ROB SCHMITT (HOST): California’s $20 minimum wage set to start next month. No surprise, you’re seeing businesses already cutting jobs. The story from the Wall Street Journal — Pizza Hut, Round Table Pizza, laying off 1,300 delivery drivers. You know, 20 bucks an hour sounds really great. But — until you realize that you’re gonna have to probably work twice as hard to get it, and your best friend at work had to get fired for you to get that wage.
ART LAFFER (GUEST): Well, you know, that would say something about your employer that — you say it sounds great. To me, it sounds really awful because I pay people, not get paid by people. And when you employ people $20 an hour sounds like a very high number. You know, it really does. Now, if you’re thinking to yourself as the recipient end of that $20 an hour, but if you’re at the McDonald’s, if you’re these other people, those are increased costs that you’re gonna have to pass on through your goods and services —
SCHMITT: And let’s just be honest, that there’s so many people in this economy that, when it comes down to it, are probably not worth $20 an hour and those people will lose their jobs in California —
LAFFER: I said that on MSNBC the other day and I got riled for it — for having done that. But the truth of the matter is, in the economic sense, they’re not worth it. They’re very fine people. We need to do a lot more in this world for them, but they aren’t worth it in the sense that they can get a job by someone voluntarily to pay them $20 an hour. Now in that sense you’re dead-on right. And I misspoke on them because I shouldn’t have said what I said based on their ideology, but these people need skills to get them to earn above the $20 around range in an open, free market. And that’s not what they do. And they’re not getting the education. They’re not getting the skills. They’re not getting the economy. They’re not getting the motivation to be able to do that. It’s a tragedy.