Political pressure will be on how workers get raises, not improvement in job performance. None of this will be good for our business or for the public weal.
I grew up in Evanston, Ill., and my first job in sixth grade was washing glasses at a restaurant on Green Bay Road called Andy’s Hamburgers, which was owned by the father of one of my best friends. This was before McDonald’s, and our menu was strictly hamburgers, French fries, applesauce (made on-site), and fountain drinks. It was only open for dinner, and there were lines out the door in the summer and winter—it was a great place. The minimum wage at the time was $1.25 per hour, but since I was vastly underage, I was paid $1.00 per hour. I loved the job and worked there for five years until the owner sold the restaurant.
I did a good job and soon graduated to doing all the fountain drinks and manning the cash register. During this time I got raises to $1.25, then $1.50 per hour. I loved the job and respected the owners immensely, so when I got the raise it was a reward for good, reliable work and I was proud of my progress. What is vitally important was that the raises were earned and the effect on me was to work harder and appreciate my bosses even more. Of course it was a starting job, where I didn’t have to live exclusively on what I made. But what it taught me was to a) always be on time, b) seek new responsibilities, and c) enthusiastically carry out all requests and orders from the owners. In my case, this was a win-win for the owners as well as for me.
Compare this to what is going on currently in our economy. The first, and most insidious, concern is the move by various government entities to enact laws that mandate minimum wages up to and including $15 per hour. Every economist acknowledges that this will have a negative effect on available jobs, and in fact many jobs will be eliminated. But to those who advocate these laws, it is perfect—they can give employees a raise, and they don’t have to pay for it. They won’t say it, but they think it is better to be unemployed at $15 per hour than to be employed at some lesser number.
The key point is that the advocates get to claim credit for enacting a raise even if it does eliminate jobs (as it always does)—but they really don’t care, because they get good PR.
The latest concern is the mandating of overtime pay while doubling the threshold for what qualifies. Once again, those who are behind this will get credit for granting a raise that they don’t have to pay for. The natural response on the part of business is to organize in such a way so as to not have to pay overtime. This will reduce overall productivity, restrict a company’s ability to be flexible, and have the overall effect of driving up the costs of doing business.
We will figure out ways of dealing with all of this, but if the government can now mandate raises, there will be a subtle, but inevitable, change in the workforce and its relationship to employers. Political pressure will be on how workers get raises, not improvement in job performance. None of this will be good for our business or for the public weal.
All of this works because the advocates yell louder than we do. Politicians would rather go with the flow than stand up for principle. It is up to us to start making ourselves heard at all levels of government, so that our voices (the voices of reason) are as loud, or louder, than those who advocate insanity.
This is bad stuff.