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Medium to long-term follow on effects get lost in these discussions. For example: Guess which expenses impacts most prices, the most? Did you guess trucking? I

Medium to long-term follow on effects get lost in these discussions. For example: Guess which expenses impacts most prices, the most? Did you guess trucking? If so, you're correct. To everyone advocating for higher wages, you're actually advocating for higher prices for many of the things you purchase. Same with taxes. Same with company sponsored healthcare. Those greedy shareholders and business owners are feverishly working to control labor costs through continued automation, continued OCONUS production, and continued passing along of costs to customers. I understand this reply will be downvoted into oblivion, but I wrestle with these issues in business every day and feel obligated to point out the unpleasant reality of a globalized supply chain that pits US workers against those making far less outside the US. Its a slow read, this story, and one that is far from over. It doesn't end well for the United States unless public policy changes toward immigration and public aid competition to gainful employment.

93po 3y ago
I have no issue with higher prices to provide workers a livable wage. I have an issue with record profits and profit margins in a period of time that is also seeing record prices for consumer goods and services. The dishonesty from the profit makers is astounding
PaulDavisThe1st 3y ago
> To everyone advocating for higher wages, you're actually advocating for higher prices for many of the things you purchase. I'm advocating for higher wages for truck drivers, and lower wages for trucking company executives. Will it come out in the wash? I don't know. But it certainly means that the net increase in shipping costs is smaller than if you focus only on the increased driver pay.
- sethammons 3y ago
  Basic numeracy: looking at top transportation CEO pay, it is coming out at $5-30M. Grabbing the first company on this list, they have 12k employees. If we completely spread out the CEO comp (which is mostly equity) everyone makes maybe a couple grand more a year. That is going to affect employee pay by less than inflation. https://www.erieri.com/blog/post/top-10-highest-paid-ceos-in-transportation?amp https://www.erieri.com/blog/post/top-10-highest-paid-ceos-in...
  - ekanes 3y ago
    A couple grand a year for 12k people isn't nothing. If you expand it out to more of the C-suite, it gets even higher.
  - wildrhythms 3y ago
    Just looking at the salary is incredibly naïve; these CEOs and other higherups sit on immense piles of stock options purchased with the company's profits.
    - mrguyorama 3y ago
      And way too often weird """loans""" on the companies books made to the execs, with no expectation of repayment.
  - deleted 3y ago
    [deleted]
carlosjobim 3y ago
I upvoted you, because you don't deserve any downvotes for your comment. However: If workers are paid more, they also have more money to spend to purchase products and services. This is good for the vast majority, including almost all businesses. It is good for the workers who get a better material standard and quality of life. There has been a great increase in worker productivity in the last decades, why is that never accounted for? Almost everybody I know who actually work, produce the same as it would take 5-10 people to produce just 20 years ago. That's probably true for truckers as well, with modern logistic systems, huge lorries and better highways. Higher wages and higher prices are probably bad for the huge amount of the population who don't work and never has worked. But with higher salaries, work will look more attractive to them as well.
- uoaei 3y ago
  I downvoted you just because you used upvotes for exactly the wrong reason, justifying it by encouraging others to use downvotes for exactly the wrong reason.
  - deleted 3y ago
    [deleted]
  - carlosjobim 3y ago
    i haven't encouraged anybody to use downvotes.
maxerickson 3y ago
My math is that for something worthless like bananas, the fuel I buy to bring them a couple miles from the store costs more than the fuel to ship them to the store. Of course they truck rather efficiently, but they also sell for ~nothing. How does it work then that the trucking cost is the primary component of the price? Or do you mean something different by "Guess which expenses impacts most prices, the most? Did you guess trucking? If so, you're correct."?
linuxftw 3y ago
Many shipping (as in, the ships on the seas) use slave labor. If the cost of transporting goods raises far enough, including coast-to-coast domestic shipping, that will provide an economic incentive to produce things domestically.
grecy 3y ago
> To everyone advocating for higher wages, you're actually advocating for higher prices I'm constantly amazed at how commonly people have been brainwashed to miss the other perfectly valid option. Lower profits.
- Maxion 3y ago
  If you look at the margins on logistics and grocery stores (at least over here in Europe) you'll find the profit margins are quite poor, around 10% or less. Even if all profits were directed to reduce prices or raise wages it wouldn't have that big of an effect.
  - grecy 3y ago
    Reduce profit of the oil company, reduce profit of the company that made and sell the truck, reduce profit of the tire company, reduce profit of the private company that charges tolls on the roads, etc. etc.
the_gipsy 3y ago
> It doesn't end well for the United States unless public policy changes toward immigration and public aid competition to gainful employment. You mean COMMUNISM!
- jtriangle 3y ago
  It's communism unless it's for the benefit of the military industrial complex, then it's patriotism.
  - howmayiannoyyou 3y ago
    Three of the biggest per capital military spenders are communist countries, and its all sold as 'patriotic duty'. Capitalism is a hope fraud from some, but Communism is hope fraud for all but a few.
rapsey 3y ago
> Guess which expenses impacts most prices, the most? Did you guess trucking? How much of that is the cost of the driver though?
- postexitus 3y ago
