Only a Liberal…

A picture of poor people getting fired

I have been warning of the unrecognized consequences of raising the minimum wage. While the cost of a computer continues to go down, politicians make sure that the minimum cost of human labor in America goes up as fast as possible. The blindly driven car of the minimum wage is wilfully unconcerned of the approaching cliff.

We have reached the “wage singularity.” I have been saying for years that if Liberals continue pushing the pseudo-compassion of increasing the minimum wage, fast food workers will soon be replaced by a computer touch screen. Last weekend, I came across just that at a Jack in the Box in the San Francisco Bay Area. Other than Santa Fe at $9.92, San Francisco will enter 2010 leading the country with a minimum wage of $9.79.

I have said it before and I will say it again.

The minimum wage gets poor people FIRED.

While San Francisco brags about it’s compassion for the poor, it is slowly ensuring that our poorest citizens will become even poorer. Before the arrival of these kiosks, employers of poor workers were given a choice: pay someone the min wage or pay them zero. Many can afford to pay their higher wage but many businesses simply can’t. So they choose zero. Now they can choose a computer.

Hal the kiosk will soon be the perpetual employee of the month, as I have no doubt Liberals will be unphased by the arrival of kiosks. Communist areas like Berkeley or elsewhere will likely pass legislation banning the kiosks but most areas won’t.

Hal works 3 8-hour shifts with no breaks, no lunch, never goes to the bathroom, and never gets tired.
Hal does not have health coverage or workers comp or paid vacation.
Hal doesn’t have any tattoos, piercings, or attitude.
Hal doesn’t eat the fries or drink the soda. He doesn’t steal from the cash register. He is never late.

Hal does need his screen wiped occasionally.

Let me add that I do not oppose the kiosk taking people’s jobs. Technology makes our lives better every time it advances, as evidenced by past history. Yes, some people will lose their jobs and find it harder to find jobs, but for society it is an improvement. It just shouldn’t be happening so soon, but it is, thanks to your local politician.

Click the minimum wage category below to read more about the economic realities of minimum wage laws.

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If you wake up one morning and have the urge to fire poor minorities, I have the solution for you. Raise the minimum wage. The majority of those that are paid the minimum wage are poor minorities. For you knee-jerkers that are appalled by my statements, let me assure you I do not support firing poor minorities, which I why I don’t support a minimum wage of ANY kind.

The minimum wage makes it illegal to sell labor that is worth less than the minimum wage. If the minimum wage is $5, and you want to do some kind of work for $4, you are not allowed to. So those whose labor produces less value than the minimum wage will eventually be fired or won’t find work in the first place. This is math, not politics. You can argue until you’re blue in the face why it is absolutely necessary to have a minimum wage. There is no argument that disputes my fundamental claim.

Liberals see it as compassionate to raise the minimum wage. Their logic is, if I raise the minimum wage, all poor people will make more money. Unfortunately, that’s not how it works. All minimum-wage increases do is drastically increase the chances of poor people getting fired from their already low-paying jobs.

No one can disagree with the following: if you freeze all other variables, increasing the minimum wage decreases employment. Again, this is pure math. If you increase the cost of labor, you will decrease the demand for labor. If you raise the minimum price of a candy bar to $5, people will buy less candy bars. It is the same principle.

In 1938, Roosevelt signed the first minimum wage into law. Why 1938? According to Mackinac.org, the American textile industry had begun moving from New England to the South. Cost of living was lower, so Southerners could produce the same product for less income. Massachusetts politicians would have nothing of this, so they began demanding wages be hiked so that “Massachusetts [would] have equal competition with other sections of the country.” Southern politicians correctly characterized this as a tariff against Southern goods.

So perhaps you agree with the minimum wage consequence part, but still don’t believe minimum wages disproportionately affect minorities. From 1948-1955, black teenage males had an unemployment rate of 11.3%. White teenage males were at 11.6% (which is higher in case you’re not paying attention). In the two years following the 1956 increase, nonwhite teenage employment went from 14% to 24%. By 1960, unemployment among black teenage males was up to 22.7%, while whites were at 14.6% (NCPA). Racism can’t be to blame, since no one can argue that employers were more racist in 1960 than 1955. In 1996, when the economy was booming for everyone else, black male teenage employment went from 37% to 41% after another minimum wage increase. “Data from President Clinton’s own labor department show that at least 20,000 jobs were eliminated by the 1996 hike. The Employment Policies Institute calculates that the real job loss was closer to 128,000.”

Now that you know, let me present this passage to you. “The [1963] Equal Pay Act was an important step in leveling the often uneven work field in which women competed with men for the same jobs but had to settle for making less money.” (encyclopedia.com) Let’s pretend that once upon a time, wide-spread sexism did exist in this country (crazy, right?). So as a result, less women were able to educate themselves and gain as much experience as men. The logical result is that at that time, women were, on average, less skilled at certain jobs then men. I’m not saying they were less “capable.” They were not allowed to gain the experience and knowledge that men were allowed to. It would be unreasonable to expect that. So what would occur if you required employers to pay women the same amount to do the same job as a man, assuming the women in question, on average, was less skilled at it in the 1960s than a man? You would essentially fire or prevent employment for tons of women.

