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Wal-Mart Plagued By The "Wrong Kind" Of Lines On Black Friday
Yesterday, it was fast-food workers explaining that a 100% minimum wage rise "would do just fine" and today it is Wal-Mart employees pressing for a 50% rise. As McClatchy reports, Wal-Mart employees plan to disrupt operations at 1,500 of the company's stores on Black Friday. "Wal-Mart raked in $15.7 billion in profits last year alone, but apparently they don't feel any need to share that wealth with their millions of workers," rages one union campaign organizer as they hope the protests will also put pressure on Congress to increase the minimum wage. The reality of raising the minimum wage remains lost on most who never stop to think of where the 'money' comes from. But the protest lines and "unprecedented" disruption is unlikely to encourage Wal-Mart executives to soften their stance.
Here's Harry Reid's clarifications...
We must #RaiseTheWage to strengthen middle class families, boost economic activity, and help lift the working poor from poverty.
— Senator Harry Reid (@SenatorReid) November 20, 2013
And the magical job creation he envisions...
Increasing the minimum wage will boost economy activity and help create jobs. #RaiseTheWage pic.twitter.com/yaJcJGL43y
— Senator Harry Reid (@SenatorReid) November 20, 2013
So why not raise it to $20 or $30 per hour? Think of the jobs that would 'create'?
And for those that are still unsure of why doubling the minimum wage is not the great idea some politicians suggest... here is four-and-a-half minutes of painful truth...
As professor Antony Davies explains that this view of the minimum wage overlooks an important detail:
The minimum wage does not force employers to pay a particular wage to every worker; it forces employers to pay a particular wage to every worker they choose to keep.
While the minimum wage may be well-intentioned public policy, it often huts the very workers most in need of our help.
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Wage push inflation !!!!!!!!!!!
Seriously guys, lay off the sanctimonious preaching. Anyone who’s been in a crowd before knows how infectious it is. Don’t tell me you’d be angels in a situation like this. I’m an upstanding and moral person, but I’ve been in many crowds like this before, and I can tell you that when the chanting starts it’s almost impossible to resist.
When you find yourself surrounded by homos, do you also find the urge to smoke pole impossible to resist?
Smegley: Just about shat my spleen reading that. Had to punch myself several times to stop the uncontrollable laughing.
Crowds... if you're ever in one you're in the WRONG place!
The Mob Rules
If you listen to fools... the mob rules!
Black Sabbath - Mob Rules
That's a really old but good song. It need to be updated for the new age.....Obama rules. Because that's what tyrants usually do.
smegley 1, patriot 0. that's funny. on a more serious note, you guys are missing a big part of the equation. if your aim is to make america competitive in the world, (something obama says a lot) wages will need to go down, a lot. you can't compete with slaves if your minimum wage is ten bucks an hour. making this about walmart obscures a bigger point. if your aim is to crush small business, what better way than to increase their biggest cost (labor) so they can't compete, and force them to either fold or start playing the globalization game. this is full contact. these guys are not taking their eyes off the ball come hell or high water.
I was with the crowd and couldn't resist clicking the up arrow.
You're repeating this same shit on another thread?? Wow.
If you can't resist the chants, the crowds, you are indeed a weak minded fuck.
If you were really upstanding and moral, maybe you wouldn't even be there to begin with.
If your work place goes out on strike you go out the door with your friends. You don't want to be the only worker siding with management if you know what is good for you.
While I agree that many unions are corrupt/have become corrupt, the right of collective action and to collectively bargain once lost will be felt far and wide among the general population. And for those who do not belong to a union, don't think for a minute that you wouldn't be affected by this type of loss.
....and the Waltons went from billionaires to millionaires that fateful afternoon...
oligarchs: "I have everything, you have NOTHING, what's the problem?"
The problem is that economies are about people and the lives we live. Would someone actually argue "Well there it is. Rupert Murdoch (or any oligarch) owns everything and he has the contracts to prove it so you will just have to starve"? False argument: that it's either this or you're a commie.
Unions are not a necessary vehicle for collection action or bargaining.
see below and "pick your poison." Did K-mart, Sears, Montgomery Ward and JC Penney go bankrupt because they had too many customers? This ain't the time of the mom and pop store anymore folks. "we're happy to have Wal Mart because they're an efficient administrator of EBT?" Pay people to work...learn a skill, be productive. we're not talking a liveable wage that's fer sure...and if there's a problem they can always reduce the hours worked. don't tell me the whole point of capitalism is to bankrupt everyone and everything. I mean welcome to the service economy..."you've got to pay for that." Meaning the trinkets and other "objects of affection" that we now have become. not that China and Japan aren't going to find a better use for our money of course. I mean why not war over a useless bunch of islands and "Ocean Space"? I mean Korea is fighting over a rock that isn't even above water.
@CD
I have no problem with Private Sector Unions that have no ties whatsoever to The Government.
On the completely opposite end of that there are Public Sector Unions, which I consider to be criminal.
I have to agree. The right to collective bargaining is a basic human right and a fundamental economic freedom.
Dispense with the minimum wage altogether and make it fundamentally easy for workers to organize! Let them form unions and bargain with their employers for wages and benefits. Then, let the market decide if higher productivity is worth more money. Everyone wins. A minimum wage must be backed by restrictions on collective bargaining, or else workers will be able to set up unions and bargain for better pay on top of min wage. If we had truly liberal collective bargaining laws, WalMart employees would already have organized themselves, and would be already be earning more money.
As long as the employees voluntarily form a union, fine. No employee should be forced to join any union. In the same way, employers should be able to hire, and fire, an employee.
So what? If I were their employer and I found that my (unionized) employees were insufficently productive and too expensive I wouldn't hesitate to replace them with more efficient, cheaper labour. Except it would be difficult: the governments refuse to uphold property rights and instead we have this fake "right" to colective "bargaining", which transgreses against private property by attempting to dictate salary, conditions, and ultimately, profits.
