To paraphrase the timeless Gene Autry, the Donkeys are back in the uneconomic saddle again.
The lead (official) Democrats (Madame Comptroller Carole Keeton Strayhorn still does not count) in the Gubernatorial pack (as both their checks cleared), Bob Gammage and Chris Bell, were out on the stump pitching some fiscally damaging woo to their equally uninformed base, and a member of said rooting party with a pen was there to record it for bad political and journalistic posterity.
There are very few things that exhibit someone's either woeful disdain for the free market system, or glittering ignorance of rudimentary economics, than when he begins to pontificate on the merits of raising the minimum wage.
This dalliance in fiscal fantasy operates under the chimeric assumption that increasing the cost of producing goods and services, which elevating the mandated minimum certainly does, will not cause a responsive rise in the cost of these goods and services whence they are ready for market.
We addressed this staggering bit of pecuniary inanity in conjunction with our response to the Austin Press Corps' once upon a time annual enamor with chastising Lone Star Elephants as cheap whence the annual aggregate state-by-state teacher wage comparisons was released by the National Education Association (NEA).
Texas always finishes in the bottom third, for myriad reasons having nothing at all to do with Republican frugality, and each time the Media latched on to the November NEA release with all four appendages and immediately went on Elephant safari therewith.
On December 2nd, 2004, we humbly submit that we blew up the Media's full court press on both teacher salary rankings and the minimum wage.
We would like to think we played at least a small part in removing one club from the Press' bag; their yearly November NEA assault came to a screeching halt and was not to be found again in the Lone Star journalistic litany in 2005.
But like a bad penny, or 515 of them per hour, the minimum wage canard is back with all the vengence a slate of Texas Democrat Gubernatorial candidates can muster (which is to say, not very much).
So we reproffer now, for your reperusal, "Context Required", to once again put this bit of asininity in its place.
Context Required
When analyzing NEA salary charts and proffering federal legislation
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National Education Assaulted |
Newsrooms throughout Texas gave their annual Pavlovian response to the nation’s largest teachers union (National Education Association [NEA]) releasing their state-by-state teacher salary comparison. They know that Texas always ranks in the bottom third thereon (this year it placed 32nd), and as soon as the light goes on they begin their frenzied dining on Republican legislators, excoriating their education compensation policies as miserly, short-sighted and mean.
You cannot make someone worth X by making it illegal to pay him anything less than X. |
This is example number 132,542 this month of the mainstream Media and the Left’s woeful inability to understand even rudimentary economic theory. The problem with straight state-to-state comparisons of aggregate dollar figures is that a dollar here does not always get you a dollar there.
Legislative case in point: the minimum wage. To compel an employer in Macon, Georgia to hike his proffered hourly employee compensation to that paid by an employer in Boston, Massachusetts is positively silly, because a dollar in Georgia is worth a whole lot more than is a dollar in Massachusetts.
It is fundamentally bad economics to artificially set the price of anything in the market place. Ask Richard Milhous Nixon about the phenomenal success he had with wage controls in 1971. Better yet, ask John Maynard Keynes himself.
Employers are purchasers of labor; when you artificially raise the asking price, employers can do less buying of the product. Result: higher unemployment, as the bosses are able to afford less people to bring on board to boss around.
And we have always thought that one has to be a fabulously pathetic employee if one must rely on the United States Congress to get a raise.
In most parts of the country, the minimum wage is pretty high for the work required in return. How much motivation for advancement does this inspire in those thusly employed? Think about precisely this the next time it takes you thirty minutes to escape the drive-thru at a McDonald’s.
You cannot make someone worth X by making it illegal to pay him anything less than X.
And because the three-toed sloths that are so employed harbor this outlook on the tasks and compensation at hand, the minimum wage also serves as a maximum wage. I know from personal experience in junior high school, there is virtually no way to get a raise above the federally mandated minimum.
The payers cannot afford to pay the good employees more, because they are forced by the Federalies to pay the schlubs to their right and left a ridiculously and artificially high wage.