  Around 70%, if it's a owner-driver (so includes fuel and maintenance) in UK.
uoaei 3y ago
The market is due for a correction after decades of outsourcing and undercut goods. Convenience came on really fast and now our expectations for the true costs of things have been completely skewed. I'm fine with certain goods getting more expensive, but I fear without the proper treatment the govt will continue to let food and medicine compete in the same markets as luxury and convenience goods (consumer electronics, etc.).
firstplacelast 3y ago
I've thought about his often, too, but I am of the opinion we can all thrive together or die together. As much as I would love to have 20-million in the bank, live off interest, and have the working class cater to my every need, it's an absurd dream. I want the bottom of the barrel to lead a dignified life if they're willing to work a full-time job. If the upper, upper-middle, and even middle class have to readjust, then so be it. The working poor need to stop subsidizing others. It IS a difficult problem, but if the answer from anyone in leadership is others should work full-time and not be able to go to the doctor when needed or buy a crappy condo or worry about food...then those people need to step aside from their positions and allow someone else to at least try (and when I say leadership I'm talking about those that allocate capital and pass laws/policies). I am a big believer that work for work's sake has no virtue, it is better to die on the side of the road than work for peanuts (it's anti-labor and makes the world worse).
- postexitus 3y ago
  So next time you are purchasing something, do you promise not to look for the cheapest option, but the one that pays a good wage to the supply chain? As long as people make purchase decisions based on price, they will be part of the problem.
  - gryfft 3y ago
    "Yet you participate in society! Curious! I am very intelligent."
    - postexitus 3y ago
      Oh - stumped. Were you in the debating club?
  - firstplacelast 3y ago
    No, I don't. It is about bottom-up accountability. Expecting top-down accountability is stupid and a recipe for an unhappy life. We need to teach people to stand-up for themselves, not expect those above them to eventually accommodate them.
Ma8ee 3y ago
> Guess which expenses impacts most prices, the most? Did you guess trucking? If so, you're correct. Can you provide a source for that statement? There are certainly some kind of goods for which your statement is true, but as a general statement I'd say it is just plain wrong.
- abwizz 3y ago
  probably a bubble thing as most produce of the hn crowd does indeed not need any trucking
- michaelt 3y ago
  Well, "impacts most prices, the most" is a kinda complicated statement to parse, so I don't know precisely what the original poster meant. But almost all products on store shelves got there by truck. As do almost all the products in an Amazon warehouse. And almost all the inputs a factory uses will arrive by truck. Even the gas in the gas station arrives by truck. Obviously, this doesn't apply to things like video games, netflix subscriptions, gym memberships or electricity. And obviously, trucking costs are lower per-item for items you can fit more of in a truck, and lower as a % of item cost for higher cost items. You'll notice the cost of trucking a lot more on a bag of onions than you will on an nvidia 4090. If you count a weekly food shop of 50 items as 200 prices per month and a single netflix bill as 1 price per month, "impacts most prices, the most" could be true. Politicians are generally very wary about things like gas tax increases because they don't just increase the amount households are paying at the gas station, they also increase the cost of the weekly grocery shop and many other things too.
  - Ma8ee 3y ago
    Even for relatively cheap and bulky food like potato or onions I’m quite certain that trucking is only a small part of the price in the store.
howmayiannoyyou 3y ago
To everyone advocating for lower C-Suite pay, let me explain how it works: 1. Trucking company ABC needs a new CFO or CEO. 2. Mrs. Smith is a Wharton grad qualified for the role, and Mr. Smith is a Michigan State grad also qualified. Mrs. Smith is 3x the compensation expense to hire as Mr. Smith. 3. Mrs. Smith has a network of bankers, industry contacts and Wall St. analysts she's cultivated over years. Mr. Smith has no such network or specific industry experience. Who would you hire? Who would you want hired if you were an investor in the company? If your existing 401k was invested in this company? As previously stated - the medium/long term considerations are entirely lost on the "pay 'em less" crowd. Its feels great to say and that's about it. To everyone advocating for lower corporate profits: 1. Good luck attracting investment capital. 2. Have fun competing against companies not similarly constrained. 3. Enjoy down cycles where the additional retained earnings would've helped you stay in the fight. The lack of real-world experience and considerations to my original comment is disheartening.
- mrguyorama 3y ago
  It's much simpler than that. Marc sits on Board A, which has CEO Daren, who sits on the Board for the company that Marc is CEO for. Marc votes to increase Daren's comp, who will then go on to vote to increase Marc's comp. CEO pay is completely divorced from reality, and from their performance.
rexpop 3y ago
How can "public policy changes toward immigration" replace wage hikes? Won't that just result in a large population of untermenschen suffering substandard living conditions? Essentially a slave class?
ryandrake 3y ago
> To everyone advocating for higher wages, you're actually advocating for higher prices for many of the things you purchase. I don't think this is necessarily so. How do you know that prices can be raised? What if the market won't bear those price increases? If the price of a product could be raised profitably today, why wouldn't the the company do so, regardless of their labor costs? If McDonalds could sell 10 million burgers for $2 each and 8 million burgers for $3 each, they will raise their prices to $3/burger, regardless of what they pay their employees.

