Category Archives: Minimum Wage

Seattle City Council 2 Minute Testimony – Against $15 Minimum Wage 5-22-2014

By Eric Minor

Background

The Seattle City Council spent the early months of 2014 holding hearings related to raising the minimum wage in Seattle to $15 per hour.  Most hearings had time blocks set aside for the public to provide input limited strictly to two minutes.  I spoke off the cuff at several of the hearings but read the following prepared remarks at the 5-22-2014 hearing.

5-22-2014 Testimony

Having attended a number of the council meetings on this subject, there are several amusing arguments that get repeated often. One of them is that there was a similar gnashing of teeth back in the early ’90s regarding a minimum wage increase. The story goes that the business community cried gloom and doom and worried that the increase might kill some businesses.

The proponents of 15 Now claim these doomsday predictions never came to pass; therefore the push for a $15 minimum wage today should be smiled upon. This logic is faulty on several fronts:

  • First, there is no possible way the people making these claims can know what damage may have been caused, and which marginal businesses may have been pushed over the edge into failure in the ’90s example. There are thousands of small businesses in Seattle, and they don’t put out press releases when they go under, or bother explaining to a deaf government that the minimum wage increase is what finally did them in.
  • Second, it is unlikely the increase of the ’90s was anywhere near as drastic as the one being advocated here. For starters, it didn’t only apply to Seattle while excluding all neighboring cities. It also didn’t start with the precondition of Washington *already* having the highest minimum wage in the country and then jumping by a whopping 62% taboot!
  • Third, and most importantly, it seems to suggest that it is OK to use coercion to steal from others provided that the violence doesn’t actually cause the death of the other party. Think about it. That’s what they’re saying. See, they said it would kill all the businesses…but they weren’t all killed. Therefore, it was in fact OK to take that money by the force of government fiat. Let me ask you council-member Clark, would it be OK for me to wait for you to leave work at the end of the day, hit you over the head with a club, and steal $200 from your purse provided I didn’t kill you in the process? Would that be OK? Because that’s what these people are saying. We didn’t kill that business when we took 24,000, 100,000, 300,000 dollars from it. Therefore it is OK!

A city of Seattle’s caliber deserves strong and wise leadership from its elected officials. Resist the thugs. Remain silent on this matter and let it go to ballot if the angry mob can get it there.

Video

This testimony can be viewed at the following link at the 6:00 minute mark:  http://www.seattlechannel.org/videos/video.asp?ID=2161440

$15 Minimum Wage — Lies People Tell Themselves

By Eric Minor

It’s funny the lies people tell themselves to justify their immoral behavior. Take, as an example, the discussion to raise the minimum wage to $15 per hour going on in a few cities, including Seattle. As a resident of the greater Seattle area, I’ve had a front row seat to the spectacle. The proponents of this naked thievery have twisted themselves into pretzels to delude themselves that they are acting virtuously. By wrapping their thuggery in the cloak of “democracy”, they think they can fool everyone. See, we voted for it! That makes it right! Well, you’re not fooling me. I, for one, see you and see exactly what you are about.

Someone coined a phrase long ago that describes this: “Tyranny of the Majority.” According to Wikipedia, authorship goes to John Adams in 1788. Wikipedia describes the meaning, in part, as: “involving the scenario in which decisions made by a majority place its interests above those of an individual or minority group, constituting active oppression comparable to that of tyrants and despots.” It further states that constitutional limits on legislative powers, the Bill of Rights, and separation of powers are some of the principles in place to try to prevent this happening. Unfortunately, we’ve all seen how well these principles are faring in recent years.

I know what you’re saying. Who is the minority group being oppressed by this tyranny of the majority? The answer will cause the “Occupy Wall Street” crowd to throw an aneurism in their righteous indignation. It is the employers, comprised not just of the GigantoCorps of the world, but of a myriad of small businesses of many flavors.

