The so called “Fight for 15” has become a rallying cry of sorts for the unskilled laborers of America. Their presence being felt in demonstrations occurring across major American cities nationwide.
Like most parts of the liberal agenda however, the minimum wage only tends to hurt the very same people it proclaims to help. The driving force behind the push for an increased minimum wage is the idea that will it will benefit the low-skill workers of America. Historically however it tends to have the opposite effect. In Seattle for example, where its leaders adopted a phased in minimum $15 an hour wage way back in 2014, many companies have already been forced to heavily cut back on hours to compensate for the increase in wages. This despite the fact that no business’s are expected even to hit the full $15 until January 1st of next year.
More damning to the Fight for $15 is that a study done regarding this new Seattle law has proven that as a whole the average worker in Seattle is now earning less than they did before the raise hike. For those curious, the study done by researchers at the University of Washington and published by the National Bureau of Economic Research can be found here. For those with less time, the important part is that the study concluded, “Wage increase to $13 reduced hours worked in low-wage jobs by around 9 percent, while hourly wages in such jobs increased by around 3 percent. Consequently, total payroll fell for such jobs, implying that the minimum wage ordinance lowered low-wage employees’ earnings by an average of $125 per month in 2016.”
So for the residents of Seattle even just a bump to $13 has already actually resulted in LESS money in their pockets. Here is quick video break down of just why this move has already proven to be such a disaster for Seattle and will continue to be as they move ever closer to the full $15.
If you buy into the idea of minimum wage to being with, and you really shouldn’t, the question then becomes how high to set it. For example let’s just add a 0 to that mythical 15 number. Ask yourself why a minimum wage of $150 an hour wouldn’t be better than 15? Most likely you along with any other person with even a beginner’s grasp of economics would say that a minimum wage set at $150 an hour would kill almost all American jobs. But if you can accept the logic that at a certain point, forced minimum wages kill jobs, why is it hard to accept that government enforced minimum wages of any amount are sure to kill at least some jobs?
In fact the overall negative effects of minimum wage laws is a very well documented and studied topic. For example a 2014 congressional budget office study estimated that an increase in the federal minimum wage to just even ten dollars and ten cents an hour would lead to a loss of around half a million jobs mostly among America’s poorest workers. Sadly though we no longer need to talk theory when it comes to proving the real dangers to be found in the fight for 15. Because one major American city has already dared head that down that dark road, and what has happened since should be a wake up call to the rest of us. All the more since Seattle was targeted first as one of the most economically well off cities in the nation, but if even they can’t make it work, how does a poor small town in Kansas have any chance?
There is another giant elephant in the room when discussing the minimum wage debate that this study largely doesn’t touch upon, and that is automation. We have all heard the robots are coming for our jobs. Well unfortunately it’s true, and the fight for 15 only helps out the machines.
Case in point Zane Tankel former CEO of Applebee’s in New York, who when asked about the relation between minimum wage and automation told Fox News, “If something becomes prohibitively priced, you find an alternative. I’ve always said increasing minimum wage is technology’s best friend.”
In fact this is already happening today, as in a direct response to the fight for 15 efforts McDonald’s has unveiled job replacing self-serving kiosks are going nationwide. Automation was already coming for these low-skill level basic jobs, but the fight for 15 movement only ensures they happen in the next year rather then slowly over the next decade. These companies certainly don’t want the bad press they will receive for increased automation, and for this very reason many of them have been trying to hold onto their human employees for as long as it was economically feasible. However these companies own workers often seemed determined to make it unfeasible as quickly as possible.
It’s easy to go on regarding all the other problems posed by the fight for 15. How it tends to skyrocket unemployment among the youngest workers for example. Or perhaps how even our current national rate of $7.25 has been crippling the U.S. territory of Puerto Rico economically for years now as they are subject to it as well, despite not being nearly as developed a nation. But perhaps that isn’t necessary when even the mainstream press seems to understand in this case, that $15 dollars might just be one step too far down the liberal rabbit hole.
The Washington Post “A ‘very credible’ new study on Seattle’s $15 minimum wage has bad news for liberals”
Chicago Tribune “$15 minimum wage, while well-intentioned, is a bad idea”
The press isn’t the only one expressing their concern as liberal economists also agree that $15 is going just too far with it. For example the former Chair of President Obama’s Council of Economic Advisers Alan Krueger, stated, “A $15-per-hour national minimum wage would put us in uncharted waters, and risk undesirable and unintended consequences…. The push for a nationwide $15 minimum wage strikes me as a risk not worth taking.”
The former chief economist for the Labor department under President Clinton also opposes the fight for 15 stating, “Such increases are extremely risky. In job markets where young or less-educated workers already have difficulty finding jobs and gaining important work experience, such mandates will likely make it much harder…. Many employers will be very reluctant to pay high wages to workers whose skills—including the ability to speak English, in the case of many immigrants—are so modest.”
Oh and when you do see the left trout out a supposed specialist in favor of the cause, please keep in mind, that when writer Dylan Matthews of liberal news site Vox.com attempted to speak with economists on this topic he uncovered that,
But if everyone knows this is a bad idea why is it still happening? Unfortunately what was once an idea on the fringe of the Democratic Party is now suddenly mainstream politics as Bernie Sanders and his openly socialist friends continue their forceful take over and radicalization of the party.
Do you think your average rural gas station can pay its employee’s $15 dollars an hours, like former Democratic Presidential Candidate Bernie Sanders wants? In fact an almost terrifying 30 members of the Senate early this year attempted to push a bill raising the national minimum wage to $15. This up from the just 5 (including Sanders himself), who thought this was a good idea two years ago. Clearly this is an idea that has suddenly gone mainstream at least on the left.
Phrases like Fight for 15 don’t just make for catchy political rallying cries and bumper stickers anymore. These days they increasingly bring in the real votes from the low paid and under-educated masses living in America’s cities, and this is why more and more Democrats are jumping on board. Just as our Founders knew however, just because the masses want something, doesn’t make it a good idea, or in this case economically sound. As the left continues to fall further into an illogical mob mentality, we need to ensure there remain voices in Washington who are willing to drop the feel good politics and keep this a nation ruled by reason and logic above all else.
This is doubly important now that the more reasonable members of the left are either being driven out, or forced to bend the knee to these ridiculous demands by the people, even when they know it’s a bad idea. Case in point California Governor Jerry Brown. A fiscal moderate in a liberal state who had previously gone on record many times to express his reservations about forced wage increases. Who was recently politically pressured by the powerful California Unions into signing into law a $15 minimum wage bill despite admitting, “economically, minimum wages may not make sense.”
The left had every chance to prove the naysayers wrong and make Seattle a success. But their experiment is already failing before they even hit their own target goal. What more proof do the rest of us need that this experiment just isn’t sustainable?
To put it at simply as possible. Let me end with a quote from economics expert Tim Worstall over at Forbes who makes the very reasonable assertion, “less human labor will be employed at $15 an hour than would have been employed if the minimum wage had not risen to that amount.” If the bottom line here is less work to go around, and higher unemployment, why do so many of us seem so determined to head in that direction? Will a lucky few who retain their jobs and hours benefit? Sure. But for all the others laws like this make things worse. At the end of every feel good law, are the people who pay the price. Because as two different very wise men were both fond of saying, Their Ain’t No Such Thing As a Free Lunch.
Liked or hated this? Make sure to let me know at @Jack_Kenrick or on the Squawker FB at https://www.facebook.com/squawkermedia/