The Seattle City Council unanimously passed an ordinance Monday that gradually increases the minimum wage in the city to $15, which would make it the highest in the nation.
The issue has dominated politics in the liberal municipality for months, and a boisterous crowd of mostly labor activists packed the Council chambers for the vote. Mayor Ed Murray, who was elected last year, had promised in his campaign to raise the minimum wage to $15 an hour. A newly-elected socialist City Council member had pushed the idea as well.
“We did it. Workers did this,” said Kshama Sawant, the socialist City Councilmember. “We need to continue to build an even more powerful movement.” [reported at FoxNews.com 6/3/14]
What would “more powerful” consist of? No answer is ever given. But if people who make less money are entitled to the same pay as people who make more money, then only two outcomes are possible:
One, raise everyone’s income to the level of the highest income earner. Or, two: Lower everyone’s income to the level of the lowest income earner.
In short, everyone either makes what Bill Gates or Warren Buffet make; or everyone makes $15 or $10 an hour.
I realize nobody is actually proposing this (at least not yet). But this is where the logic of the minimum wage inevitably leads. And if it leads us down such an absurd path, why are we engaging in it part way?
Before calling opponents of the minimum wage “racist,” proponents of this foolish fallacy used to say, “America deserves a raise.” But at what cost? A government established minimum wage, by definition, outlaws jobs that are not worth anything below an arbitrarily determined rate. Why is this so hard to understand? It’s a fact. If Company Owner X is able and willing to pay an employee $9 an hour, and then discovers he must raise that wage level to $11 or $15 an hour, why automatically assume he will simply do so? Most likely, he’ll fire the employee. Or resign himself to the wage, and fail to hire another employee. Or increase the workload on other people. Or raise prices on his goods and services, price increases which will hurt working class or poor people the hardest.
One happy worker in Seattle “said she and her three kids are living with her brother because she can’t afford an apartment of her own even though she works full time. ‘This will make changes to myself and also a lot of other people in my shoes.'”
Poor soul. She thinks it’s social justice to outlaw someone else’s job so that she can get a dollar or two more an hour. She also thinks that her own prospects improve in an economy where growth and jobs are declining (thanks to policies like the minimum wage), making the perceived need for a minimum wage even more urgent than it already is. She’ll never know what a thriving, robust and growing economy looks like, not so long as we continue on these ruinous policy paths so the anointed in Washington and academia can impress themselves, and each other, at their cocktail parties.
In a totally free market economy — the only kind of economy worthy of the name “economy” — the right price is what you can get. This sounds, to some, like an amoral or callous statement. But it’s simply a fact. People will not pay more for a product or service than they’re willing and able to pay, or more than they consider it worth. Nobody will.
If smart phones suddenly rose in price to $1000 or $1500 each, would you stop buying new ones?
Would you spend $5000 on a vacation when you can’t afford it, when $500 vacations are readily available? Would you spend $10,000 or $50,000 on a vacation you could afford, but you don’t consider worth the money?
Prices and wages are the product of countless judgment calls made by millions of individuals every day. Jobs, including wage rates, are part of that mix. You tamper with this at the peril of harming those you claim you intend to help.
We look at employers as if they’re somehow different. Logic and rules of economics we’d never apply to ourselves we readily take for granted when talking about businesses with 50 or 500 employees or more (wherever government sets the arbitrary limit). Somehow, people who employ some number of people are not only invincible and invulnerable, they’re outside the province of economic laws.
There are no economic arguments in favor of the minimum wage. Advocates of the minimum wage know this, which is why they rarely make them.
The only arguments you can advance in favor of the minimum wage are ones related to morality. According to this view of morality, it’s wrong for people to make unequal amounts of money. Therefore, we permit economic puritans to outlaw jobs they feel pay too little. They feel superior about themselves in doing so, but facts remain facts: Fewer jobs exist than would otherwise be the case and the ones who suffer the most are people who make the least money.
It’s economic puritanism. Those who are holier than thou make the rules for the rest of us by their own arbitrary and emotionally-based standards. That’s what socialism is, after all: State-sanctioned religion.
It’s easy to claim, “Look at me. I support equal wages for everybody, or at least as close to equal wages as possible. I’m so nice.” But in saying this, you’re claiming, in effect, that no goods or services are any better than any others. Everything is equal.
You’re also implying that your own preferences, choices, desires and needs are all invalid. You’re probably not prepared to do that when it comes to yourself. But most of us seem unwilling to challenge this assumption when it comes to business owners or the wealth creators who make all the economic growth and jobs we still enjoy possible.
If you’re that upset about someone making too low a wage, then consider other options. Demand a free market economy so you can get out there, make a lot of money and give it all away. Or how about going to the company where the employee is being paid the low wages, and buying out their products? This will lower supply for the product, create demand and raise the wages for the employee along with the cost of the product.
Minimum wage is nothing more than going through the motions of making it look like you’re helping someone out. It has nothing whatsoever to do with economics — or morality, either.
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