Living wage – Wal-Mart vs. DC

Wal-Mart wants to build a store in Washington DC, certainly a city that needs jobs. But DC wants Wal-Mart to pay a Living Wage which is about four dollars more than the minimum wage. DC position is that at the minimum wage the workers do not make enough that the city still does not need to provide them assistance. Other cities have taken the same position as DC.

In a global economy where there is not full employment setting wages cannot be left to the supply and demand the model that has been used in the past. Many like to argue that setting wages other than the use of supply and demand model is a form of socialism. But it can be argued that a model of pure capitalism is a group of pirates who elect their own captain. What is occurring here is the group is deciding their share of the bounty – not much difference then how a CEO’s salary is determine with the corporation’s board. The concept of a Living Wage for the lower end of the wage scale is a step in maintaining the middle class in America. There needs to be a paradigm shift in the establishment of all wages in the global economy – a concept that has eluded most economists.