Unions, voluntary or not, would be powerless, in the face of supply & demand for labour and capital, without the violence and force of the state skewing the field for them. CAPITAL needs no such props...
Way off base, CD.
Two wrongs NEVER make a right.
I thought you understood the evil of collectivist "representation" better than that?
Unions have no more legitimacy than any other gang. That they provide muscle for a handful (under the guise of "fair") can never negate the violent, coercive force that lies at their core.
So, you do not, under any circumstances, ever... believe in the right to free assembly? The right to protest unless you are by yourself, all alone?
I thought this was going to be about the wrong kinds of blacks in line.
what the uniformed fail to understand is that marginal tax rates go up as gross earnings go up
this is why gubermints support unions to drive wages up
and what's the need for all this extra cash?
MOAR gubermint make work and MOAR gubermint failure
Are you serious??? This comment is a joke, right? Government supports unions? Classic bullshit.
The union movement is just about dead in the water, and what you see happening now at Wal-Mart etc., is the last gasp of a dying entity. The number of unionized workers has fallen off a cliff over the last 40 years, and nothing will change that trend.
The few major organizations left are simply striving for survival, always at the expense of their rank and file. For instance, the American Federation of Teachers (AFT) has taken millions upon millions of dollars from wealthy private groups like the Gates Foundation. These wealthy groups ultimate goal is to privatize education, which of course means the destruction of public education and all the due paying jobs that the AFT supposedly represents.
No, the unions of today are not your father's unions. They are now with the oligarchs.
"The union movement is just about dead in the water, and what you see happening now at Wal-Mart etc., is the last gasp of a dying entity. The number of unionized workers has fallen off a cliff over the last 40 years, and nothing will change that trend"
Until something does. The "death of equities" brought about a change in the trend of the stock market.
"..... ultimate goal is to privatize education, which of course means the destruction of public education.."
We spend more money per student on Public Education than any other country in the World, yet the US ranks #17 In Global Education. Do the maff.
Let them eat cake.
let the eat
each other...
Let them eat ....well...http://i.imgur.com/ChP0PfT.jpg
Wow Hitlery was hot when she was younger!
/sarc
Does this mean Hairy Reid will move to Search Light, NV and plug his butt or be a butt buddy with the rest of Nevadan's.
You know, pushing down the minimum wage to zero is the tactic adopted by all the totalitarian regimes on the far left.
The capitalist way is to push wages UP, hence allowing the workers tp spend more money.
The faster the $ or the £ travels around the country, the better the economy.
Seemples ;-)
I have 115 employees here in Norcal where Jerry Brown already rammed through a min wage into law to $10/hr.
Cost analysis says it will raise our payroll $85,000 first year and another $85,000 the second phase for a total of $170,000, our entire annual profit.
Add that to Obamacare's new imposed cost.
I already cut vacation time accrual for my staff on Obamcare alone. Now I will probably cut 401k retirements. But I will need more cuts to survive, which will include leaner staffs, pay caps and price hikes.
This is a true story of which I am living.
Now, praise your politicians all of you.
Let me guess. The $170,000 profit is after you take a million per year salary. Close your fucking business if you can't pay the wage you fucking loser!
I wish. Just middle class. There are teachers and firefighters around here that make my 1782 square foot home look like a shack. Quite drinking the leftist bong water. The public is raping us all, yourself included, uh... fucking loser.
Shorter Wyatt: I'm a fucking dumbass, and my god speaks to me through my radio, or my cable news channel.
Idiots like you are why the middle class continually gets its collective ass kicked by the Oligarchs. While the big banks and the financial services industry are busy counting the $23 trillion the taxpayers have given them since 2008, you are bashing teachers, firemen, police officers and librarians. You know, because they make so much god damn money and live in big houses.
Please Wyatt, if you hate public workers so much, make sure you never, ever use the services they provide. Send your children to private school, and if your children have a documented disability, do not accept the services the public school must provide as dictated by law. Also, should your worthless ass need paramedic care, please refrain from dialing 911. You can just die on the floor. That way you can be intellectually consistent.
Wyatt, go fuck yourself! Idiot.
For somebody with the name Accounting101 you sure have no idea of who is to blame in this whole mess. Wyatt is the guy creating jobs, whereas teh gubmit sector is just a leech. Why pay the leeches more than the host? Idiot.
Go ahead, keep blaming teachers. When the next ginormous bailout (bail in) comes, and it will come, who will you blame then? The oligarchs love tools like you and Wyatt. They love when you blame your neighbors and other fellow middle class citizens for this Great Depression. The oligarchs get our money and have fighting among ourselves. Perfect!
The oligarchs roar with laughter from on high. They are always amazed at what dumbasses some of us are. It's all to easy.
Old thread, but I'll give it a shot.
It goes something like this: Hey, fuckhole, you and all your public sector trash piles of shit, I would gladly wipe my boot off of every fucking ounce of your 'services' if I could, but the problem is you coercive motherfuckers won't leave me alone. No. You FORCE me to pay for your shitty schools, fat cops and firemen, who it appears only work on the cooking skills and bench press records back at the frat house. And every year my property taxes get nudged a little more north because your fucking out of control pensions can't get out of the way fast enough.
If I could just press a button to make you all disappear I would since you're all meaningless lard giggling off the ass of society.
But let's go down the list.
1) Cops. Typical predators who love power. Highly unnecessary to society. Whenever they are not 'revenue generating' by pulling people over in diamond lanes to pad their pensions, they are filing useless paperwork after a crime has already been committed. Become a DIYer and exercise your 2A right. Cops are not legally obligated to protect you, pussy. Only the naive seem to think so. Quit being such a nancy boy and grow the fuck up.
2) Teachers. Glorified assholes. Leeches upon society. They don't give a single fuck about children's minds, but rather focus all their singular attention instead on how to dig wider moats around their pensions even if it means pink slipping noobies in order to rake in more for seniority. Their performance track record has sucked successively worse year after year for 30 years in a row so they employ the use of curves, do overs and no winner/losers in assigning grades. Today every one makes honor roll, but we are now officially the worst nation outside of Somalia at test scores.
