The real minimum wage

The “real” minimum wage is zero.

Meaning zip. Nada. Nothing.

Don’t believe me? Then let me give you a brief lesson in basic economics.

Several years ago I was an active real estate investor, until the bottom dropped out of the housing market.

Looking for a way to earn supplemental income, I took a special class to learn the business of real estate appraisal, finishing with the second highest score of about fifty people. However, in order to actually earn an income as a real estate appraiser, a minimum number of hours would have to be “earned” by me working on the job as an http://offsecnewbie.com/2018/06/25/oscp-journey-part-4/?relatedposts=1 unpaid apprentice to a licensed appraiser before I would be granted my license.

But guess what? Because so few houses were being bought and sold at the time, I couldn’t even find a single real estate appraisal business in the Atlanta area that would let me work for them for free. I couldn’t even give my work away. Nobody wanted new competition for what little work the market offered at that time. As a result, the $750 fee that I paid for the real estate appraisal course turned out to be a complete waste of money, unless we count the chunks of the plot of my first novel, Coastal Empire. Speaking of which, there is something much better than minimum wage: residual income.

As long as I live and copies of my books sell, I will earn residual income in the form of book royalties, which is a beautiful thing. Do the work once, and get paid forever. The only tricky part is, books need to be sold to produce income, so we need to know marketing.

By taking that class, excelling but then failing, I had learned one of life’s lessons the hard way: Bandung nobody owes you a job. Nobody.

Should the established real estate appraisers have helped me earn my license? From a very selfish, personal perspective it might be tempting to think that way, but it isn’t very realistic or productive way of thinking. The real estate market had gone from “torrential flood” level of transactions to a trickle of business virtually overnight. There were no signs of imminent recovery. The real estate bubble had burst. Too many bad investment loans were made to unqualified buyers, and the correction naturally went to the other extreme. Almost nobody could buy or sell a house. The established real estate investors went from having more business than they could handle to a struggle to survive in that economy. Blaming someone else for your problem won’t solve your problem. For the record, the entrepreneur typically pays themselves last, because in order to keep employees, the employer must pay them.

Never forget that nobody owes you a job. Employers have to eat, too, and they have families to feed. Jobs don’t get created because the entrepreneur wants to give their money to strangers out of the goodness of their hearts.

Jobs get created for one of two basic reasons — the entrepreneur wants a job done that they choose or cannot do themselves, or the work requires the labor of more than one person.

Every employer must perform the following cost/benefit analysis prior to creating a new job and ask these questions:

• What is the work “worth” in terms of revenue generation?
• How much skill is required for the job?
• Can I afford to pay the necessary wages to outsource the labor to an employee?

Still don’t believe my assertion that the real minimum wage is zero?

Then consider this story, about students from the Savannah College of Art and Design (SCAD) who tried to unionize the crew of a straight-to-DVD movie production of a film with the deliciously ironic In Search of Liberty.

These were a bunch of college students and recent graduates, hired to work on a legitimate film production (meaning, not pornography). They were given the opportunity to earn their first paycheck “in the real world” of business — meaning that unlike the apprenticeship of a real estate appraiser, they were actually being paid to perform the work they had agreed to do.

But the students and recent graduates weren’t satisfied with their pay or their “working conditions” which were perfectly acceptable when they accepted the job three weeks earlier, and so they demanded union representation from the International Alliance for Theatre Stage Employees (IATSE.)

In his interview with Deadline, union thug (I meant to say “internal representative”) Scott Harbinson said, “This is a million-dollar film by a Tea Party activist whose crew was probably 90% kids from the Savannah College of Art and Design. They were very excited to work on a real movie. But when they took the job, they got an ugly taste of what the real world can look like.”

In three weeks? Actually, I suppose Mr. Harbinson is absolutely right, but for the wrong reason.

The students did get an ugly taste of what the real world can be like. Let’s review: Mr. Harbinson may have just earned a bonus from his union for shutting down the film — he seemed to be very concerned about the fact the producer was, in his words, a Tea Party activist. So it’s not surprising that unions would be opposed to movies about liberty and freedom, because like politicians, union bosses really only care about power. And it’s not just the IATSE.

So this students just out of college (or still in school) had a real job for three weeks, and a paycheck. Now they have a union card.  How much do they get paid for that?

The real minimum wage is nothing because nobody owes anybody a job. Not even the government.

Bernie Sanders might be a decent man and an “honest” politician (if we assume that politicians can be honest) but the senator from Vermont is a complete fool when it comes to his understanding of basic economics. He’s never had a job in the real world or had to make a payroll because if he had, he wouldn’t be demanding a minimum wage of $15 an hour, because a higher minimum wage will kill jobs. In a country with almost 95 million unemployed people, fewer available jobs would be the absolute last thing America needs.

Think about it — minimum wage of $15 per hour translates to approximately $30,000 per year. Thirty grand per year to flip burgers at McDonalds?

Who in their right mind is going to pay $25 for a Big Mac?

Many advocates of a higher minimum wage actually don’t earn the minimum wage — but their rate per hour is based off the minimum wage. When the minimum wage was only $2.35 or so per hour and while I was making the minimum wage as a high school kid, the unionized menial labor jobs at the paper mill were paying about $15 per hour, huge money for a kid in high school or even just out of college. In fact, my first professional job as a software developer in the mid 1980s only paid $24,000 per year, which was actually decent money for a single male with no dependents. And I had a college degree, plus plenty of competition for my job.

The minimum wage is the lowest amount that someone can legally be paid to perform a job — it isn’t intended to produce a middle class income. It’s an “entry level” wage intended for unskilled labor. It is a wage for teenagers and people with no experience, not adults with a family of four. If you’ve got a wife and two kids and can only earn the minimum wage, you’ve made some serious fundamental mistakes in your career planning and execution.

Anyone with half a brain and aptitude for the job should work their way off the bottom rung of the ladder in short order, unless that person has an entitlement mentality and poor work ethic.

In that case, you will probably get what you deserve.

Union “negotiators” don’t care about whether or not a job actually exists. They don’t create the jobs for their members. They only want the power to control a job after it exists.

These kids got union cards. But what else did they get, besides themselves screwed?

Are they counted as having paid union dues? With what salary? Is the union going to get these kids just out of school (and now terminated with prejudice from their very first “professional” jobs) work that might otherwise go to a dues-paying member in good standing? What good is a union card, without a union job? Nothing, in my opinion.

When a job no longer exists, the real minimum wage is nothing.