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Fri Jan 24, 2014, 03:17 AM

 

The Outrageous Truth About A $12 Minimum Wage And Your Grocery Bill

Every time I even mention the idea of raising the minimum wage, I am immediately attacked on social media.

Opponents imagine that inflation will skyrocket; some have even claimed that ‘milk will be $10.00 a gallon’ if we raise the minimum wage. Oh, the hysteria. Milk is currently around $3.50 a gallon and that is up 25% from just ten years ago. Is that 25% due to rising wages? Sadly, no – wages in America have declined during that time. Must be some other economic force at work. (Read “Even Dairy Farming has a 1%” here.)

So, what if we raised the floor to a living wage, and paid non-tipped employees a minimum wage of $12.00 per hour? Oh, more hysteria. Opponents claim that will drive our costs up so much we will be unable to eat!

Let’s look at a few facts about minimum wage.

Who gets paid minimum wage? People opposed to raising the wage claim that ‘minimum wage workers are kids in high school; adults do not make minimum wage’. The fact is 25% of minimum wage workers are below the age of 19 – which means that 75% of all minimum wage earners are above the age of 20. That means they’re adults – not high school kids. In fact, almost half of all minimum-wage earners are above the age of 25.

Another fact: 64% of all minimum wage earners are women. Of that a whopping 66% are women above the age of 20.

Another fact: More than a third of minimum wage workers (35.8 percent) are married, and over a quarter (28.0 percent) are parents. The Economic Policy Institute estimates that if Congress raised the minimum wage, it would raise the standard of living for more than 21 million children.

Walmart employs about 2.2 million people – almost 2% of America’s workers, these days.

If the minimum wage is raised to $12.00 an hour, 37% of Walmart employees would see a raise ranging from $3,200 (part-time workers) to $6,500 (full-time workers). Another 14.6% would see a raise between $1,670-$2,640 per year.

Now, let’s assume that Walmart passed every penny of the minimum wage increase onto customers, r ather than taking it out of profits or dividends. What would that mean to consumers? The average customer would see an increase of $12.49 per year – about 46 cents per visit – if Walmart executives passed the total cost along, rather than cutting their profits.

A closer look at Walmart’s dividend payments: corporate “insiders” own more than half of Walmart’s stock. Once again, the people who run the company personally benefit from decisions about profits paid out as dividends.

For example, Walmart Director Jim Walton owns 10.5 million shares of the company. This year, the company paid out $1.88 per share in dividends. That means Director Walton received more than $19.7 million in dividends (which are taxed at about half the rate as executive salaries).

Walmart President and CEO Michael Duke owns about 1.2 million shares of the company – that means he personally received about $2 million in dividend income this year.

All that money to corporate executives. And some people claim Walmart can’t afford to give raises to its workers?

http://nhlabornews.com/2013/07/the-outrageous-truth-about-a-12-minimum-wage-and-your-grocery-bill/

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Arrow 35 replies Author Time Post
Reply The Outrageous Truth About A $12 Minimum Wage And Your Grocery Bill (Original post)
El_Johns Jan 2014 OP
Egalitarian Thug Jan 2014 #1
laundry_queen Jan 2014 #2
RobertEarl Jan 2014 #3
TBF Jan 2014 #7
ReRe Jan 2014 #4
SomethingFishy Jan 2014 #26
ReRe Jan 2014 #31
Hissyspit Jan 2014 #5
LineReply ^
Wilms Jan 2014 #6
YarnAddict Jan 2014 #8
oldhippie Jan 2014 #23
YarnAddict Jan 2014 #24
HangOnKids Jan 2014 #35
Doctor_J Jan 2014 #29
Coyotl Jan 2014 #9
redqueen Jan 2014 #10
taught_me_patience Jan 2014 #11
davidthegnome Jan 2014 #12
kcr Jan 2014 #13
taught_me_patience Jan 2014 #14
kcr Jan 2014 #15
jeff47 Jan 2014 #16
kcr Jan 2014 #18
CrispyQ Jan 2014 #32
dickthegrouch Jan 2014 #20
Doctor_J Jan 2014 #27
SomethingFishy Jan 2014 #25
ProSense Jan 2014 #17
dickthegrouch Jan 2014 #21
KansDem Jan 2014 #30
El_Johns Jan 2014 #22
G_j Jan 2014 #19
Doctor_J Jan 2014 #28
indie9197 Jan 2014 #33
fujiyama Jan 2014 #34

Response to El_Johns (Original post)

Fri Jan 24, 2014, 04:05 AM

1. The problem/advantage of an ignorant population.

 

As it has been popping up here lately, here it is again, "It isn't what we don't know that gives us trouble, it's what we know that ain't so." - Will Rogers

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Response to El_Johns (Original post)

Fri Jan 24, 2014, 04:06 AM

2. K&R nt

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Response to El_Johns (Original post)

Fri Jan 24, 2014, 04:17 AM

3. $12 is not enough

 

$15 an hour is best. That would be $600 a week for full time. Take home about $500.

