Politicians are to economics as arsonists are to home renovation.
Beginning this year the Seattle City Council spread its benevolence on delivery drivers in the area. The council arbitrarily decided that in the utopia that is Seattle, delivery drivers would get a substantial pay raise.
And it was a unanimous vote.
This is classic politician behavior.
Give money to one group to earn loyalty and votes while taking the money from another group the politician doesn’t particularly like.
Cost-free moral exhibitionism at its finest.
Here’s how the Seattle Times explains the law, "Seattle’s new wage standard, which took effect in early January, requires the companies to pay at least 44 cents per minute, plus 74 cents per mile during orders, or a minimum of $5 per order — intended to at least match and possibly exceed the city’s minimum wage."
The pay scale also starts from the instant the driver accepts the order on his app instead of when he picks up the order.
The new law made perfect sense to those left-wing council members because everyone knows corporations all have a money tree growing in the headquarters atrium.
If the company’s revenue decreases, they just have to shake the tree a little harder.
It’s not like the law is going to cost anything!
The reality was significantly different. Or as the Washington Examiner described it, "How politicians killed food delivery in Seattle."
The new wage "raised the minimum wage of delivery workers to about $26 an hour (not counting tips)."
That’s a nice wage for parttime work and in the abstract would have made delivery driver’s life much easier.
Only we don’t live in the abstract.
Here’s what happened in the real world. "Delivery services such as DoorDash and Uber Eats responded by increasing prices; a $5 fee was added to all orders placed through the apps."
We particularly liked the DoorDash description of their upcharge as "Seattle Regulatory Response Fee." The company also predicted it will experience 1.7 million fewer orders in Seattle during 2024.
Seattle Medium checked delivery prices after the law took effect and the prices were shocking. "Restaurant owners have reported significant price discrepancies between orders placed directly through their websites and those placed through the apps.
"For example, a $54 order for pickup from Grillbird would cost $85 when placed through Uber Eats. Similarly, a $9 chicken tikka kathi roll from Spice Waala, a popular takeaway joint, is priced at $19 on DoorDash, before tips.
"As a result, customers have reduced their delivery orders or deleted the apps entirely."
That’s the experience of the drivers — who were supposed to be living on Easy Street — too. The Seattle Times, "The tension over the current wage requirements hinges on whether the new minimum wage is actually leading to higher pay for drivers.
"Andi Honer, who’s been delivering for six years, says no. When the law took effect in January, she saw her earnings drop in half. Though she was making more per trip, she was getting fewer orders and smaller tips.
"Before, I was making $3 on an order, and now I’m making $8 on an order, but after 40 hours of work I’m making half the amount I was making beforeshe said.
"Tips, in particular, have disappeared: They once accounted for more than half of her earnings, but now customers are plowing that money into service charges."
That’s because customers don’t have access to the money tree.
When their food budget is eaten up by politician inspired fees, there is less money for discretionary tips. Besides, if the driver is making 26 bucks an hour, who needs a tip?
The backlash has been so great the council "has moved at breakneck speed" to rewrite a law that is barely six months old.
The new, improved meddling law would cut the hourly rate and allow companies to calculate pay on a weekly basis.
We predict the net result will be to reduce the delivery prices somewhat, but the total will still be more than it was before the city council became delivery pay experts.
And the income the drivers lost after the law took effect will never be recovered.
This is yet another example of Auron MacIntyer’s observation being proven correct again, "The liberal mind identified cause and effect as an existential threat and decoupled the two long ago."
Michael Reagan, the eldest son of President Reagan, is a Newsmax TV analyst. A syndicated columnist and author, he chairs The Reagan Legacy Foundation. Michael is an in-demand speaker with Premiere speaker's bureau. Read Michael Reagan's Reports — More Here.
Michael R. Shannon is a commentator, researcher for the League of American Voters, and an award-winning political and advertising consultant with nationwide and international experience. He is author of "Conservative Christian's Guidebook for Living in Secular Times (Now With Added Humor!)" Read Michael Shannon's Reports — More Here.