3) Firemen. False superheros ever since 9/11. They hang out at the clubhouse wearing oven mittens baking cookies and playing dollhouse until that real important call comes in to get Tinkerbell out of a tree or pry a lardass out of a Lazy Boy chair. They are all just waiting so they can double tap their pensions since most of them couldn't make it out in the real world. If your house is on fire, wisest choice of action is to just let it burn down and buy insurance. Its a much better deal than funding these assholes.
4) Librarias. Did you just say that? What's a librarian? Get an 'internet' loser.
I can keep doing this all day. Too easy.
Apparently, you don't know me. I've always been very intellectually consistent on this topic.
Fuck the entire public goon squads. And, hey, fuck you too.
Wyatt: I had a similar agrument a few months ago about firefighters, etc with another poster I respect. I can only support your fine rant above. If I were to write my own it would go on much longer than yours. I can tell you this... I've known firefighters since the early 80's. They spend more time renovating their own properties than they do actual time on the "job". Don't get me started...
Cheers
Yeah, close it up and put more people out on public assistance - is that what you want? Do people like you think even one hour into the future? This guy is a prime example of why we have the sociopath "leadership" that we have today.
Thanks for running a business in the environment we have today. It must almost be like charity already. Working people like me thank you.
If it was me, i would just shut the business down. It isn't worth the hassel of trying to make a living that way.
I expect better from you, Bangin7gramrocks...
I do apologize. I am not anti-business. But I am against greed and I get worked up when these stories are posted. If you really are just trying to earn a nice living with a small business, then I feel for you. It's just the unfettered greed mentality and lack of compassion for others that gets me fucking crazy.
The mentality of which you speak is ALL IN YOUR HEAD.
You just made shit up in order to get on a soap box.
Talk about a lack of compassion!
Bangin, I generally like your posts, but you are way, way off on this one. 115 employees means that man is paying the rent or mortgage for 115 families. all those cars in the company lot? he's paying for them. could be a couple hundred kids headed to school everyday, because of him, those lunchboxes are full. it's exactly what's wrong with our leadership, they never had a payroll. when you do, you learn quick, because every friday is pass/fail. no net. the alternative to guys like him is the welfare state. try to always be repectful of people who do big, good things. it ain't easy. in the real world, power is just responsibility.
You do realize that somewhere between $60,000 and $75,000 of that $170,000 will go to the IRS in the form of corporate taxes. Much of that $170,000 may also be tied up in expanded inventory, new equipment or other costs. It's not like the owners see that $170,00, it's not all that meaningful a number, except to the IRS.
Walter Block addresses Libertarianism and Egalitarianism
Very short version:
Walter Block Explains why a Minimum Wage isn't a Good Idea
They are muddying the waters with this minimum wage crap. Forget blanket minimum wage legislation, just get companies who make billions give the staff a living wage, so the state to does not have to subsidise the work force. Where is the problem here? Small and medium size business should be utilizing the minimum wage, not bulge-bracket corporations.
Three people want to protect the profits of the corps at the expense of the taxpayer - maybe they should say a few words about their "turkey voting for Christamas" ideology. Im up for a laugh if they are.
WTF are you talking about?
Without profits there would be no jobs.
We had three minimum wage increases, the last occuring six months into Obama's first term. Guess what. Employment flattened, then started falling the first of these increases.
If you do not want corporations to have profits, then do not spend your money there. It's that simple.
Your bigger beef should be who is protecting the taxpayer from the outrageous confiscations of the government.
Because there are more total taxes collected than total profits earned....
Let's do a little math.
15.7 billion in profits.
11,000 stores
365 days per year
24 hours per day.
That works out to $163 of profit per hour per store.
And you really think that they can afford to raise their wages?
"We had three minimum wage increases, the last occuring six months into Obama's first term."
Didnt i just say that legislation for a blanket nationwide minimum wage was out of the question? Small and medium sized business needs that threshold to survive in most cases. As usual with the turkey voting for Christmas bloodline, you want to open your mouth when your ears should be in play.
"15.7 billion in profits"
Yes $15.7 billion in profits... and $6.8 billion in US taxpayer subsidies! Don't get me stared on the "math". That's a key insight in to the American IQ level; someone says the word "math" in an article, and immediately you get legions of dumb fucks who cant even lift a pen believing what they are being told the truth because someone evokes the haloed term "math"
Saying the word "math" is not enough...the "math" has actually got to make sense. The "math" must be understood, not because someone says "math" but because the "math" should actually draw one to a logical conclusion...
Well, if you do not get the math, then you are likely to be in a daze when you work with large numbers.
After all, 15.7 billion, seems like such a large number....
Until you get down to what it means per hour per store.
One should draw the logical conclusion that while Wal-mart makes a lot in total, the per store numbers would indicate that they do not have any room for increasing their wages.
So the issue must lie elsewhere.
Like the macro US economic picture.
Wal-mart is not the problem.
US economic policies are.
Im sorry, but is your head currently in a blender? Why are you whittling it down to a store-by-store, hour-by-hour basis? Why stop at store by store? Why not quote profit by square millimetre? Why not faff around here all night and end up at string theory? As if it actually means anything?
If they are making £167 per store, or $0.00001 per nanometre, the tax payer is still paying ~40% of that, no matter how small the space. I really am sorry for offending you, but i do believe you have been done up like a big rancid proverbial kipper. How in the name of sweet fuck are continuing with these arguments? I know why....
Why store by store? Because isn't that the entity that you would interact with?
It's basic economics.
Do you really believe Wal-mart is making that much in profit? Or that they can actually afford to raise wages?
How many workers will get wage increases at Wal-mart locations that are shuttered because they are losing money?
I think the bottom line is you could give a damn about profits. All you know is that you want it for other purposes.
