About minimum wage

[The Grand Nudger]

I know, I know, lol...it;s just that I love this country, I think it's awesome.....I'd really like to believe that we're better than that.  That we're not a bunch of spineless idiots being led down the primrose path.

Nothing good -has- come from accepting these easily deconstructed "arguments", or siding with the minimum wage employer over the minimum wage employee...and nothing ever will. That's why I, personally, say to those who threaten to retaliate against any obstruction to their exploitation of both the poor and the taxpayer at large, with higher prices to end consumer.....go right ahead asshole. I;'ll enjoy watching you go out of business while your smarter competitors continue to sell that 6 dollar sandwich for 6 dollars...just like they already do.

Good riddance to garbage.

Apparently, that makes me a leftie, lol...which is strange to me, because I always thought that a market kinda guy unapologetically told those that couldn't ruck it as business owners to wither and die. / shrugs

[abaris]

I know, I know, lol...it;s just that I love this country, I think it's awesome.....I'd really like to believe that we're better than that.  That we're not a bunch of spineless idiots being led down the primrose path.

Nothing wrong with your country. But if I may say so, everything wrong with the ones running the show for the last 30 years or so.

You were the first ones institutionalising bribery for politicians. We're not quite there yet, although there are numerous signs on the wall, with the revolving door being obvious. When a guy, without any qualification to his name, suddenly makes it into the management of a major company after his political career.

It's kind of obvious that these kinds of politicians don't give a shit over the population they're supposed to represent. They only care for the ones lining their pockets or provide a future career.

The USA, as it's founders imagined it, is a model. But even a model can be rotten at it's core.

[johan]

I just saw this ... a BigMac in USA costs USD 0.74 more than a BigMac in Australia, despite our minimum wage being about double. So much for the argument that high minimum wage = higher prices...

Its widely known that the margin on restaurant food through the roof. Not every business segment operates on 200% margins. Or even 100% or even 50%.  There are many business segments where just a wage increase of 66% with no other cost increases will push the ledger into the red because margins are that tight. Short of Government subsidies or something similar, there is simply no way those business segments could sustain a minimum wage increase of 66% without raising their prices.

[The Grand Nudger]

Perhaps an example would be in order?  Some segment, which, if it were not able to source labor at the current federal minimum, would have to either close their doors or hope that the public still wanted their product at it's newly increased price (and that's ignoring the obvious and oft-selected solution of setting up a sweatshop in some third world shithole, and ignoring those government subsidies we do hand out, which you do acknowledge, but wish to leave out of the equation...for reasons)?

Personally, I'm hard pressed to come up with such an example..because I work in one of the sectors where labor is very literally 90plus% of the cost to produce..except it isn't subject to the federal minimum in the first place, and I know for a fact that a margin -can- be made on the same products at the same prices to end consumer (I actually like to think that I sell a better product for the same, if not lower, price)....even if you pay people 10 an hour...which I'm doing right now. This segment being the literal well from which all labor flows, since laborers can't labor without food to eat, and theres really no point in making anything if we're all staving.

Where, exactly, does this relationship you've proposed, then claimed not to propose, then reasserted as-proposed, present itself?

[abaris]

Perhaps an example would be in order?  Some segment, which, if it were not able to source labor at the current minimum, would have to close their doors?

There are a few branches where the margins are pretty low. That in itself doesn't say anything on profitability. The secret lies in units being sold, if we're talking about retail in any shape or form.

I guess it can be problematic for small corner delis or the good old general goods store on the corner. However there are numerous loopholes for these businesses to evade minimum wages entirely. Such as only offering part time employment.

[The Grand Nudger]

The margins being low means jack shit unless those margins are unavoidable and directly related to wages, -necessitating- an increase in price.  It seems like there may be a non-insignificant amount of bullshit being peddled here as a distraction, part and parcel of minimum wage fear mongering.  I don't even know what we're talking about until I can see the industry, specifically.  

When we have that example to consider...there will still be things to consider such as..who the fuck cares, beyond the person pocketing the margin?  If your model is bad your model is bad, and barring some compelling interest to keep you in operation by other means (corporate welfare by a hundred names)....buh bye.

[abaris]

I don't even know what we're talking about until I can see the industry, specifically.  

I can give you a very personal example. Also the reason why I mentioned small corner shops and the secret lying in units being sold. My father used to run a small chain of car supply shops. Starting in 1945 and closing down in 1989. Back in the day when people needed car supplies, such as sporty steering wheels, additional headlights, radios, stuff like that. For about three decades he was very successful. But the margins on these articles lay about 3 to 5 percent. So, not a lot of money to be made by selling one or two pieces. In that kind of climate it wasn't any problem to keep up while having the same employees for decades.

Then a few things happened. The oil crisis of '73 and the big chains opening up in the mid 70ies. They undercut the prices for the same articles my father sold. They were able to do that because they ordered several thousand pieces when my father only ordered a dozen and were given better prices by the importers. My father kept going for another decade because he had a lot of regulars. Among them many Eastern European embassys. But he had to lay off his employees since he was no longer able to afford their wages without ruining us in the process.

[The Grand Nudger]

Excellent.  An example.  I have to ask, and you'll have to give me some leeway to be coarse here...but was there suddenly no one to supply car parts...when your father went out of business?  Because if not, it's clear that it was his model, and not the industry, that couldn't take the increase.  Further...they drove him out by offering the service at a -lower- cost to consumer...didn't they?

Your story, though, is familiar to many americans.  Economies of scale, the power of a bulk purchaser (or producer) to dominate the market and drive out competition.  At some point, all other things being equal (I know, hardly ever are)..we just have to accept that the other model was better than ours, strictly comparing business to business.

All the above said, I'm not really sure why it would be an example of an increase in minimum wage making an industry unprofitable? Which is what I thought we were discussing?

[abaris]

Your story, though, is familiar to many americans.  Economies of scale, the power of a bulk purchaser (or producer) to dominate the market and drive out competition.  At some point, all other things being equal (I know, hardly ever are)..we just have to accept that the other model was better than ours, strictly comparing business to business.

Not so much the model as the financial power. If you are able to open up a chain of -say - 30 stores at once and to undercut prices of local retailers, you're bound to have one over them. And that was the case. The ones opening the discounter already had the financial means from other non related business exploits. They originally ran a chain of DIY stores in the third generation. Last year they also went bankrupt because - same old song - getting too greedy and expanding too fast without observing demand.

[The Grand Nudger]

There's no accurate consideration of a specific model that can exclude the purchasing power of the operator. Your purchasing power is -part- of your model. The purchasing power of -their- model made your fathers model un-competitive. Nevertheless, the industry soldiered on, and cost to consumer was reduced, at least so much as I can tell from the narrative. It's very literally the opposite of an example where labor costs put someone under. I bet the other guys had alot more employees, they;d have had to, to fob off all that product, from which their purchasing power derived.