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CEO Hikes Minimum Wage To $70K, Capitalist Tragicomedy Ensues
Meet 31-year-old Dan Price.
Dan is the CEO of Seattle-based credit card payments processing firm Gravity Payments, and three months ago, he did a funny thing.
After talking with a friend who confessed to having difficulties making student loan payments and rent each month on an annual salary of $40,000, Dan decided to set a $70,000 per year pay floor at Gravity.
Dan was not, The New York Times says, looking to insert himself into "the current political clamor over low wages or the growing gap between rich and poor." All he wanted to do was improve the lives of the 120 or so people who worked for him and after reviewing some literature on the subject, he decided that $70,000 was the level at which workers start to experience "an enormous difference in [their] emotional well-being."
Predictably, the initial response to the new policy was quite positive. Here’s The Times:
Talk show hosts lined up to interview Mr. Price. Job seekers by the thousands sent in résumés. He was called a "thought leader." Harvard business professors flew out to conduct a case study. Third graders wrote him thank-you notes. Single women wanted to date him.
But even as Dan adjusted to life as a rebel hero and basked in his newfound popularity among third graders and single women, he quickly learned that whether he liked it or not, he had waded waist deep into the minimum wage debate and he would soon discover a few very hard lessons about the unintended consequences of hiking the pay floor.
First, some employees felt it wasn’t fair to indiscriminately give everyone a raise. That is, some felt Gravity should at least pay lip service to the notion that there's a connection between higher pay and performance and because the new pay plan didn't seem to acknowledge that link, the company lost some workers.
Two of Mr. Price’s most valued employees quit, spurred in part by their view that it was unfair to double the pay of some new hires while the longest-serving staff members got small or no raises. Some friends and associates in Seattle’s close-knit entrepreneurial network were also piqued that Mr. Price’s action made them look stingy in front of their own employees.
Maisey McMaster was also one of the believers. Now 26, she joined the company five years ago and worked her way up to financial manager, putting in long hours that left little time for her husband and extended family. "There’s a special culture," where people "work hard and play hard," she said. "I love everyone there."
She helped calculate whether the firm could afford to gradually raise everyone’s salary to $70,000 over a three-year period, and was initially swept up in the excitement. But the more she thought about it, the more the details gnawed at her.
"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 said. To her, a fairer proposal would have been to give smaller increases with the opportunity to earn a future raise with more experience.
A couple of days after the announcement, she decided to talk to Mr. Price.
"He treated me as if I was being selfish and only thinking about myself," she said. "That really hurt me. I was talking about not only me, but about everyone in my position."
Already approaching burnout from the relentless pace, she decided to quit.
Next, Gravity began to lose some of its long-standing customers and while the across-the-board pay raise won the company more than enough new business to make up the difference, the new accounts won’t be immediately accretive and in the meantime, Gravity has had to hire more people to service the new accounts and thanks to the new salary floor, all of those new employees will eventually have to be paid $70,000.
A few customers, dismayed by what they viewed as a political statement, withdrew their business. Others, anticipating a fee increase — despite repeated assurances to the contrary — also left. While dozens of new clients, inspired by Mr. Price’s announcement, were signing up, those accounts will not start paying off for at least another year. To handle the flood, he has already had to hire a dozen additional employees — now at a significantly higher cost — and is struggling to figure out whether more are needed without knowing for certain how long the bonanza will last.
Dan’s benevolence is also costing him friends in the business community where some say Gravity’s new pay floor will embolden minimum wage workers in their quest for higher pay.
Brian Canlis, a co-owner of his family-named restaurant, is also a client. He said he was fond of Mr. Price, but was more discomfited by his actions.
Mr. Canlis is already worried about how to deal with Seattle’s new minimum wage, which rose to $11 an hour in April and is scheduled to reach $15 an hour for small businesses within five years.
The pay raise at Gravity, Mr. Canlis told Mr. Price, "makes it harder for the rest of us."
Finally, Dan is now being sued by his older brother and as it turns out, Maisey McMaster had not included a "provision for legal fees in case my brother sues us" line item in the new budget, which means that ultimately, Gravity may have a hard time staying in business.
Less than two weeks after the announcement, Mr. Price’s older brother and Gravity co-founder, Lucas Price, citing longstanding differences, filed a lawsuit that potentially threatened the company’s very existence. With legal bills quickly mounting and most of his own paycheck and last year’s $2.2 million in profits plowed into the salary increases, Dan Price said, "We don’t have a margin of error to pay those legal fees."
Lucas Price owns about 30 percent of their company, although he has not actively been involved in day-to-day operations for several years. There had been tensions between the two long before the new pay plan, and Lucas is demanding that Dan buy him out for an unspecified amount, plus damages.
* * *
To be sure, there are number of lessons here and indeed, the Gravity story touches on several topics we've discussed at length over the last several months.
There's no question that surviving in America is becoming more difficult by the year for an alarmingly large subset of the population and part of the problem is anemic wage growth for 83% of the workforce. In fact, just last week the Department of Labor said the employment cost index notched a meager 0.2% increase in Q2 - that's the smallest quarterly gain since record keeping began in 1982.