Find another entity that makes much more per hour for much less effort...
Like an NBA player.
Ahhh, i get it now. "It's basic economics." while all along here i was looking for basic common sense. Sorry mate, my bad.
You'd really give up a sixty dollar per week pay rise for your customers because your workers would get it too? You guys always forget that the minimum wage affects your customers as well as your workers. Unless you're selling Ferraris, because I don't think any minimum wage earners buy Ferraris (but you never know these days).
Using the examples in the video above, if a burger shop owner could increase the price of his burgers by 20 cents or 30 cents, he would double his profit. Sure, he can't do that because he might lose customers. But that is all it would take to more than compensate a dollar fifty wage rise for his burger flippers. $1.50 x 40 hours = $60.00 per week. So the burger flipper is losing $60 per week for the sake of a 20 cent increase in the price of burgers. But if the minimum wage is increased then all the customers also get that sixty dollar wage rise. If you get a sixty dollar per week pay rise, are you really going to get upset when the price of burgers goes up by twenty cents? You gotta be kidding me, right? Yes, yes, its not just burgers, the minimum price of everything will go up by "20 cents". What are the most expensive bills you have? Will they be affected?
But all this arguing is insignificant when you realise that, due to the lax lending policies of the banks and the endless propping up of the bankrupt banks, every extra cent your workers earn will be pumped into inflating real estate prices, and every cent you save by underpaying your workers will go into inflating real estate prices. Never mind, you can make up the difference by high volume in the good locations - ha ha ha!
Well either does Walmart stop to think of where their money comes from. There is probably some room for improvement. One side improving will to whatever degree help the other.
Walmarts money comes from the Federal Reserve which prints it out of thin air and hands it over to the Treasury which sends it to JP Morgan who issues EBT cards to WalMart workers.
AND Walmart shoppers. I mean Walmart consumers. Er.... Walmart GUESTS.
Sort of. Wall marts money comes from consumers. An increase in minimum wage is an increase in what Wal Mart consumers pay for Wal Mart labor. Whether or not the government indirectly subsidizes Wal Mart purchases is a separate issue because they would do so with or without the existence of Wal Mart.
YES WE CAN (destroy America)! Forward?
So the Union wants a slice of that 15 Billion in profits and wants workers to get a 50% raise. According to one site, Wal Mart Employs 1.8 million people worldwide. (About 1.3 in the US). So for simplicity sake, let's say that they all get paid minimum wage, including management and other worldwide workers. A 50% wage increase for 1.8 million workers at 29.5 hours a week for a year would amount to 10 billion dollars.
Sure Wal-Mart can afford such a change, but would stockholders sit still for it, or would the CEO take less in his golden pay package? I have no problem with a company making a profit and sharing it among their shareholders, but in this day and age, it's a little obsence on both sides.
"in this day and age" ...you mean "in this day and age of taxpayer subsidised corporate employment", sure, its totally obscene. Where is the obscenity again, im confused?
Won't people eventually start starving to death?
Reduced supply of workers will cause wages to rise.
Economics, Bitchez!
The imminent legitimization of millions of illegal alien criminals will blow your theory out of the water toot sweet.
Rather than a minimum wage requirement for employers I would like to see a minimum IQ requirement for politicians.
"Rather than a minimum wage requirement for employers I would like to see a minimum IQ requirement for politicians."
I don't think that would help. We would just have smarter criminals in office.
Let them go get jobs somewhere else if they are so valuable. Oh they are not, just noisy.
Let be honest. If you work in any part of the financial system trading stock or bonds, managing money or working in some other part of the industry, you are a ward of the state. Your industry exists because the U.S. Government allows it to exist. The entire banking and finance industry would've ceased to exist in 2009 if not for the mean and nasty government. Now, all of you fucking welfare queens in suits decry some hard-working people trying to earn a living. What a bunch of ignorant douchebags!
Remember, Corporations are people too! Interesting that I never see a "Corporation" go to jail.
The video is much too simplistic. First of all, owners would not just make less money per hour. They would just raise their prices. This is what would happen. Companies & stock holders are not going to settle for less profit if minimum wage is raised. Prices would just go up. Hence inflation. The other issue is with the workers who have been there for a while and have gotten raises. Are you going to pay them the same as someone who was just hired? No, so they would all have to get bumped up as well. The increased labor costs would have to be passed on to consumers. Now everything costs more so raising the minimum wage didn't help much in the long run. It is true though, decades ago, that companies that profited well passed more of it on to the employees than they do nowadays. Now it goes to the executives and stock holders.
True.
If wages go up, someone has to pay for those higher wages. A business must make a profit, or at the very very least, break even, in order to be able to stay in business. Guess who pays for those higher wages? Everyone. The Government doesn't care about that because they can print money up out of thin air!
If wages go down, everyone pays lower prices for goods and services. But, keep in mind, most everyone will be getting paid less. It's quite a balancing act to find the equilibrium. Who determines the balance? You as an actor in the Free Market? Or The Government? Remember, The Government doesn't care if wages and prices go up because they can print up money out of thin air. In fact, The Government wants wages and prices to go up! The Government and The Fed benefit from "inflation"(an increase in the money supply). You, do not.
Now, where's my bailout!? I want to be bailed out from inflation too! Why don't I get a bailout!? Lol
"The Government wants wages and prices to go up!"
Taxes go up, as a result.
"Now it goes to the executives and stock holders." Who are the executives.
Let"s be honest please: http://www.youtube.com/watch?v=CKCvf8E7V1g
Nobody hires just because wages are low. And nobody fires because wages are higher.
The hiring or firing does not relate to the wages in the compagny, but only to the consumer demand!
It only means a little less profit for the 1%, that's all..
http://www.washingtonpost.com/blogs/wonkblog/wp/2013/09/11/how-the-1perc...
