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By the time minimum wage hits $15, he will be operating at a $200k loss. Are you implying that he is lying about that? Or are you just suggesting that some of t

by hueving 10y ago

By the time minimum wage hits $15, he will be operating at a $200k loss. Are you implying that he is lying about that? Or are you just suggesting that some of the employees would be better off unemployed while the remaining that he could afford pick up the slack? Or would you rather the business fold entirely and all of them become unemployed including the owner?

youdontknowtho 10y ago
That would only be the case if this one business were the entire economy of California. The added demand caused by employees with more money to spend will generate more production.
- twoodfin 10y ago
  If you're sure about this, what's the point at which raising the minimum wage would be a net loss for aggregate demand?
  - youdontknowtho 10y ago
    I'm not an economist, so consider me soundly put in my place.
  - cmdrfred 10y ago
    Probably around the natural wage floor that is artificially low due to government subsidies (food stamps, housing assistance, welfare, Medicaid, etc). The unsubsidised wage floor is likely around the cost of living (In California that number is or will be above 15 an hour by the time the law is in place). A minimum wage increase isn't a gift to workers as much as it is a demand that the taxpayer no longer subsidize these businesses.
    - twoodfin 10y ago
      That argument still doesn't seem coherent me. What "subsidy" is Walmart receiving that the Costco across the street is not? Walmart, after all, is paying workers who otherwise would receive even more government benefits. Costco is paying those same workers $0.
      - cmdrfred 10y ago
        I'm not sure what your question is. Costco runs smaller margins than Walmart due to the founders religious ideology that prohibits him from operating like Walmart. Walmart is by far a more profitable model (121 billion gross for Walmart compared to 15 for Costco). The wages paid by Walmart are below the cost of living, if they simply paid them without subsidy their employees would be often unfed and homeless. >Costco is paying those same workers $0. Why would Costco pay its competitors employees? (Beyond what is does already via taxes)
FussyZeus 10y ago
These situations are not solvable by doing basic math, you miss the complexities of the situation. To pay employees better, he'd shift the cost of the salaries to the goods in question, and possibly provide new/different products to address market conditions. Additionally everywhere I've worked, and this is anecdotal but still, when you pay your employees better they don't loathe their jobs quite so much, which leads to better customer service. Some people do still shop for service. If his response to rising operating costs is to not respond at all and continue charging the same prices for the same goods and not move at all in terms of addressing the problem, then he shouldn't be in business in the first place, he clearly has no idea how to run one.
mcphage 10y ago
> By the time minimum wage hits $15, he will be operating at a $200k loss. Are you implying that he is lying about that? Now, that's a good question. Are companies lying when they fight against every law enacted to protect their employees? Are they mistaken? I think most likely: they don't care if what they're saying is true or not. Is that the same as lying? Well, I'll leave that to you to decide. > Or would you rather the business fold entirely and all of them become unemployed including the owner? Well, if the company you work for paid you 33% less, would you rather they folded immediately, so you could look for work elsewhere? Or would you rather that they went on paying you less so they could stay in business—succeeding as a company merely because they're unwilling to pay people what they should?

by hueving 10y ago

youdontknowtho 10y ago

That would only be the case if this one business were the entire economy of California. The added demand caused by employees with more money to spend will generate more production.

twoodfin 10y ago
If you're sure about this, what's the point at which raising the minimum wage would be a net loss for aggregate demand?
- youdontknowtho 10y ago
  I'm not an economist, so consider me soundly put in my place.
- cmdrfred 10y ago
  Probably around the natural wage floor that is artificially low due to government subsidies (food stamps, housing assistance, welfare, Medicaid, etc). The unsubsidised wage floor is likely around the cost of living (In California that number is or will be above 15 an hour by the time the law is in place). A minimum wage increase isn't a gift to workers as much as it is a demand that the taxpayer no longer subsidize these businesses.
  - twoodfin 10y ago
    That argument still doesn't seem coherent me. What "subsidy" is Walmart receiving that the Costco across the street is not? Walmart, after all, is paying workers who otherwise would receive even more government benefits. Costco is paying those same workers $0.
    - cmdrfred 10y ago
      I'm not sure what your question is. Costco runs smaller margins than Walmart due to the founders religious ideology that prohibits him from operating like Walmart. Walmart is by far a more profitable model (121 billion gross for Walmart compared to 15 for Costco). The wages paid by Walmart are below the cost of living, if they simply paid them without subsidy their employees would be often unfed and homeless. >Costco is paying those same workers $0. Why would Costco pay its competitors employees? (Beyond what is does already via taxes)

FussyZeus 10y ago

These situations are not solvable by doing basic math, you miss the complexities of the situation. To pay employees better, he'd shift the cost of the salaries to the goods in question, and possibly provide new/different products to address market conditions. Additionally everywhere I've worked, and this is anecdotal but still, when you pay your employees better they don't loathe their jobs quite so much, which leads to better customer service. Some people do still shop for service. If his response to rising operating costs is to not respond at all and continue charging the same prices for the same goods and not move at all in terms of addressing the problem, then he shouldn't be in business in the first place, he clearly has no idea how to run one.

mcphage 10y ago

> By the time minimum wage hits $15, he will be operating at a $200k loss. Are you implying that he is lying about that? Now, that's a good question. Are companies lying when they fight against every law enacted to protect their employees? Are they mistaken? I think most likely: they don't care if what they're saying is true or not. Is that the same as lying? Well, I'll leave that to you to decide. > Or would you rather the business fold entirely and all of them become unemployed including the owner? Well, if the company you work for paid you 33% less, would you rather they folded immediately, so you could look for work elsewhere? Or would you rather that they went on paying you less so they could stay in business—succeeding as a company merely because they're unwilling to pay people what they should?