Minimum Wage Is A Curse, Not A Blessing by Nathan McDonald, Sprott Money
Central planners and politicians have no clue when it comes to creating wealth. They are incapable of creating growth and a productive economy, despite what they would have you believe.
The government cares about one thing above all else: expanding itself and its power. One of the methods in which they have done this through history, up until the point in which it becomes so bloated it implodes on itself, is through the expansion of social welfare programs.
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In the West, a large portion of the population now finds itself stuck in this very cycle, the social welfare cycle, which is the doom of all established economies – the cycle of “why should I work if I can make more money sitting at home?”
The logic is sound; you can’t entirely blame those for thinking this way, as it is only human nature to take the easy way out, no matter the cost to our future or the wellbeing of generations down the road.
The biggest challenge for government is how to expand this dependant class, while making it seem to the rest of us (who support the welfare class) that this is not their intention. One stealth method of achieving this end goal is through the nefarious “minimum wage.”
To the naked eye, minimum wage is a great thing. Yet to those of us who are awake and understand basic economics, we know that this has been one of the great blights in the West and has hollowed out our manufacturing base and shipped untold jobs overseas.
Minimum wage forces companies, such as McDonald’s, to come up with newer and newer solutions to replace humans in the work force, pricing people out, as politicians raise the bar ever higher, making it less and less feasible to hire people to do jobs. It becomes cheaper and cheaper to replace workers with machines.
In some cases this has led to great innovations, yet in others it has been a great detriment to mankind, putting many out of the workforce and causing vast poverty in many sectors where there was once untold wealth.
This “pricing out” of mankind is happening in many industries, with McDonald’s, for example, making it very clear that they will be replacing much of their workforce with machinery as the minimum wage price goes up. This will add no increase in service to the customer, but will place much more stress on our already fragile system.
I have seen this first-hand. In Canada there are numerous “self-checkout” McDonald’s kiosks, where only one staff member can be seen on the front line, and the rest are represented by machines with which you fill out and pay for your own order, interacting with barely anyone during your experience there.
This is the way of the future, as politicians continue their war on the working class, while “acting” like our saviors and demanding a raise in the minimum wage. A raise – as anyone who understands economics 101 will understand – that will not bring more prosperity, but only inflation, wealth destruction, and misery. Good job, mission accomplished.
The views and opinions expressed in this material are those of the author as of the publication date, are subject to change and may not necessarily reflect the opinions of Sprott Money Ltd. Sprott Money does not guarantee the accuracy, completeness, timeliness and reliability of the information or any results from its use.