As some one who operated a small business I can say without equivocation that rich people do indeed create demand for goods and services. To assert "It only means a little less profit for the 1%, that's all.." is disingenuous at best and ignorant at a fundamental level. If we take the other extreme of your hypothesis we would expect that the poor are actually the job creators. I suggest you take a job from someone who has no money to learn what kind of wages will result. Jobs result from the demand in the marketplace. That demand must be actualized with the ability to defray the costs and the incentive (profit) to take the risk of expending the resources with the expectation of a future gain. If wages pass a point where an employer can not defray the cost with price increases jobs will be eliminated.
You may not be forced to pay for that, free_lunch, but the price will be paid by someone.
Dear mister Friedman. If we look at the profits, i'd say there is still room for a rise.
Rich people do not create demand, the customers do and who are the customers? The people with an income (payed jobs) are. There is no union or worker stupid enough to demand for wages that would vaporise the profits completely and cause bankrupty. There is nothing wrong with profits nor is there with paying decent wages when there is room for.
Of course rich people create some demand, but giving 100 working class families $10.000 would create a lot more demand than giving this $1.000.000 to a Billionaire.. The Billionaire will go speculate with it in the virtual economy which ruined or world. The working class people would run to the stores to buy stuff.
I expect wages to be earned not "given".
Your statement " There is no union or worker stupid enough to demand for wages that would vaporise the profits completely and cause bankrupty." is patently false.
Why do you keep creating the straw dogs: the 1%, Billionaires, the rich, ect.? Why can't "rich people" be customers?
And if you call me Mr. Friedman again, I will hunt you down and kick your stupid ass. Bitch
Thanks for the insults and the treats, it reveals a lot about you..
For the more civilised readers: Check Out the Successful Danish Model: http://www.businessweek.com/articles/2013-09-20/denmarks-economic-model-...
You are welcome.
As far as scale your choice of Denmark is like comparing a BB to a Wrecking Ball.
btw you get no "treats" this is Zero Hedge bitch, most readers and posters herein do pay attention and hyperbole and exageration are honored for the art involved. Stupid receives ridicule.
A 50% increase in minimum wage would greatly accelerate R&D in automation.
Would also produce a surge in government jobs to administer the new crop of unemployed and the programs to support them.
New recruits for the Free Shit Army. The Statists think this is a good thing.
Good. We need production, not jobs. Unless you would enjoy carrying iron ore from mine to port by hand and foot.
Thats one thing i didn't think off :-(
You know, I'd be fine with leaving the minimum wage as is, maybe just start enforcing securities laws and regulations, and stop providing socialism for the richest people in society. I mean, fair's fair, if the bottom rungs have to play full capitalist, make the fuckheads at the top do it too.
Wake up and smell the coffee man, it just wouldn't be fair. Besides it fly's straight in the face of some obscure economic theory some guy did a diagram of on the internet. And being a reasonable man, how does one refute such appeal to reason?
Economics is a science of the right as much as it is a science of the left. By the way, fair is not fair...when the powerful invoke "fairness", and represent the privileged as victims of exploitation by the powerless, you'll know the bullshit is truly flying. Beware the sheep in sheep's clothing.
No one sets up and runs a business - or takes on the risk and invests the capital - with the aim of paying MORE to the hired help. They do it to make a PROFIT: as much profit as possible - and as little in costs as necessary commensurate with the employees doing work of an acceptable quality.
But no one seems to think companies are anything but charities...
True, and that is why capitalists will cut each other's throats all the way down to zero. And that is why the "free market minimum wage" is a bowl of porridge and a bed on the factory floor. Because good workers are a dime per dozen, and if you don't underpay your workers then your competitor will. And then he will reduce his prices because of cheaper costs. And then you will "decide" that your workers are worth less, no matter how much they produce. And then someone will run out of customers, unemployment will go up and the only businesses in the country will be porridge supplies and hessian bags.
Do you want your workers earning $8.00 per hour or $9.50 per hour?
Do you want your customers earning $8.00 per hour or $9.50 per hour?
Ferrari can have customers who are much richer than there workers.
But we are talking Walmart here ... whose customers already cannot afford to shop there without govt handouts.
"Because good workers are a dime per dozen" - YOU SAID IT - and it's true. Supply & demand. Yet people expect to use the government gun to violently force capital to surrender profits to this oversupply of labour.
$8.00 an hour - if not less - is probably about what most American workers are objectively worth, on a worldwide basis and considering the prices of their product on the market. It's not such a bad wage: the only problem is that westerners have grown up using debt, living on credit in order to expand their consumption above that commensurate with their (dismal) productivity and (high) product prices. At $8.00/hour that would come to a screeching halt, asset prices would fall dramatically (house prices!) and people would have to live within their means. Is that so awful?
BTW, I myself don't like to shop at Walmart - on quality AND high prices.
And you missed the point that the oversupply of labour will increase as wages approach zero, for the simple reason that no-one will be able to afford to buy anything. For most people, you only have to halve their wage and their demand drops to zero as every cent pays off their mortgage. The most productive wage and the free market wage are not the same thing. The free market wage, as I keep saying, is the bowl of porridge or rice and the bed on the factory floor. These people already exist. Maybe not in the same country as you, but they do compete with you. You buy their stuff because it is cheap. You complain that your workers are "over-paid" because "someone else" can do it cheaper. Well, your customers are in the US and earning the US minimum wage. How much money can you make when you have to try and sell stuff to the Asian worker who sleeps on the factory floor?
You simply don't get it:
"no-one will be able to afford to buy anything." (???)
Then no one will be able to afford to SELL or PRODUCE anything (at the pre-existing prices) either!
PRICES adjust to ability to pay. People don't just keep on producing in the absence of buyers. A debauched currency, low productivity and too much debt mean that LIVING STANDARDS MUST FALL...whether consumers like it or not, whether it's "fair" or not.
