Tuesday, December 10, 2013

"Ya know, if you're 22, 23 or so not in school or an apprenticeship somewhere and are still

flipping burgers than something is wrong with you," said a plumber to me the other day.

The more I think about it, he's right.

The truth is that I was damned near forty when I embarked on my career having chased rainbows for my first part of my life. In a way something WAS probably wrong with me, but I suppose we can say 'all's well that ends well'.

One thing, though. During that period I don't think I ever had a minimum wage job as such. I simply wouldn't accept it. I found better. It was always out there.

The last time I had a minimum wage job was in high school.

There is a lot of talk out there to raise the minimum wage and a lot of good that's going to do any of us, including those that have stuck themselves in minimum wage jobs. The fact that some people out there are in minimum wage jobs is simply for the most part, their choice. There's opportunity out there.

All raising the minimum wage is going to do is cause more inflation. It's as simple as that. All one has to do is look at Australia where minimum wage is a lot higher. 

Guess what, people, so is the price of goods.

To make things easy, let's use round numbers.

If the minimum wage is $10 per hour and milk is $3 per gallon than an hour's pay (after taxes) will buy about 2 gallons of milk.

So if you double minimum wage to $20 and hour (which puts the worker in a higher tax bracket) then inside of a short period of time the price of milk will double and the guy working for minimum wage will still have to work an hour to bring home 2 gallons of milk.

Hell, he might not even be able to do that because he's now in a higher tax bracket.

Truth is, the plumber that started this conversation will lose. He's nonunion and there is no corresponding wage increase in his contract. His wage will likely stay the same and the difference between his skilled labor and the bottom of the pile will decrease. 

The resulting inflation will mean that the plumber can buy less and that he and is skills are now less valuable. The gap between skilled and unskilled labor has closed up and made a skilled tradesman poorer.

Call this 'Trickle Up Poverty'.

Nobody wins. The skilled laborer gets made poorer because his money isn't worth as much The minimum wage earner gets thrust into a higher tax bracket and the resulting inflation robs the frugal of their savings because the money they saved is worth considerably less.

The fast food workers that are planning on striking are very likely to face the unintended consequence of unemployment if they get the wages raised.

The price of their burgers will rise and fewer people will buy them and that means layoffs. Competition for the jobs will go up as displaced construction workers that make about $15 and hour now will flock to the jobs.

What's more, the workers that don't lose their jobs right off will very likely have to produce more to compensate for their raise and it is likely that automation will enter the picture and kick more of them to the curb.

Actions have consequences.

Truth of the matter is that Ben Franklin was right when he said that the more we do for the poor the less they do for themselves and therefore get poorer.

The other truth of the matter is that the poor have been dragging us down for generations and costing us a lot of money. It's time to simply let them go. Some, of course, are bound to sink but the bulk of them will simply either swim or at least tread water.

What is likely to happen is that some of the poor will become successful because they are on their own and will discover that they can do well without any outside help.

As for those that don't try and better themselves?

As a sergeant once said to me when I was a private, "Them ditches ain't gonna dig themselves."

That particular statement stuck. I simply decided then and there to make rank and I did. Sixteen months after I enlisted I was wearing sergeant's stripes.

It was that easy.

To find out why the blog is pink just cut and paste this: http://piccoloshash.blogspot.com/2009/12/my-feminine-side-blog-stays-pink.html NO ANIMALS WERE HARMED IN THE WRITING OF TODAY'S ESSAY


  1. The other aspect to this is that when you raise the minimum wage to 15.00 an hour, the employer is going to have to figure out how to get 15.00 worth of value out of your time... Which means you're not going to be an unskilled worker at that wage. Fast food, for example, is going to automate, and the employees getting that 15.00 an hour are going to be fewer in number, and doing things that are worth that money to the employer. Things like maintaining and feeding that expensive automated equipment that you just made cost-effective by driving the wage for unskilled labor up artificially.

    That's the root problem with this idea: The minimum wage goes up, and the fewer jobs there are going to be for unskilled people. Those burgermaker maintainers may well be making 30.00 an hour, but there are only going to be two or three of them per store, versus the 15-20 or so unskilled burger flippers. Congratulations, fools: You just put yourself out of work, and made it more profitable for the franchise owner after he invests in the automated machinery. Hell, with the tax benefits he gets for investing in business improvements, he may even wind up sending thank-you notes to your unemployed selves...

    1. They are already putting the automation in in France. That's going to get rid of the order takers. They have machines that flip the burgers so about the only job left is putting the goodies on the bun and boxing it up.