And the tax revenue growth for cities would be tremendous because most all the higher wages would go toward buying stuff that is locally taxed. A $15 minimum wage would do wonders for America!

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Response to RobertEarl (Reply #3)

Fri Jan 24, 2014, 09:11 AM

7. Agree - minimum wage workers spend their checks

immediately to pay for essentials. That would be a huge increase felt immediately throughout the economy - as opposed to executives making additional millions and parking it in their off-shore tax shelters.

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Response to El_Johns (Original post)

Fri Jan 24, 2014, 05:15 AM

4. "Minimum wage workers are kids in high school"...

...words out of Mary Mattelin's mouth last Friday night on Bill Maher's show. I thought Jennifer Granholm was going to leap across the table and strangle her! I think all wages need to go up, but especially minimum wage. Everyone needs a living wage, so take the minimum up to at least $20. And if we can't get universal health care passed,
then force all employers to pay for their employees health care policies.

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Response to ReRe (Reply #4)

Fri Jan 24, 2014, 06:04 PM

26. She was on something... Drunk or pain killers but Matalin was a complete idiot..

and slurring her words.. I don't know how Carville stays married to her. She hit all the moron talking points in less than 5 minutes.

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Response to SomethingFishy (Reply #26)

Fri Jan 24, 2014, 06:30 PM

31. As a matter of fact...

... she seemed doped up and/or drunk Friday night. At one point, she wanted to take the show over and ask the questions herself, and you know Bill Maher... He shut her down just as soon as that thought came into her mind. She reminds me of the wicked witch in The Wizard of Oz. James is going to have to put her in a nursing home or commit her when she gets older, wait and see. She is one mean bitch. They will have to either dope her up and/or restrain her. And I'm not being hateful. It's a fact. My Grandmother became very pleasant in her old age. Lived to be 97 yrs old. But Mary will just become meaner with age.

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Response to El_Johns (Original post)

Fri Jan 24, 2014, 05:41 AM

5. K&R

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Response to El_Johns (Original post)

Fri Jan 24, 2014, 08:19 AM

6. ^

 

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Response to El_Johns (Original post)

Fri Jan 24, 2014, 11:55 AM

8. I know this . . .

 

I write the payroll checks for a small, non-profit no-kill animal shelter. We have about 7 or 8 minimum wage part-time employees, and 2 low-paid full-time managers. $12/hour is more than we pay the managers. If minimum wage went up to $12/hour (or higher,) we would no longer be able to run the shelter. The dogs and cats would have to be transferred to other shelters, which would probably be "kill shelters." The employees we have would be unemployed. Our community (which has benefitted by not having to build and staff a pound) would be hurt. This would be a disaster for us, and probably for a lot of other non-profits as well.

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Response to YarnAddict (Reply #8)

Fri Jan 24, 2014, 03:09 PM

23. You must know wrongly ......

 

.... as everyone here knows that raising the minimum wage does not cause unemployment, so your employees would still have their jobs. Saying raising the minimum wage would cause them to be let go is a RW talking point.

If minimum wage went up to $12/hour (or higher,) we would no longer be able to run the shelter. The dogs and cats would have to be transferred to other shelters, which would probably be "kill shelters." The employees we have would be unemployed.

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Response to oldhippie (Reply #23)

Fri Jan 24, 2014, 05:21 PM

24. Is that sarcasm?

 

Because I think I know (in this case, anyway) rightly. It is not something we can afford. An increase to $12/hour would be probably an average of $50/week per part-time employee, and $200/week for the full-time managers. We have to fundraise for every single nickel we get. It is constant and exhausting. If we had to raise more than $3000 additional per pay period we couldn't do it.

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Response to YarnAddict (Reply #24)

Sat Jan 25, 2014, 03:39 AM

35. Former fund raiser here

 

Get better fund raisers. Your post is ludicrous.

