THE "living wage" law under consideration in Washington, DC is terrible policy in more than one way.  As my colleague points out, the law narrowly targets Walmart, though it does not specifically name Walmart.  The majesty of the law resides in its generality.  Rules intended to pick out particular individuals or firms are just thuggish.  Perhaps it is believed by some members of the DC city council that Walmart, a company fairly notorious for its less than lavish compensation practices, has it coming.  It has become a commonplace on the left to maintain that Walmart is "subsidised" by the taxpayer insofar as its employees make use of public assistance.  That is to say, the "subsidy" to Walmart is the difference between the market wage and the "living wage", whatever that's determined to be.  This idea strikes me as more than a little dotty.  As Jason Brennan, a philosopher at Georgetown, puts it, "this presupposes that if you hire someone for, say, 40 hours a week, you owe him enough money for him to lead a decent life".  If the value of a worker's labour is less to her employer than the cost of a reasonable standard of living, why should the employer be on the hook for the difference?  Subsidising the worker, to bring her up to a certain baseline mimimum, counts as a subsidy to the employer only if we think that was the duty of business all along—to pay workers not only a wage commensurate with the market value of their labour, but also sufficient to finance a life of a certain dignity and security.  Mr Brennan goes on (using the example of Bob, a McBurger employee):

Isn’t it more plausible to think that if there’s some enforceable positive duty to provide Bob with enough stuff to lead a life, that all of us, together share this burdensome duty, rather than just Bob’s employer?  Why should Bob’s employer, specifically, be the one that has to bear the burden and lose all this money to keep him alive (at whatever level you consider decent)?  This just seems like a kind of moral outsourcing to me.  Why not instead Bob’s neighbors, parents, friends, or sexual partners?  Bob does McBurger a service, and McBurger pays him for that service. 

Social insurance is an excellent idea.  And it ought to be financed broadly.  Let businesses seek efficiencies and competitive advantage, tax them (or their owners), and finance a generous safety net with the proceeds of generally robust economic performance. 

This supersensible idea of letting markets rip then letting the fruits of growth bankroll a decent universal mimimum has in recent years come under fire by progressives as "neoliberalism" or "pity-charity liberalism", pithily critiqued in this 2011 post by Freddie deBoer:

Even if you could guarantee a certain minimal welfare state, the idea of poor and working people depending on the largesse of the rich and powerful is obscene.  Sometimes, people have to live under the charity of others.  But nobody wants to in perpetuity, because they then are not in control of their own lives, and because having to do so leaves many feeling robbed of personal dignity.  As long as economic security is a gift of those at the top, it can be taken away.  And if the last several decades have shown us anything, it’s that for the richest, what they already have will never be enough. 

The progressive impulse to make employers rather than the government ensure workers a decent standard of living seems to me to be based in these sorts of considerations.  Yet I cannot see how forcing Walmart, or employers generally, to guarantee minimum incomes helps.  There is, no doubt, a great deal of dignity in work, and there is also a certain indignity in receiving government transfers.  Hiding transfers inside paychecks is therefore an excellent strategy for rewarding work while getting people what they need in a way that makes them feel good about it.  That's a great reason to support wage subsidies.  However, forcing employers to directly bear the economic burden of the subsidy is mostly just a strategy for reducing the supply of paychecks, which would benefit neither the dignity nor economic security of the American worker.