It of course stands to reason that there are many more employees than employers. In this shocking upset, someone walked into some fast food restaurants in Seattle and asked the employees if they’d prefer to make $9.32 per hour or $15 per hour — and the “poll results” were that they’d prefer the $15! Imagine that! This subterfuge seems to have been enough to convince the economic illiterates on the Seattle City Council and in the Mayor’s office that a jump to $15 is prudent.

Having attended the first city council meeting on this subject out of a car-wreck-gawker curiosity, I was shocked to see the Mayor’s blue ribbon committee co-chaired by an executive of SEIU (Service Employees International Union). Hmmm, I wonder what his recommendation will be? For his next parlor trick, I expect to see the Mayor form a committee to investigate the benefits of loosening the human cannibalism laws in Seattle — to be co-chaired by Hannibal Lecter and Jeffrey Dahmer.

If our republic has devolved to the place where everyone can just vote themselves raises, can its final death throes be far behind? Benjamin Franklin predicted as much more than 200 years ago when he said, “When the people find they can vote themselves money, that will herald the end of the republic.” A socialist friend of mine pointed out there is some question as to whether Franklin penned this phrase or not. I don’t want to quibble. Whoever said it, they were dead on.

Of course, it is phrases like “income inequality”, “social justice”, “poverty wages”, and “the one percent” that the angry mob is using to provide cover for their pilfering. I would ask you, when did envy become a virtue? If you scratch away at “income inequality” just a bit, that’s what you will find — pure naked envy. That guy has more than me, and I want it!

Slogans like “social justice” sound nice. After all, who can take issue with “justice”? And applying it across all of society? That’s like puppies mixed with kittens wrapped up in a warm blanket of nougaty goodness. But make no mistake — it is pure propaganda — and intended only to provide misdirection and camouflage for the frontal assault underway.

The looters (thanks Atlas Shrugged!) try to use absurd inventions like “living wage calculators” to further obfuscate the issue and they try to give these inventions an air of legitimacy by pointing out that they were created at some respected institution, like say the University of Washington. Hogwash! I reject contrivances like these outright. Since when was listing your “living expenses” on a spreadsheet (as though they cannot be impacted by choices you can make) a legitimate and moral reason to steal from someone else?

Can’t afford an apartment on your salary? Bunk up with a buddy! Or two or three. I know it sounds unfair to you, but it’s exactly what I did when I was in college and couldn’t afford to have my own apartment. Imagine the outrage when I had to sleep on an actual bunk bed in the same room with another person! Would I like to do that now and deal with the bi-weekly drama of “who drank my milk?” No. But that doesn’t mean it gives me the right to confiscate someone else’s money so that I can have the privacy of my own apartment.

I know, I know…you’re a single mom and you don’t want to have roommates given that you have a child. I understand that you don’t *want* that. But your wanting (or not wanting) is not a good enough reason to justify stealing from others. Here’s an idea. Place a Craigslist ad looking for another single mom willing to share your one-bedroom apartment. Save your outrage — I know how heartless that is of me.

You would work staggered shifts and would each watch the other’s children while the other worked (daycare expenses — poof!). You would share a bedroom and sleep on bunk beds with your children sleeping in cribs nearby or else on the sofa in the living room if they were a bit older. Is this a glamorous lifestyle? No. But it’s exactly the type of sacrifices people used to make in years gone by before it became en vogue to use their comparatively modest means as an excuse to steal from their neighbors.

I was amused when a young woman offered public testimony at the first Seattle City Council hearing that, at the end of the month, she didn’t know if she should pay her cell phone bill or her rent. Now, don’t get me wrong, I love my cell phone — but I managed to survive for three quarters of my life without one. The fact that I want and like a cell phone is not justification for advocating that the government use its coercive powers to seize money from others so I might have one.