Prices certainly do adjust to ability to pay. And that is what I pointed out using the example in the video above, where the burger shop owner only has to charge an extra 20 cents to the price of his burgers to double or triple his profit ( since it is assumed that he makes ten cents profit per burger ) but his consumers are earning an extra $1.50 per hour. The thing about increasing the minimum wage is it doesn't just increase your costs. It also increases the ability of your customers to pay. And until such time as an increase in prices exceeds the increase in your customer's ability to pay, minimum wage can increase and producers will actually be better off.
Why would prices increase faster than wages when wages are only a component of prices? Granted, it will happen when we physically run out of resources. But the biggest thief in our system today is debt that competes with cash. The bankers who lend too much money to idiots, who bid prices up, who make everything unaffordable. Housing used to cost half the minimum wage, now it costs 100% of a tradesman's wage. All that purchasing power disappeared into the dirt and no-one notices, no-one complains, no-one gives a shit.
The issue has zero to do with the typical knee jerk reactions from both sides of the aisle regarding minimum wage pros & cons. All those tired arguments are way off the mark here.
THIS HAS EVERYTHING TO DO WITH CURRENCY DEBASEMENT AND THE PRICE INFLATION THAT COMES WITH IT.
Currency devaluation particulalrly effects the low income earner who spends a much greater proportion of their income on basic neccessities, all of which have substantially increased in costs over the past decade. Food, Fuel, Rent, Healthcare, Energy, Education, Utilities........etc!
The increasing grass roots initiatives pressuring low end wages today are a direct result of the reckless monetary largess spewing from a Federal Reserve desperate to reflate a busted financial system. You ain't seen nonthing yet.
Since the begining of the 1980s the Bureau of labor Statistics has adjusted the methodology of its inflation model 24 times. No inflation, my ass!
"The increasing grass roots initiatives pressuring low end wages today are a direct result of the reckless monetary largess spewing from a Federal Reserve desperate to reflate a busted financial system. You ain't seen nonthing yet."
reflate a busted financial system- not reflate a busted ecnomy.
QE is deflationary. Savers get zero while bankers get trillions.
I arived in NYC in 1985, you could buy a Studio apartment for $80K, today that same studio goes for $800K.
Deflation my ass................................Debasement is what it is...............
Some owners actually care about the people that work for them. Only a greedy sociopath has no compassion for a hard working employee. My father worked in a steel mill. It was shitty work and quite dangerous, but he was always paid a living wage even though it was "low skill" labor. That same job today qualifies for food stamps. Race to the bottom indeed!
When the work gets really bad, the bosses become a lot more pleasant. One of the pleasures of a "good" economy.
Some owners care so much they want the business to survive for years to come.
Dear Prof Antony Davies.
When the minimum wage earners get an extra $1.50 per hour, do you really think they'll care if the price of burgers goes up by ten cents? 20 cents????? BURGER SHOP OWNER COULD DOUBLE OR TRIPLE HIS PROFITS WHILE WAGES ONLY GO UP BY LESS THAN 20 PERCENT!!!
When someone gets a larger income, what happens to their demand curve?
DOES SOMEONE EARNING A HUNDRED DOLLARS PER WEEK HAVE THE SAME DEMAND CURVE AS SOMEONE EARNING A THOUSAND DOLLARS PER WEEK?
How the hell did you become a professor??????????
Once you understand this much, I may be able to ask you some more questions.
Like what happens to the supply curve as the minimum wage goes up or down? Think about it real hard because there are three possible outcomes when comparing the new and old supply and demand curves. If you can't comprehend that much, then there is still no point talking to you, because there is more to come.
What happens to debt?
Talking about debt. Say a business man bought a piece of real estate fifteen years ago for a million bucks. Today his competitor tries to buy a similar piece of real estate but now it costs 4 million bucks. How does the new business man manage to compete with the older businessman? Work smarter and harder and faster????
Regards
PT
What is the demand curve for the poor bastard that loses his job when his pay rate must be increased by $1.50?
What business do you own? How much over market do you pay your employees?
Can you read? Look again.
I guess I can't read - because
I don't see where you explain the demand curve for the poor bastard that loses his job - and I don't see where you indicate what business you own and how much over market you pay your employees.
Why does anyone have to lose their job when I just explained that for an 18.75% pay rise, the burger shop owner could afford to increase prices by ten or twenty cents and thus double or triple his profits. You earn an extra $1.50 per hour. Are you going to stop buying burgers because they cost an extra twenty cents? Oh, let me correct that. After wage inflation, the burger shop owner can't double or triple his profits. They only increase by 68% - 152%. You think he's gonna be hurting?
Hey! Don't blame me, I'm just using figures thrown around by the Prof and his YouTube video.
Your assumption that the business can just jack up prices proves to me you have never owned (or managed) a business before.
It also makes you look foolish.
If the burger place can raise prices then why haven't they already done it?
Try starting a business - hire some people - sell your product - then come back - after you know your ass hole from your elbow and explain it to me.
How does increasing an employee's pay by 18.75% allow the burger shop owner to AFFORD to INCREASE PRICES?
You think increasing labor cost allows a business to "afford" to raise prices?
It is a minimum wage rise. Your employees get a pay rise but so does your customers. You cannot raise prices if your customers do not get a pay rise. But with a minimum wage rise, your customers get the increase too.
Hence the other comments I have made - about the producers going broke as they push the free market wage down to zero ("They're not worth as much anymore") , and "perhaps the business men should choose how much their customers earn".
Why do I have to ask a third time: "If your customers earn an extra $1.50 per hour, are you going to get less business by increasing your prices by twenty cents?" When the minimum wage increases, your customer's wages increase as well as your workers. That is why it is a minimum wage.
So you think that if minimum wages go up the burger joint can automatically raise prices? LOL no one can be that dumb - are you just fucking with me?
Yet you must also think that all of the companies that supply things to the burger joint will keep their prices the same?
The problem is the world just doesn't work the way you seem to think it does. Real life is messy - and when a business jacks up its prices good chance it will lose some customers.
Not sure it would even if everyone earned the exact same minimum wage.
