Monday, December 15, 2008

The Mysterious Case of the $30,000 Waitress

There is many ways the following, from CNN's program Your Money, is awesome.
[CNN Host] ROMANS: Peter Morici the Senate was right to bail out on this bailout?

Peter Morici,University of Maryland School of Business: They didn't bail out. Gettlefinger bailed out. Toyota workers are paid very well, they have outstanding benefits, but that is not good enough for Ron Gettlefinger in the UAW. Instead they want a gold plated package as if they're the British aristocracy.I don't think a waitress making $30,000 a year in Indiana ought to send her tax dollars to Washington to subsidize that nonsense.
Digby focuses on the notion that Morici casts unionized workers, not capitalist investors or executives, as the equivalent of aristocracy. I am particularly enamored with the fact that a professor at a business school in the US apparently operates under the delusion that waitresses in Indiana are pulling down $30K a year.

According to the government, the average waitress earned $7.14 an hour, including tips, in 2006. Ignoring the fact that our hypothetical waitress is in Indiana and probably on the bottom end of the wage scale, $7.14 an hour comes out to $14,851.20 a year, assuming a 40-hour work week, which is probably high.

Of course, it could be argued that these facts make UAW salaries even more outrageous, but (hopefully) our Indiana waitress understands that her customers are likely to pass along that pay in the form of chicken fried steak orders and tips. The less money in their pockets, the less money in her pockets. This simple economic formula is probably over the head of our b-school guy, as he is so far off in his estimation of what is happening the US economy that he thinks that entry-level jobs in the US earn 75% of the average wage. Would that they did.

5 comments:

ash said...

It probably says something about the CNN host that he didn't pick up on this wild misestimation of waitresses' salaries, the gross mischaracterization of auto workers, and the misunderstanding of how the economy works. I'll lay odds that the on-camera folks at CNN (as opposed to, say the people working the cameras) are just as out of touch as the B-school guy about how most of America lives.

wobblie said...

Seeing as how CNN just got rapped for union-busting, ash is probably right.

unionboy said...

I can personally assure you that I never made anywhere near $30K in my stints at LaRosa's Pizza and Don Pablo's - both fine establishments, but not so fine as to provide a living wage to their employees. They would have been good places to test out the EFCA though.

dr said...

I think we must assume that the media types are themselves extraordinarily good tippers, but that the very same largeness of spirit which motivates their tipping behavior also inclines them to overestimate the generosity of typical restaurant patrons.

wobblie said...

I'm going to disagree with dr here and assume that most media talking heads are venal assholes who'd stiff a waitress on a tip if she didn't make it around to fill up his/her water glass every 8 minutes. But I'm just bitter that way.