Neither does unregulated capitalism!!!


And forgive me if I don't give a rat's behind about the margins of Wal-Mart. The oligopoly is not good fit our nation.


By the way, I understand and agree with most of what you are saying. I'm just thinking of solutions to help my class.

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Right now Walmart operates at roughly a 3% profit margin.  That's hardly a profiteering glutton.  I have a close family friend that used to be involved as as a human resource manager for walmart.  one of interesting things about their business model is that they have one of the most liberal promotion policies around.  They are very clear about the fact that you can come in as a cashier making 7.25 and as you learn and grow in your knowledge and performance you can become the manager of a profit center or greater. 

The Walmart near us has recently raised their entry-level wage to $10.25/hr., over $2/hr more than the state's minimum wage. Interestingly enough, when I ran by Wally World last night to pick up some packing supplies, I bumped into a sales floor supervisor I know while he was outside on a smoke break, so I stopped and had a chat with him to let him know about our move. The topic of the entry-level wage bump came up, and he mentioned that several of the front-line supervisors were actively looking for new jobs because of it. Apparently, their pay was not raised as well, and they're only making $10.50-11.50/hr. This means that the cart jockey who was making $9/hr. is now making very close to what they do, only his job duties are extremely simple compared to theirs and have not been increased at all to compensate for the huge bump in pay. This, understandably, greatly irritates them (the supervisor's language was more colorful than mine). The justification that he was given when he and a couple other supervisors asked the store manager if they'd see raises as well was that the store has to "protect its prices", and thus could not afford to increase the pay of those already making $10.25/hr. or more.

 

Anecdotal, I know, but still an interesting conversation to have. I suspect the raise was to attract potential employees to that store, which has always had staffing problems because it, like everything else here, is on the fringes of nowhere.

 

The pizza joint increased their minimum wage to $15.  If they'd started out at $12.25, a 20% increase is $2.45.

 

$12.25 + $2.45 = $14.70

 

So in reality, these guys increased their employees wages by 30 cents an hour and eliminated the tips, which in Berkley/Emeryville are near 20%.

I don't follow your math. Not trying to be difficult, I just genuinely don't see where $0.30/hr. is coming from. Are you assuming that $2.45/hr. is what they were making in tips?

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I don't follow your math. Not trying to be difficult, I just genuinely don't see where $0.30/hr. is coming from. Are you assuming that $2.45/hr. is what they were making in tips?

 

Yes.  If management said "no tipping, we'll just pay our employees 20% more" then it would equate to a $2.45/hr raise.

 

In one of the articles, one of the wait staff mentioned that it was actually a small decrease in pay due to the actual tipping rate being slightly better than 20%, which is believable if you've ever been to Berkley.

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Neither does unregulated capitalism!!!


And forgive me if I don't give a rat's behind about the margins of Wal-Mart. The oligopoly is not good fit our nation.


By the way, I understand and agree with most of what you are saying. I'm just thinking of solutions to help my class.

 

Let me say this.  The concept of capitalism isn't inherently antithetical to the baseline concept of government oversight.  For instance, if you're a butcher then every customer isn't going to have the ability to make sure that the meat you are cutting isn't contaminated.  (even though as a business owner it is in your best interest to serve the highest quality meat you can to attract future customers, and you're customers can't patronize if they are sick or dead.)

 

There is a role for elected officials to make sure that companies are honest in their advertising and bring products to market that aren't going to kill people.  That's the role of a referee.  That being said, when they start telling people how to do things, how much to pay their employees, how much of certain products to make, etc. etc. etc. the inflexibility in that structure has historically lead to irrevocable market distortions and the collapse of the underlying economy.  

 

So i would contend that even the most ardent Free Marketer, myself included, would object to third party verification that businesses are honest and fair.  

 

As for Walmart, i think that their profit Margin is relevant.  I wouldn't simply call them part of an oligopoly.  If they are keeping their market share through continued expansion and innovation then i think they are providing a service to the nation in the form of jobs and cheap goods.  You can compete with Wal Mart, just not on price.  You beat Wal Mart because of more personal service and higher quality products.  For me, the dangers of big corporations is when they derive their gerth in whole or in large part because of unfair allegiance with government agencies squashing legitimate competition through the rule of law.  