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Response to YarnAddict (Reply #8)

Fri Jan 24, 2014, 06:24 PM

29. This sort of post presumes only your employees would get the $12 raise

 

Others would also get a raise, allowing them to donate more money or volunteer more instead of working the second job.

All of these trickle-down theories are set in some sort of vacuum where you're the only one affected.

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Response to El_Johns (Original post)

Fri Jan 24, 2014, 12:06 PM

9. K&R .... raise the minimum wage = best economic stimulus of all.

 

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Response to El_Johns (Original post)

Fri Jan 24, 2014, 12:28 PM

10. K&R

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Response to El_Johns (Original post)

Fri Jan 24, 2014, 12:32 PM

11. A $12 minimum wage might not affect Walmart too much

 

but would be a death blow to a ton of small businesses struggling out there.

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Response to taught_me_patience (Reply #11)

Fri Jan 24, 2014, 12:41 PM

12. Boo hoo.

If they can't afford to pay their employees enough to survive - then they can't afford to be hiring people. I keep hearing that, here in Northern Maine, the rich men that start companies and hire people are heroes, for providing jobs. The jobs they provide pay an average of eight dollars an hour. They do not offer benefits. The men who own these companies, generally speaking, have two or three homes, three or four cars, and earn so much more than their employees that it's despicable.

It's past time for some kind of progressive legislation that enables people to survive. I don't know if raising the minimum wage is the solution, but it's a good start. Frankly, I'm tired of working for "small businesses" that already put corporate profits way above their employees welfare. When these "small businesses" become "big businesses", and start making outrageous profits, you can count on them to not give a damn about the people who make the small businesses work.

You may be right about small businesses, but I'm past caring. I can barely survive as it is, and I'm sick of working my ass off for 8 dollars an hour, I'm sick of not having a choice - especially when employers CAN pay more, but refuse to. Do you honestly believe it would make a difference if most of these small businesses had the money to pay more? I don't. I think we'd see more like Walmart.

I'm tired. I'm broke - and I'm working. Time to go get ready for another night of it.

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Response to taught_me_patience (Reply #11)

Fri Jan 24, 2014, 12:52 PM

13. I don't think that's the case

Because they would see an increase in business from all the people who suddenly have more money to spend. Your view is shortsighted. But even if you're right? Why should millions have to suffer poverty for these small business owners? Raise the minimum wage.

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Response to kcr (Reply #13)

Fri Jan 24, 2014, 01:08 PM

14. It is the case

 

There are so many restaurants teetering on the edge of failure and the reason is simple, labor costs typically range 30-40% of gross sales. Let's say that a restaurant pays $9/hr and is netting 10% profit. Should the minimum wage rise to $12/hr ( a 30% rise in cost), then there would be no profit at all.

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Response to taught_me_patience (Reply #14)

Fri Jan 24, 2014, 01:13 PM

15. Oh well

Why is their interest more important than the millions living in poverty because they're underpaid? Why is it okay to artificially prop up their existence by underpaying a significant portion of our population?

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Response to taught_me_patience (Reply #14)

Fri Jan 24, 2014, 01:44 PM

16. It's fascinating that people believe supply-side economics

which requires a very lengthy path and side effects to trickle down to everyone else.

But "If you give people more money, they will buy more stuff" is treated like it's an utterly ridiculous concept.

Your teetering restaurants would have a lot more customers if people were paid more money. The increase in customer base would vastly outnumber the increase in labor costs. To argue otherwise is to argue that there were no small restaurants in the 1960s, when the minimum wage was higher (in real dollars).

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Response to jeff47 (Reply #16)

Fri Jan 24, 2014, 02:09 PM

18. Even more amazing

is they're right here with everyone else watching this downward spiral -with small businesses closing left and right - and they still cling to that bullshit.

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Response to jeff47 (Reply #16)

Fri Jan 24, 2014, 06:40 PM

32. This. ^^^ -nt

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Response to taught_me_patience (Reply #14)

Fri Jan 24, 2014, 02:56 PM

20. It's a very complex equation

More people would be able to afford to eat in the restaurant so its gross income is not a fixed quantity, which this argument seems to assume.

Yes, costs go up for wages and the increase in amount of meals sold. But the profit margin on the increasing quantity doesn't need to go up at the same rate as the salary and meal costs to continue to make a 10% net margin.

Most restaurant owners are not in it for the money anyway, they are in it because they enjoy the job. Making money is an added bonus for the really well-chosen workers viz: "A man who enjoys his job never works a day in his life".

