Lawrence W. Reed of the Foundation For Economic Education (God, wouldn't the world be better if Obama had taken some online courses there) has reared back and thrown out a gem of a post about the minimum wage.
It's in the form of a Socratic Dialogue.
I try to do this on Facebook all the time, with varying degrees of success, mostly because my FB friends get pissed and declare that I don't care about poor people and then the dialogue ends when I point out that they don't pay people a freakin' dime more than they have to because I've watched how they tip their bartenders and then we all unfriend each other.
I'm scraping the whole thing here, just in case the FEE website goes bankrupt or something. This thing mirrors so many conversations and blog entries I've written on this dismal subject, but does it so much better.
Socrates: So you want to raise the minimum wage. Why?
Congressman: Because as President Obama says, minimum wage workers haven’t had a raise in five years.
Socrates: Can you name one single worker who was making $7.25 five years ago who is still making $7.25 today? And if you can’t, then please tell me what caused their wage to rise if Congress didn’t do it. Come on, can you name just one?
Congressman: I don’t happen to have a name on me, but they must be out there somewhere.
Socrates: Well, we’ve just been through a deep recession because successive administrations from both parties, plus you lawmakers and your friends at the Fed, created a massive bubble and jawboned banks to extend easy credit. The bust forced many businesses to cut back or close. Now we have the weakest recovery in decades as ever-higher taxes, regulations, and Obamacare stifle growth. No wonder people are hurting! Do you take any responsibility for that, or do you just issue decrees that salve your guilty conscience?
Congressman: That’s water over the dam. I’m looking to the future.
Socrates: But how can you see even six months into a murky future when you refuse to look into the much clearer and more recent past? You guys think the world starts when a problem arises, as if you’re incapable of analyzing the problem’s origin. Maybe that’s why you rarely solve a problem; you just set everybody up to repeat it. If you really look to the future, then why didn’t you see this situation coming?
Congressman: Look, in any event, $7.25 just isn’t enough for anybody to live on. Workers must have more to meet their basic needs.
Socrates: An employer doesn’t have anything to pay an employee except what he first gets from paying customers. I wonder, whose "needs" do
you consider when you decide to buy or not to buy: the workers’ or your own? Have you ever offered to pay more than the asking price just to help out the guy who made the product? And if customers like you won’t do that, where do you expect the employer to get the money?
Congressman: That’s not a fair question. My intent here is purely to help.
Socrates: Sounds to me like the answer is "no," but let’s move on. Why do you assume your intentions mean more to a worker than those of his employer? It’s the employer who’s taking the risk to offer him a job, not you. You’re only making speeches about it. Don’t you see a little hypocrisy here—you, who are personally offering no one a job, self-righteously criticizing others who are actually creating jobs and paying wages even if they’re not all at a wage you like?
Congressman: Employers are interested only in profits.
Socrates: Are you saying employees are not? Are they more interested in working for companies that lose money, and if so, then why don’t they all line up for government jobs?
Congressman: Well, we lose money here in government every year and there are plenty of people who are happy to work for us.
Socrates: You have a printing press. You also have a legal monopoly on force. When you borrow in the capital markets, you shove yourself to the head of the line at everybody else’s expense. Are you saying these are good things and that we’d be better off if the private sector could do these things too? Try to keep up with me here.
Congressman: I repeat, employers are interested only in profits. People before profits, I say! I even have a bumper sticker on my car that says that.
Socrates: So are you saying that employers would be better people if, instead of seeking profits, they tried to break even or run at a loss? How does that add value to the economy or encourage risk-takers to start a business in the first place?
Congressman: You’re trying to belittle me but I went to a state university. All of my sociology, political science and gender studies professors told us that raising the minimum wage is good.
Socrates: Were any of those tenured, insulated, and government-funded pontificators actual job-creating, payroll tax-paying entrepreneurs themselves, ever?
Congressman: That’s beside the point.
Socrates:
(Sigh.) Figures.
Congressman: Look, $10.10 isn’t much. I think you must be mean-spirited and greedy if you don’t want people to be paid at least $10.10.
Socrates: Yeah, like you guys in government check your personal ambitions at the door when you take office. I’d like to know how you arrived at that number. Was it some sophisticated equation, divine revelation or toss of the dice? Why didn’t you choose $20.00, which is not only a nice round number but also a lot more generous?
Congressman: Well, $20.00 would be too high, for sure. Too much of a jump at once.
Socrates: It sounds like you think the cost of labor might indeed affect the demand for it. Good! That’s progress. You’re not as oblivious about market forces as I thought. What I want to know is why you apparently don’t think higher labor costs matter when you raise the minimum wage from $7.25 to $10.10. Do you think everyone, regardless of skill level or experience, is automatically worth what Congress decrees? Do you believe in magic, too? How about tooth fairies?
Congressman: Now hold on a minute. I’m for the worker here.
Socrates: Then why on earth would you favor a law that says if a worker can’t find a job that pays at least $10.10 per hour, he’s not allowed to work?
Congressman: I’m not saying he can’t work! I’m saying he can’t be paid less than $10.10!
Socrates: I thought we were making progress, but perhaps not. Can you tell me, if your scheme becomes law, what happens to a worker whose labor is worth only, say, $8.10 because of his low skills, lack of education, scant experience, or a low demand for the work itself? Will employers happily employ him anyway and take a $2.00 loss for every hour he’s on the job?
Congressman: Businesses need workers and $2.00 isn’t much, so common sense and decency would suggest that of course they would.
Socrates: So employers who employ people are too greedy to pay $10.10 unless they’re ordered to, but then when Congress acts, they suddenly become generous enough to hire people at a loss. Who was your logic instructor?
Congressman: Can we hurry this up? I’ve got other plans for other people I have to think about.
Socrates: I give up. You congressmen are incorrigible. You’re the only people on whom my teaching method has no discernible impact.
Congressman: You ask too many questions.
At this point, in utter frustration, Socrates drinks the hemlock. The congressman votes to price many of the nation’s most vulnerable employees out of work and gets reelected.
Whoever warned us to beware of
Greeks bearing gifts apparently never met a congressman.