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The Foolish Fast-Food Strikes: When wages increase, jobs decrease is that what workers want?
National Review ^ | 08/05/2013 | Jillian Kay Melchior

Posted on 08/05/2013 7:24:31 AM PDT by SeekAndFind

Thousands of urban fast-food workers across America walked off the job last week to stage protests for higher wages. They want a minimum of $15, or about twice the current minimum wage, and a whopping $6 higher than President Obama’s suggested $9.

Unions and their allies are marketing their efforts as a grassroots push to secure a living wage, but such ongoing one-day strikes are backed by Big Labor, which has an ulterior motive. With union membership dramatically on the decline nationwide, labor leaders are seeking new members wherever they can. Fast-food workers aren’t unionized, partially because the high turnover rate makes unionization difficult. But Big Labor is getting desperate enough to make a serious effort to gain support among this group.

The strike in Detroit was particularly notable. Late last year, Michigan, long a bastion of organized labor, became a right-to-work state, a development met with much rage from the unions. Michigan’s organized-labor movement is fighting for its life, and its influence in last Wednesday’s strike was obvious. Fast-food workers used well-worn union slogans — “hey, hey, ho, ho, [fill in the blank] has got to go” — and were joined in their picketing by members of Detroit unions. Earning minimum wage at a restaurant does make for a miserable subsistence. When I was in college, I worked for a while as a hostess at a Chili’s, putting in long hours to pay for my car, insurance, and gas. I lived with my parents and didn’t have to worry about rent or food, but money was still tight. The job was boring, I left reeking of fajitas, and my feet and legs ached from hours of standing.

But as difficult as that work is, and as unrewarding the pay, Detroit’s fast-food workers are playing a risky game. True, they know they won’t get the $15 minimum wage they’re requesting — that’s merely their opening salvo — but even more modest wage hikes would have devastating consequences for Detroit’s restaurant workers.

Already, Detroit has an unemployment rate of 16 percent, more than double the national rate of 7.4 percent. A bleak Washington Post article recently reported that the job-placement agency Michigan Works! was able to find jobs for a mere 2,300 workers in 2012, “a tiny fraction of those who walked through its doors seeking help.”

Part of the problem is that many of Detroit’s job applicants are very low-skilled. The city has a functional-illiteracy rate of around 47 percent, and almost all jobs require basic reading proficiency. And the new generation’s prospects don’t look much better: Last year, the Detroit Public Schools graduation rate was only 64 percent, which was an improvement over the previous year. Simply put, a lot of Detroiters don’t have the skills they need to find better, more remunerative work.

In that context, the fast-food industry begins to look like a bright spot in the Motor City’s employment portfolio. A 2010 survey by the Physicians Committee for Responsible Medicine found that Detroit has 73 fast-food restaurants, more per square mile than many cities with comparable populations. The Huffington Post reported in May that fast-food jobs outnumber automotive jobs in Detroit by nearly two to one.

Fast food is a labor-intensive industry, the jobs don’t require advanced skills, and the number of available jobs is on the rise. The Bureau of Labor Statistics has projected that employment within the food-and-beverage industry will grow 12 percent between 2010 and 2020.

But it’s a well-documented fact that when wages increase, employment decreases. The Employment Policies Institute has found that labor already costs the typical fast-food restaurant about a third of its income. If those labor expenses increase further, it will put Detroit’s much-needed fast-food jobs in jeopardy.

A Ball State University study, for example, found that when the federal minimum wage increased by 40 percent between 2007 and 2009, it cost 550,000 part-time jobs. And the Employment Policies Institute has reported that when the minimum wage increases by 10 percent, small businesses cut teen employment by between 4.6 percent and 9 percent. And minority youths suffer the most from such cuts.

Big Labor has marketed the fast-food strikes as a chance to fight for the well-being of Detroit’s poorest residents. And protesters are right: A minimum-wage fast-food job is hardly ideal. But having no job at all is even worse.