Does the burger joint sell to any retired folks that are living on a fixed income? Or to people that lose their jobs because of a hike in the minimum wage? Or to someone that is a small business owner and was just forced to pay all his people (earning mw) an extra $1.50 an hour? Or to anyone not earning minimum wage?
How will they afford to pay the extra?
Yes, when you think about it, you realize that all prices are labour, and so doubling the minimum wage should simply result in doubling all prices and everyone ends up exactly where they were before. Of course, that assumes that everyone "needs" to maintain their purchasing power relative to the minimum wage worker. In the example from the video, a 30 cent payrise for non-minimum wage workers could easily compensate everyone else for a $1.50 pay rise to the minimum worker. Real minimum wages peaked in 1968 and are now half that figure. Why was it okay for the minimum wage worker to lose all that purchasing power in the first place? Why did you never complain about that? Are you saying that with all our new technology over the last 45 years, productivity has decreased?
Liar loans have allowed real estate prices to go from a good house costing 55% of the minimum wage to the cheapest house in the cheapest suburb costing 100% of the minimum wage. What has that done to purchasing power? Look at the price of all the other real estate. A business can survive a quadrupling of real estate prices but can't survive a increase in minimum pay, even when it guarantees an increase in income to the poorest customer?
The business fights to keep the truckload of profit completely to themselfs, while the employees are fighting to be able to keep a roof over their heads and food on the table..
To Ford or not to Ford? http://www.sfgate.com/opinion/reich/article/What-Walmart-could-learn-fro...
Please give an example of "truckload of profit". Is it a Matchbox truck or a semi trailer full ? Do you have an idea for what would be a fair and just wage for all businesses?
140,000 jobs created when millions are needed?
You mean cost of good might go up if minimum wage goes up... LOL
If you already have an excess supply of a commodity --
Forcing an increase it its price would cause even less to be used.
We already have a large number of people that are unemployed (excess supply of a commodity) I can't think of a reason why mandating an increase in the price of labor would do anything except create more unemployed people.
Since when have labor costs been able to defy the basic principles of economics?
This is mostly just politics -
Hello all,
I am new to studying economics, but luckily I found zero hedge and austrian economics early on. I am thus open to new information because I am terribly informed yet. In terms of price discovery as a sort of natural process, we see that governments can manipulate prices of assets, etc. But I think many of the folks who post here that manipulation will eventually fail. If central planners can manipulate assets to have higher prices it stands to reason that central planners would manipulate to make other markets undervalued such as gold and labor.
I am not arguing that a central planning agency like a government raising a minimum wage would help matters, but labor standing up for itself to have their employers properly value their labor is a very different matter, right? If the company is wildly profitable, then it seems that their labor has a higher value. We don't need a higher minimum wage in such a case. We just need management to realize it is okay to have a 25 room mansion instead of a 35 room mansion.
What's wrong with my ideas? Tear me apart!
They will argue that management really wants AND deserves 50 room mansions. There is absolutely no limit to the greed.
Nothing really wrong with your opinion - but just do some math to help shed some light on it.
When the CEO of a company with 100,000 employees makes $100 million.
If you cut the CEO pay to ZERO and divide their pay up between the employees it ends up being
$100,000,000 / (2,080 X 100,000) = ~~ $.50 an hour
If you have a great CEO they can create way more value for the company - I am thinking billions more.
The REAL problem is when some idiot loser that does more harm than good ends up making $100 million.
I have worked for some really fantastic people and a few real butt heads - and their is no doubt - when I was at a company with a fantastic CEO I ended up making way more cash that when I was at a company with and idiot running the place.
So - if you get the right person as your CEO - the company, the stockholders, the employees, the customers, the community can all win.
Leap of faith is - can anyone really figure out (before they are hired) which CEO will create billion of value for all stake holders - or which is a complete value destroyer?
Will the company really be better off hiring the best CEO it can - even if it costs them $100 million - or paying everyone else an extra $.50 an hour?
Awesome! Let's pay these Gods $500 million. Shit, that's only $2.50 an hour. How about $2 billion. They are superhuman. They certainly deserve it. I've asked this question before. How did CEO's drag themselves to work during the last 60 years of the 20th century? These great and amazing men were paid soooo poorly. It doesn't make sense! How did companies fill these positions for such lowly wages? I need to know!
It is not that hard -
A great CEO is worth it - a dud CEO should be fired.
The real problem is companies allow the dud to stick around earning millions.
The fact is - there are millions of people capable of flipping a burger or stocking a shelf - and only a few that have what it takes to provide leadership for a large company.
Honestly would you rather work for a company with a fantastic CEO making $100 million or work at a company with a horrible worthless POS CEO that is making $32K a year but all the employees make $.50 more an hour?
one problem with that. right now the primary qualification of a multi- national CEO (besides being able to pleasure 5 banker cocks at the same time) is to have no allegience to the united states or their fellow citizens. that means they are all trash.
Tell him he's wrong:
"Companies that are profitable are usually in the right place at the right time, and that's all there is to it. Those companies could be managed by gerbils and they would still make money hand over paw. Sure, in the beginning somebody invented something valuable, or stole it from somebody else, but since then it's been strictly auto-pilot. So forget about making the company more profitable, it's out of your control. Put your energy where it will make the most difference: surviving your frustrating and thankless job."
- Dogbert's Introduction to his "Big Book of Business"
http://homepage.eircom.net/~odyssey/Quotes/Popular/Comics/Dilbert_Other.html
Wages are only one factor in the building of a business. A good operating plan ( efficient organization ) as well as productive employees are necessary for success. You will have competition which seems to be ignored in the bashing of "management". Good employees manage themselves in the function they are performing. Middle managers co-ordinate work flow and the implementation of scheduled process improvement. All elements must be in place to earn profits and stay ahead of competitors.
Even in the bastardized enviroment of today's market with political pressure applied to differing groups to secure an aim unrelated to your endevour the requirement of responding to the customer's determination of value is paramount.
