Dan Price apparently had the best of intentions.
He wanted his employees to stop worrying about petty problems like their mortgages and car payments, so Dan one day called a company meeting and announced that going forward, everyone would receive the same pay.
Even his own salary would be slashed from seven figures all the way down to $70,000 — the arbitrary “minimum” (and maximum) wage for every employee of Gravity Payments.
Now everyone should be happy, right? What could possibly go wrong?
Well…everything. First, Dan’s two best employees quit.
“He gave raises to people who have the least skills and are the least equipped to do the job, and the ones who were taking on the most didn’t get much of a bump,” said former Gravity financial manager Maisey McMaster. When she complained, Price called her selfish and naturally, she resigned.
Web designer Grant Moran observed, “Now the people who were just clocking in and out were making the same as me,” and he also quit.
Then Dan’s big brother filed a lawsuit against him that may bankrupt the company. However, “We don’t have the margin of error to pay those legal fees,” Dan told the New York Times.
Well, Shazam! Apparently it never occurred to Mr. Price that there might be some blowback to his plan to redistribute the wealth of the company’s investors by ludicrously increasing their salary expenses.
This story should become the classic case study that illustrates the value of capitalism and a free market system.
It would be easier to feel sorry for Mr. Price — he’s renting out his house, no longer able to afford to live in it himself, after all — except his own liberal arrogance brought about his current misfortune.
Price blamed his Christian upbringing and good intentions when he spoke to the Times for their article, but God only asks for ten percent of the gross.
Question: the minimum NBA salary for a player with 3 years of experience is just about $1 million — should that be the same salary paid to LeBron James? Of course not.
No disrespect meant toward Anderson Varejao or Joe Harris, but fans aren’t buying Cavalier tickets to watch those guys ride the pines. They are buying tickets and wearing t-shirts with LeBron’s name and number on them. Whether you’re a fan or not, Mr. James draws thousands of fans to the game.
It sounds perfect and wonderful to say everyone should receive the same salary…except for the fact that not everyone deserves the same salary. People should be rewarded according to their efforts and ability.
If everyone is paid the same regardless of how hard they work, what is their incentive to work hard?
The new hire who is basically useless and the CEO of the company shouldn’t receive the exact same pay. That isn’t Christianity, or capitalism. You can’t sugarcoat it…that’s just plain stupid.
And now Mr. Price is paying a steep price for his foolish social experiment. He may even lose his company — due to legal fees. Pretty soon nobody will be making $70,000 per year.
The real minimum wage is zero.