I’ve made a few new friends since attending the city council meetings on this issue. One cut through the flak nicely by observing the following: “The term ‘income inequality’ has utility only for a thief.  Think about it.  Who else?  The term has no use and meaning for an honest person.” Contrast that with the sentiments of new Seattle Councilmember Kshama Sawant: “The workers should take over the factories, and shut down Boeing’s profit-making machine.” Did you notice the word “take” in the previous sentence?

The sad thing is, even if you manage to convince yourself, through a series of innocent seeming self-deceptions, that what you’re advocating for is not theft, it *still* doesn’t make any sense and does not help the people you think you are helping — it hurts them. As the late, great, Nobel Prize winning economist, Milton Friedman, remarked, ” There are no positive objectives achieved by minimum wages. Its real purpose is to reduce competition for the trade unions and make it easier for them to maintain the wages of their privileged members higher than the others.”

He further states that “the consequences of minimum wage rates have been almost wholly bad, to increase unemployment and to increase poverty.” I have some first-hand perspective on this. In addition to my primary vocation of software consulting, which provides me a good living, I also own a small retail shop, which does not.

If the minimum wage were to go to $15 in my town of Gig Harbor, the four women who work for me would wind up with a wage of $0 when my shop closed, not $15 as intended by the “do gooders”. I don’t expect Washingtonians to repeal their highest-in-the-nation state minimum wage rate of $9.32 any time soon — but for god’s sake, don’t compound the problem by raising it 60% higher in Seattle!

I had the pleasure of sharing an umbrella and chatting with a nice lady while standing in line to get into the first Seattle City Council meeting on this topic. She was opining guiltily that she was probably on the wrong side of history, that she was a progressive and generally supported these types of things, but that this sudden jump to $15 per hour would have a devastating impact on her modest collection of small businesses in Seattle (she testified to that effect in the meeting). She was afraid that the negative effects this would have on Seattle would “give the Republicans ammunition.” I responded to her, as gently as I could, that when you consistently advocate for positions that amount to pointing a gun at others to take from them their property, under the aegis of “the common good”, you should not be surprised when that gun is inevitably turned upon you.

Some businesses (mostly restaurants) have started with the premise that the $15 per hour minimum wage is disastrous to them personally but that the thinking behind “income inequality” is sound and hence the minimum wage should rise by some lesser amount.

As part of their deliberations, they were able to convince themselves that slogans like $9.32 being a “poverty wage” were morally truthful while a wage of say, $12, was virtuous (since their businesses might be able to support that if ramped in slowly!). They were endorsing the thought that businesses that could only afford to pay wages in neighborhood of $9.32 were “exploiters” but that they, at $12, would be the opposite! They were the good guys that did not exploit their workers!

To someone like me (a software consultant), who makes an hourly rate that is many times higher than $9.32 or $12, it is simply absurd to split hairs in this way. From my perspective, both are crappy wages. I could (but I don’t) demand that the “living wage” in fact be set at $20 per hour, wiping out the viability of all their businesses in the process. The fact is, I want low skill workers to have job opportunities so they can work their way up to something better.

What people like these don’t realize, is that the moment you give your imprimatur to the dishonest language that is the corrupt foundation for this whole ridiculous argument, you’ve already lost. With the tip of that wedge in place, anyone can say anything and propose that any amount is the “living wage” amount and that the other amount is the “poverty wage” and that “income inequality” requires government intervention and it goes on and on. Oh, they’ll rig up all kinds of spreadsheets and they’ll form committees and hold phony symposiums and press conferences to try to convince you of the legitimacy of their “science”.

However, it is all a charade. If the Seattle City Council had an ounce of integrity, the day after they passed an ordinance approving a minimum wage of $15 per hour, they would pass another ordinance reducing their own pay from $120,000 per year to $30,000 per year — the equivalent of a $15 per hour wage rate. After all, if their position is that “income inequality” is a problem which justifies government intervention in free markets to correct, then that is the next logical step (and is something that is wholly within their power to achieve without any complaint from the electorate whatsoever).

