Interesting article for sure and I actually agree that businesses would do better to follow the Henry Ford model and pay better wages. Employees who are paid more tend to feel more valued, they tend to care more about their work, and they tend to hold both themselves and their coworkers to a higher standard. That is merely my own observation, though I believe there is plenty of evidence to back that up.
Paying a higher wage helps to attract and retain a higher quality of worker. It only makes sense that someone with ambition will seek out more compensation when it is available. That means if they are not paid well they will leave their present employer and will often even before that take the slight of being undervalued personally. That usually leads to resentment, which often leads to a poor attitude, which often leads to less production.
It is also true that a thriving middle class is a huge part of the engine that drive our economy. When people have less disposable income then they have less money to dispose. That means less consumer spending, which ultimately means a shrinking economy. Increasing disposable income leads to higher disposable income and a growing economy.
I do think that there is a false choice presented between who really drives the economy and creates jobs. Instead of a choice between the rich and the middle class I believe there is a symbiotic relationship much like the natural flora and cellular mechanisms in our guts. When there is a good natural balance then all prosper and the engine runs smoothly. Upset the balance, allowing the bad actors to propagate out of control, or don't provide the right balance of inputs and you have a sick engine that runs out of control or gums up the works. Sooner or later balance has to be restored or the problems grow more and more dire.
What we are seeing with strikes and social justice movements and the like is simply a natural reaction to a lack of balance. His prediction of pitchforks is not far off the mark if things continue on their present path.
Government policies have by and large hurt the middle class. Once a person moves into middle class they lose some benefits they earlier had as the working poor. This ranges from food stamps to tax breaks to pell grants and so on. The amount are not inconsequential, especially when combined. That is not an argument for or against doing away with help for the poor or expanding that help to the middle class, it is just a statement of fact.
What this means is that the government is squeezing the middle class at both ends, both reducing the help it gives at one end and taking more in taxes at the other end. These combined greatly reduce disposable income.
So are businesses that pay low wages part of the problem? I believe so.
But is government policy an even bigger problem? Perhaps so. That can be no doubt in my mind that the problem of government policy has at least an equal, if not greater impact on middle class disposable income and, therefore, consumer spending.
He also fails to admit the inflationary pressures his idea would place not only on consumer prices, but also on the wages of those who currently make more than minimum wage. Those pressures would lead to still higher pay for some and even more price pressure which would erode some of the newly found buying power of the lowest wage earners.
I do find it interesting also that Amazon, the company which made the author much of his money, does not yet follow his advice on pay. I wonder if he has offered a percentage of his own dividends and other earnings to help bring Amazon into compliance with his wishes. Consider this the Warren Buffet counter-argument: If you don't put your own money where your mouth is then how strong is your conviction? Henry Ford had no trouble putting his own money behind his conviction, even when his wages were far higher than the prevailing wage at the time. He was willing to take the risk. He did not outsource the risk to everyone else. Henry Ford was not a feckless hypocrite.
