What's more American these days than using government to tip the scales in your favor?
On Tuesday, Costco CEO and President Craig Jelinek came out in support of the Fair Minimum Wage Act of 2013, which aims to raise the federal minimum wage to $10.10 per hour, then adjust it after that for inflation.Now...Murray Rothbard smashed the minimum wage law in one succinct paragraph:
In truth, there is only one way to regard a minimum wage law: it is compulsory unemployment, period. The law says: it is illegal, and therefore criminal, for anyone to hire anyone else below the level of X dollars an hour. This means, plainly and simply, that a large number of free and voluntary wage contracts are now outlawed and hence that there will be a large amount of unemployment. Remember that the minimum wage law provides no jobs; it only outlaws them; and outlawed jobs are the inevitable result.The Costco CEO then tells us about his company:
"We pay a starting hourly wage of $11.50 in all states where we do business, and we are still able to keep our overhead costs low."So what?
Who cares that Costco's starting wage is $11.50/hr?
Does that change the economics of the minimum wage law? If Rothbard were still alive, would he have to retract his statement because of Costco's pay scales?
Not at all.
So, how could Costco benefit from their CEO publicly sticking his nose in on this issue? HuffPo says (my emphasis):
Costco has a reputation for paying its employees above market rate, with the typical worker earning around $45,000 in 2011, according to Fortune. Walmart-owned Sam's Club, in contrast, pays its sales associates an average of $17,486 per year, according to salary information website Glassdoor.com.Ahaaa!!!
Stick it to the competition!
This is the same reason that Unions are traditionally in favor of minimum wage hikes. Screw the non-union individuals who are willing to work for lower wages!
Or as Bob Wenzel has said to me, "Well then, if the Costco chief wants to pay currently unemployed people more than the minimum wage, he should start doing so now. Let Costco hire them. What's that? He doesn't have jobs for them? Oh."
So the Costco CEO is just playing the game. The government billy club is there...why not pick it up and beat your competition over the head with it?
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