93po 3y ago

I have no issue with higher prices to provide workers a livable wage. I have an issue with record profits and profit margins in a period of time that is also seeing record prices for consumer goods and services. The dishonesty from the profit makers is astounding

PaulDavisThe1st 3y ago

> To everyone advocating for higher wages, you're actually advocating for higher prices for many of the things you purchase. I'm advocating for higher wages for truck drivers, and lower wages for trucking company executives. Will it come out in the wash? I don't know. But it certainly means that the net increase in shipping costs is smaller than if you focus only on the increased driver pay.

sethammons 3y ago
Basic numeracy: looking at top transportation CEO pay, it is coming out at $5-30M. Grabbing the first company on this list, they have 12k employees. If we completely spread out the CEO comp (which is mostly equity) everyone makes maybe a couple grand more a year. That is going to affect employee pay by less than inflation. https://www.erieri.com/blog/post/top-10-highest-paid-ceos-in-transportation?amp https://www.erieri.com/blog/post/top-10-highest-paid-ceos-in...
- ekanes 3y ago
  A couple grand a year for 12k people isn't nothing. If you expand it out to more of the C-suite, it gets even higher.
- wildrhythms 3y ago
  Just looking at the salary is incredibly naïve; these CEOs and other higherups sit on immense piles of stock options purchased with the company's profits.
  - mrguyorama 3y ago
    And way too often weird """loans""" on the companies books made to the execs, with no expectation of repayment.
- deleted 3y ago
  [deleted]

