Passage of Seattle 15 Minimum Wage: Notes and Predictions

Doom and gloom for Seattle?
No. $15/hour will, ironically, accelerate gentrification in Seattle.  Spatial divide between socio-economic classes will become even more pronounced, with the middle-class moving to first ring suburbs, the poor to outer ring suburbs (as has been the trend). Seattle becomes city of champagne socialists (“privileged” lefties) and the homeless. Kinda like San Fran.

There will be fewer McDonald’s, Jack n’ Boxes, Olive Gardens, anything considered to attract the “poor,” the “deplorables,” anyone who disgusts champagne socialists. “Dirty” industries that employ low-skilled labor move to suburbs (or another state), allowing developers to — after years of resistance from Labor — transform SoDo into mixed use high end neighborhood.  (While champagne socialists become so because of guilt over their privileged upbringing, they remain so not out of conviction or care for those less privileged, but because their political and social philosophy works for them economically and socially. They get what they want, and look good doing so).

This is like Rent Control in NYC and SF (version of which may be legislated in Seattle).  Government intervenes to ensure socio-economic diversity, to maintain cultural vibrancy of whatever whatever I call bullshit.  End result will be more spatial and social segregation, not less.  (Anthony Bourdain paints similar picture in his graphic novel “Get Jiro!”).

Molly Moon Ice Cream supports 15 min because it would increase consumer spending.  Agree?
Not sure.  To begin with, how will they spend?  On high or low return on investment activities and items?  Random novelties, twinkies, meth, and mindless escapes that shrink the economic pie? Or a CPA textbook, math tutor, energizing food, challenging activities that grow the pie?  My guess is those who are chronically making minimum wage are those who waste most of their leisure time on activities that produce little to negative value (getting wasted and causing 10 car accident is example of negative value act). Giving such workers higher pay will shrink the economy. I’m also guessing that these workers will be laid off and will find more appropriate jobs in, say, Everett, where pay will reflect the value of their work. Those who produce $10/hour worth of work don’t get $15/hour. Not even in the most fantastic Leninist state.

I suspect businesses supporting 15 minimum are referencing Henry Ford’s controversial “$5 a day minimum” at his factories.  Short version: Ford increased minimum wage at his factories from $2.34 for 9 hours to $5.00 for 8.  Business leaders howled, claimed that the money would be wasted on vices. Result: Ford was sorta right.  Productivity soared and a new middle-class emerged with enough money to purchase the products (autos) they made.

I say “sorta” because Ford didn’t offer his wages to anyone.  He hired social workers to investigate the habits of potential and existing employees.  So more likely, the higher wage didn’t make employees more productive. Ford improved productivity because of the thoroughness of his background checks and his wages attracted and retained the best applicants.

Whereas I’m hearing something different from 15 NOW supporters, a contrasting interpretation of history.  That raising the wage of a worker will make her more productive *and* transform her into someone champagne socialists won’t hold in maternal contempt.  But that’s not what happened in Ford’s case.  Ford simply did a better job at finding and attracting underpaid employees.

Sure sure,  there are underpaid employees under the current wage regime.  These workers probably will save and invest more, and perhaps spend more at high value businesses. Not because they earn more, but because they’ve always had the desire to do so. Increasing wages doesn’t change a person.  It only changes their actions, shows us who they really are.

The person who has been working as a cook at Jack N Box isn’t going to eat at Harvest Vine or the Corson Building even if you pay him a six figure salary. He’s going to eat at McDonald’s for lunch, Buca Di Beppo for his birthday, not because he’s poor, but because THAT’S WHAT HE LIKES AND WANTS.  If he really wants to eat at Cafe Juanita, he would, he’d figure out a way to make it happen, either by working there or someplace similar.  The kid making $12 an hour who eats at Thrive does so not because he’s rich — he’s not — but because THAT’S WHAT HE LIKES AND WANTS, and so he makes it happen.

What happens when a chronic minimum wage worker wins the lottery? They lose it all,  fuck up in their own fucked up way: spend on bling and bad investments and attract the worst type of people.  More money didn’t transform them, it only brought attention to their character.

Thomas Jefferson understood that wealth and dignity must be accumulated slowly, through hard work and thrift. That’s why he envisioned USA as an agrarian rather than an urban industrial nation. He understood that wealth accumulated too quickly brings out the worst in people — ask Jalen Rose about how many young NBA players squander their wealth. One appreciates wealth only after earning it slowly, over a life-time.

Will higher wages mean less dependence on government agencies?  
No. Once established, government agencies are notoriously difficult to close.  Someone will figure out a way to make $15/hour the new poverty wage.  Poverty is a psychological condition that’s based on comparisons of material wealth — envy — rather than a physiological situation. Few in the United States are starving to death. Many don’t want to be known as someone who makes minimum wage, regardless of what is that wage.

15 Minimum wage will lift many out of poverty.  
It will not.  Poverty is a mindset, an attitude, not an economic condition.  Money doesn’t make one dignified.  Dignity comes with conviction, resilience, and grit.  Those who lack dignity at 10 dollars an hour will lack it at 15 dollars an hour, at 50 an hour, 500, it doesn’t matter. That’s why so many big pot lottery winners lose everything in a few years.

Will the new minimum wage affect Alive Juice Bar?
Probably not much.  There’s enough time for distributors to relocate so we don’t expect dramatic price increases.

Would you open a store in Seattle?
Hell no!

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