— Jillian Kay Melchior is a Thomas L. Rhodes Fellow for the Franklin Center for Government and Public Integrity.


TOPICS: Business/Economy; Constitution/Conservatism; Culture/Society; News/Current Events
KEYWORDS: fastfood; minimumwage; strike

1 posted on 08/05/2013 7:24:31 AM PDT by SeekAndFind
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To: SeekAndFind

fast food service is poor enough without making it union poor service.


2 posted on 08/05/2013 7:26:15 AM PDT by School of Rational Thought
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To: SeekAndFind
Idiots.

If I double your pay, all I have to do is cut your hours in half.

Thanks, government run schools for "educating" another generation of nincompoops.

3 posted on 08/05/2013 7:26:21 AM PDT by Texas Eagle (If it wasn't for double-standards, Liberals would have no standards at all -- Texas Eagle)
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To: SeekAndFind

Neil Boortz explains what happens if these workers get their way in his own inimitable way in TOWNHALL:

http://townhall.com/columnists/nealboortz/2013/07/31/waitim-not-quite-through-n1652799/page/full

Let’s just walk through a few logical steps that would follow such an idiotic ploy.

1. McDonald’s doubles everyone’s salary by raising all prices by 17%. Burger flippers are now earning $15 per hour.

2. The price of virtually all McDonald’s items rise. This means more money out of the pockets of all who shop at McDonalds. If a family of four comes in for four Big Macs, fries and some drinks the price increase could equal somewhere around $4.50 or more. Not small change for many people.

3. Workers at other fast food companies quickly abandon their jobs to travel across town so they can work for twice the bucks at McDonald’s!

4. Wendy’s, Burger King, Popeye’s and other culinary castles quickly raise their hourly wages to meet the McDonald’s challenge! Prices go up at these fast food emporiums as well! Now no family can go out for a burger without paying more.

5. Minimum wage workers in other areas, principally retail, learn of the higher wages that can be had by memorizing the line “Would you like French fries with that?” They quit their jobs to search for the fast-food worker’s paradise.

6. In order to keep employees working in retail establishments employers have to effectively double their wages, just as McDonald’s and the rest of the fast-food industry has done. This, of course, means that prices of virtually everything that is sold in retail stores will have to be raised. Now the family that started out paying an extra $4.50 for a meal at McDonalds is experiencing a similar price increase on pretty much everything they buy at the retail level.

7. Many unions have contracts with employers that are based on a multiple of the prevailing minimum wage. If the minimum wage goes up, union salaries go up by a similar percentage. You can only imagine what would happen to some union wages under this scenario, and the resulting price increases to compensate for these increased wages would be incredible. The price increase on a union-made automobile would be substantial.

8. So, as a result of McDonald’s playing this undergrad student’s silly game we find retail prices for basic consumer goods increasing pretty much across the board. The minimum wage workers who benefitted from this ruse soon find themselves with pretty much the same purchasing power they had before.

9. To top this scenario off, some businesses discover that the economics of the marketplace simply will not allow them to raise their prices enough to cover the wage demands brought on by this scenario, and they simply go out of business. Who knows how many jobs will be lost.

All this because some undergrad student at Kansas comes up with a spectacularly brain-dead idea that gets published on The Huffington Post and then drooled over by ignoranus Democrats and assorted leftists who couldn’t tell the difference between a P&L statement and a valet parking ticket.


4 posted on 08/05/2013 7:26:32 AM PDT by SeekAndFind
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To: Texas Eagle

Neil Boortz explains what happens if these workers get their way in his own inimitable way in TOWNHALL:

http://townhall.com/columnists/nealboortz/2013/07/31/waitim-not-quite-through-n1652799/page/full

Let’s just walk through a few logical steps that would follow such an idiotic ploy.

1. McDonald’s doubles everyone’s salary by raising all prices by 17%. Burger flippers are now earning $15 per hour.

2. The price of virtually all McDonald’s items rise. This means more money out of the pockets of all who shop at McDonalds. If a family of four comes in for four Big Macs, fries and some drinks the price increase could equal somewhere around $4.50 or more. Not small change for many people.

