Bernie, Amazon, and How a $15 Minimum Wage Screws the Little Guy

September 4, 2018

by Rob Roper

Amazon just announced that it will be implementing a $15 minimum wage for all of its North American employees. Bernie Sanders is crowing that the political pressure he brought to bear on Amazon CEO Jeff Bezos is responsible for this policy change, and in fairness he deserves some credit – or blame, as the case may be.

Here’s the whole story of what’s actually happening with Amazon… Yes, they are adopting a $15 minimum wage, but in order to pay for it the company is eliminating incentive bonuses and employee stock option awards. In other words, the overall compensation package for employees isn’t really changing, it’s merely a rearranging of the deck chairs. It costs Amazon nothing to do this. Employees don’t get any real benefit. But, the company gets the political and branding benefit of virtue-signaling to the world that they are so “woke.”

But there’s injury to add to the above insult. Amazon will (Bezos said they are going to do this) use that political/social capital to lobby congress to mandate a national $15 minimum wage on everybody. Or, strategically speaking, hang an unaffordable financial burden on their small business competition. These little guys are screwed. They’ll either have to raise prices, lose profits, or go out of business. Any and all of these options benefit the mega-company Amazon.

So many Vermonters say they hate the big box stores and national chains and proclaim their love for the mom and pop’s on Main Street, but then the support these high cost regulations that drive small businesses out of business and give the deep pocketed, large corporations a significant competitive edge.

Take your bow, Bernie! You got played.

Rob Roper is president of the Ethan Allen Institute. 

{ 1 comment… read it below or add one }

Charles Russell October 4, 2018 at 9:43 pm

The indiscriminate laws of economics never rest

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