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Response to taught_me_patience (Reply #14)

Fri Jan 24, 2014, 06:16 PM

27. Bull. They can raise the price of a meat loaf platter to offset this problem

 

Your premise is preposterous.

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Response to taught_me_patience (Reply #11)

Fri Jan 24, 2014, 05:59 PM

25. Bullshit. If you are running a business and can't afford to pay your employees

$400 a week then you are either not charging enough for your product or you suck at business.

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Response to El_Johns (Original post)

Fri Jan 24, 2014, 01:47 PM

17. Walmart could pay workers $14.89 an hour without raising prices

Walmart could pay workers $14.89 an hour without raising prices

by Laura Clawson

Walmart can easily afford to raise pay for its low-wage workers by $5.83 an hour, to an average wage of $14.89, a new report from progressive think tank Demos concludes. All the retail giant has to do is stop its massive stock buybacks—which only serve to enrich a shrinking pool of shareholders, not to improve productivity—and put that money toward its workers.

Walmart spends $7.6 billion a year buying back shares of its own stock:

... which reduces the number of shares traded on the market so that the same level of earnings are distributed over fewer owners, making each remaining share worth more. Those owners who keep their stake in the company see the value of their holdings increase even if the company’s performance does not change.

The main owners who have kept their own stake in the company are the Walton family, who now own more than 50 percent of the company. If you're of the "companies should only care about their shareholders" school of thought that's driving the race to the bottom on wages and jobs, consider this:

Even for investors, the intended beneficiaries of a share buyback, the value of this financial maneuver is often illusory. As a prominent business analyst explained to the Wall Street Journal last year, "the evidence overwhelmingly shows that heavy buyback companies usually create less value for shareholders over time… Many managements have become so infatuated with how buybacks increase earnings per share that these distributions are crowding out sound business investments that create more value over time."

Paying workers more or adding worker hours would be a sound business investment for Walmart by reducing worker turnover, which is predictably very high. Or by fixing the problems with bare shelves that have left many customers unhappy. Or by turning the very large Walmart workforce from people who need food donations and government assistance into people who make a living wage and can afford to shop at Walmart.
(Via Salon)

http://www.dailykos.com/story/2013/11/19/1256723/-Walmart-could-pay-workers-14-89-an-hour-without-raising-prices

http://www.democraticunderground.com/10024067021

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Response to ProSense (Reply #17)

Fri Jan 24, 2014, 03:01 PM

21. Remember those 85 people Oxfam talked about?

5 of them are in one single family: the Waltons of Walmart.

They could easily forgo a few percent of their income and pay every single Walmart employee a living wage and take lots of people off State and Federal welfare rolls at the same time.

Those dividends talked about upthread a direct theft from the US taxpaying public. Should be grounds for forfeiture and jail.

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Response to dickthegrouch (Reply #21)

Fri Jan 24, 2014, 06:26 PM

30. Yeah, time for them to kick in some bucks!

Walmart tells its underpaid workers to use government assistance--

How Walmart's Low Wages Cost All Americans, Not Just Its Workers

Same holds true for sweatshops like McD's.

F*ck 'em! Why should my tax dollars go to supplement their cheap wages?

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Response to ProSense (Reply #17)

Fri Jan 24, 2014, 03:07 PM

22. +1

 

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Response to El_Johns (Original post)

Fri Jan 24, 2014, 02:10 PM

19. K&R

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Response to El_Johns (Original post)

Fri Jan 24, 2014, 06:19 PM

28. "Papa" John of the pizza chain admitted during the ACA debates that providing his

 

workers with health insurance would raise the price of a pizza 11 cents. These CEOs are desperately in need of a very rude awakening.

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Response to El_Johns (Original post)

Fri Jan 24, 2014, 11:52 PM

33. The minimum wage in the US should be tied to the average CEO compensation.

I think 1% is fair. (Ironic number, eh?) Average CEO pay is $3 million per year.
3M x 1% = $30K. Assuming 2000 hours in a year that works out to $15/hour.

Sounds fair to me!

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Response to indie9197 (Reply #33)

Sat Jan 25, 2014, 03:09 AM

34. I actually like that idea

but it's easy to get around - Corporate boards would just approve ways to get around it. They'd start providing greater perks (cars, planes, homes, other gifts, etc) and more compensation in stock.

But I'm convinced that at this point, we'll need to start tying CEO compensation to the company's lowest wage employees' wages. It's the only way to begin reversing this dangerous level of income inequality.

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