3. Workers at other fast food companies quickly abandon their jobs to travel across town so they can work for twice the bucks at McDonald’s!

4. Wendy’s, Burger King, Popeye’s and other culinary castles quickly raise their hourly wages to meet the McDonald’s challenge! Prices go up at these fast food emporiums as well! Now no family can go out for a burger without paying more.

5. Minimum wage workers in other areas, principally retail, learn of the higher wages that can be had by memorizing the line “Would you like French fries with that?” They quit their jobs to search for the fast-food worker’s paradise.

6. In order to keep employees working in retail establishments employers have to effectively double their wages, just as McDonald’s and the rest of the fast-food industry has done. This, of course, means that prices of virtually everything that is sold in retail stores will have to be raised. Now the family that started out paying an extra $4.50 for a meal at McDonalds is experiencing a similar price increase on pretty much everything they buy at the retail level.

7. Many unions have contracts with employers that are based on a multiple of the prevailing minimum wage. If the minimum wage goes up, union salaries go up by a similar percentage. You can only imagine what would happen to some union wages under this scenario, and the resulting price increases to compensate for these increased wages would be incredible. The price increase on a union-made automobile would be substantial.

8. So, as a result of McDonald’s playing this undergrad student’s silly game we find retail prices for basic consumer goods increasing pretty much across the board. The minimum wage workers who benefitted from this ruse soon find themselves with pretty much the same purchasing power they had before.

9. To top this scenario off, some businesses discover that the economics of the marketplace simply will not allow them to raise their prices enough to cover the wage demands brought on by this scenario, and they simply go out of business. Who knows how many jobs will be lost.

All this because some undergrad student at Kansas comes up with a spectacularly brain-dead id


5 posted on 08/05/2013 7:26:54 AM PDT by SeekAndFind
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To: SeekAndFind
The answer, in a word, is yes. Libtards always assume that someone else will bear the job losses and they will get the wage increases.

See baker's union vs. Hostess for a recent example.

Then, when TSHTF, is is somehow the fault of those evil capitalists.

6 posted on 08/05/2013 7:27:58 AM PDT by Vigilanteman (Obama: Fake black man. Fake Messiah. Fake American. How many fakes can you fit in one Zer0?)
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To: SeekAndFind

It’s just going to push owners into full automation faster. And then there will be NO jobs. . . except as a roving Fast-Food Automation Mechanic/Technician. . .


7 posted on 08/05/2013 7:28:22 AM PDT by Salgak (http://catalogoftehburningstoopid.blogspot.com 100% all-natural snark !)
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To: SeekAndFind

MSNBCs progressive Marxist Melissa Harris Perry is real big on this theme that its these employers who are robbing the taxpayers by denying their workers a ‘living wage’, resulting with them on medicaid and food stamps.

However she ignores ‘the employers’ who just refuse to hire over crap like this, does unemployment comp pay a ‘living wage’???

Never hear the GOP respond with that point.


8 posted on 08/05/2013 7:29:37 AM PDT by sickoflibs (To GOP : Any path to US Citizenship IS putting them ahead in line. Stop lying about your position.)
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To: SeekAndFind

It’s all a part of the vicious cycle that hap[pens when wages go up.

It has happened for years. wages go up then prices go up then wages need to go up again to catch up.

We keep telling progressives this , but they never seem to learn.

As for $15.00 an hour. People in hell want ice water.


9 posted on 08/05/2013 7:29:56 AM PDT by Venturer ( cowardice posturing as tolerance =political correctness)
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To: SeekAndFind

Try talking to these people about the consequences of raising the min. wage. They refuse to listen. They don’t want to hear about what has happened in the past. They always convince themselves it’s going to work this time.
If these people were capable of understanding the economic reality of this move they wouldn’t be working at McDonald’s in the first place.