Despite claims that this miserable data point was anomalous, this ECI print clearly suggests that for all the publicity around the minimum wage debate, and despite (or maybe even because of) the growing pressure on employers to raise the pay floor, wage growth is virtually non existent. Thus, across-the-board pay raises seem to be suffering from the QE paradox that's now playing out in Sweden - that is, the more you do it, the less effective it is and at a certain point, it even begins to undermine itself.
Meanwhile, easy access to credit has led to an explosion of student loan debt and yet that debt has created a preponderence of degreed job seekers. In other words, college degrees are now so common as to reduce their value for prospective employers which has had the unfortunate effect of transforming many college educated, would-be professionals into waiters and bartenders.
Needless to say, paying off $35,000 in student debt is tough when you're relying on tips to make ends meet and it's made all the more difficult by the fact that rents are soaring. With lenders still stinging from the collapse of the housing bubble, underwriting standards are still relatively tight (for homes anyway) which means, to quote WSJ, households are being squeezed "between rents they can't afford and homes they can't qualify for."
Meanwhile, the gap between the rich and the poor is widening materially on the back of Fed policy that, while ostensibly designed to rescue Main Street via the elusive "wealth effect", serves only to further enrich the wealthy by inflating the value of the assets most likely to be concentrated in the hands of those who were already rich in the first place.
Whether Dan Price realized it or not, his move to raise the pay floor at Gravity was destined to be seen as an emphatic reaction to each of these economic realities. But as we saw last week with WalMart, addressing the rise of class segregation and the disappearance of the American Middle Class by resorting to across-the-board pay raises comes with a long list of unintended consquences and as Tony Hsieh learned when he attempted to transition Zappos to a "bossless" corporate culture, predicting how employees will respond to what seem like unequivocally worker-friendly policies is quite difficult.
So while we wish Gravity the best of luck with the new pay structure, we fear that if anything, Dan Price's experience will serve as a cautionary tale to employers who may now think twice before embarking on one man crusades to address the nation's social and economic maladies and ultimately, if the company's very existence continues to be threatened by the fallout from the wage hike, Gravity's employees may soon find that the new pay floor is, like everything else in the world, subject to the law of... well, gravity.
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Fine example of the new liberal socialist generation.
Communal living social media etc etc.
The future is bright!
Its also a fine example of the narcissistic pinheads that cant just survive and prosper with a well paying job, but somehow don't feel complete unless another person is paid less.
wrap yourself inthat commie blanket oddjob. feel warm n comfy do ya?
There I was, respecting the right of a business owner to renumerate his employees as he chooses, there you are chiding him for exercising his rights, who's the real communist?
It is just a fact that some people are more reliable and work harder than others.
Setting a flat scale pay structure guarantees that those who excel and work harder than others are not rewarded and those that are lazy and unreliable will remain so. No incentive for either party and a guarantee 'fail' over time.
Or just not employ materialistic psychopaths that get bent on co-workers salries, or even better, realize that this is only a problem with white collar workers mainly in the financial industry that do nothing all day but sponge up free money and worry about what the guy next door earns.
You're logic is quite sound ... in Utopia.
Here in the real world ... it's fatally flawed idealism. Of course, that's redundant.
Sure nut sack, I'm sure if you had busted your ass for years, then your nut sack boss decides to give all the employees under you, including the ones that were just hired 2 days ago, salaries equal to yours. Oh, Sorry Mr. oddjob, no raise for you! You make 74,500.... PuTz
Maybe you should have busted your ass making yourself rich instead of toiling for a boss you hate. Putz.
Barley - If my boss did what Dan did after I helped build the company I would be pissed out of my fucking head and quit.
The user Headhunter is correct. Employees need incentives. It is good pyschology to be noticed by your boss for hard work and loyalty.
I ask an employee what there monetary goal is then I tell them what I expect for that renuneration.
In general it has been bad politics that has stagnated wages while inflation (tax) is turning our country into Mexico. The condo where I lived was bought by a larger Boston corporation.
The property manager Eric lived next door. He had been with the company for five years he did a stellar job for $35,000 a year. He quit because the company wouldnt give a raise to $38,000. The company hired a bunch of Mexicans. I had to call six times to get my AC fixed over two months. They painted half the porch and left it that way for a week.
They powerwashed the building and these people were so dumb they powereashed under my door. I slipped and fell and settled with the corporation. I could have really ass raped them but was very fair. But I am going to buy a new primary residence. They lost a customer. Now multiply this story all over the US and people wonder why we are going down the shitter.
On second thought most dont wonder, they know the real issue is lobbying, buying politicians who sell out. I have no qualms against Mexicans, I know a few who work real hard in construction and make a decent living. They have incentive while the ones at this property corporation don't. So they are lazy and stupid as shit.
Same as a lot of hotel chains in the Carribean. They dont pay shit so the staff takes an hour to bring a fan or extra pillow. I stayed at one and tipped them all.
