Attention, Minimum Wage Activists

The free market is providing small business with all sorts of alternatives to “being forced to pay more for something” – in this case, minimum marketable skill – “than they would normally pay”.  In this case, a coffee shop that operates entirely on the honor system

Would it work in, say, Minneapolis?  Of course not.

But could the idea put some people out of work – people who haven’t yet developed a skill worth $8-9 an hour – in places like Watertown?  Mazeppa?  Albert Lea?

Say “Thanks, Uncle Ryan Winkler!”

12 thoughts on “Attention, Minimum Wage Activists

  1. Cheaper coffee and more money in the economy to hire barristas to do something else.

    Isn’t it just possible that these people are worth $8-9 an hour but they can’t get that wage in the market as currently structured? After all worker productivity has doubled since the mid 70s while average wages remained flat.

  2. “Cheaper coffee”? Sure.

    But “more money in the economy”? No. Exactly the same amount of money in “the economy”, barristas and their money are part of “the economy”.

    And “to hire barristas”? No, they may hire former barristas, and they may not. Are they barrista/assembly-line-workers? Perhaps then they will be hired to construct the robots that will now make my coffee. If not, they may have to learn a new set of skills.

  3. “After all worker productivity has doubled since the mid 70s while average wages remained flat.”

    I know what you mean, RickDFL, but a lot depends on how you count wages. Before 1975 a color TV set was something of a luxury (like air conditioned automobiles). The amount of square feet of living space per person has increased since the 1970s.
    If it is true that the large share of the wealth generated by new efficiencies in the economy were gained at the expense of workers, how do you propose to remedy that? Keynes showed that government has no multiplier. A government that spends a greater share of the GDP does so at the expense of economic growth.

  4. “worth”


    The issue is why is the job market so lousy? The alternatives aren’t there. That is what is “suppressing” wages.

    Alternatively, the cost of living is too high for because of so much government and Fed intervention.

    All the MW does is reduce someone else’s demand by the same amount or reduce investment in the business. Every single time. It’s idiocy. It only “works” in a wage-price spiral situation. You want to go back to the 70’s?

  5. Listen at 12:30 and see what happens to STATE workers when you raise the MW

    Of course Rick is going to say it’s all bullshit.

    There are ALWAYS knock on effects. Sometime they aren’t obvious. Working conditions, training, working harder. etc.

  6. The government and the Fed have to take their damn thumbs off of the economy. it’s a simple as that.

  7. We have been overdoing demand economics ever since Nixon closed the gold window in 1971. debt + unfunded liabilities vs. GDP and the horrific labor market is the result.

    Now the cost of living is going up faster than wages for most.

    Welcome to Krugman’s wonderful world.

  8. TFS; you nailed that cost of living increase. If we look at how the current regime has been calculating the rate of inflation, we notice that they have conveniently stopped including the costs of food and fuel, When those are added in, the true inflation rate is around 11.5%.

  9. Look at this. Not a damn thing changed in productivity. Nothing real happened.

    Think about it That won’t happen in aggregate. In aggregate it HAS to be a net minus.

    Plus there all all kinds of individual businesses that will be affected differently.

    Pure stupidity.

  10. This is what you get from Alinsky driven Neo Keynesian central planning

    “This chart also shows labor’s share of the non-farm economy: that broad measure of earned income (as opposed to corporate profits, unearned income and rentier income) reflects a steady decline in labor’s share of the national income.

    Once again, claims that the Main Street economy is “doing better” make no sense if labor’s share of the national income is declining.”

    “Even though the rate of inflation is heavily gamed, real median household income is the best available gauge of purchasing power. Purchasing power simply means how many goods and services will your income buy?

    For example: if your daily salary buys 20 gallons of gasoline, and a year from now you get a raise but your daily pay only buys 15 gallons of gasoline, the purchasing power of your earnings fell despite the higher nominal salary.

    Real median household income has declined, meaning the purchasing power of earnings fell.”

  11. Rick, as one who interacts regularly with a number of teens in our church’s youth group, I can assure you that I know people whose labor is not worth $9/hour, or even half that. The main issue is that they have to be supervised constantly to get them to work–and when you get them to work, they automatically assume you’re some kind of slave driver. The consistent factor is that they do not have fathers in their lives who assign them things to do, and I would assume that anywhere a large portion of kids don’t have fathers, you will find these kids aren’t worth what it would take to hire them.

    Another example was way back in 1989…went into Chicago and in Grant Park, I saw the participants in a Chicago make-work program cleaning around Buckingham Fountain….or, rather, ambling around while on the clock while watching the trash fly around. Magnificent physical specimens–would do well in most any sport they tried except for distance running–but they simply did not know how to work. And I think this explains a lot of the horrific unemployment rates among urban youth.

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