Supersized Salaries

A great call to Rush Limbaugh yesterday:

CALLER: This is Sean in San Diego, and I believe those workers at McDonald’s and Burger King deserve some more money. The shareholders are getting rich. I watch every day on MarketWatch, and the CEO is getting rich. They’re making their profits. They can afford to pair their workers a bit more money. They’re not asking for much. They haven’t had a raise in 25 years.

RUSH: Really? In 1988, people at McDonald’s were making $7.25 an hour?

CALLER: I’m not exactly sure of that, but –

RUSH: Well, that would be important.

CALLER: They’re not being paid fairly, Rush.

RUSH: They’re not making what?

CALLER: They’re not making enough money to even buy themselves a dinner and pay their rent.

RUSH: Well, then why don’t they go get a job that does pay that?

CALLER: Maybe ’cause they can’t.

RUSH: Why can’t they?

CALLER: Probably no other jobs out there in this bad economy.

RUSH: Why? Why aren’t there any jobs out there?

CALLER: The Democrats have destroyed this economy. We all know that.

RUSH: Okay. Well, the minimum wage, by the way, back 25 years ago was $3.35 an hour, just to get the number out there. It was not what they’re making today. I’ll get the inflation calculator out and take a look at it. They’re asking for double their current wages. Sean, why doesn’t the McDonald’s franchise just pay it? You know, why not just give them more money?

CALLER: Oh, that’s simple. Greed.

RUSH: Greed? Or is it competition?

CALLER: Why should they if they don’t have to and nobody’s making them? Government sets the minimum wage, and they don’t want to do it.

RUSH: Well, okay. Let’s take a look McDonald’s, and let’s say the McDonald’s gives their employees a raise. Let’s just say $10 dollars an hour. Would that be enough?

CALLER: No. I don’t think so.

RUSH: Okay.

First of all, does Rush sound mean to you? A bully, a blowhard? The caller has just declared Democrat politics to be the ruin of the country, yet denounces greedy capitalism and wants to set wage levels. No wonder Rush is being patient: he’s talking to a functioning imbecile.

RUSH: How about this? How about McDonald’s raises everybody to $20 an hour? Would that be enough? Would that be okay?

CALLER: I think that would probably help a lot of people.

RUSH: What about $25 an hour?

CALLER: Managers should probably get at least that. They probably already do.

RUSH: Okay, then what about $30 an hour?

CALLER: If that’s the fair market rate.

RUSH: Well, no, that’s what $7.25 is.

CALLER: I don’t believe that.

RUSH: Yeah, that’s why it’s $7.25. It’s the fair market rate. It’s $7.25 not because it’s temporary. That’s the fair market rate. Let’s pay ‘em $50 an hour, how about that?

CALLER: $15 an hour.

RUSH: No, $50.

CALLER: $50?

RUSH: Five-oh, $50 an hour. How about that?

CALLER: Yeah. That should be the new fair market rate.

RUSH: Right on. Right? Well, let’s keep going, how about $75 an hour, let’s pay ‘em $75 an hour.

CALLER: Where you going with this?

RUSH: Well, I want to know whether you agree with $75. I’m not going anywhere with it. If $50 is good, $60 would be better, right?

CALLER: Well, yeah.

RUSH: What about $75 an hour?

CALLER: Where you going with this, though? I don’t understand.

No he doesn’t poor fellow, so Rush explains.

CALLER: I think the workers wanted $15 an hour, and that’s what seems fair to me, not 50.

RUSH: Okay, but if $15 is fair, how about $20? And you agreed, and then he said how about $30.

CALLER: Certain workers, yeah. The management style.

RUSH: Okay, so you want to equal what management’s making? You want no delineation?

CALLER: No, I think the entry-level should be $15.

RUSH: That’s what I asked, “How about $20?” Why shouldn’t the entry-level be $20? If $15 is good, $20 would be better. Why shouldn’t the entry-level be $20 an hour? The point, Sean, is that you just said that $7.25 isn’t the market price, and it is. That $7.25 an hour is what it requires for McDonald’s to be fully staffed. There are people who will work for that, and therefore that sets the wage scale. Now, $10 would be better.