My son was 10 at the time and got a bad ear infection. The whole hotel mobilized, we were picked up in a limo, brought to a doctor where there was 25 people in the waiting room. She saw us immediately, wrote a script. She would not charge me. The limo brought us back and I asked the driver what I owed him. He told me nothing. I asked why. He told me I was one of very few who tipped and tipped well (I didnt think $10 a pop was outrageous).
Attempting to equalize outcomes fails. It is evolution. Some are born luckier than others. Best that can be done is we all follow the same set of rules something definately not happening right now.
Isn't this a convenient story for those of us who believe in a living wage. They are taking this man's decision to be good to his employees, maybe too good, to propagandize those who have no understanding of economic issues into believing that people do not deserve a living wage. No, not $70,000/year...just enough to afford the basics: shelter, food, medical care...
Agreed. They have to keep the fight over the -ism's and Demican/Republicrat and Conservative/Progressive going to keep all the hamsters on the wheel.
Anything but: sound money, productive capacity, career employment, and bankruptcy enforced along with the rule-of-law for the banks/corporations/insurers.
+1 but what is this rule-of-law thing of which you speak? Is it a fantasy like the unicorn? Or a sentimental relic like the Bill of Rights?
Didn't he say the rule-of law for banks?
There is no such thing as a living wage. As soon as you make more you find new ways to spend it. Unless you want to live your life frugally, no debt, no baubles, no extravagances.
Generally, most people that make more spend and go deep into debt trying to live a lifestyle. Sadly, given the chance most would opt for the McMansion, the back yard in ground pool, the fancy new car, the vacations, the lifestyle of the rich and famous.
Nice if you can afford it.
A living wage for some is a poor house for others.
If everyone making minimum wage now was paid the living wage of $15/hr, the cost of everything would jump to soak up that money. Rents would go up, along with food prices, clothing and everything else. Even their income and payroll taxes would increase. There is no free lunch and for every action there is an opposite and equal reaction. The laws of nature have not been repealed yet.
Sounds good to me. But just wondering?
" No, not $70,000/year...just enough to afford the basics: shelter, food, medical care..."
So like does food include steak? hamburger? or Ramen? you know just to like clarify.
Well, Ramen's ok as long as you've got a pot to piss in.
Turd burgers on moldy bread.
Steak obviously, don't you care about my emotional well-being?
Convenient lawsuit. Wonder who is paying the brother Lucas' bills?
Wish this article had talked more about WHY what this CEO did was bad economically-speaking. As it currnetly reads, it sounds more like a bunch of selfish people quit because they didn't like how the pay raise of other employees made them feel. That's not the actual lesson here. The lesson is around why minimum wage is a broken concept to begin with and carries with it increasing, unavoidable consequences the higher it is set.
This company should be used as an example of the problem, but the article needs more analysis of why it was stupid to raise the min wage to $70k. There's no teachable point present in this article, so it has no value for the people who need an economic education the most and who I'd like to send this article.
https://mises.org/ will cover that, specifically with this story, multiple times, real soon.
They love covering Minimum Wage articles. In fact that is all they do, minimum wage articles.
Bankster can steal the world, and they will be lamenting about Minimum Wage laws for waiters and bagboys.
You got it. Most of these useful idiots ... useful to our rulers that is ... hate labor movements more than they hate the banksters whose damage to this country has been so much greater. But factoring in magnitudes are always a problem for the simplistic. They "know" what is good and bad but they have difficulties discerning what is better and worse.
Z
The only useful idiots are those who believe labor rates can be set at an artificially high rate with no effect on commerce -- and the businesses that are forced to pay them.
If we had a small government with limited ability to expand the money supply, free markets and less regulation, then crony capitalism would go the way of the dodo and the "living wage" problem would take care of itself.
If one has children one can easily see how ego's are affected when doling out the weekly allotment, or allowances.
Older children get easily enraged if the youngest, who may have less responsibility receives the same amount of allowance as the oldest child that may have significantly more responsibility.
Of couse wrapping your self-worth into how much you earn is a self defeating enterprise.
Pretty much. It is a hatchet website masquerading itself as a libertarian one. Just paid shill & selective-issue whores for their corporate masters.
So every business that pays its workers bare minimum is doing great, right?
And/or importing most of its workforce from India?
Cute.
Let's all go down to the soda shop while this country turns into Mexico....
{which, of course, is probably the idea...}
They know their enemies. It's those $9/hour workers that want better. They're trying to steal our freedom! Yes, we should all be free to live in lean-toos and eat grub worms!
Z
Might well as well get in front of the wave. You can be a grub and lean-to consultant on the other side of the bottleneck.
Another politically correct socialist bumps into reality.
He could do this easily if he worked for Uncle Sugar. When you work for .give, I mean .gov there are no mechanisms that prevent this from happening.
Thanks for the laugh and two fabulous zingers!!!
Uncle Sugar and .give are rolling off my tongue from this moment forward!
Priceless
Wait, there's more: .give is short for Givernment. :-)
I'm a member of the FSA and I'm entitled to your earnings.
Gimme, gimme, gimme.
After reading this story, I gave myself a raise.
bout time, you deserved it. Unfortunately you also gave .gov a raise.