Result: the good employees leave, and the employer is left only with people who drool on themselves, and having to pay each of them $5.15 an hour for the privilege of watching them do it. Again, think of this missive as you idle in your automobile awaiting the unprompt delivery of your Big Mac.
And to recoup the conscripted losses incurred as a result of the minimum wage, employers must raise the cost of the goods and services they provide, which again prices the minimum wage recipients out of purchasing them all over again.
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The Dynamic Minimum Wage Trio |
Only this time there are less of them, and conversely even more unemployed, due to the artificial wage pricing many of them out of jobs, who have no money to purchase anything.
What the minimum wage actually is is nationwide collective bargaining, as if we are all part of one giant union. And, as in unions, pay based on mandated across the board rates rather than individual merit serves as a disincentive to excel.
Why do more than the next guy, when you will all be going in to renegotiate for one flat rate the next time around? In addition, the guys on the line will hate you for going above and beyond, because you will be “making them look bad”. Now there is a recipe for productivity.
Unions and the minimum wage: richly rewarding mediocrity for over a hundred years.
At this point, Gentle Readers, you are probably screaming through your monitors, with voluminous words along the lines of “You idiots; I thought this article was about the NEA assessments!”
Well, your patience is now to be rewarded. We will even tie it into what you just slogged through above, to make it up to all of you.
As previously stated, Texas came in 32nd in teacher salary last year, with an aggregate disbursement of $40,494 per annum. And on the surface, 32nd out of 50 appears to be nothing about which to jump around.
But when one factors in the cost of living in the 32nd ranked state, things suddenly seem much better for the educators of Texas.
California leads the charge in teacher pay, with an average annual recompense rate of $58,287. On first glance, the almost $18,000 remuneration deficit we are running with the Golden state appears drastic.
But comparing cities of similar size from the respective states, with corresponding adjustments for the cost of living in the respective municipalities, reveals a much better situation for the teachers of Texas than anyone in the Media has indicated.
According to the National Association of Realtors Salary Calculator, the $58,287 paid to an educator in San Francisco (population 751,682) is equal via cost of living adjustment to a salary of $24,932 in Austin (population 672,011).
Second in summative teacher pay is Connecticut, at $57,337 per year. But a teacher paid that in Stamford (population 120,107) would get COLA equivalent pay of only $26,759 in Waco (population 116,887).
And if you want to go with super huge cities, you can look at the New York borough of Manhattan (population 1,537,195) paying the averaged sixth highest salary at $54,054, which carries the economic weight of a $20,090 salary in Dallas (population 2,009,690).
Can one sense the trend here? The 32nd ranked teacher salary has twice the effective purchasing power here as do the salaries from those at the top of the NEA list there.
But the newsrooms yammering about the listing today failed to provide this aspect of the story, because the details would deprive them of the opportunity to yet again backhand Governor Rick Perry and the Republican legislature.
Never let the facts get in the way of a good beating.
And why is it that Texas’ “lower” salary does so much more for it’s recipient than the “higher” salaries do for their earners?
Could it be the business friendly, job friendly, low tax environment the state’s elected officials have rigorously fostered, which serves as a magnet for companies wanting to expand their productivity?
And their expansion means more jobs, more promotions and accompanying higher salaries. Salaries that go, as we have seen, much farther here as compared to there. And said increased fiscal distance creates more and elevated economic activity, which creates more jobs, which … .
Can one sense another trend, this one cyclical? Capitalism works, every time, provided it is allowed to do so.
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We Were Unable to Identify This As Gammage or Bell Prior to Publication |
So, in short, it’s not what you get, it’s what you can do with it once you get it.
All of which ties in to our Friday excursion into educator compensation, does it not? These are not complicated things. But the simplicity of it is either lost on these Democrat Gubernatorial candidates and the Press who loves them, or intentionally lost in the shuffle in order to again fatuously batter the man in the Mansion and his Elephantary brethren.
Whichever it is, it is pathetic on stilts.