10 posted on 08/05/2013 7:31:07 AM PDT by Wiser now (Socialism does not eliminate poverty, it guarantees it.)
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To: Texas Eagle

“Idiots. If I double your pay, all I have to do is cut your hours in half.”

That’s why they are idiots in the first place. They cannot comprehend the concept of free market economics. Their concept of economics is “whez mah free money, homey?”


11 posted on 08/05/2013 7:31:42 AM PDT by max americana (fired liberals in our company after the election, & laughed while they cried (true story))
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To: SeekAndFind
The very thought of a "living wage" serves as insight to the Totalitarian mindset.

Once a burger flipper, always a burger flipper.

There's no such thing as an entry-level job anymore.

A version of the "caste" system in India.

12 posted on 08/05/2013 7:32:37 AM PDT by Texas Eagle (If it wasn't for double-standards, Liberals would have no standards at all -- Texas Eagle)
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To: SeekAndFind
Won't it result in general inflation that would de-value both debt and savings, and higher taxes as people get pushed into higher tax brackets?
13 posted on 08/05/2013 7:34:05 AM PDT by tacticalogic ("Oh, bother!" said Pooh, as he chambered his last round.)
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To: SeekAndFind
some businesses discover that the economics of the marketplace simply will not allow them to raise their prices enough to cover the wage demands brought on by this scenario, and they simply go out of business. Who knows how many jobs will be lost.

In Totalitarian circles, this is known as a "win-win". Either the union increases its rolls and thereby increases its dues collection, or the helpless little waifs become unemployed and even further dependent on The State.

14 posted on 08/05/2013 7:35:34 AM PDT by Texas Eagle (If it wasn't for double-standards, Liberals would have no standards at all -- Texas Eagle)
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To: SeekAndFind

of course that’s what they want.

The destroy jobs, so they can scream, “we want jobs!”.

Then they demand more policies which destroy jobs - except for government jobs which are a product of patronage, corruption and which further kill capitalism.

The more jobs they kill, they more they get to demand “jobs!”.

It’s a pretty transparent playbook, really.


15 posted on 08/05/2013 7:36:41 AM PDT by ConservativeDude
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To: SeekAndFind

We all have to remember & tell others this:

EVERY single penny that the minimum wage is increased is added to EVERY single union contract in the USA.

No matter how much per hour that union member is already making—a raise in the minimum wage increases their wages by the same amount.


16 posted on 08/05/2013 7:42:28 AM PDT by ridesthemiles
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To: Vigilanteman

Liberalism is based on the concept of no consequences for choices.

That’s because liberalism is the political expression of Humanism, the foundation of which you can read about in Genesis 3:4-5.

“You will not surely die...”


17 posted on 08/05/2013 7:45:17 AM PDT by MrB (The difference between a Humanist and a Satanist - the latter admits whom he's working for)
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To: SeekAndFind

I actually see this as a corporate failure, one they could fairly easily and relatively cheaply alleviate.

Take McDonald’s, for example. If anything, their business is oriented to “economics of scale”, buying vast amounts of everything so that its “per unit” cost is tiny. At that scale, for example, a Big Mac probably costs just 50 cents, including energy and wages.

For them, this means some mind boggling schemes. For example, they want their hamburger to have an exact amount of fat, so they use two kinds of cattle: beef cattle just for the meat, and much fatter dairy cattle just for the fat. They mix the meat and fat together during processing.

In any event, they buy everything this way, not just their food, but cleaning supplies, gasoline for their supply trucks, paper products, light bulbs, you name it. Thousands of items.

And one thing about economics of scale is that waste can be enormous. You can’t just buy 900,000 units of cheese, for example, you must buy 1,000,000, which means 100,000 goes “to waste”

Or, as I suggest, to their employees.

That is, for the most part, they only think of their employees in terms of wages and work. But they shouldn’t. They could give their employees “free stuff” instead of raising their wages, if the “free stuff” is something that they want and would typically buy out of their wages.

There can be a lot of creativity in this. For example, giving “fuel points” to employees, redeemable at a particular gas station chain. Some grocery stores do this for their customers, as a “rebate” to their purchases. So why not give it to employees as a bonus?


