens' residents produce slightly more in aggregate personal income every year than the residents of next-door Nassau County — nearly $65 billion vs. almost $64 billion, according to the state Labor Department.

Given those numbers, you would suppose that the two counties would have similar levels of retail employment and spending. Sorry, you'd be wrong.

The last federal economic census, taken in the late 1990s, estimated that Nassau has about double the annual retail-sales volume as Queens. Not surprisingly, Nassau boasts a much bigger, thriving retail sector. It has 82,000 retail jobs in about 6,200 stores, paying about $2.3 billion annually in wages, according to the Bureau of Labor Statistics census of employment and wages.

Queens, by contrast, has only 49,000 retail jobs — a whopping 40 percent fewer than Nassau — and only about 5,700 stores, paying a total of $1.2 billion a year in wages. It's no mystery why these vast differences exist despite the potential size of the Queens marketplace. For decades, New Yorkers have been leaving the city to shop because city officials keep at bay the stores where their constituents want to shop in. In 1993, when the big-box controversy first erupted, the polling firm Leo J. Shapiro and Associates asked New Yorkers about their shopping patterns and found that more than half of city residents leave the city to shop regularly, often visiting stores they can't find in Gotham. Obviously, the city's big box policies haven't done much to protect Queens' small retailers, as the recent stats on jobs and sales in Queens and Nassau demonstrate.

Of course, the big loser in all of this is the city's taxpayers. The extra sales-tax income that Queens alone forfeits to Nassau County might amount to about $250 million a year — to say nothing of lost property-tax revenues when sites sit empty while big-box stores build energetically in Nassau or Westchester or New Jersey.

Steven Malanga is a contributing editor of the Manhattan Institute's City Journal.

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