UPDATE: Yesterday, as expected, the Seattle City Council unanimously approved a $15 per hour minimum wage in the city which will be put into place gradually. Most businesses will have to comply with the highest level minimum wage in the nation by 2017, smaller businesses have until 2021 to comply.
The People’s Republic of Seattle government has once again ignored the ages old teachings of Adam Smith by considering a plan to increase the minimum wage of workers within the city limits to $15 per hour. If approved it would make Seattle’s minimum wage FAR higher than any other city or state in the country. San Francisco, that West Coast Liberal bastion, previously held such a proud distinction with a minimum wage of $10.55 per hour. Seattle’s plan doesn’t so much resemble the “invisible hand” as it does represent an iron fist.
In 1776 with his magnum opus “The Wealth of Nations” Scottish economist Adam Smith described the invisible hand as the means by which industrialized nations attained prosperity by government staying out of a free market economy and letting the “invisible hand” dictate prices of products and services as well as wages of workers.
I always felt that if a person doesn’t like making the minimum wage, whatever that wage might be, they should make themselves a more valuable commodity (i.e. worker). Put in the time to gain experience. Put in the effort to educate yourself. Develop a craft. Sell yourself. Upon making yourself more valuable a company will surely find use for you and compensate you in a fashion that makes your desire to work well and stay with that company heightened. Hiring and then training new personnel is expensive and time-consuming for businesses. As long as other outside factors aren’t driving the business owner they will tend to pay good or fair wages for a good staffer.
There is no question the move toward a higher minimum wage in Seattle and elsewhere in the country is rolling down hill and gaining momentum. There is also little argument that the $15 level proposed in Seattle and approved by voters in the small town of SeaTac, just south of Seattle, is completely arbitrary. There is no relevant data to suggest that $15 per hour is the sweet spot between fair and unfair wages. Why not make the minimum wage $20 per hour? Why not make it $13? For the record a worker earning $15 per hour, working 40 hours per week, and working 50 weeks per year would earn $30,000 per year. For the record the poverty rate for a single individual is $11,670 and $27,910 for a household of 5. Those making less than those figures would be eligible for Medicaid and CHIP (The Children’s Health Insurance Program). Is there anyone who couldn’t live fairly well on 30k annually? Trust me, I’m speaking from experience. I wonder how inspired you would be to improve yourself, educate yourself, grow your income if you weren’t so motivated to do so prior to being handed a wage that allows you to live as comfortably as $30k per year would allow you to work. Keep the hateful comments to yourself. I am not suggesting that $30k is a LOT OF MONEY. Clearly it’s not for many people. But its a helluva lot for a 19-year-old high school dropout with no employment track record.
I also look at another bit of recent local, Washington State and Seattle, news being related to this subject. Last month King County voters rejected Proposition One to raise taxes to maintain current Metro bus service at existing levels. Ultra Liberal Seattle and King County voters rejected a tax increase to maintain, MAINTAIN, BUS SERVICE…a service that caters almost exclusively to people of lower-income. Seems like a contradiction of terms doesn’t it?
So what does this mean? Can we read the tea leaves and make a determination on our future? Seems to me the people of King County want and probably need more money in their pockets. Unemployment in Washington State has dropped to pre-recession levels of 6.1% in April. In the Seattle-Metro area the unemployment rate is 5%. The federal unemployment rate also hit new post recession lows last month. So…what gives? Higher taxes and lower wages is what gives. People are not thriving. They want more money.
I do not hold to the Libertarian point of view that there should be no minimum wage and government should stay out of it. Unfortunately so much government involvement already makes that dream completely unrealistic. Nonetheless a $30,000 minimum wage seems far beyond reasonable for someone handing out McCheeseburgers and fries. The minimum wage ought to be as low as possible; my suggestion would be $9.89 per hour to comply with the Federal standards of what constitutes poverty for a family of three. If you have a family of more than three and you make the minimum wage…learn to watch movies at night.
Any minimum wage law should include other requirements. It should be two-tiered. One minimum wage that’s lower for teenagers, and one that’s higher for adults. Teen unemployment nationwide is already at an incredible 19.1%. And keep in mind that only includes those who have previous employment in which to claim they are unemployed. The real number is MUCH MUCH higher. A $15 minimum wage, if universal, would grow teen unemployment to almost 100%. Such an occurrence would make saving for, or paying for college nearly impossible; subsequently putting more of a strain on Mom and Dad or simply denying a higher education to far too many deserving young people.
Another aspect of a very low minimum wage that I would like to see implemented is that it could only be used for a short period of time, perhaps 6-months or one year. Make it illegal to continue to employ someone at the minimum wage if they’ve proven their worth and the employer wants to keep them around. Naturally employers would know, or could be educated, that hiring and training a Newby would be more expensive and time-consuming than giving someone who was making minimum wage a well-deserved raise.
These ideas make sense in so many ways. Which is why they will never be implemented.
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