There is no one on the planet who would like to see his fellow man and woman find productive and meaningful employment at wages that allow for the complete satisfaction of every need and want more than I do.
Over the arc of my life, I have spent my fair share of time thinking that the path to that goal could come from legislation. I even led a group in Portland, Oregon fighting against Wal-Mart in SE Portland, and did so because I felt that their wage scale was unfair to employees. I no longer think this is the case. I actually believe that the minimum wage, however well intentioned, is a significant barrier to upward mobility, and a major contributor to the school-to-prison pipeline.
I would like to tell you a personal story that I think embodies this reality. I have told it to a number of friends, and it has opened many eyes to a different point of view. I have been in a 20-year friendship that started through the Big Brothers program of San Francisco. My Little Brother is from the Sunnydale Housing project in San Francisco and I have known him since he was 8 and I was 22. My Little Brother was, and still is, a compassionate and intelligent young person. When he was in high school he was one of the top high school basketball players in the state and was being recruited by every major college program in the country.
During the summer between his junior and senior year, with too much time on his hands, he participated in an armed robbery. He was promptly arrested. He was 18 at the time, and this was a felony, so his entire future went up in an instant. He never went to college and has been in and out of prison a couple of times. A few years ago, I hired him to work as a laborer in my construction business. The budget allowed for it, and I wanted to help him out, so I started him off at $15 an hour. This created a fully burdened hourly wage to me of around $27, before covering profit, overhead, and training. For the non-employers out there, there are a LOT of extra costs that go into hiring someone above the headline gross wage.
Despite our 15-year relationship at that point, he routinely called in sick, did not take instruction well, consistently was on his phone during work hours, and in any given day delivered far less value than the $216 he cost me. He confided in me that right up to the day I offered him employment, he had been selling crack as a way to make some money. He also let me know that his take home pay, as a work a day crack salesman, was not typically more than the net pay I was offering. He did believe that the risk adjusted higher wage and freedom (my words) selling crack was not worth it anymore and wanted to get his life on track. Despite his actions, it was clear that he appreciated my help up. I kept my Little Brother around for nearly 6 months enduring almost every possible thing an employer could with a no/low skill employee. Had there been no prior relationship, a reasonable man would have found reason to fire him on a nearly daily basis. One day he came to work with a semi-automatic pistol that I found, and I had no choice but to fire him on the spot. Otherwise he might still be working for me today, as I was making a bit of progress with him, and I felt really good about that. This has now been about 18 months ago, and, sadly, I have not heard from my Little Brother since I had to let him go. I suspect that with no other reasonable employment prospects given his history, he is back in prison or selling drugs.
The point of this story is to give you something to think about other than the potential upside for some employees with a higher minimum wage. Imagine, if you will, that during that fateful summer my Little Brother was able to keep himself occupied at a job with a wage commensurate with his ability to deliver value to an employer? If someone, somewhere, had the economic freedom to employ him at that wage, teach him some useful and transferable skills, keep him off the street and focused on a bright future. Is it reasonable to think that he might have accepted a low wage opportunity at age 18? Remember, he was netting about $12 an hour after taxes as a 25-year-old, and happy to have the opportunity to get his life on track. Maybe $3, $4, or $5 an hour as a teenager PLUS learning to show up on time, sweep, stock, have a good attitude… would have kept him off the street that day, resulted in no prison record, and potentially a college degree. Could that have happened? I believe so. How many other guys like my Little Brother are out there on the street or in jail because we have priced them out of the labor market? Just in the last month, right here in Berkeleyside, we read a very similar story of a young Berkeley High athlete that is seemingly now on a similar path to my Little Brother. What a tragedy!
Now, also imagine if ex-felons, without the benefit of a Big Brother in a hiring position, could find work at a wage that reflected their ability to deliver value. Prison Industries can employ people legally at between $.30 to $.95 an hour. Why can’t we let people have that kind of opportunity on this side of the wall, and learn skills, establish a track record, and reduce the risk to employers so that one day maybe they can deliver $19 an hour in value as productive members of society? Could the Prison Industrial Complex be behind the minimum wage increase story? Probably not, but can you now see how much they benefit from this arbitrary price floor? Do you really want to be a part of raising it with all the carnage it could bring to our young people?
I know through personal experience that the kids that we read so much about in the crime blotter in Berkeleyside are good people, and can, if provided the opportunity to learn and grow, deliver far in excess of $19 an hour of value to an employer. Sadly, they will never get that chance if they can’t first learn how to deliver $8, $10, $12… As with any legislation, there are tremendous unseen consequences no matter how well intentioned the policy may be. This at-risk youth story defines just one of MANY related to the minimum wage debate. I encourage the Labor Commission and the City Council to really reflect on this topic before they continue down the path to $19. This really is a matter of social justice. You guys just aren’t looking at it from every angle.
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