Yeah, you can keep raising it, but at some point, everybody who believes in a minimum wage will say, “No, wait a minute. That’s too much,” and at that point, you have demonstrated that that there’s no market relationship. You’re just talking emotion. You’re just talking “fairness.” You’re just talking being nice, and that’s not how the market works. People aren’t paid a wage because they’re being nice to, or because it’s fair. In the market, the market rules. You can control it all you want, you could add arbitrary numbers on it all you want, and all you’re doing is delaying the inevitable.

The market will always win and will always rule, because it is the market.

Sean was done by then, but not Rush:

RUSH: Teachable moment, market economics. As much as Obama wants to socialize everything and make everybody equal in terms of their outcomes, it hasn’t happened yesterday, and he’s never going to be able to fully do it. If you are a Millennial, if you’re a teenager, I don’t care who you are, there are certain facts of life that have not changed and aren’t going to change no matter how much you want them to.

If you want a “living wage,” if you don’t like what fast food restaurants pay, then do something else. It’s just that simple. Go to a trade school. Go to another business. Start your own business. Maybe the work that you are capable of isn’t yet worth $15 an hour at a fast-food restaurant. Maybe the consumer doesn’t want to pay $10 for a Big Mac so that people working at McDonald’s make $15 an hour. It’s not just a one-way strata.

Now, to those of you who, like Sean from San Diego, are sympathetic to this demand for the minimum wage at Mickey D’s to go from $7.15 or $7.25 an hour to $15, let me ask you this: When you buy a meal, do you make sure that you’re paying a fair price for it?

When you walk in there, do you ask the employee, “Look, am I paying enough here so that you can get a livable wage? When you go in and buy a Big Mac or a Quarter Pounder with cheese or a double Quarter Pounder with cheese, do you look at the price is and say, “Are you sure that this costs enough that you can make a livable wage?” Or do you just get a little upset when you think it’s a little too expensive?

When you buy a meal and you pay a fair price for it, are you doing this to ensure that the employees get health care? When you walk into Mickey D’s and you buy a Big Mac, do you ask them, “By the way, is this thing costing enough so that you get health care here? By the way, is this Big Mac costing enough so that you get a pension here?” Do you think any of that when you go buy a Big Mac? No. You want it to be as cheap as it can be. That’s why you’re there.

Meanwhile, what about the other side of this? The increased cost to the consumer. Many of the people who go to these stores and restaurants are looking for bargains. They themselves are on limited or fixed incomes. They have large families, or they’re unemployed. These people are consumers, too. They have weekly budgets, too.

Rush returned to the theme today:

RUSH: … Instead of asking for the minimum wage to go up because it’s compassionate or makes you feel good, why don’t you go in and demand that a Big Mac only costs half what it costs now? ‘Cause it’s just too expensive. You can’t afford it. Why don’t you do that? Or why don’t you, as I say, agree to pay double what it costs? But any time you want to go into any business and arbitrarily set the value of something in that business, you’re going to affect everything else that happens.

But everything else, price-wise, is attacked by the market, which includes all kinds of factors. Competition, shipping costs, traveling costs, refrigeration, costs. It’s just so involved that you can’t arbitrarily set the price of anything without totally throwing everything out of whack, including the price of labor. But when you go in and think you’re making a really compassionate statement, you really feel good about yourself, ’cause you think the people that work there are underpaid, and you want ‘em to get paid more?

Well, you have a role in that, and your role is higher prices.

And if you’re unwilling to pay higher prices, then shut up.

James Taranto addressed the issue in his column today too:

Tyree Johnson said he’s worked at McDonald’s for 21 years, but is still earning minimum wage–$8.25 an hour in Illinois for workers 18 and older; and $7.75 for those under the age of 18, or older employees on the job less than 90 days.

“Every time I ask for a raise, they tell me ‘You shouldn’t have joined that union, we’re not giving you no raise,’ ” he said.

Why stay at a job for 21 years at minimum wage?

“With the help of this union, I’m going to overcome this,” he said.

[H]ere’s a first-person story from Willietta Dukes in London’s Guardian, titled “Why I’m on Strike Today: I Can’t Support Myself on $7.85 at Burger King”:

I’ve worked at fast-food restaurants in North Carolina for the past 15 years. I’ve spent more hours at Church’s Chicken, McDonald’s and now Burger King than I can remember. I work hard–I never miss a shift and always arrive on time. But today, I’m going on strike.