 

I can understand your feeling about helping your class.  I felt the same way for a long time.  For me, there was a change when i realized that for the most part America isn't truly a CLASS system.  there are a few of the Elite elite elite elite elite that may want for nothing and are set up for a good life but that's actually a lot fewer than you think.  

 

of the top 5% (rough numbers): 10% are doctors and lawyers, 10% are top level executives, 5% are super sales people 74% are entrepreneurs and only 1% get their money from inheritance.  

 

I think the most untapped solution to upward economic mobility of the "middle class" is to allow them to own a greater portion of the efforts of the 74% though equity investment instead of state ownership through taxation (I have a whole boring theory about what Karl Marxx and Adam Smith would have actually compromised on had they lived in the mid 20th century but it would be off topic.) 

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Here's how I see it...  From a small business / middle class worker point of view...

 

The number 1 employer in the USA is Walmart (I heard this on some news show).  Walmart imports most of the goods from overseas in order to keep thier costs low.  They also have economies of scale, so when they purchase thier goods for sale, they get a discount that a smaller business could not get...  So they have driven their costs down, and have in essence driven out small business competitiors.  The only people that can compete with Walmart's prices are the other big chains (Target, Costco, ETC)...  

 

To exaserbate this, we have move to becoming a service based economy, we really don't manufacture that much, except for war materials...  So we have no high paying manufacturing jobs available to workes.  And even in the service based economy, the major players are generally large conglomerated corporations.  So based on our economic policies of little regulation
and free trade agreements we've helped the big businesses at the expense of small businesses and middle class workers.

 

It's time to level the playing field.  It's time to put in some rules that even's the costs that small businesses cannot compete with.  

 

I got to get ready for the day...  But it's something I'm thinking about in regards to the minimum wage.  Consider this:  A minimum wage that only affects the consolidated corporations that are traded publicly but does not affect small businesses could potentially help level the playing field and allow small businesses to compete...  

 

At the end of the day, small businesses are would will help our economy.  If we concede that manufacturing is never coming back, we should begin to figure out a way to ensure we as educated and skilled middle class workers are not having our wages stagnate.  And we should also come up with solutions the level the playing field so that markets are not dominated and taken over by only a few corporations that own all the market share.

 

Believe it or not, you do make a point in a way that is a conservative point of view.  the only part that I disagree with is the part in red.  Regulation more than anything is what hurts small business.  I just read Carly Fiorina's Book Rising to the Challenge: My Leadership Journey.  Here is a quote from the book.

 

 

Bureaucracies crush human potential, but they do not do so equally. I know firsthand that the rules and regulations churned out by bureaucracies like the EPA and the IRS are relatively easy for big businesses to handle. Big corporations have the lawyers and the accountants to cut through the red tape. It’s the small businesses whose potential is crushed. They can’t afford to jump through all the hoops that bureaucracy creates, and that suits big business just fine. More regulations and more complex taxes mean less competition for them. One of the greatest fictions ever peddled by politicians is that big government is necessary to fight big business. In fact, the opposite is true. Big business and big government are mutually reinforcing. They need each other, and they know it. There’s a reason why six of the wealthiest counties in America are directly adjacent to Washington, D.C. Big business pays big money for lobbyists to influence big government.

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There are 10 kinds of people in this world.  Those who understand binary and those who don't.

Anyone saying that it's impossible to compete with Walmart need look no further than Target, which is generally 3-5% more expensive.

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of the top 5% (rough numbers): 10% are doctors and lawyers, 10% are top level executives, 5% are super sales people 74% are entrepreneurs and only 1% get their money from inheritance.  

 

 

 

Link?

 

Because I don't believe that for a second.

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Little Cesars $5



Just sayin..

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Little Cesars $5



Just sayin..

$6 here. Costs too much to bring the ingredients in for the franchisee to make any money at $5. Stupid capitalism.

