Tag Archives: Milton Friedman

$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.