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Urban minimum wage as election promise?
Written By silkboard - 7 April, 2009
Bangalore governance Elections Urban Poor suggestion Economy labour laws Minimum Wage
Cities are not just about rich or middle classes. It is estimated that majority of residents (> 60%) in our cities belong in poor or lower middle income groups. I was wondering if Lok Sabha 2009 has seen any promises that would influence the votes of this sizeable group?
Leaving aside the 2 Rs/Kg rice promises, how does a "minimum wage" implementation for urban areas look? Unorganized labour literally runs our cities. A lot of "goodies" of Indian urban living are argubaly built on the back of (sorry to use an old fashioned word) exploitation of low-skill workers. Urban middle class has unreasonable demands, like wanting to have a "clean, well bathed maid" every morning in the middle of central business district. How many of these unorganized sector workers have access to health benefits, or education assistance, or just working conditions (like say, leave on national holidays!?), leave aside access to clean water for taking bath everyday!?
A lot of above is justified today using the demand supply argument - working conditions, and the wages are determined by the market and supply conditions. But, are there are any bars and standards for the unreasonable competition for limited urban space and low cost resources that happens within this group? Programs like housing for economically weak sections (EWS) are launched only to be "misused" (because the EWS beneficiary sells his benefit at market price, and moves on to a newer hut).
What will provide equal opportunities to the workers within this group? That thing called BSUP (basic supplies to urban poor) ? More reliance on government's direct-delivery mechanisms, like those run-down government schools and hospitals? Or more money directly in their pockets?
Why not develop a system of "minimum wages in urban area" determined by certain acceptable set of living and affordability standards in a city?
Too drastic a thought? Or dangerous (because it will destroy the cost structure of our cities)? Or simply a stupid idea (too leftist, hard to implement and measure)? If I hire a domestic worker, maid, gardener, driver, security or whatever, should the state fix certain responsibilities on me? These could be in the form of mandatory health, education assisances, or simpler, just a "minimum wage".
Just testing this out here. And before you picture only your domestic helps, remember that Bangalore has about 2 lakh "security" guards, many of them making pittances (source: a TOI or DH article 3 months ago), and (my estimate) 50000+ "drivers" employed by residents, and 1 lakh+ domestic workers (another estimate).
COMMENTS
idontspam - 7 April, 2009 - 20:10
Why are we becoming more socialist in our thinking these days? Is it the water (or the lack of it)? If all the socialists started small businesses we would have provided enough jobs to stop worrying about this.
IDS, even so called capitalist economies also practice socialism
kbsyed61 - 8 April, 2009 - 03:53
IDS,
Seems we are ignorant about capitalist economies practicing socialist policies. Don't believe it? In US, the both state and Federal has stipulated minimum wages. Even though it is very low, but still families can survive on low wages with little support from govt with low cost rent, low cost medicare etc. One of the reason US can afford low wages (in dollar terms) is, its subsidizes food products like wheat, rice, milk, poultry etc. This subsidy makes sure that the essential items are available at low cost and hence can afford to keep the wages. The funda here is if essential items are low, wages would be minimum.
Even it controls the number of private players operating in many sectors like Taxi/Cab services etc.
Urban minimum wage is not "socialist"
s_yajaman - 8 April, 2009 - 04:08
IDS and I can hardly agree on anything of late :)
What is wrong with a socialist approach to many of these problems. It is not as if capitalists have managed to create any paradise on earth.
Look around where you live of late - probably one of the most socialist countries. Socialism has its place in the grand scheme of things. It does not only mean state ownership of the means of producton. It means that the government protects the interests of the not so fortunate, at least to me.
Srivathsa
navshot - 8 April, 2009 - 04:21
I support this one in principle and it would fetch benefits in the long term. As with any idea, even this has its share of positives and negatives.
Positives (most of them in long term): This would help flatten the society (atleast in the urban areas) - would ensure better living standards in the urban areas. Would provide more self-respect amongst lower income groups. Would reduce social unrest - theft, crime, etc. Would reduce school dropouts, etc...
Negatives (many of them in short term): There would be a major restructuring of society - if not handled well, can result in unrest. There would be jobloss due to reduced demand for labour. Skill would become more important. More machinery to replace labour, so more energy consumption and related drawbacks. Possibly further widening of gap between urban and rural? etc...
-- navshot
IDS - disagree on "socialism sucks"
s_yajaman - 8 April, 2009 - 06:16
IDS and I just not agreeing. MCadambi and I agreeing. Strange things happen on our site :)
IDS - Socialism for me does not mean high taxes and big government. It means an active role for government and to ensure that everyone gets a chance to compete before the meritocracy talk starts.
Much better than the American version of capitalism where profits are private and losses go the tax payer.
SY
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