I make $7.85 at Burger King as a guest ambassador and team leader, where I train new employees on restaurant regulations and perform the manager’s duties in their absence. Before Burger King, I worked at Church’s for 12 years, starting at $6.30 and ending at just a little more than $8 an hour.

I’ve never walked off a job before. I don’t consider myself an activist, and I’ve never been involved with politics. I’m a mother with two sons, and like any mom knows, raising two teenage boys is tough. Raising them as a single mother, on less than $8 an hour, is nearly impossible, though.

So here we have two people who have worked at or near minimum wage for 36 years between them and are claiming, as the slogan has it: “We can’t survive . . .” That is true only in the sense that, as Paul Newman observed in “Hud”: “Happens to everybody. Nobody gets out of life alive.”

Never would I claim that it’s easy to live off $8 an hour. Never would I try to raise two kids on $8 an hour. But Rush is right: they have jobs because they’re willing to work for $8 an hour. If it’s the only jobs they can get, are they lucky or cursed?

The Seans of the country are easily led—by Rush or Obama—into absurd positions. But they can vote only for Obama (and not even him anymore). Alas for Willietta and Tyree, the Seans of the country—and probably the Williettas and Tyrees—did vote for Obama. Asking for double their wages now is like trying to wring blood from a stone. And I’m more sorry than you can imagine that they’re too dumb—sorry, “low-information”—to know it.

7 Comments »

  1. Judi said,

    August 30, 2013 @ 10:50 pm

    Of course a low skill minimum wage job doesn’t pay enough to live on. When did this become so hard to understand.

  2. captain*arizona said,

    August 30, 2013 @ 10:54 pm

    hey if I am not banned here goes. a 40 year old woman I know works at mcdonalds and has been working there for 7 years she makes 40 cents an hour over minimum wage and they will only give her 29 hours a week so they don’t have to pay benefits! she has medical problems but can’t afford medical treatment so she trys to work while sick to feed her family. our state does not have medicade and even only working 29 hours she makes to much to be eligable for any state medical treatment. A year ago I was at a hospital emergency room when a woman was told that she needed gall bladder surgery but since it was not an extreme emergency the hospital wouid not be reinbursed by county medical so the couldn’t do it! they told her if she gets in critical condition try to mae it back just before she dies and they could get paid by county as extreme emergency! As thomas malthus said in the iron law of wages. Wages tend to fall just above starvation level because if they fall below to many workers starve to death and you have labor shortage!

  3. Judi said,

    August 30, 2013 @ 11:26 pm

    McDonald’s uses to offer a catastrophic type insurance plan to part time employees at a low cost but under Obamacare the plan is illegal so they were forced to drop it.

  4. Joe said,

    August 31, 2013 @ 12:56 am

    Captain * Arizona…….It is not the duty of the state to feed house and doctor a persons family.If you disagree maybe you should live in such a state such as North Korea or Cuba where the State is in charge of everything a person cannot live on the wages paid at McDonalds then get a job elsewhere, if they cannot get a better job then get some education and improve ones employability.Where is the father of the children in your story.It is no good breeding bastards and then expecting the rest of us to feed them.

  5. Judi said,

    August 31, 2013 @ 1:39 pm

    Another side to this argument that I keep hearing aside from the greedy employer is that customers shod be willing to pay more so employees can make more money. Well, I may be willing to pay more. Maybe twice as much even. But then I will have to eat out half as offed to afford it. So where does the extra money come from? The liberal argument always assumes there’s a bottomless pit of money available for their perfect little plans.

  6. DavidD said,

    August 31, 2013 @ 6:51 pm

    Why doesn’t Sean just slip the server at McDonald’s a $5 tip when he buys his lunch? Sheesh.

  7. Bloodthirsty Liberal said,

    September 1, 2013 @ 10:18 am

    Where’s your humanity, David? Why should Sean assuage his guilt when we can create a government bureaucracy to do it for him? I see a cabinet-level department–the Secretary of Completely Arbitrary and Random Intrusions into the Marketplace to Salve Our Consciences for Eating at McDdonalds, or CARIMSOCEM for… short.

RSS feed for comments on this post · TrackBack URI

Leave a Comment