Restaurants Shouldn’t Serve Cheap Sandwiches

Gregory J. Welborn

z.deli

Zingerman’s Deli

Let’s take Costco.  By all accounts, it’s a great place to work offering a great environment an above-minimum-wage scale.  But for the national debate on this issue what’s missing is that they can afford to do this.  As reported by Michael Saltsman of the Employment Policies Institute, Costco charges its members an annual fee and sells products at prices which allow it to earn an average $10,000 profit per employee each year.  Your average casual dining restaurant, on the other hand, earns roughly $2,000 in profit per employee.  That’s a 5 to 1 ratio, allowing Costco to pay employees more than a casual dining restaurant.

Perhaps that’s why President Obama also referenced Zingerman’s Deli.  If ever there was a casual dining joint it’s a deli.  Casual or not, Zingerman’s sandwiches run about $12 to $14.  Most local sandwich shops, McDonalds, Subways, Burger Kings, etc. couldn’t charge ten bucks for a sandwich to someone coming off a diet.  Raising the minimum wage will not affect companies that are already paying more than the minimum wage.  But raising the minimum will have a tremendous effect on those businesses which hire the least skilled workers and sell lower priced items. 

If you force these businesses to increase their wages, they have three choices:  A) raise their prices – thus passing the burden on to customers who probably shop there because they can’t afford the more expensive alternative – or B) reduce the number of workers who have to receive the new higher wage – thus unemploying those who need an entry level job the most – or C) a little of both.

The President is on a tear to raise the minimum wage because he claims to support the little guy, but his policy prescription will hurt them most.  Those who can least afford to lose a job where they’re learning job skills will be fired, and all of them will pay more for the products and services they purchase from the businesses affected by the minimum wage.

This isn’t complicated, but there is something about the inequality between those who earn a lot and those who don’t earn much which blinds this president, and most in his party, to the laws of economics.  They are willfully ignoring the unintended, but very predictable, consequences which will devastate the very constituency they hope to help.

Beyond that blindness, there is also unwillingness to really deal with the primary cause of income inequality:  single-parent families.  It may have taken some time for statistical analysis to prove what common sense, and the good Lord, told us, but the correlation between economic inequality and single-parent families is stronger than the correlation of inequality with any other factor. 

Consider some basic statistics.  In 1960, 97% of whites, and 76% of blacks, were born to married couples.  Today, those rates have dropped to 70% for whites, 30% for blacks, and 50% for Hispanics.  On the economic side, it is equally clear and devastating.  Only 2% of children raised in two-parent families live in poverty long-term, while more than 20% of the kids raised in single-parent homes live in poverty long-term.  Numerous books and studies by credentialed, respected academics – from Susan Mayer to Charles Murray – have chronicled the decline and causes of income inequality and poverty.  Today, the causal relationship between single-parent homes and poverty is stronger than that between smoking and cancer.

Lest I be accused of racism, because I’m picking on the victims, who happen to be overwhelmingly black and Hispanic, please consider that even Harvard University – a bastion of Liberalism – produced a study showing that communities with high percentages of single-parent homes are less likely to enjoy upward mobility.

As a conservative, I am a friend of the poor and certainly more of a champion of the poor than any Liberal in the modern era.  I say that because as a conservative I care about outcomes, not just intentions.  I care about opportunity; I care about mobility; I care about people having a job – any job – in which they can have opportunity and learn the skills they’ll need to advance up the income scale.  I don’t care about how rich the rich are; I care about how poor the poor are and how long they have to stay there. 

Liberals, like President Obama, claim the greatest of intentions and many times generate the most compassionate sound bites, but they seem to care very little about outcomes among the poor, the very people they claim to champion.  Rather than making sure the poor can get a job and work their way up the income ladder, the Liberal solution to income inequality boils down to telling restaurants to stop serving cheap sandwiches.  That won’t help anyone.

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Gregory J. Welborn is a freelance writer and has spoken to several civic and religious organizations on cultural and moral issues.  He lives in the Los Angeles area with his wife and 3 children and is active in the community.  He can be reached [email protected]

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One Response to Restaurants Shouldn’t Serve Cheap Sandwiches

  1. William "Bill" Hicks April 30, 2014 at 11:10 am

    I couldn’t have said it better. The only problems lie here:

    1) Too many people are charmed by sweet sounding words, no matter how deceitful they are. They accept as fact, what they want to believe.
    2) Too few people, in positions of leadership, will choose substance over symbolism to explain the very obvious facts.

    Reply

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