Doh!
Anyone can READ atlas shrugged. Not many, apparently, understand it.
We paid some (unworthy)folks
What the hell did he think was going to happen?
"Publicity and single pussy" was what he thought was going to happen!!
On that level, mission accomplished!
The business consequence were probably not as well thought out as his "fifty shades of grey" routine he was trying to pull off!
Henry Ford knew he had to pay his workers a living wage in order to get them to be able to buy his cars.
Henry also knew a lot about where the troubles in the world stemmed from.
He wrote a series of articles that were, surprisingly, published in a newspaper.
Someone had the wisdom to collect them and publish a book about this global problem.
It's called
The International Jew.
Same problem now.
He paid a high wage, sure, but it wasn't arbitrarily high, and it wasn't equal. It was based on performance. In this case, he just gave a bunch of money to a bunch of people and left his mid and top tier employees in the cold.
Also, it is more accurate to say that these problems stem from central banking than from Jews, even though jews by and large control the central banks (not all of them, though). If you are going to invoke collectivism, at least use the right collective. Venn diagrams help.
this topic was covered on zh comment board just few day ago. it was to do with turnover. the hype that they could buy ford cars is what i would call marketing
http://www.forbes.com/sites/timworstall/2012/03/04/the-story-of-henry-fo...
All y'all bitchez in here should get 70,000 +1s even if your comment sucks. Welcome to Murica!
Look, you bitch, I have been on zero hedge longer than you. I should get the 70k and you should get, maybe, just maybe 45k.
LOL.
genius comment +1
The obvious answer to low wage growth is more jobs. More jobs change the supply demand equation. The tsunami of regulations, taxation and cronyism of the last few decades has taken it's toll of the profitability of adding new employees so businesses are just not hiring people.
On more salient point is that the results are all too obvious to anyone who knows the Bible...
https://www.biblegateway.com/passage/?search=Matthew+20&version=ERV
Ain't gonna help, Num. You can creat all the 3.00 an hour jobs you want to, and things only gonna git worse.
Sounds like every union. Pay everybody the same regardless if they're a useless POS or a productive superstar.
That is not what he did. He simply increased the minimum pay for anyone who works for him.
It's the same thing at the limit. IE if he had set the minimum wage equal to that of the highest paid employee.
Everyone is an AHOLE, but I have an un regulated solutionl
i thought this guy was going to up the pay of people that made $40k but should have been making $70k....because they work at a startup and took a pay cut etc etc etc. this idiot just gave 'everyone' a raise for a socialist bullshit reason. that is stupid.
His money. He is also guided by higher principles. He is taking from himself to give to people he works with. One can quibble with the sledgehammer approach....... but.
No, I don't think it is all his money. Older brother, banks...
Wow.
The saying among the employees must be "the Price is right!"
Another well-meaning, but mis-guided, attempt to 'fix' a problem caused by the very system you are trying to repair.
Trouble with wages, as with everything else, is that no one really knows WHAT anything is worth anymore. Price-discovery for everything has been obfuscated by artificially jacked-up prices in many asset classes, which in turn obfuscates the price-discovery mechanisms of other assets that are using them as collateral.
The result? We only see the numbers. Bigger numbers are better. How do I judge my pay against yours? Well, it's better if my number is bigger. And if yours gets bigger and mine doesn't, that's bad...
So we end up in a scenario where a bunch of folks decide to quit a 70k a year job, working for a guy who is apparently pretty open to the idea of sharing his company's wealth with his workers, and why?
Because they're mad that someone else's paycheck number went up and theirs didn't...Presumably now they will all find other jobs at 70k, with a boss who shares the same philosophy as their old one...
Bwaahaahaahaa! Good luck with that...let us all know how you make out there...
If I had the skills this guy was looking for, I'd gladly accept a position. And I wouldn't lose a minute's sleep over the janitor's pay raise...
Michael Hudson tells a story when he was riding in a limo with former US Federal Reserve Chairman(Miller?) that most Americans are not jealous of millionaires, they are jealous of their neighbors.
You will loose sleep when this company goes bankrupt and you and the 70k a year guy who quit are both looking for a job. Managers at Costco start out at 35,500...enjoy
Reminds me of 20th Century Motors.
Finally a man of principle and who acts in accordance with principle. He should run for president; more than half of Americans would vote for him; and most of the media wound never bring up the detail about his ruining his company. They never bring up such stuff in regard to Obuma.
"Finally a man of principle and who acts in accordance with principle. "
HOW is it principled to seize the entirety of the profits of the last business year from his co-owners -including his own brother?
Dan DOES NOT own 100% of the company. He did not just dole out HIS portion of the profits: he doled out everyone else's as well and promised to do so on an indefinite forward basis.
IMHO, it is not principled in the least to EXPROPRIATE one's co-owner's and family members in pursuit of an ideological agenda.
The 2-year community college grad janitor is happy; he got a pay hike to $70k from his previou salary of $16.5k
The PhD with 20 years experience is not so happy.
It's awesome!