carlosjobim 3y ago

I upvoted you, because you don't deserve any downvotes for your comment. However: If workers are paid more, they also have more money to spend to purchase products and services. This is good for the vast majority, including almost all businesses. It is good for the workers who get a better material standard and quality of life. There has been a great increase in worker productivity in the last decades, why is that never accounted for? Almost everybody I know who actually work, produce the same as it would take 5-10 people to produce just 20 years ago. That's probably true for truckers as well, with modern logistic systems, huge lorries and better highways. Higher wages and higher prices are probably bad for the huge amount of the population who don't work and never has worked. But with higher salaries, work will look more attractive to them as well.

uoaei 3y ago
I downvoted you just because you used upvotes for exactly the wrong reason, justifying it by encouraging others to use downvotes for exactly the wrong reason.
- deleted 3y ago
  [deleted]
- carlosjobim 3y ago
  i haven't encouraged anybody to use downvotes.

maxerickson 3y ago

My math is that for something worthless like bananas, the fuel I buy to bring them a couple miles from the store costs more than the fuel to ship them to the store. Of course they truck rather efficiently, but they also sell for ~nothing. How does it work then that the trucking cost is the primary component of the price? Or do you mean something different by "Guess which expenses impacts most prices, the most? Did you guess trucking? If so, you're correct."?

linuxftw 3y ago

Many shipping (as in, the ships on the seas) use slave labor. If the cost of transporting goods raises far enough, including coast-to-coast domestic shipping, that will provide an economic incentive to produce things domestically.

grecy 3y ago

> To everyone advocating for higher wages, you're actually advocating for higher prices I'm constantly amazed at how commonly people have been brainwashed to miss the other perfectly valid option. Lower profits.

Maxion 3y ago
If you look at the margins on logistics and grocery stores (at least over here in Europe) you'll find the profit margins are quite poor, around 10% or less. Even if all profits were directed to reduce prices or raise wages it wouldn't have that big of an effect.
- grecy 3y ago
  Reduce profit of the oil company, reduce profit of the company that made and sell the truck, reduce profit of the tire company, reduce profit of the private company that charges tolls on the roads, etc. etc.

the_gipsy 3y ago

> It doesn't end well for the United States unless public policy changes toward immigration and public aid competition to gainful employment. You mean COMMUNISM!

jtriangle 3y ago
It's communism unless it's for the benefit of the military industrial complex, then it's patriotism.
- howmayiannoyyou 3y ago
  Three of the biggest per capital military spenders are communist countries, and its all sold as 'patriotic duty'. Capitalism is a hope fraud from some, but Communism is hope fraud for all but a few.

rapsey 3y ago

> Guess which expenses impacts most prices, the most? Did you guess trucking? How much of that is the cost of the driver though?

postexitus 3y ago
Around 70%, if it's a owner-driver (so includes fuel and maintenance) in UK.

uoaei 3y ago

The market is due for a correction after decades of outsourcing and undercut goods. Convenience came on really fast and now our expectations for the true costs of things have been completely skewed. I'm fine with certain goods getting more expensive, but I fear without the proper treatment the govt will continue to let food and medicine compete in the same markets as luxury and convenience goods (consumer electronics, etc.).

firstplacelast 3y ago

I've thought about his often, too, but I am of the opinion we can all thrive together or die together. As much as I would love to have 20-million in the bank, live off interest, and have the working class cater to my every need, it's an absurd dream. I want the bottom of the barrel to lead a dignified life if they're willing to work a full-time job. If the upper, upper-middle, and even middle class have to readjust, then so be it. The working poor need to stop subsidizing others. It IS a difficult problem, but if the answer from anyone in leadership is others should work full-time and not be able to go to the doctor when needed or buy a crappy condo or worry about food...then those people need to step aside from their positions and allow someone else to at least try (and when I say leadership I'm talking about those that allocate capital and pass laws/policies). I am a big believer that work for work's sake has no virtue, it is better to die on the side of the road than work for peanuts (it's anti-labor and makes the world worse).