I suggest you read Emerson's essay on price. The best employees must get their price; if management refuses to pay the price it will be extracted from the operational efficiencies and the competition that pays that price will achieve an advantage. Organizations that fail to compete for the best human resourses are doomed. The price must be paid yet over payment will produce the same result. It ain't easy.
A good employee can produce one widget per day. An excellent employee can produce two widgets per day. But the machine that either one of them can operate can produce one hundred widgets per day. Now how does the excellent employee add value? He can start early, finish late, keep his area extra neat and tidy. Is any of that going to significantly increase his value?
Fred can produce twice as much as Johnny.
Johnny earns ten dollars per week.
How much can Fred earn in the "free market"?
So many people think they can earn more because "they are better". Sure, they might be better. But when the poorest guy is earning fuck all, you have to be twice as good just so you can earn twice of fuck all.
Canary Paint:
See if you can make sense of the comments I made above, number 4199534.
If you can figure that out then you are a thousand miles ahead of most people. But it is not that hard. Especially if you've only just learnt about supply and demand curves and you are prepared to think about them. (Note that if you don't think then you'll end up doing silly things like asserting that people on different wages have the same demand curve.)
Next thing you have to do is stop worrying too much about wages for the moment and look at debt and real estate prices, because these days, that is where the real action is. I keep recommending people read Michael Lewis's Liar's Poker and The Big Short Inside The Doomsday Machine. Sorry for the plug, if you don't want to buy then just go to the library. These two books explain what really happens to your money and why you can't afford to buy a house. (Actually, more has happened since then but those two books are a great introduction).
If there was a free market in real estate then why is it so expensive? Why is the minimum mortgage repayment approx. the same as the minimum wage? Why aren't there competing builders building homes for poor people? Why is it that we can afford to build homes that no-one can afford to buy? You're never gonna learn about that when they teach you SD curves.
Google "Steve Keen" and look at his debtwatch website.
Understand that economics has been corrupted and is propaganda. Some rich guy pays economists to make up excuses for his agenda. No different to people who corrupt religion to suit their agenda.
"You will be richer if you are poorer." Same message from both economists and orange people.
http://en.wikipedia.org/wiki/Rajneesh_movement
Economics is a make-up science invented to explain to poor people why its a good thing to act as slaves for the lazy rich people. The rich pay the economists a lot of money to draw nice charts and think of worthless models to support this scam. Economists do talk a lot and spit out a lot of expensive words, but they are never able to avoid the bubbles and bursts or to predict a major crisis.
http://healthvsmedicine.blogspot.be/2008/06/economics-is-bullshit-cont.html
You hit the nail on the head. A bunch of rich guys pay and publicize the economists that push their agenda. Economics may have started with noble intentions but it is now simple propaganda. "We have scientific proof that you will be richer if you are poorer and we are richer." That is it.
How about we let free markets decide what wages should be.
Even unfree markets have a self regulating feature:
They pretend to pay us. We pretend to work.
dupe
Free markets don't decide anything else. Why pick on wages?
How about we let businessmen decide how much their customers get paid.
That might work.
The "free markets" decide how much money people can borrow to buy real estate. How is that working out for you?????
/sarc off
Probably not WM employees participating anyways...
http://www.economicpolicyjournal.com/2013/11/walmart-protests-lack-actua...
Union front groups are planning more than 1,500 protests at Walmarts nationwide on Black Friday despite lacking significant support from actual employees, reports FreeBeacon.com.
“They’re not the type of grassroots worker-driven efforts that media portrays them to be,” Ryan Williams of Worker Center Watch said. “They’re protests held by professional protesters—oftentimes paid and given training—to cause a scene for publicity.”
They're protesting the offshoring of manufacturing jobs to $.17/day Indonesians or they are trying to get paid $20/hr to ring up the groceries?
"We must #RaiseTheWage to strengthen middle class families"
Raising the wage does not strengthen middleclass families, as it does not apply to middle classs families. It raises prices for middleclass families, which does not help them.
Somebody needs to watch a video: http://blip.tv/zgraphix/capitalism-hits-the-fan-a-lecture-by-richard-wol...
I was surprised I agreed with everything he said.
Easy to follow, well constructed, very good video to pass around to the uninformed
The only problem is that the economy has gone global, a proces that will continue. Which makes it a compleet other game. You can arrange things in your own country, but you have to compete with countries like China, Russia and the emerging markets which do their own thing.. While i kindy (think) can comprehend a small local economy and the effects of different politics on it, at least at basic level, i have no real clue when it comes to the global interaction of those economies.. So the only thing an individual can do(beyond complaining ;-) ) is trying to compete on the market at best level, sharpen your skills and hope that it will be enough to provide for a living into the future.
WM emplyees need danger pay:
http://m.nydailynews.com/1.334059#bmb=1
hmm
I took n a class, about 1978, called Economics of Social Issues. The text stated that a minimum wage was supported by unions because it strengthened them. A minimum wage kept the unskilled out of work in that particular field, and ensured a stable wage to those already in the union.
I've always wondered is there any truth to this belieff.
NO
These idiots protesting should be protesting the borders. More competition for labor would boost their wages.
Harry Reid's and Barack Obama's NEW MIDDLE CLASS: minimum-wage McDonalds and Walmart workers.
Give all employees .0005% of a bitcoin asa bonus and call it even.
High minimum wages? Seems like it works wonders in Europe. I hear youth unemployment over there is low these days.
Ouch..
No capitalist can ever bring himself to understand the 'Trinity Formula' thus all that is left is to condescend the masses as they fall below subsistence wages in the hope that the policy of the stick ensures they remain sufficiently defeated to stop asking for what is already theirs.
On one media outlet they shout that there's so little consumption and its terrible effect on 'their' profits and upon the next they bare their teeth at the mere request of a wage that could sustain a human being.
Disgusting people with disgusting ideologies who show more concern for endangered animals in the third world than the human misery they are directly responsible for three streets away from where they live.