The most important thing to keep in mind about this is that, regardless of the predicted outcome, this CEO implemented his little socialist experiment with HIS money.
He did not implement it with loot stolen from others at gun point, and/or under the treat of violence. He just did it, and then found out why it won't work.
I say kudos to him, regardless of how ignorant we may think his attempt was.
Liberty is a demand. Tyranny is submission.
I agree with, kchrisc on this.
I don't particularly care what an individiual decides to pay his employees. I care when force is applied to the scenario.
Did you ever consider that corporations that bash down workers' wages by bringing in people from overseas, etc. are also applying force? Force is not predicated on a state to back it.
Z
"The most important thing to keep in mind about this is that, regardless of the predicted outcome, this CEO implemented his little socialist experiment with HIS money.
He did not implement it with loot stolen from others "
WRONG !!! Can't you fucking read??
He EXPROPRIATED $660K in amassed profits from his co-owner and brother, and at the same time allocated forward profits in like without reservation -and is rightfully being SUED for it.
Dan didn't decide to dole out just his portion of the profits of the company: he EXPROPRIATED his business partner/brother.
It may not be ALL his money. Sounds like he has at least one partner in his older brother and I would bet that there is a bank or two or a VC that has ownership. It is not a coffee or sandwich shop.
If the ownership were that far spread out, the chances are quite low he acted against their wishes.
Mr. Price proved himself to be incredibly out of touch with human nature AND a very poor listener. He blew off the concerns of his most knowledgable, loyal and hardest working employees. Now he is reaping the consequences.
Pay everbody not to work.
I'll buy that for a dollar.
Hey, look at me I'm a member of the FSA and I don't have to work.
But, I do need a robot to do my shopping using my EBT card.
Who does the think he is, . . . the government?
"
Less than two weeks after the announcement, Mr. Price’s older brother and Gravity co-founder, Lucas Price, citing longstanding differences, filed a lawsuit that potentially threatened the company’s very existence. With legal bills quickly mounting and most of his own paycheck and last year’s $2.2 million in profits plowed into the salary increases, Dan Price said, "We don’t have a margin of error to pay those legal fees."
Lucas Price owns about 30 percent of their company, although he has not actively been involved in day-to-day operations for several years. There had been tensions between the two long before the new pay plan, and Lucas is demanding that Dan buy him out for an unspecified amount, plus damages. "
This is just another story about a CEO acting unilaterally and against the interests of the shareholders. Dan either made his decision without consulting his co-owner and brother or did so despite his co-owner/brother's reservations. He could have dipped into his own compensation or share in the profits to do this but took everything he could lay his hands on...
He robbed the till of $2.2M -'the balance of last year's profits'- 30% ( $660K ) of which arguably belonged to his own brother.
It sounds like Dan did this in part to 'win' an argument with his brother by spending his portion of the profits of the business and thus deprive him of his share of those profits past, present and future...
Now he can't backpedal without looking like a complete idiot to eveyone that agreed with his actions and vindicating everyone that disagreed with his actions. IF this year and next year are not as profitable as last year Gravity will be in the hole.
The 31 yr old should not have been in charge. He probably did not work his way to that position and showed a lack of experience. It would have been common sense to include some raises for everyone.
The 26 year old who quit a 70k a year job for this reason doesn't have much common sense either. If anything, that alone proves she wasn't worth 70k...
She may well have got a higher paying job elsewhere for all you know.
it seems like his mistake was, effectively failing to reward longevity and productivity. I don't think anyone believes paying everyone equally regardless of their performance or book of biz, or whatever makes much sense.
That's a different thing, though, from attacking the guy for wanting to pay people over the market's Mendoza line with his own dough.
And it should be mentioned - Walmart raced to the bottom on the backs of US taxpayers. This guy didn't cost me shit - he just learned that if you pay some new hire similarly to someone who's been in the trenches for you, they're going to feel betrayed and abused.
"with his own dough. "
IT WAS NOT 'his own dough.
Dan DOES NOT OWN 100% of the company. He looted the till and promised to do so on a forward going basis indefinitely.
Dan EXPROPRIATED his co-owner/brother.
that may be true, i don't know the company rules on who agress what pay structure.
perhaps the lessons learned are "
1. successful and failing businesses should check the impact on business cash flows if everyone got the same percentage pay increase or decrease that results in the highest minimum (maybe 70,000, maybe less)
2. talk to the groups that would get a disproportionate rise/benefit to others from the percentage increase and see if they can take less to increase the minimum.
3. pay the increase in shares
who knows, that may make things work out better or worse, but an individual making an arbitrary decision acorss a complete supply chain and stakeholder group is hardly ever (never?) going to be the best answer
Someone on the radio predicted this exact outcome for this company.
And the outcome was? He's not out of business. There hasn't been an outcome yet!
Z
So you are betting that the company survives? I'll go with the under.
- Ned
Can we also have August off for vacation?
The competition should be partying hardy over this.
INDICTMENT
Americans are criminals because Americans violate the Constitution of the United States of America.
The U.S. President Obama, the entire U.S. Congress, the CIA, the FBI, the U.S. Military, and the entire Police Force of these United States SWORE to protect, serve and uphold the U.S. Constitution.
