Remember CEO Who Set Minimum Wage to $70,000? THIS is What Happened NEXT!

04 Aug, 2015 by Greg Campbell

Print this article Font size -16+

Wealth cannot be created simply by giving-out more money. In this day and age where socialists crusade for a whopping $15 an hour minimum wage, it’s unsurprising to see that some in the private sector simply don’t “get” economics. When one CEO raised his minimum salary for employees to $70K a year, he was hailed as a socialist hero. One year later, however, he’s hit the skids and his employees must now worry about future employment.

For the past few months the CEO of Gravity Payments – Dan Price – has become famous across the world because he promised to pay ALL his employees $70,000 annually.

That means they earn $70,000 if they are executives or if they are hourly, beginner jobs. No matter how hard his employees work or produce, everyone earns $70,000 each calendar year.

Now, as you might have guessed, Price is having a difficult time! In fact, with such a low income placed on himself and his business falling apart, he has been forced to sell his house. And employees are leaving the company in massive numbers. Long-time employees are furious at the lack of raises or incentives to continue being valuable to the company.

Clearly, liberals don’t understand economics. This tiny experiment in socialism couldn’t even support itself through the summer! What a train wreck:

Dan Price, 31, tells The New York Times that things have gotten so bad he’s been forced to rent out his house.

“I’m working as hard as I ever worked to make it work,” he told The Times in a video that shows him sitting on a plastic bucket in the garage of his house. “I’m renting out my house right now to try and make ends meet myself.”

The Times article said Price’s decision ended up costing him a few customers and two of his “most valued” employees, who quit after newer employees ended up with bigger salary hikes than older ones.

Grant Moran, 29, also quit, saying the new pay-scale was disconcerting

“Now the people who were just clocking in and out were making the same as me,” he told the paper. “It shackles high performers to less motivated team members.”

The Times said customers who left were dismayed at what Price did, viewing it as a political statement. Others left fearful Gravity would soon hike fees to pay for salary increases.

Brian Canlis, co-owner of a family restaurant, already worried about how to deal with Seattle’s new minimum wage, told Price the pay raise at Gravity “makes it harder for the rest of us.”

Even one of the biggest supporters of the plan quit after it was implemented:

When Dan Price, founder and CEO of the Seattle-based credit-card-payment processing firm Gravity Payments, announced he was raising the company’s minimum salary to $70,000 a year, he was met with overwhelming enthusiasm.

“Everyone start[ed] screaming and cheering and just going crazy,” Price told Business Insider shortly after he broke the news in April.

But in the weeks since then, it’s become clear that not everyone is equally pleased. Among the critics? Some of Price’s own employees.

Maisey McMaster — once a big supporter of the plan — is one of the employees that quit. McMaster, 26, joined the company five years ago, eventually working her way up to financial manager. She put in long hours that “left little time for her husband and extended family,” The Times says, but she loved the “special culture” of the place.

But while she was initially on board, helping to calculate whether the company could afford to raise salaries so drastically (the plan is a minimum of $70,000 over the course of three years), McMaster later began to have doubts.

“He gave raises to people who have the least skills and are the least equipped to do the job, and the ones who were taking on the most didn’t get much of a bump,” she told The Times. A fairer plan, she told the paper, would give newer employees smaller increases, along with the chance to earn a more substantial raise with more experience.

This highlights the problem with socialism. It dis-incentivizes the acquisition of skills, higher education and innovation when the janitor and the web designer make the same amount of money in a company.

Sadly, we are currently saddled with a president who maintains this warped sense of “fairness” and we risk being saddled with another one.