In 1974, I was busing tables in a steak house when the manager called me in to her office and said I was getting a promotion to dishwasher. It was a proud moment; my hard work was recognized and my performance rewarded. It set my teenage feet on a path of accomplishment that remains to this day.
A month after my promotion, the minimum wage was raised from $1.80 to $1.90 per hour. My 15 hours a week now netted an additional $1.50. The reward of the promotion endured, the buck and a half did not, and that is what is wrong with the government setting the price of labor.
Politicians like to throw around buzzwords like “living wage” and “fairness”. Whether the minimum wage is $7 or $9 per hour, a person cannot raise a family on that money. The vast majority of minimum wage workers are young people just starting out. Even at 14 years-old, I knew that I would have to work harder and get an education if I wanted to buy a car, have my own apartment etc. Working in a minimum wage job was great training to build life skills. I learned to show up on time, follow instructions, help your co-workers etc. It never occurred to me that I would raise a family on this job. Today, politicians assume that Americans are stupid and lazy and will not learn the lesson that I did; the simple lesson that if you work hard, you can better your circumstances. Therefore, politicians, strive to “protect” workers from the evils of capitalism.
When you raise the price of a good or service, you reduce the demand. When politicians raise the minimum wage, restaurant operators have to do the same work with fewer hours, the demand for workers falls. In an era of high unemployment, this is foolish.
An out of work factory worker that gets a job in a restaurant can learn new skills, move up and build a new life. The accomplishment of working again will improve their outlook and the low paycheck will inspire them to do better. This is the marketplace at work, it is also called pride.
Government should not set the price of cheese or chicken, even if it makes the chickens feel better about their self-worth. $9.00 an hour in mid-town Manhattan will not attract quality labor, so pizza operators have to pay more. Nine dollars an hour in rural Nebraska, might not provide a high enough return on investment. Washington D.C. can’t know local markets and should not try.
As a 14-year-old bus boy making $27 a week, I knew there was more in life. The lessons I learned making minimum wage inspired me to reach for the stars. When I opened my paycheck on Friday, I was motivated to do better. I did not look to my government to help, I looked inside and I still believe that pride lives inside every worker. Government’s job is to set policies that encourage economic conditions that permit people to earn enough money to support themselves. When government policies lead to reduced employment and motivation, everyone loses.