The U.S. Constitution forbids usage of debt as money (referred to as 'notes') and stipulates that only gold and silver can be used as money.
Yet,
Americans commit or support and condone the murder and torture of human beings throughout planet earth in the name of democracy and freedom, all for the sake of acquiring Constitutionally fraudulent and illegal Federal Reserve Notes a.k.a (counterfeit) U.S. Dollars.
Since the United States is a democracy and Americans only elect Democrats and Republicans who perpetuate this unlawfulness,
Americans are indicted criminals according to the United States Constitution.
Spread the word.
So, you're saying the dumbed down floridated, boob toob watching, celebrity worshiping, iPhone hypnotized masses are responsible for all this just cause they're brainwashed into thinking that voting Dumbocrat and Republiturd is the right thing to do?
More BULLSHIT on an anti-worker crusade! Right ZH, you don't even pretend to conceal your bias. If this CEO lowered everyone's salaries and 50% of employees quit, you would keep your dirty fingers in your pockets and not on a keyboard.
Thanks again for a laugh, I am sure your idiot following (Putin cocksuckers, Muslims cunts and neo-Nazis old farts) loved it.
Let me get this straight, you still think that raising wages to the artificial rate of $70,000/year is pro-worker?
No but even the $15/minimum wage hour (which by the way the DNC or no one is supporting nationally) is $31,200. Of course this is bad policy but the any time I hear anyone argue about 'well why don't we make it $100/hr' or 'let the market determine rates' as if some magical force will benevolently work its magic instead of employers colluding to keep wages down.
My grandfather in Reading, PA, who was a labor organizer and wildcat striker in textile mills learned about reality the hard way in the 30s. Got a metal bar to the head which left him with a scar above his right eye for the rest of his eye by a strikebreaker while the police looked the other way because they were in the pockets of the textile owners and large industrialists in town including the Reading Railroad. You have a right to organize and strike out in front of our mill? The fuck you do. You'll leave or our strikebreakers and private paid goons will beat you senseless while the police simply look the other way.
The only thing that prevented his house from being firebombed was the deal they cut with organized crime to 'protect' his house because the police wouldn't find anyone if something had occurred.
This is about workers only...come back in a year or two., see if that business is still around, or it gets out-competed/outsourced, or probably autobot'ed by tech. There are better ways to do charity.
And the end results of fast food workers pushing for the artificial rate of $15/hour for fucking up your order will be just as entertaining. No one could have seen this coming.
Indoor drive thru. Moar safety glass.
If the situation were completely reversed, and this guy had LOWERED the pay, and his brother was complaining, everyone would be high-fiving him and saying that at 30%, the brother got outvoted.
It isn't about what he did, it's about who benefited. When the benefit accrues to the top, it's good business. When it goes to the bottom, it's socialism...
Hypocrisy has a rank stench.
The oligarchs LOVE the libertarians because they are their useful idiots. That's why jackasses like the Koch brothers back these dumbasses. Yes, fools agitate for "freer" markets that we dominate with our leverage, fight for less regulation and lower taxes ... provide some populism behind our oligarchal rule!
Z
The capitalism comedy started when banks got bailed out with taxpayer money.
Bernie gets it
Note the "qualified", not everyone
BERNIE 2016!
Bernie Sanders 3 hrs ·If we could bail out Wall Street seven years ago, we have got to make sure that every qualified American, regardless of income, can go to college without going into debt. And, Wall Street has a responsibility to pay for that.
WOW! This guys a CEO and he couldn't see where this was going? I may be an ape but I'm able, not STUPID...
I think he was trying to get laid. Makes you do stoopid stuff.
LMFAO!!! Good job Price you fucking idiot. Socialists never learn.
Where are you getting your cash from now asshole? The Fed?
The calculations are in:
If 1.5 million liberal university professors all across America, like Paul Krugman, (Fauxchohontas) Liz Warren and Robert Reich, et al., give up just 10% of their university salaries then all 3.5 million fast food workers across the USA could get a $5 hour raise!
So -- what say ye, Ms. Warren? ...Mr Krugman?
He's a debt collector and his turnover rate is high.
So. he raises the minimum on an employee who will never last the year.
Does ZH vet these articles for sanity?
Call Center Representative is not a career.
I bet he is fantasing he is Steve Job.
He's a bottom feeder.
He could have achieved the same result through bonuses and still retain the fkexibility to adjust rewards according to both circumstances as well as reflect on the effects of his initial decision.
I feel for the guy though because already across America there are ountless individuals who receive the same basic pay and yet they all perform at starkly different levels.
The reaction of some of his employees reminds me of the upset caused by a deceased's will when one child who is a goody two shoes is offended by the parent leaving the same amount to the other child who is profligate.
In that business, the bonus calc is always changing.
Stability only exists for executives.
And their bonuses aren't calc'd the same way.
It's a business run by scumbags.
Ah yes. Another bleeding-heart socialist fuckwit.
Come on buddy give the man a break. We finally have someone wanting to practise trickle up economics and it offends you?
