Posted on 03/22/2015 10:01:57 AM PDT by Diana in Wisconsin
"Why Are So Many Seattle Restaurants Closing Lately?” asks a recent Seattle magazine headline. The Scrapbook is no restaurateur, let alone knowledgeable about the local economy, but we’ll guess it has something to do with the fact that Seattle’s new $15 minimum wage starts phasing in on April 1. However, the first rule of liberals confronting the laws of basic economics is deny, deny, deny.
A feature in the Seattle Times called the “Truth Needle” (we’re guessing the Times didn’t want to pony up to license PolitiFact’s logo) declares the claim that minimum wage has anything to do with the undeniably large number of restaurant closings is “false.”
Now, it’s certainly the case that restaurant operators in liberal Seattle are claiming a higher minimum wage has nothing to do with their business decisions. This is likely somewhere between a delusion and a lie, so let’s split the difference and call it public relations. Again, basic economics tells us that the typical restaurant operates on a slim profit margin, and wages typically run about 35 percent of operating costs.
Nonetheless, in very liberal and very wealthy Seattle, angering your customer base by proclaiming your opposition to redistributive social justice would be foolish. It would also be foolish to anger the local regulatory czars in a city that has proclaimed the new wage law a political triumph. “Restaurateurs are business people, not politicians, and angering the mayor over the law he signed is not a smart business move,” notes the Washington Policy Center.
However, there’s little doubt that the city’s heralded food scene is running scared. A spokesman for the Washington Restaurant Association told the Washington Policy Center, “Every [restaurant] operator I’m talking to is in panic mode, trying to figure out what the new world will look like.” We’re fairly certain it will be a Brave New Seattle, where there are fewer great restaurants, to say nothing of all the other labor-intensive businesses that will be shutting down.
Naturally, this means fewer jobs for the poor. Worse, the increased wages will also amount to a regressive tax. Economist Tyler Cowen flags a new study in the Journal of Political Economy by Stanford’s Thomas MaCurdy, concluding an increase in the “minimum wage produces a value-added tax effect on consumer prices that is more regressive than a typical state sales tax.”
The study also points to another reason why cash-strapped municipal governments like artificially raising wages. “Unlike most public income support programs, increased earnings from the minimum wage are taxable,” MaCurdy writes. “Over 25 percent of the increased earnings are collected back as income and payroll taxes. . . . Even after taxes, 27.6 percent of increased earnings go to families in the top 40 percent of the income distribution.”
So minimum wage increases grow government, make the rich richer, and still allow liberal politicians to demagogue the hell out of poor voters by falsely claiming they’re putting more money in their pockets. In the longer term, living wage laws and other en vogue liberal policies are likely to transform one of America’s best cities into Detroit on the Puget Sound. It would be nice if there were a stronger political counterweight in our overwhelmingly Democratic cities, but the best hope for conservatives regaining a foothold in urban America might be simply to stand back and let liberal economic policies work their magic.
“... what happened? Seems like the California locust moved there.”
Well, that’s true, but only because the locust saw it as easy pickings. California liberals are voracious, but they are also basically lazy. Hence, they will always migrate to an area they see as already “buttered and seasoned.”
how does it make the rich richer?
Aw, Man! If they start messing with our booze, there’s gonna be BIG TROUBLE.
Oh, wait...Government TRIED that once before, didn’t they? ;)
Seriously. WHAT is it going to take for people to wise up and realize that Government is the ENEMY OF THE PEOPLE?
Yeesh!
Don’t know for certain, but I suspect it has to with aircraft navigation, where you ‘fly the needle’.
So when you’re “on the needle”, you’re on course.
Wait til Starbucks Seattle installs robot order machines and organic extra lite soy macchiato does not compute. LOL!
You know, I’m hopeful. :)
Messing with people’s Cuppa Joe in the am MAY be the one and ONLY thing that will wake people UP to what is going DOWN!
One can hope. :-)
Every dime min wage goes up raises the cost of a loaf of bread by at least 2 dimes. All that savings you struggled to put back all those years? Forget it. Every dollar just decreased by at least 2 dimes. Expect a raise on your salaried job to keep up with inflation? Hahahahaha, the joke is on you. Same if you’re getting a retirement check. Oops, that monthly check’s buying ability just got whacked all thanks to whiny unskilled burger flippers who will be making more than you and your hard earned retirement check.
There’s always this: https://www.youtube.com/watch?v=NNq28DDjlA0
That makes no sense, since payroll taxes go to the feds and state, not local government.
Minimum wage may be the issue de jour, but the problem started with the Obama regime...and cash-strapped folks don't want or don't dare to eat out regularly in quality restaurants as they used to.
Leni
Where I live, they're downsizing portions and quality. That sucks. I'd rather they be honest and just raise the prices. For example, one noodle house I go to used to have "Regular" size and "Large" size bowls of noodles, with a price difference. The new menus did away with the "Regular" option, and only show the "Large" size at the previous price of large. However, what they serve is the regular portion, which is now at the large price! Fewer noodles and ingredients, smaller bowl, effectively more expensive soup. I bought once with the new menus, and won't be returning because I'll find another restaurant that serves what I desire. There's a pizza restaurant my family has been going to for nearly 70 years. They continually raise the prices, but the quality and portions remain the same, so I and my family will continue going there.
Let them eat dirt..
I don’t disagree. As we’ve seen ALL ACROSS THE LAND, ‘Stupid’ can’t be legislated. Ever.
I give up trying to figure out how Americans can allow this sort of thing.<BR
They have so many reasons that are completely illogical and perverse it’s insane.
“Oh, everything is just peachy but I’m tired of the restaurant business”.
Bet they start up again somewhere near without the wage mandate.
50+ years of Socialist Indoctrination through our Publik Skrool System will do that to a generation or two or three.
No need to think or reason; Mother Government is here for you!
I would like all of us to invade the Facebook thread about this and just blow the little commie minds for a few minutes then leave. lOL! They are still flaming me from lunch time.
Let see how long this will take to isolate Seattle then watch it dry up. As city fathers complain about nearby communities profiting from their collective stupidity. Or complain about an underground economy that springs up like mushrooms run mostly by illegals under cutting that minimum flooding into their city and going out of control.
Won’t be just restaurants it’s the tourist industry as a whole. Kiss the convention business goodbye. Nobody will want to go there because its too expensive and not worth it. If your a Senior living there you’re so screwed.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.