America is founded on freedom and freedom to choose. The free market system embodies this and it does work. Price controls and their close cousin, wage controls, are the antithesis of this and always come with a raft of unintended consequences that achieve the opposite of what was desired. I asked another friend what he thought of this $15 minimum wage thing. He responded that he was all for it, provided the laws of economics and supply and demand were somehow suspended. I thought that was well said.

The fact that the Seattle City Council is even considering this larceny speaks to their competency. At best, they are exercising horrible leadership. At worst, they are grossly derelict in their fiduciary responsibility to the citizens of Seattle.

 

Mr. Worf on $15 Minimum Wage

By Eric Minor

Also Published At:

To Quote Mr. Worf: “One cannot regain honor by acting dishonorably.” Unfortunately, Seattle Mayor Ed Murray and the Seattle City Council appear to have missed that episode of “Star Trek – The Next Generation”.

The mayor and many of the council seem to think there is some debt of honor they need to discharge towards the minimum and low wage workers of the city. In order to discharge this perceived debt and provide them a “living wage” of $15 per hour (a 62% increase from the current minimum wage of $9.32), they are willing to act dishonorably and steal money from others.

Does the word “steal” sound harsh? Sometimes the truth sounds harsh. In addition to my primary career of software consulting that offers me a comfortable living, I also own a small retail shop in the greater Puget Sound area in the town of Gig Harbor. The community likes my shop but it barely breaks even on pretty modest revenue. It has never paid me a dime but I still take a certain amount of pride in it and enjoy providing the service to the community.

If the 62% minimum wage increase was enacted overnight in Gig Harbor, as openly Socialist Seattle Councilmember Kshama Sawant desires in Seattle, there would be an immediate increase of roughly $24,000 for my yearly payroll related expenses (salary plus employment taxes). I would go from breaking even, struggling to survive, and living to fight another day, to completely under water and probably out of business (with the corresponding loss of four jobs). If thieves were to break into my shop and steal $24,000 of cash and/or merchandise, given my revenues, it would be a devastating blow. But somehow, if the local government were to do so with the stroke of a pen it would be moral?

You’ve got to give some credit to the common street mugger — at least they’re honest in their thievery. The Mayor, the City Council, and the other supporters of this movement try to disguise their theft in the trappings of democracy, and in so doing, secure themselves a spot well below that of “honest thieves” in the pantheon of shame.

The platitudes that are put forth by the supporters of this proposal are childishly naive to say the least: “Just raise your prices!”. Um, if I thought I could get $8 for the widget I currently have marked at $6, don’t you think I’d already have it marked at $8?

Or how about this one: “Raising the minimum wage to $15 per hour will pump $50 million (or whatever number) into the local economy.” This logical fallacy is pretty easy to defeat. It suggests we can just raise it up to $20 per hour and pump $100 million into the economy instead. While we’re at it, let’s go ahead and make it $30 per hour and pump in $200 million! Apparently there are no negative repercussions to these actions, so we can just raise it to whatever we want and reap the rewards. These are the types of arguments you expect to hear from a confidence man at a carnival trying to sell a perpetual motion machine, not from people that are exerting actual influence on the government of a city as prominent as Seattle.

And yet, I’ve attended several council meetings on this subject, and the council sits there and nods their heads at this kind of absurdity with seeming approval. Literally dozens of small businesses have taken their two minute turn at the microphone to describe how this would destroy their businesses, and the council just plays along and lets the charade continue, never once calling out the architects of this movement with the type of skeptical and incredulous questioning that is warranted.

What makes the theft even sadder is that there are many reputable economists that have provided compelling arguments that minimum wage laws are counter-productive and cause more harm than good to the people they’re intended to help. A quick Google search with the names Walter Williams, Thomas Sowell, or Milton Friedman along with “minimum wage” will give you many excellent examples.