postexitus 3y ago
So next time you are purchasing something, do you promise not to look for the cheapest option, but the one that pays a good wage to the supply chain? As long as people make purchase decisions based on price, they will be part of the problem.
- gryfft 3y ago
  "Yet you participate in society! Curious! I am very intelligent."
  - postexitus 3y ago
    Oh - stumped. Were you in the debating club?
- firstplacelast 3y ago
  No, I don't. It is about bottom-up accountability. Expecting top-down accountability is stupid and a recipe for an unhappy life. We need to teach people to stand-up for themselves, not expect those above them to eventually accommodate them.

Ma8ee 3y ago

> Guess which expenses impacts most prices, the most? Did you guess trucking? If so, you're correct. Can you provide a source for that statement? There are certainly some kind of goods for which your statement is true, but as a general statement I'd say it is just plain wrong.

abwizz 3y ago
probably a bubble thing as most produce of the hn crowd does indeed not need any trucking
michaelt 3y ago
Well, "impacts most prices, the most" is a kinda complicated statement to parse, so I don't know precisely what the original poster meant. But almost all products on store shelves got there by truck. As do almost all the products in an Amazon warehouse. And almost all the inputs a factory uses will arrive by truck. Even the gas in the gas station arrives by truck. Obviously, this doesn't apply to things like video games, netflix subscriptions, gym memberships or electricity. And obviously, trucking costs are lower per-item for items you can fit more of in a truck, and lower as a % of item cost for higher cost items. You'll notice the cost of trucking a lot more on a bag of onions than you will on an nvidia 4090. If you count a weekly food shop of 50 items as 200 prices per month and a single netflix bill as 1 price per month, "impacts most prices, the most" could be true. Politicians are generally very wary about things like gas tax increases because they don't just increase the amount households are paying at the gas station, they also increase the cost of the weekly grocery shop and many other things too.
- Ma8ee 3y ago
  Even for relatively cheap and bulky food like potato or onions I’m quite certain that trucking is only a small part of the price in the store.

howmayiannoyyou 3y ago

To everyone advocating for lower C-Suite pay, let me explain how it works: 1. Trucking company ABC needs a new CFO or CEO. 2. Mrs. Smith is a Wharton grad qualified for the role, and Mr. Smith is a Michigan State grad also qualified. Mrs. Smith is 3x the compensation expense to hire as Mr. Smith. 3. Mrs. Smith has a network of bankers, industry contacts and Wall St. analysts she's cultivated over years. Mr. Smith has no such network or specific industry experience. Who would you hire? Who would you want hired if you were an investor in the company? If your existing 401k was invested in this company? As previously stated - the medium/long term considerations are entirely lost on the "pay 'em less" crowd. Its feels great to say and that's about it. To everyone advocating for lower corporate profits: 1. Good luck attracting investment capital. 2. Have fun competing against companies not similarly constrained. 3. Enjoy down cycles where the additional retained earnings would've helped you stay in the fight. The lack of real-world experience and considerations to my original comment is disheartening.

mrguyorama 3y ago
It's much simpler than that. Marc sits on Board A, which has CEO Daren, who sits on the Board for the company that Marc is CEO for. Marc votes to increase Daren's comp, who will then go on to vote to increase Marc's comp. CEO pay is completely divorced from reality, and from their performance.

rexpop 3y ago

How can "public policy changes toward immigration" replace wage hikes? Won't that just result in a large population of untermenschen suffering substandard living conditions? Essentially a slave class?

ryandrake 3y ago

> To everyone advocating for higher wages, you're actually advocating for higher prices for many of the things you purchase. I don't think this is necessarily so. How do you know that prices can be raised? What if the market won't bear those price increases? If the price of a product could be raised profitably today, why wouldn't the the company do so, regardless of their labor costs? If McDonalds could sell 10 million burgers for $2 each and 8 million burgers for $3 each, they will raise their prices to $3/burger, regardless of what they pay their employees.