Editore"s Note
Tilting at Windmills

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October 17, 2003
By: Kevin Drum

YET MORE CLASS WARFARE....Following in the footsteps of our supermarket chains, California restaurant owners are trying to cut the wages of yet another coddled segment of our society: waiters.

It's the usual story: waiters make such a gold mine in tips that they don't deserve $6.75 an hour. Why, some waiters make as much as $30 an hour in tips!

Now, set aside the fact that the $30 an hour waiter is sort of like the welfare queen getting eight separate checks from the federal government: sure, there are some, but the overwhelming majority of waiters make only a few bucks an hour in tips. Instead, ask yourself why restaurants need to cut costs so badly. After all, it's not like they're competing with China. Hell, they're not even competing with Arizona.

Here's explanation #1:

Some restaurant owners contend that if they didn't have to pay $6.75 to tipped employees, there would be more money in the pot to give raises to cooks and other nontipped employees.

After you've picked yourself up from the floor and stopped guffawing over the idea of all these kindhearted restaurant owners wanting nothing more than to redistribute a little income to the kitchen staff, check out explanation #2:

At California Pizza Kitchen Inc., labor costs as a percentage of sales run about 2% higher in California and other states without the tip credit, said Greg Levin, chief financial officer. The company has 165 restaurants in 27 states.

"If a tip credit were to pass, you'd see a 2% reduction in labor costs" in California and other states where waiters are paid the minimum wage, Levin said. "It would increase our earnings, which would help increase the value of the stock."

Ah, that's more like it. It's not competition, it's not concern for the cooks, and it's not a desire to reduce prices. They just want to increase earnings so they can pay their long suffering executives higher salaries.

It never ceases to amaze me that businessmen are continually so outraged over the possibility that any decent paying non-executive jobs are left in our country. But they are. If you're just an ordinary schlub working in an ordinary job, you don't deserve a decent wage, you don't deserve decent healthcare, and you don't deserve any job security. And don't you forget it.

So the next time some idiot in a suit starts prattling on about liberals and class warfare, take a minute to remind him who started it. And don't bother being polite about it.

Kevin Drum 9:24 AM Permalink | Trackbacks

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