As long as no one is being under paid by market standards, who cares what he does with his profit?
This is just a classic case of envy borne out of a sense of relative worth.
No quarter. While as a majority stakeholder in the business he is within his rights to do with it pretty much as he pleases, but this is just plain stupid.
He made a unilateral decision to financially ruin what appears to be a successful company over what he apparently perceives to be some manner of social injustice. And pissed off the real value in the company, the employees.
If everybody gets paid the same, what's the point of making the extra effort? Call that what you will, I call it human nature. The old Soviet saying, "they pretend to pay, we pretend to work" comes to mind here.
I have owned businesses with employees in the past. I'll never do it again. Don't get me wrong, I had some great people working with me (not for, with) and in a couple of cases, their monetary compensation exceeded my own. Not because I am a nice guy or an idealist, but because these were skilled engineers that stepped up, worked smart and invariably made the company money. They didn't want a piece of the action, they wanted paychecks. And, they ran circles around the noobs whose ink was still drying on their licenses.
I paid for demonstrable value, plain and simple. Arbitrarily deciding to pay everyone, irrespective of experience or value to the company and effectively bitch-slapping the existing employees already making the new minimum (presumably because they did it the old fashioned way - they earned it) because you think it is the right thing to do is, well, just plain stupid. It showed a lack of respect and to my mind, a lack of business acumen.
Your experience should be a reality show on the Boob Toob.
If there was sarc there, apologies for missing it. Business 20+ years ago bears little semblance to what passes for it today. But, I suppose in the context of reality shows actually having any resemblance to reality they purport to represent, then perhaps you have a point.
I don't think my experience is all that unique, but I really don't know. I could have given myself a fat salary, but even if I couldn't pay myself the fat salary, I still had to pay the taxes on a fat salary, so it made no sense to pay myself really anymore than I would have paid an employee for billable production.
Basically Communism/Marxism: equal pay for unequal work/talent/intelligence/risk.
I've heard rumors that it doesn't work very well.
Another report on this story included that he was paying a web designer $40k and that guy will now receive an increase. $40k is absurdly low for a web designer, unless he's a total newb with no education - in which case $70k might be too high.
Price (sic) is just a goofball, lucked into a very profitable little scam, had no real idea what he was doing before, never heard of ideas like "salary compression", woke up one morning and decided to do this stuff. Maybe he should have just embezzled $50k from himself and gone lion hunting instead.
Apparently I was wrong the other day, we need both mandatory minimum employment quotas for businesses (so that the evil capitalists can't cut their workforce which as we all know they dream about every night) AND laws preventing employees from quitting (so that filthy kulak employees can't flee like the vile rats they are). Then we jack that minimum wage up like 1000% and we will have a true worker's paradise in no time.
Self-evidently, we need to ignore the causes of relentlessly rising cost-of-living (actually, falling affordability of energy, which of course, is merely mean reversion to the long-term trend) and throw everything at the symptom by pretending the price signal does not exist and pushing the wages of jobs whose value is relentlessly falling (in reality, it's negative).
What will the bleeding hearts do when, inevitably, the next hike the minimum wage quickly fails to gain the employee any more energy (productivity declining, margins crushed, small businesses re-decimated, etc. etc. etc. and of course, consumer prices rising in affordability terms, even without wage-push inflation!)? That's a stupid question! Raise it again!
You'll like France then.
Giving debt collection a good name?
Is this guy from Chicago?
So wait... you mean liberal talking points do NOT translate into anything close to REALITY?!!?!? They are just horseshit?
Dang, I m going to return my 3 pairs of personally signed Hillary Clinton XXXL panties.
Sounds like he got rid of the right people and proved that nobody is so "special" that they can't be replaced if they get butthurt over other people coming up in the world. This article is misleading in its subject matter, but very revealing of the terrible attitude that has caused worthless "management" types to drive this country into the ground.
Exactly! This article is so puposefully misleading. It's been twisted into propaganda from the established parasitc order for the ignorant who have no clue who their real enemy is...who really think raising the minimum wage a few dollars is worse than allowing the greedy, unscrupulous, self-serving executives and CEOs gain exorbinant profit off the real hard work of others.
the filing threshold for income tax in 1913, adjusted by government inflation statistics which are themselves far lower than actual inflation------------is now currently 60,000 dollars.
so when income tax was first introduced if you made at least the equivalent of 60 grand, you didn't pay a dime AND NO PAYROLL TAX EITHER PAYROLL IS REGRESSIVE INCOME TAX RELABELLED AS A LIE.
the standard deduction should be raised to 40k. no joint filing , and NO PAYROLL TAX FOR MEDICARE/SOCIAL SECURITY.you can even allow withoholding to continue as an emergency measure put in place after ww2.
3 CHANGES TO REVOLUTIONIZE THE TAXCODE on the bottom end.. 40k standard deduction. no payroll taxes, and no joint filing.
3 changes on the top end. -----------
A) ALL UNEARNED INCOME IS NOW TREATED LIKE EARNED INCOME (CAPITAL GAINS IS TAXED LIKE NORMAL INCOME) .
