Target Voluntarily Raises Their Minimum Wage… Guess Why?

“The rung of a ladder was never to meant to rest upon, but only to hold a man’s foot” -Thomas Huxley

by R. Brownell

The invisible hand of the market has swayed again, this time in a way which will excite those looking for better wages in the retail business. Target, the nation’s second largest retail chain, recently decided to raise its current minimum wage to nine dollars per hour.

Many are saying it’s a way to ensure Target will not lose employees to Wal-Mart, who made the jump to wage increases earlier this year. This type of story shows how competition, something most progressive liberals often say is destructive to workers, actually demonstrates how businesses and their employees thrive in a healthy competitive environment. This is a breath of fresh air to see these two retail giants willing to make a call so monumental, plus it shows something even more significant about the country’s current minimum wage debacle.

Recently the cry for higher wages have been a rallying point for Democrats, who wanted to use power at the federal level to raise the current minimum wage to twelve dollars. Contrary to the robber-baron stereotypes you learned about in your public school history textbooks, minimum wage is, and never has, been intended to be a living wage. Minimum wage is a way in which businesses can hire typically younger, inexperienced people, and train them on the job while working on lower skilled tasks, so eventually they could work their way upwards.

As the nation’s unemployment rates still waver, the Great Recession didn’t help at all when people who were let go from their careers went from working in a corporate office to working behind a grill and fryer. The state of despair the country was in caused a large number of reasonable Americans to advocate for a short-term solution to a long-term problem. The issue at hand that people need to understand is that it is wrong to have the government fix wages that are supposed to be left to the free market.

A current case study proves the effects of uneducated decisions made by politicians and bureaucrats is the present state of Seattle, WA. Early last year, the city council decided to raise the minimum wage to fifteen dollars. The question at hand is why did such a prosperous metropolitan choose to make such a drastic decision? The answer is simple: they elected a socialist….literally a socialist.

In January of 2014, the City of Seattle swore in a member of the Socialist Alternative Party, former college professor Kshama Sawant, to the Seattle city council. The former educator, with no experience in economics, used her reputation to create a youth populist movement which shared her sentiment. Sawant was successful in rallying voters to not simply vote for her, but to vote for her lone promise, a living wage of fifteen dollars. Needless to say, winning more than enough of the votes to gain a seat, the city council voted for her wage proposal immediately.

RELATED: Oakland Raises Minimum Wage, Destroys Childcare Market

As soon as the bill became law in the Emerald City, businesses already started to see the ramifications. A February, 2014, report from the Seattle Times, shed some light on this matter as it all started creeping in:

“At the Clarion Hotel off International Boulevard, a sit-down restaurant has been shuttered, though it might soon be replaced by a less-labor-intensive cafe…

Other businesses have adjusted in ways that run the gamut from putting more work in the hands of managers, to instituting a small “living-wage surcharge” for a daily parking space near the airport.”

Small businesses aside, Seattle saw its first casualty which made up 20% of the local workforce, Cascade Designs. The company recently decided to move 100% of their workforce to Reno, Nevada, where they could escape the harsh standard Seattle put on them and many other businesses. If that wasn’t enough cause for worry, it has been in the wind for a while now that if minimum wage began to increase, specifically for fast food employees, places like McDonalds might opt out of the friendly face behind the register, and instead put in their place a customer service robot. Why in the world is this whole thing such a big deal again? Because government thought it could meddle in the private sector, and now their good intentions are hurting the people that they wanted to help.

Austrian economist F.A Hayek once said that “the curious tasks of economics is to demonstrate to men how little they really know about what they imagine they can design”. Target and Wal-Mart were able to raise their minimum wage standard because perfect timing met perfect opportunity. Government raising minimum wage is a sly way of telling those primarily in the retail and fast food industry to pack their bags, because unemployment, outsourcing, and even robots are right around the corner.

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