As you know Congress is currently debating a coronavirus stimulus bill that will spend about $1.9 trillion. 9% of the spending goes to coronavirus related activities. The rest of it is for unrelated spending or programs that have nothing to do with coronavirus. This includes a $15 mandatory minimum wage. Even though it has been well documented that this program fails miserably, many politicians support it because it's popular with the uninformed masses. We have seen it fail in New York, Seattle, Tacoma, and Santa Fe. It not only has put people out of work but it has increased the cost of living for everyone. Which defeats the purpose, doesn't it?

Let's look at the reality of what people are making. Walmart is often a target for people like Bernie Sanders and Alexandria Ocasio Cortez, who love to point out that the Walton family is filthy rich and the average pay of the hourly worker is less than $15.00 an hour. But is it? It's a little bit hard to find current data using Google or Bing. but don't worry I've put in the elbow grease to find it.

Currently the average hourly worker at Walmart, with little difference in rate of pay between full time and part time, makes $15.02 per hour. If you had the benefits they receive, the hourly rate of pay is just below $20 per hour. Among the benefits hourly workers receive are health, dental, life insurance; retirement plan; tuition reimbursement; Parental leave; Paid time off; and quarterly bonuses. That bonus average is about $3000. 75% of Walmart's management started in their organization as hourly employees. If it's such a bad place to work and they don't pay their employees, why do people stay? By the way, the average annual salary for a Walmart manager is $175,000.

I understand not all employers can provide the benefits that the Waltons do to their employees. But looking at different industry websites such as Indeed and Pay Scale, the vast majority of hourly workers do not remain at minimum wage for very long. Most hourly entry level positions are given to people with no skills. They work in jobs that do not require a lot of skill but are still given raises that take them above minimum wage within six months, most often simply because they show up on time and put forth good effort. Not necessarily because they have developed some technical skills.

Let's bring that a little closer to home. I know a number of people in the restaurant industry, both employers and employees, in our region. You would be surprised how many wait staff in smaller restaurants make over $40,000 a year. The popular perception however is that they are vastly underpaid because they don't even get minimum wage. I would bet that most people who share this perception of low pay for wait staff and bartenders are the ones that do not tip very well if at all. Kitchen staff may not make quite as much but they are certainly paid north of $25,000 a year. If you are a chef that's often significantly more.

In talking to many business owners and looking at the experience of those that have tried a $15 minimum wage or even a $12.00 minimum wage, a significant portion of those people who need the jobs the most will lose their jobs. Companies that have the ability will move operations to a different location. Those who claim that businesses can pass the cost onto the consumer are once again proven wrong by history. You don't want to pay $25 or $30 for a hamburger and fries but that is exactly what happens because it's not only that business owner who must increase expenses but every business from whom they purchase goods or services must increase their costs as well.

Everyone loses in this equation. Some lose their jobs, business owners see reduced sales, and some go out of business because the consumer is not willing to absorb the cost increases that must be passed on. Others close their business because even if they tried not to pass the increased cost onto the consumer their return on investment and effort decreases to a point that it's not feasible. Unfortunately as usual, the only winners in this are the politicians who can convince a significant portion of the population that they not only care, but have taken action to help out those in need. This helps to keep them in power. Which for them, isn't that their primary goal?