This issue has been brewing in our country for awhile. Like most political and economic issues, the minimum wage is a pretty polarizing one. Last night I read an article on Yahoo news where the owner of the oldest operating McDonald’s was interviewed and asked about what he thought about movements to raise the minimum wage to $15/hour. You can read the article in its entirety here, but I’ll be pulling sections out for the purpose of this post.
To be perfectly clear, I think there are a lot of valid reasons why the minimum wage should be raised. I don’t know where the $15/hour number came from, and I don’t know if that’s an appropriate figure in terms of an increase. But I would argue that the data indicate that it does indeed need to be raised. But first, let’s take a look at some arguments against raising the minimum wage, as outlined by Ron Piazza, the owner of the oldest operating McDonald’s.
I started at a dollar an hour. Poverty is as severe as it was when I was making a dollar an hour. The minimum wage increase, frankly, hasn’t reduced our poverty problem. Do I think it’s fair that people live in poverty? Of course not. But I don’t know how you can say that business is responsible for that.”
Where to begin here. This is probably the worst possible logic to use against raising the minimum wage. First of all, I don’t really understand how the people who pay their workers’ wages aren’t responsible for those wages, which is what Mr. Piazza seems to be saying. It’s as if he’s blaming the employees for the amount of money that the company pays them, which is ass backward.
But more importantly, let’s examine the first statement by Mr. Piazza. And let’s look at the data. Let’s travel back in time 40 years, to 1974. According to the US Department of Labor, the minimum wage that year was $2/hour. Someone who worked 40 hours per week would be making $320/month. Well, when Mr. Piazza frames it that way, workers today seem downright ungrateful. But how far did a dollar get you in 1974? And would a 2014 dollar get you to the same places?
The average rent in 1974 was $185/month. Gas was 55¢ a gallon. So to fill a ten gallon car tank would cost $5.50, which means that if one filled up once per week it would cost a grand total of $22/month. Now let’s fast forward to 2014. The minimum wage is now $7.25. A full time worker would be making $290/week or $1,160/month. The average apartment in an urban center is now $1,022.13. Which would leave our minimum wage worker with about $140 a month for food, transportation, and utility bills. Someone in 1974 would still have about $120/month left over–back when a dozen eggs was only 78¢.
So what does all of this mean? Well, quite frankly, it means that someone who works for minimum wage in this country can barely afford a roof over their head. Which has big implications for the rest of us, since we end up subsidizing everything else as taxpayers. According to Business Week, we subsidize $7,000,000,000 a year to fast food workers alone. And according to Forbes, people actually make more money not working and collecting benefits than they do by holding a minimum wage job in 35 states. This graphic does a good job of summing this all up nicely.
Doesn’t that seem a little, I don’t know, ridiculous to you? So let’s take this back to Mr. Piazza. How is this the fault of business? Well, gee, I don’t know Mr. Piazza, maybe because THEY’RE THE ONES PAYING THE WAGES? Employees don’t control how much they get paid (unless they’re in a union, but that’s apparently un-American), so Piazza’s argument is ludicrous. Let’s examine more gems from Mr. Piazza.
When the minimum wage is $10 an hour, you lose all that because I’m going to bring someone in at $10 an hour. What incentive did you have to learn your job?“
Here we go again with this bullshit. Yes, your labor force is no better than a pack of dogs performing tricks to win cookies. Give me a fucking break. Money is NOT the only thing that motivates people to perform their jobs. What about, I don’t know, pride? What about wanting to make sure your coworkers succeed? What about wanting to see your company succeed and grow? Using Mr. Piazza’s logic, every worker in the country should show up to work every day and do the absolute bare minimum of work needed to get by. They’d never work overtime, they’d never stay late, they’d never take their work home with them. And to be sure people like that do exist. But how many people do you know who go above and beyond at their job? Many of you reading this right now probably do so because you, heaven forbid, like your work and take pride in it. And finally there is this:
Piazza says his managers make roughly $55,000 per year, which he notes is more than a teacher (“a noble profession”), and that his employees can flourish no matter “what schooling you have.”
“People think we’re a dead-end job. Well, I’m not a dead-ender. I’ve got 585 employees and 55 managers, they’re not dead-enders.”
Gee, that’s funny, because all I ever here from conservatives who think the minimum wage shouldn’t be raised (or should even be lowered) is that fast food jobs like the ones Piazza provides are not meant to be permanent. That’s all any conservative pundit or talking head can jabber on about–these are jobs for teenagers, they aren’t meant to support people and families! Well, Mr. Piazza seems to be quite pleased with the permanency of the jobs he offers. His statement would seem to indicate that he sees no problem with people staying in fast food jobs long term.
On a side note, how stupid is it that a fast food manager makes more than a teacher? That’s pretty fucked up. And I’ll tell you why. In a market society like ours, wages are determined by the value that society as a whole places in the job being done. So guess what that means? Americans value fast food more than they value education! Although anyone who’s taken a look at the waist lines and test scores of American children probably could have told you that.
Another argument I hear about raising the minimum wage is that the price of goods and services would also increase. Well, yes, that is one possibility. Although in many cases it’s probably not a necessity. But let’s say that the price of goods and services generally did increase. So? It wouldn’t matter, because the wages of a the lowest sector of the economy would be increasing, meaning they would be able to afford more goods. Or more expensive ones. Any increase in price wouldn’t be more than the increase in wages (because employee/customer ratios are never 1:1). Essentially, a whole group of people would suddenly find themselves with disposable income that they would then pump into an economy. Not to mention all the money that taxpayers would save once these people no longer needed food stamps and other forms of public assistance.
But I know that this argument is bullshit for another reason. All one needs to do is look at the minimum wages that other countries set. In Australia the minimum wage is $16.87/hour (where, coincidentally a Big Mac costs $4.62–only 6¢ more than in the US). In Belgium it’s $11.69/hour. In Canada it’s $10-$11 per hour by province. In Denmark it averages out to a whopping $20/hour. New Zealand is $14.25 an hour. And a lot of other first world, industrialized nations like Iceland, Germany, Norway, Sweden, and Finland don’t even have a minimum wage because all workers are allowed the right to collective bargaining (damn commies!). None of these economies are collapsing or teetering on the brink of destruction. In fact, a lot of those economies are booming. Hmm, could it be because companies there actually pay workers enough to buy the goods and services produced by their economy?
It essentially comes down to this: who should provide for workers–employers or your tax dollars?