If my business is in Gig Harbor and not Seattle, why do I care? Several reasons. First, since my primary career is software consulting and I commute into Seattle every day to engage in that career, I am naturally concerned about the well being of Seattle. Second, I just don’t like dishonesty, especially when it is wrapped up in demagoguery. Theft is wrong. Coercion is wrong. Third, the backers of this play are not content to leave it at Seattle alone — they started at SeaTac, another suburb of Seattle, and I have no reason to believe they will stop their molestation of the golden goose before they get to Gig Harbor. Seattle City Council President Tim Burgess said as much when his aide responded to one of my emails to the council thusly: “…he [Burgess] would be interested in a regional approach that extends beyond the city limits of Seattle to other parts of King County and the Puget Sound region”.

Has everyone in Seattle been hypnotized into some sort of trance that they can’t wake up from? Is this the best leadership that a world class city like Seattle can get? It’s time to listen to Mr. Worf: “One cannot regain honor by acting dishonorably.”

$15 Minimum Wage is Disastrous

By Eric Minor

Also Published At:

The $15 per hour minimum wage proposal being considered by the Mayor and the Seattle City Council is, in a word, disastrous. Many economists agree that minimum wage laws do more harm than good as they make it impossible for young and low skill workers to find jobs. Washington State already boasts the highest state-wide minimum wage in America at $9.32 per hour, though several localities such as San Francisco and SeaTac have recently enacted local ordinances that raise their minimum wage above their state levels a little or a lot.

If $9.32 makes the door to employment sticky for low skill workers, $15 slams it in their face and throws the deadbolt. Having attended the first three city council meetings on this subject, one almost gets the impression that it is a vanity project for the city leaders to see if they can one-up some of the other municipalities that are threatening to outshine them as most progressive kid on the block. This is of course a poor basis for policy, especially policy that uses the coercive power of government to intercede in the freely made choices of others.

The late Nobel Prize winning economist, Milton Friedman, summed the situation up nicely in an interview from the 1970’s: ” The minimum wage law is most properly described as a law saying employers must discriminate against people who have low skills. The law says here is a man who has a skill that would justify a wage rate of a $1.50 or $2.00 an hour. You may not employ him — it is illegal. If you employ him you have to pay him $2.50. What is the result? To employ him at $2.50, you have to engage in charity. Now there is nothing wrong with charity. But most employers are not in a position where they can engage in that kind of charity. Thus the consequences of minimum wage rates have been almost wholly bad, to increase unemployment and to increase poverty. Moreover, the effects have been concentrated on the groups that the do-gooders would most like to help (minorities).”

Although the numbers have changed since the ’70s, the universal truths remain the same. If you Google “Milton Friedman Minimum Wage”, the first link you will see is a short three minute clip from the interview quoted above. In it, Friedman shreds the assertion that minimum wages are beneficial.

I can lend credence to Friedman’s argument from my own first-hand experience. I live in Gig Harbor and commute to Seattle most days to conduct my primary vocation — software consulting. This affords me a good living. I also own a small retail shop in Gig Harbor called Animal Crackers Kid’s Store, which has been in business seven years. The community appreciates my shop — they have told me so many times.

In seven years I have never taken a paycheck, but the business at least breaks even at this point. I don’t relate this to garner sympathy — I relate it to emphasize a point. If that is the case for my small business, I know intuitively that similar stories exist for thousands of other small businesses in Seattle — slim or no profits. As Friedman suggested, small businesses are simply not in a position to survive a massive leap in the minimum wage rate, with the effect being the opposite of what some “well-meaning sponsors” of a $15 minimum wage intend. Dozens of Seattle small businesses have already testified to that effect at the first three council meetings on the subject.

Seattleites — wake up and take action. Tell the council in strong terms to remain silent on this matter. If the proponents of this disastrous proposal can get it qualified for a ballet measure — fine — at least the people of Seattle will get a chance to decide their own fate.