18 posted on 08/05/2013 7:47:38 AM PDT by yefragetuwrabrumuy (Be Brave! Fear is just the opposite of Nar!)
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To: ConservativeDude

Eventually all of these franchise owners will receive a visit by a government agency who tells them they no longer own their McDonalds but are mere employees. They will be given a new salary structure, which lo and behold, they will also get a salary.

And McDonalds corporation will be government run.


19 posted on 08/05/2013 7:51:07 AM PDT by EQAndyBuzz (The reason we own guns is to protect ourselves from those wanting to take our guns from us.)
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To: Texas Eagle
Once a burger flipper, always a burger flipper.
There's no such thing as an entry-level job anymore.
A version of the "caste" system in India.

I think you are right. I'm a fairly recent graduate (less than five years ago) in Computer Science; many of the entry-level jobs want "2+ years experience" in the field/with their particular software-stack, it's not uncommon to see "5 years" for these entry-level jobs. (I've even seen 10 years, though only once or twice.)

The problem, IMO, is that companies do not want to train people: they want cookie-cutter computer guys*. That is, of course, a stupid mentality to take, precisely because they [employees] are not simple replaceable parts. (I'm former Army, we had lots of training, and though I've been out for about 4 years it wouldn't take a lot to get back up-to speed; I know the value of training.)

20 posted on 08/05/2013 7:55:17 AM PDT by OneWingedShark (Q: Why am I here? A: To do Justly, to love mercy, and to walk humbly with my God.)
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To: EQAndyBuzz
Eventually all of these franchise owners will receive a visit by a government agency who tells them they no longer own their McDonalds but are mere employees. They will be given a new salary structure, which lo and behold, they will also get a salary.

It's already here: extensive regulation and convoluted taxation.
It's already been done: American Fascism was started around 1900 IIRC. [See Wickard v. Filburn; a USSC decision made unjustly justifying Congress's regulation of everything, even intrastate affairs because they were afraid of losing what power they did have via a court-packing scheme.]

21 posted on 08/05/2013 8:00:17 AM PDT by OneWingedShark (Q: Why am I here? A: To do Justly, to love mercy, and to walk humbly with my God.)
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To: MrB
Excellent! Love your tagline too!

I accept the clearly stated message in Genesis 3:4-5. But it is mind-boggling how many self-professed Christians refuse to do so.

22 posted on 08/05/2013 8:01:32 AM PDT by Vigilanteman (Obama: Fake black man. Fake Messiah. Fake American. How many fakes can you fit in one Zer0?)
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To: SeekAndFind

IMO what we are seeing is analogous to a steam boiler that has had its relief valve plugged.

In the past pressure to raise wages in these positions was blunted by the fact that it was much easier for the average worker to pursue some education or career training and just leave to move to a better paying job.

But five years into the Obama Economy those outlets are drying up. These workers are increasingly seeing themselves stuck in fast food for the long haul. Hence that pent-up energy has got to go into something. And it is going into union organizing and agitation for a living wage.


23 posted on 08/05/2013 8:10:46 AM PDT by Buckeye McFrog
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To: yefragetuwrabrumuy
"There can be a lot of creativity in this. For example, giving “fuel points” to employees, redeemable at a particular gas station chain. Some grocery stores do this for their customers, as a “rebate” to their purchases. So why not give it to employees as a bonus?"

Isn't that how we got into business supplied "health care?"

24 posted on 08/05/2013 8:15:43 AM PDT by goodnesswins (R.I.P. Doherty, Smith, Stevens, Woods.)
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To: Vigilanteman

I did an entire message on how the lies in Gen 3 are still with us in the form of the Humanist worldview today. The more I examined it, the more I was amazed how much the leftist ideology lines up exactly with and derives from those couple of simple verses.