So these beliefs or fantastic wishes that liberals have to help minorities, to help young people, to help women, all do the EXACT OPPOSITE. The best thing you can do for these formerly oppressed groups is afford them every opportunity to work and gain experience even if it temporarily makes you uncomfortable. Raising the minimum wage only hurts the poor and the weak.

EVEN IF YOU ASSUME that every single person that makes the minimum wage stays employed when there is an increase, there is another consequence. The cost of labor is included in the cost of goods and services. If you increase the cost of labor, and the employer doesn’t fire anyone, then the cost of the goods that the labor produces will go up. So a minimum wage increase is also a goods and services cost increase. The price of fresh produce goes up. So even in the sunny, happy-go-lucky, naive liberal scenario where raising the minimum wage supposedly doesn’t make poor people unemployed, it most certainly makes it harder to buy groceries. That sure-as-shit hurts poor people more than rich people.

A fake scenario: President Obama takes the stage and makes an announcement. He has decided that barbers and salon stylists don’t make enough money, so he’s gonna raise the minimum price for a haircut up to $40. This will ensure that the hair-cutters of American get the money they deserve for the invaluable service they provide.

Any layperson can deduce what would happen. All barbershops would disappear, and high-end salons would live on. Amazingly, this logic is lost in an argument about the minimum wage. Phrases like “living wage” are thrown at us as though it means something tangible. Even if there is such a thing as a living wage, how the heck do we think a bunch of career politicians with no background in macroeconomics could possibly determine what it is? Why can’t each individual decide what they want to charge for their time?

When you implement a minimum wage, you are making it illegal for a poor person to sell services for less than that wage. You are making it illegal for them to provide labor to someone for a price they are willing to charge. This is not freedom. You can immerse yourself in the illusion that the minimum wage prevents employers from hurting poor people while it is the wage requirement itself that hurts them. Are these liberals telling us there really is no labor that is worth less than $6.55? Nothing?! If flipping burgers is worth $6.55 perhaps tasting burgers and giving your opinion is worth less.

Every time the minimum wage rises, various alternatives become fiscally viable to companies. The lines in the image above indicate the cost of a cashier to an employer over time. The price of a human increases while the price of a computer decreases. That red dot is the day sometime in the future when the minimum wage will get everyone fired. You raise it high enough, and companies will invariably automate EVERYTHING. Elevators used to have operators… a person would press the buttons for you. At some point they either asked for a raise, or people figured out that operating an elevator does not require any expertise. They were all fired. Gas stations used to include the personal care of your own attendant who would clean your windshield, check your oil, the works. At some point, the cost of this service exceeded what it was worth, and every last one of them was fired (New Jersey required full service until recently, and I hear Oregon does as well but I can’t confirm). You only hurt poor people by requiring they charge more for labor than their labor is worth.

YOU CANNOT HURT RICH PEOPLE BY HAVING A MINIMUM WAGE. THEY ARE TOO RICH. YOU ONLY HURT THE POOR.

Their are COUNTLESS arguments for and against the minimum wage (I checked). Forget all of them; liberals are immune to statistics and facts. Try this (I’ll make the numbers rough for the sake of simplicity).

Pizza at Pizza Hut: $5
Pizza at Olive Garden: $10
Pizza at Il Fornaio: $20

The party in power in Congress decides its unfair that Pizza Hut gets less per pizza than the other two restaurants, so they pass a bill that requires pizza be sold at a minimum price of $10 next year, and $20 the year after. Ask your liberal friend what will happen to Pizza Hut. Answer: short of changing their image to substantially more sophisticated, Pizza Hut will cease to exist.
Labor is no different than any consumer product. If someone wants to sell a pizza for $5, they should be allowed to. Raising the minimum price of pizza $10 makes it illegal to sell pizza for $5.

If the minimum wage is $5, you essentially make it illegal to sell labor for $4, or $3. Ask your liberal friend who gets hurt by making $3 labor legal, rich people or poor people. Are liberals saying there is no labor worth $3 per hour? Who decides what its worth? If flipping burgers is worth $5 per hour, might eating burgers and filling out a questionnaire be worth less than $5?
The minimum wage hurts poor people, period. Elevator operators tried to raise their wages above what their labor was worth. As a result, you had to figure out how to use that crazy contraption, and every last one of them lost their jobs. The less obvious consequence is all the people that could have started as elevator operators had to start somewhere else. Have you even experienced “full service” at a gas station? Doubtful.

The employment “singularity”

Fast food restaurants are not only required to provide wages equal or greater than the federal minimum, but they also provide medical benefits, a 401k, everything a human could want. Electronics aren’t quite so picky. Let’s say it costs $20,000 for Burger King to employ someone at minimum wage, but a touch screen order system costs $25,000. Keep raising that minimum, liberals. The rich guys in Silicon Valley who develop touch screen technology thank you. Low wage earners aren’t as thankful.

(Here are some more in-depth analyses of the minimum wage)

Min wage increase result in unemployment increase

George Will: Minimum wage should be $0

Santa Fe citywide wage increase failure