WASHINGTON -- In 1786 the Annapolis Convention, requested by Virginia and attended by only four other states, called for a second gathering to revise the Articles of Confederation in order to strengthen the federal government. Some revision: The second meeting became the Constitutional Convention. It scrapped the Articles, partly because the Founders were alarmed by states legislating relief of debtors at the expense of creditors, often in ways not easily distinguished from theft.
Something not easily distinguished from theft recently occurred in Annapolis. In legislation ostensibly concerned with any company with 10,000 employees but pertaining only to one, Maryland has said Wal-Mart must spend 8 percent of its payroll on health care, or must give the difference to the state.
The Constitution's foremost framer, James Madison, understood the perils of democracy at the state rather than the national level of an "extensive republic'': State legislatures have fewer factions competing for favors than compete for Congress' favors. States, being smaller than the nation, have legislatures more easily captured by overbearing majorities. Madison would have understood what Maryland has done.
Organized labor, having mightily tried and miserably failed to unionize even one of Wal-Mart's 3,250 American stores, has turned to organizing state legislators. Maryland was a natural place to begin because it has lopsided Democratic majorities in both houses of its legislature.
Labor's allies include the "progressives'' who have made Wal-Mart the left's devil du jour. Wal-Mart's supposed sin is this: One way it holds down prices (when it enters a market, retail prices decline 5 percent to 8 percent; nationally, it saves consumers $16 billion annually) is by not being a welfare state. That is, by not offering higher wages and benefits than the labor market requires. Labor's other allies are Wal-Mart's unionized competitors, such as, in Maryland, Giant Food, a grocery chain. These allies are engaging in what economists call rent-seeking -- using government to impose disadvantages on competitors with whom they are competing and losing.
Wal-Mart's enemies say Maryland is justified in expropriating some of the company's revenues because the company's pay and medical benefits are insufficient to prevent some employees from being eligible for Medicaid. Well.
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