25 posted on 08/05/2013 8:26:21 AM PDT by MrB (The difference between a Humanist and a Satanist - the latter admits whom he's working for)
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To: ridesthemiles; SeekAndFind

You are correct. No minimum wage increase push has anything to do with people making minimum wage. The unions want their wage contracts (and subsequent dues) inflated and the minimum wage is the baseline. If it were up to them, these fast food workers would all become union apprentices or unemployed- not making $15 an hour!


26 posted on 08/05/2013 8:42:10 AM PDT by philled (If this creature is not stopped it could make its way to Novosibirsk!)
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To: SeekAndFind

Not only do minimum wage laws lead to higher unemployment, but the extent to which they do so depends on the extent of union activity in the economic system. The more the unions close off employment opportunities, the greater is the number of workers forced to seek employment elsewhere, and thus the greater in the downward pressure on wage rates elsewhere.
They also deny many people the opportunity of acquiring work experience, knowledge, and skills they might have acquired by means of working. The least-skilled, most-disadvantaged members of society will be less able to compete. Thus, they tend to exert a lifelong depressing effect on people. It both stops them from working and prevents them from becoming qualified for anything better than the kind of low-skilled jobs to which a minimum-wage law tends to apply. Many blacks will be condemned to a life of poverty and parasitism on the welfare rolls.


27 posted on 08/05/2013 8:56:14 AM PDT by mjp ((pro-{God, reality, reason, egoism, individualism, natural rights, limited government, capitalism}))
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To: mjp

I think union boses want fewer members so they can control the pension funds without those pesky members.


28 posted on 08/05/2013 8:57:07 AM PDT by longtermmemmory (VOTE! http://www.senate.gov and http://www.house.gov)
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To: SeekAndFind

Why does anybody go to fast food places anyway? I can understand doing that when you’re traveling, but otherwise you can make your own burger and fries for a buck and a half. Making your own takes less time (~20 minutes) than driving to McDonalds, standing in line, and waiting for your order. You also get more meat, real cheese, and the results tastes way better. Eating out just seems ridiculous to me.


29 posted on 08/05/2013 9:23:55 AM PDT by Driabrin
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To: SeekAndFind

To pay a worker $15 an hour that worker must generate at least $15 per hour worked in revenue just to pay their wage. Consider that in a typical fast food joint there is a least one worker flipping burgers, one making fries and another taking and filling orders...that’s $45 per hour worked just to pay the wages. Taking into account the cost of the food, the building costs, utility costs, management costs, taxes, licenses etc. each burger served might only produce a few cents to pay the wages of the three employees making them. So how many burgers per hour would have to be produced...you do the math. Raise the price of burgers...fewer burgers will be sold. It’s not sustainable.


30 posted on 08/05/2013 9:37:59 AM PDT by The Great RJ
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To: Venturer
It all comes down to demand and a business culture.

In-N-Out Burger employees average 14hr. Not bad, and throw in medical and dental.

McD's and others have a business model of 'low' wages and high turnover for workers.

Wages for all Americans has been stagnant for years. Crying about minimum wage won't matter, but lower wages fro ALL will continue.

31 posted on 08/05/2013 12:16:46 PM PDT by Theoria
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To: Texas Eagle
If I double your pay, all I have to do is cut your hours in half.

I understand the math, but not the logic. If you can cut your employee's hours from 40 to 20, why did you have them on the payroll for 40 hours in the first place. I would suppose you hire someone because you have work to be done, not because you want to insure they only receive a certain amount of money. Capitalism works, but we have to accept that labor is part of that system. If the laborer sets his price above what the market will bear, he will be priced out of the market just as will the businessman who overprices his product. Neither wage or price controls ever work but we keep trying.

32 posted on 08/05/2013 12:40:42 PM PDT by etcb
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To: etcb
Roger that. I didn't think that through all the way.

But the point is that the owner of the business is going to have to make changes that would be detrimental to his employees and customers.

33 posted on 08/06/2013 6:17:54 AM PDT by Texas Eagle (If it wasn't for double-standards, Liberals would have no standards at all -- Texas Eagle)
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