A Study In Deceit

Tomorrow a substantial group of council members will convene at city hall to announce their support for the living wage bill-and denounce the EDC-sponsored put up job. The NY Post has the story: "On the heels of the bruising defeat of a bill to require paid sick days in the city this month, a coalition backing a “living wage” measure for projects getting city subsidies is set to release a report tomorrow attacking the city’s ongoing study on the issue. The Living Wage NYC coalition will unveil an 8-page condemnation of the city Economic Development Corp.’s study of the Council bill, which would require developers getting subsidies from the city of $100,000 or more to pay $10 an hour plus benefits, or $11.50."

The coalition, in issuing its own study, is right to suspect the bona fides of the city's study. In our view, we adopt the I.F. Stone position that, "all governments lie"-and one should never treat any government report with anything but disdain. As the Post points out: "The pro-living wage report, written by the National Employment Law Project and the Fiscal Policy Institute, points to successful living wage policies in place in Los Angeles and Pittsburgh, according to a copy obtained by The Post. It also blasts EDC for choosing what the coalition considers a biased consulting firm - Charles River Associates of Boston - to conduct its study, which is expected to be released in March. The report says the economists at that firm have long expressed opposition to the concept of a mandated minimum or living wage."

And, according to living wage proponents, the lead author of the EDC study is a ringer-the NY Times reports: "On Wednesday, two liberal research groups — the National Employment Law Project and the Fiscal Policy Institute — plan to release a critique of the study’s leaders and methods and to contend that the labor economists leading it are too “biased” to produce a credible analysis. One of them, David Neumark, is “such a controversial figure” that his involvement is “surprising and troubling,” the critique says. It goes on to characterize Mr. Neumark, a professor at the University of California, Irvine, as a leading critic of policies intended to raise the wages of the lowest-paid workers."

The professor, however, demurs at the charge: "From his West Coast office, Mr. Neumark sounded only mildly perturbed at the prospect of being publicly demonized by Council members and labor leaders 3,000 miles away, though he took umbrage at being called biased. “I fail to see how someone can read all my research and say, ‘This guy is biased against living wages,’ ” he said. “My research on living wages, I think, reads as kind of wishy-washy, if anything.” By that, he meant that his studies on living-wage policies in different parts of the country had generally concluded that while they did cost some workers their jobs, they also reduced poverty among others whose wages rose. Despite the increase in unemployment, he said putting a living wage into place “may be a relatively intelligent thing to do.”

Perhaps, but if this EDC study is a fair analysis, it would be a first-and we don't believe in this administration's honest search for the unbiased truth, Professor Neumark's statements notwithstanding.

But, that being said, the prospects of the bill's passage remain uncertain-after all, the paid sick leave bill expired when the speaker announced her opposition. As Gotham Gazette reports, the waters remain choppy: "In the wake of Council Speaker Christine Quinn’s decision not to support paid sick leave, some City Council members and advocates are attempting to make waves on another issue: the living wage. Currently two bills to require some sort of wage mandate at city-subsidized developments are treading water at City Hall. One would require a prevailing wage for building service employees, while the other would require a living wage for every worker on a city-assisted development, including the development’s tenants. Quinn has not taken a position on either. When asked during her sick leave announcement earlier this month, she sidestepped the issue."

On the other hand, there are some major differences between the two legislative issues-and Speaker Quinn may look to tack back to a more progressive position after her cold water throw on sick leave. Still, the attack on EDC is a righteous one: "The presser tomorrow, according to an advisory we just got, will “exposes Charles River Associates (CRA), EDC’s choice to conduct the study, as a business-backed lobbying group using economists who oppose living wage and even minimum wage policies for EDC’s study.” The chief economist on the study is Daniel Hamermesh, a reputable professor at the University of Texas at Austin. David Neumark, a professor of economics at the University of California and a fellow at the Public Policy Institute of California, is also on the study team. He has authored several studies questioning the sustainability of living wage policies."

The EDC study is quite simply a dodge-and no one believes it will conclude that living wage makes sense. Kind of like the so-called studies of the bike lanes done by DOT-a methodology that favors conclusions first; and then data derived from them. Now we might not take the Coalition's study as gospel, but the EDC sham effort needs to be deconstructed and debunked-and the council should try to seek an outside independent analysis.

But even if it doesn't, what the living wage legislation exposes, are the anti-small business policies of an administration that is misappropriating tax dollars for destructive economic development policies. Even when the money isn't earmarked for Doctoroff cronies like Steve Ross, it is still wasted-check out the IDA splurge on Manhattan Beer, one of the country's wealthiest beer distributors.

As we pointed out in this regard, once again Bloomberg fronts for the big guy who doesn't need the money at the expense of smaller competitors. IDA handed over millions that the company didn't need, to build a Bronx warehouse that it needed to build-with or without, government help: "Basically Manhattan Beer holds a monopoly over the distribution of hot beers such as Coors and Corona and, due to the concentration in both production and distribution of malt beverages, it is able to operate with significant profit margins-while, at the same time, its customers, the bodegas and neighborhood supermarkets, are suffering without any hope for relief from the public sector...But don't go expecting that the price of a six pack of your Corona will be reduced-or even that it will stay at current price levels. That's because these IDA bennies come with virtually no give backs to the tax payers that are forced to pony up; and there's little apparent due diligence investigating whether, absent the public money, a company like Manhattan Beer would refuse to build. To us, this is corporate welfare in its most egregious form."

But at least the Manhattan Beer workers are unionized and well paid-not so much the retail workers who, after the Relateds get the gold mine, all they get is the shaft If the Bloombergistas are going to irresponsibly steer tax dollars for real estate boondoggles, than for crying out loud, pay the damn workers a decent wage.