B) NO TAX FREE DEBT INSTRUMENTS OF ANY KIND.
C) ELIMINATE THE 501C3 TAX SHELTER MODEL WHICH FAR BIGGER THAN ALL OFFSHORE TAX SHELTERES COMBINED. ----JUST SIMPLY ELIMINATE 501C3.
I have a better idea: abolish taxation and let the chips fall as they may.
What about no tax only any capital gains or investment. Its a tax on the inflation that the government caused.
when income tax was first introduced...
But nobody could've seen that coming!!1!
Fire all these useless paper pushers and replace them with robots?
I was trying to think of something glib to say about this article, but the whole story is one big punch-line.
This is what happens when an "idealist" runs a company. The same thing happens on a national level when we get idealist leaders.
I think he will go under.
Having employees is really costly. perhaps Gravity should consider making all of them Independent Contractors? Research the benefits Mr. Price. You may be surprised. And let the workers be.
You do realize what you're saying right? It's too expensive to have a traditional employee but it is more affordable to have independent contractors? It's almost as if there is a massive entity sitting in the middle like a black hole syphoning off revenue. I wonder what it could be.
That "massive entity sitting in the middle like a black hole syphoning [sic] off revenue" is government. Contractors can and do make economic sense for many businesses. I know, I do contract work only and when I need more bodies for a contract, I sub that out as well. Employees are a phenomenal burden on a business and for a wide range of reasons, so there has to be a compelling business case to justify having them.
dup-o-matic
Jesus already threw down on this topic – Matthew 20:1-16. Yawn.
Jesus already threw down on this topic...
I was thinking the same thing. If it's yours, it's yours, one is free to do with it whatever one wants, just don't cheat anyone out of an agreement.
There's another story in Acts with a couple that sold some property and wanted to give the proceeds away that were dealt with rather severely when it came to light their motivation to do so was less than virtuous. Acts 5:1-11
Wealth is a very common topic in the Bible and it's always fascinated me to see how God uses it to confound the wise, strong, powerful, and other divinely apportioned virtuously endowed persons to reveal our common weaknesses, foolishness and sinful depravity.
One technique I've tried to use in dealing with it personally is to try to think in a 150 year interval, i.e., what difference will this particular decision make 150 years from now? Kinda my version of the 1000 yard stare.
I was thinking the same thing. If it's yours, it's yours, one is free to do with it whatever one wants, just don't cheat anyone out of an agreement.
Sounds to me like there was an agreement that the brother would recieve 30% of the profits.
Those profits have been given to the labor instead.
Sounds that way. It was also pointed out that as a minority shareholder, he may not have had the juice to vote in favor of himself. Democracy in action.
If he was aware of the risks of his ownership of this venture, he should've unloaded it to one of these enlightened customers lining up to buy their services. In fact, CALPERS/CALSTRS would probably be interested. When it goes belly up, it can be sucked up by GS/JPM and combined with their other SNAP program schemes. They can use the tax write offs to offset their "fines".
Another argument in favor of a constitutional republic combined with an equal opportunity to trustworthy information, indoctrination free education and equal protection under the law imo.
Dear God, save us from the fricking do-gooders paving the road to hell with good intentions.
Yeah, paying workers more is really paving the road to hell ...
Z
nice myopic thought
Sorry, the road to hell has been blocked.
We've put up signs that say, Keep Out, and Hell Is All Full Up.
I hear limbo is nice this time of year.
Ask Detroit and other soon to be bankrupted munis...
ZeBow - I would say employers are in a race to the bottom taking advantage in a depression. Big companies get exemptioms from the law and get can deal with inflation. The small business guy not so much. Your conflating the two as one entity. Dan could have structured this as inventives. I paid my employees based on productivity and loyalty.
The problem with underpaying in general is you trade long-term gain with short-term gains. Since the executives get there's now in the current cycle of government not enforcing the rules you wind up with a lot of executives looting the company. They dont care what happens 5 years down the road. But your arguments lump us all in together.
Ill just tell you in my experience every time I put an inventive in fromt of an employee with the caveat of increased production in exchange me and the employees were happy. The rare couple times early in the business I didn't neither me nor the employee were happy.
Especially disingenuous good intentions!
An illegal can somehow travel from Ecuador to my driveway and still offer cheaper rates.
America, Fuck yeah!
and is he only taking a salary of $70,000 a
LOL - yeah right
He treated me as being selfish and........
Yep, being productive and competent, and wanting to be rewarded accordingly, is the new selfish.
One of my kid's friends (high schooler's) said "if everyone had the same salary in the US, everyone could make $100k/yr."
My response: "Who gets to decide who cleans toilets for $100k/yr and who becomes a brain surgeon for $100k/yr.?"
I had a young employee tell me college education should be free for everyone. I told her that you realize it would then be worthless dont you? She said I never looked at it that way
I have to call it like I see it: that is a stupid remark, or you are assuming that college provides exactly zero skills that are useful for work. It isn't a badge.
Show me a living wage of 110k a year and I'll show you a 300 dollar loaf of bread.