The election for mayor of New York City is less that a month away and Bill de Blasio’s lead in the polls appears insurmountable (about a 50 point lead), Joe Lhota’s attempts to curry favor with New Yorkers by red baiting de Blasio’s progressive activism has back fired on the Republican as the Democrat’s favorable rating has increased since the initial attack.
Lhota has now taken a new tack– to denounce de Blasio’s plan to guarantee a living wage to New Yorkers who work at projects that are subsidized by the city. This proposal has aroused the ire of the business and real estate interests and Lhota has jumped on their bandwagon to denounce the living wage.
Let’s be clear on what a living wage is. It is not a minimum wage. The minimum wage is set by law, in the U.S. and New York State it is $7.25 per hour. This is really a subsistence wage level and the basic needs of an individual human being cannot be met at this level in the U.S. For comparison the minimum wage in Bangladesh is $0.38 per hour. US corporations and the international business community think this quite adequate for Bangladeshi workers to live on, just as Lhota and New York business elites think that $7.25 is good enough for New Yorkers.
The living wage is supposed to meet the basic needs of a worker. These needs are food, housing, and clothing and should also provide for health care, transportation costs and gas and electric charges (and maybe some recreation)– these needs vary from culture to culture. In New York City a living wage of $12.75 an hour would supposedly cover these needs according to a recent study by MIT.
Who is supposed to make up the difference of $5.50 between the legal minimum and the amount needed for the basics? This is what the “safety net” is for; i.e., food stamps [SNAP], medicare, WIC and other state sponsored programs to keep the working poor from starving to death. The general tax revenues of the state provide the money to the working poor that business would have to provide in higher wages to ensure their workers would survive and be able to show up in the morning. This is about 5% of total federal government spending (individual state funding has been excluded). Contrast this with the almost 7.5% of the federal budget that went as direct subsidies and other forms of welfare to the American business community including some of the largest corporations such as Walmart and Exxon.
If the minimum wage were set at the living wage of $12.75 per hour businesses would have to pay the difference from $7.25 with the FREE money they already get from the government leaving them with only 2.5% unearned welfare to pocket as a gift from their admirers in Congress. Republicans should be very happy to vote for this measure as one of their heroes, Adam Smith, would have no doubt supported it since he wrote in, the capitalist Bible, The Wealth of Nations:
Servants, labourers and workmen of different kinds, make up the far greater part of every great political society. But what improves the circumstances of the greater part can never be regarded as an inconvenience to the whole. No society can surely be ﬂourishing and happy, of which the far greater part of the members are poor and miserable. It is but equity, besides, that they who feed, clothe and lodge the whole body of the people, should have such a share of the produce of their own labour as to be themselves tolerably well fed, cloathed and lodged. 1
I don’t think there are many who would accuse Adam Smith of being a “socialist.”
The US is a member of the United Nations and so subject to Article 23 of the Universal Declaration of Human Rights which says:
Everyone has the right to work, to free choice of employment, to just and favourable conditions of work and to protection against unemployment.
Everyone, without any discrimination, has the right to equal pay for equal work.
Everyone who works has the right to just and favourable remuneration ensuring for himself and his family an existence worthy of human dignity, and supplemented, if necessary, by other means of social protection.
Everyone has the right to form and to join trade unions for the protection of his interests.
So when Bill de Blasio puts forth the idea of a living wage for New York City he is only supporting the basic ideals of the UN regarding human rights based on the ” recognition of the inherent dignity and of the equal and inalienable rights of all members of the human family” as put forth in the preamble of the Declaration.
De Blasio is supporting a living wage of $11.75 per hour (only a dollar off the MIT estimate) and this only for workers employed by those companies getting tax subsidies and/or other forms of welfare from the city. The City Council has already passed a $10.00 per hour fair wage for such workers– over the veto of billionaire mayor Bloomberg (who won’t ever have to worry about a living wage), so de Blasio wants to throw in another $1.75 (should be $2.75 I think).
Joe Lhota, the one per centers candidate, is opposed to the living wage increase for workers but favors big subsidies to private businesses — such as Fresh Direct the grocery delivery company (as an incentive to stay in New York.) The Wall Street Journal [“Living-Wage Fight Seen With de Blasio”- 10-7-2013] quotes the Republican candidate as saying, about the living wage, “Bill and I really disagree about that. I think jobs are very important. I think we need to get as many people employed as possible. By putting a restriction on that how does anybody possibly win?”
The point of the living wage is, in the words of the Universal Declaration of Human Rights, to ensure “an existence worthy of human dignity.” The question to Joe Lhota and all his Republican and conservative buddies is “By putting a restriction on that how does anybody win?”
If Joe Lhota is New York, New York is in trouble.
- Adam Smith, Wealth of Nations, Book I, Chapter VIII, page 90 of The Modern Library Edition, 1994 [↩]