But, Bob Cheapo, the employer, only pays $7 per hour and leaves Hardworking harry, about $800 short on that. So Harry doesn’t get health insurance and car insurance. Who picks up the difference? Taxpayers and whoever he hits in his car.
Why is it Bob Cheapo's responsibility (or the responsibility of anyone else for that matter) to make sure Harry is taken care of? As capable adults in a free society, aren't we responsible for taking care of ourselves?
Put yourself in Bob's shoes. You are an employer. There are certain small tasks that could be done to improve your business. The work is nothing too difficult- any person could do it, really - it's just that you don't have the time to take care of it yourself. You carefully calculate that getting these tasks done will add about $1200 each month to your business. But you also believe a person can not live decently on less than $2000 a month.
What is the most that it would make sense for you to pay to the person you hire? Probably something close to $1200...after all, you started this business primarily as a way to make money. Pay any more than $1200 and you are actually losing money by hiring someone. If you pay a "living wage" you would be paying out $800 more each month than you are taking in, all things equal.
In effect, by paying a "living wage" in this situation you are effectively giving the person a charitable donation. Charity is nice, but is that something we should force on other people?
And if charity should be a legal obligation, how should it be imposed? What you are proposing is that whenever an employer hires someone, the employer should be shouldered with that obligation because it is the employer who must then pay enough to support this person.
But why place that burden exclusively on the unfortunate employer, just because some job applicant thought his business would be a nice place to work? It's not Bob's fault that this employee has bills to pay! If we really believe that people have a right to have all their basic needs met by some third person, shouldn't that burden be shared equally across society in the form of taxation, rather than shared unequally by making some employers the de facto parents of society's less productive members?
Lastly, supposing that we really do have a "right" to a "living wage" and that the proper way to protect this right is by forcing employers to pay those wages...what do you think the real world result of a living wage law would be? If businesses were faced with losing money by hiring less productive people, do you think they would be more or less willing to create new employment opportunities? If workers at any job were guaranteed enough to live comfortably as long as they stayed employed, do you think starting workers and members of the underclass would be more or less productive? Would kids be more or less likely to study hard in school?
“It’s not Bob’s fault that this employee has bills to pay! If we really believe that people have a right to have all their basic needs met by some third person, shouldn’t that burden be shared equally across society in the form of taxation, rather than shared unequally by making some employers the de facto parents of society’s less productive members?”
Now you have finally hit the nail on the head. It costs something for the basics of human life. Lets assume $2,000 minimum a month for purposes of this argument. If the employer does not meet that amount, the taxpayers will pick it up, because most of us don’t want people sleeping on park benches, starving to death, and going untreated for medical problems.
There is a whole class of the poor called the “working poor.” A lot of these people work for companies who could pay more, but choose not to and let the rest of us pick up the tab. It wasn’t always this way. Min wage used to be livable and our country wasn’t doing so bad. Then we let it slide.
Gov’t has no business setting all wages for all people. But setting a lower limit, is just good sense. As an accountant in a former life, the costs are there whether you make the journal entry or not.
Now as to cheapo, I have more sympathy then you think. If he is a one man show, minwage could indeed affect him more than say, Walmart. But if all had to live by the same rules, there would be more demand (>MPC)and Cheapo would probably have more demand for his product.
parsy, who has to stop in a minute to finish read Superman vs. Spiderman from 1976