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Link?

 

Because I don't believe that for a second.

 

Full disclosure, that's a stat i know off the top of my head from work.  

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Full disclosure, that's a stat i know off the top of my head from work.

Saw a stat 40% of Forbes top 400 inherited huge amounts of money. Your 1% figure is off. Way off.

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Saw a stat 40% of Forbes top 400 inherited huge amounts of money. Your 1% figure is off. Way off.

Do you know how many people are in that top 5%?

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“An empty vessel makes the loudest sound, so they that have the least wit are the greatest babblers.”. - Plato

the top 1% is roughly 3 million people right?

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Do you know how many people are in that top 5%?

I'm not understanding your point. I can look into it, but I do not believe your 1% figure is correct.


At the same time I'm not saying the figure is 40% either. Merely making a point.

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I think the most untapped solution to upward economic mobility of the "middle class" is to allow them to own a greater portion of the efforts of the 74% though equity investment instead of state ownership through taxation (I have a whole boring theory about what Karl Marxx and Adam Smith would have actually compromised on had they lived in the mid 20th century but it would be off topic.) 

 

This actually sounds interesting!  If you are up to it (which I have a feeling you are) why not create a thread regarding this Marx/Smith theory and we can all discuss?

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I'm a small business operator in business for 20 years now. My lowest cost employee makes more than I make. There's this thing called competition where if I raise my prices to compensate for higher minimum wage I lose customers to my competition. I've lived it for 20 years. I have menu items which haven't been increased in price in 10 years despite 4 increases in minimum wage over that period. I just eat the margin losses.

 

Why do I do it? I'm retired from the corporate world and receive a pension. I don't rely upon my business profits to pay for our living expenses. I am paying off the mortgage on my business property and my payoff will come when I sell the property. I also do it because a person must have something to do. God didn't make these bodies to be sedentary and there is only so much golf and fishing a person can do. However, if I had to pay $15 per hour for a high schooler to wash dishes I would be forced to lay off people and raise prices on items I thought I could without losing too many customers. If the reduction in customer volume was too much I would be forced to close and go work for Walmart.

 

Regards......................the Chiefjag

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Same story, different perspective:

 

LA Times article

 

BTW, I've paid 30 bucks for a pizza before, AND had to leave a tip.  Just sayin'

 

If anything, I think the "No tip" part of Lanesplitter's plan may be the more radical part of it.

There are pizza places here where their pizza is like $25 plus $2.50 per topping that doesn't come on the pizza

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I'm a small business operator in business for 20 years now. My lowest cost employee makes more than I make. There's this thing called competition where if I raise my prices to compensate for higher minimum wage I lose customers to my competition. I've lived it for 20 years. I have menu items which haven't been increased in price in 10 years despite 4 increases in minimum wage over that period. I just eat the margin losses.


Why do I do it? I'm retired from the corporate world and receive a pension. I don't rely upon my business profits to pay for our living expenses. I am paying off the mortgage on my business property and my payoff will come when I sell the property. I also do it because a person must have something to do. God didn't make these bodies to be sedentary and there is only so much golf and fishing a person can do. However, if I had to pay $15 per hour for a high schooler to wash dishes I would be forced to lay off people and raise prices on items I thought I could without losing too many customers. If the reduction in customer volume was too much I would be forced to close and go work for Walmart.


Regards......................the Chiefjag

Chiefjag if everyone is paying the same minimum wage then why would it effect your business more than your competitors? Or you saying nobody would eat out again?

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When you have ten times more customers to spread the cost over then you can mittigate cost increases. Walmart only needs a three percent margin because their volume is rediculous. And bigger businesses have more cash reserves so if they post a loss for a quarter then they can still make payroll. Smaller businesses where someone started from scratch or a retired person cashed in their 401k those costs are magnified.


Doubling the cost of entry level labor without corresponding increase in productivity or efficency is just forced inflation. Thats why central price controls generally fail.

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Little Cesars $5



Just sayin..

 

Yes. A pile of dough with sugared-down sauce and processed cheese. Yum.

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