By Robert T. Smith
The mantra of the Progressives on the left is that we need to “biggie size” the minimum wage to $15 per hour. No thought is given to the question of “what then?”
The current political group term Progressive is the synonym, not the antonym of regressive, it is simply a repeat of failed policies from the past, centered around the collectivist notion of command and control by our betters in the centralized government. As a Progressive example from the country’s past, a part of President Franklin Delano Roosevelt’s (FDR) National Recovery Act was that the conditions for the conduct of business and industry were significantly controlled at the federal level.
An example of the tenets of the National Recovery Act included the national control over employees working at all businesses. In the Progressive minds of the master planners in the FDR administration, more pay for workers would boost the economy. In addition, mandating reduced hours for the workers would lead to businesses necessarily hiring more workers, who would also be paid more. Both of these dictates assumed for-profit businesses would not respond to the dramatic increased cost of labor by reduced activity that harmed both the economy and workers. Divorcing the cost/value of labor in relationship to the cost of goods or services provided in this equation is at best naively simplistic, and is a clear example of the types of tragic failure of centralized, collectivist governments throughout history.
The Coronavirus lockdown has tragically created an economy of unemployment, with significantly more people who now are categorized as living in poverty, and who are on financial aid from the government. As two sides to the same coin, both the Progressives and Conservatives have differing beliefs as to how to address the harm the lockdown has caused and the economy in general under normal circumstances.
According to the Progressives, rich people and evil big business have taken more of the available pie than the Progressives have determined they should, consequently, others do not enough of the pie. There should be an equal outcome for all. The Progressives demand the Washington bureaucrats should take some pie by force of government from the evil rich pie hoarders and give the pie to those they deem to be in need. Never mind the old adage (modified), give a person pie and they eat for a day, teach a person to make pie and they eat for a lifetime.
According to the Conservatives, the federal government has diminished the pie business by substituting taxation, regulation, and the pursuit of litigation in place of life, liberty and the pursuit of happiness. Even worse, the Washington elite have stolen the ingredients for making pie and transferred these ingredients to other nations, as example China. The Conservatives demand the ingredients for making pie be returned to our country and they themselves will make as much pie as they would like, and this abundance of pie will be shared with those who are consequently employed in their pie-making endeavors. The President John F. Kennedy adage from what was formerly the Democrat party appears to apply, a rising tide lifts all boats.
This brings us to the McDonald’s nation of $15 per hour labor. McDonald’s and other similar stores typically have a clear matrix of positions, from entry cashiers, food preparers, shift supervisors, to management, etc. Working from the lower labor value salary to a higher labor value salary is the means of improving your financial situation as a worker at McDonalds. Each step up the pyramid of job titles requires more and better skills and responsibility, consequently a higher value for a person’s labor is provided to the store and a commensurate higher rate of pay for the employee’s efforts. Individual employee efforts are rewarded by personal financial gain.
Artificially increasing the cost of the lowest laborer to $15 per hour necessitates increasing the entire matrix of positions upward in labor cost, devoid of any relationship to the value added to the store’s product by these workers. The alternative would be a flat or flatter matrix of pay and no reward for those employees who excel and increase their value to the restaurant. The McDonald’s hamburger is not bigger or tastier, or provided even quicker, its cost simply increased to pay for the increased cost of the workers. McDonald’s cannot maintain its products at an affordable price with the artificially increased cost of labor.
Eventually, there will be no “value meal” at McDonalds and the consumer’s money will be spent on more affordable food, either at home or otherwise. The eventual choice is McDonald’s goes out of the affordable, fast-food business, no jobs for anyone, or McDonald’s chance of survival dictates that machines substitute for many of its labor workers, McDonald’s work force gets “little sized.”
So let’s increase the minimum wage to $15 per hour. But why stop there, let’s simply set it even higher at maybe $50 per hour and everyone of course will be rich then. In a Progressive McDonald’s nation, no thought is needed for the question “what then?”
Robert T. Smith is an environmental scientist who spends his days enjoying life and the pursuit of happiness with his family. He confesses to cling to his liberty, guns and religion, with antipathy toward the arrogant ruling elites throughout the country.