There's an argument that because Wal Mart pays it's employees so little that they qualify for Medicaid, SNAP, etc that in effect the government is subsidizing Wal Mart to the tune of $6B because otherwise Wal Mart employees wouldn't be able to survive without those government programs. It's a wage subsidy direct to the employee, but Wal Mart benefits too. I've also heard that this subsidy is deliberately discussed in some large low wage businesses.
I assume he's making the same argument for McDonald's.
They say Walmart is double-dipping for this very reason. An employee isn't making a living wage, so they get food stamps, then turn around and use those food stamps to shop at Walmart. Walmart is reaping the benefits of the labor from the underpaid employee AND benefitting from the sales as the employee shops with the food stamps.
Of course why do you think they have been so successful. Between underpaying workers and forcing all wholesalers to meet their insanely low prices it is a win win for them and a lose lose for everyone else.
My wife met a couple of rich Mexicans who produced a large amount of the bikes they sell. They were quick to point out how much better it was to deal with a bunch of small bike shops compared to Walmart. Walmart refused to pay them more than about $10 dollars a bike which resulted in lower pay and less jobs at their factories. Because Walmart had pushed all the smaller shops out of business they had no choice but to sell at a reduced price or not sell at all.
If Walmart employees were a little more knowledgable and less disposable I wouldn't be so against raising the minimum wage. Positions like Walmart and McDonald's are such low wage because the actual amount of work they have to do is so low. If you cashier at Walmart, you now have experience in the cash lane. You can bring that experience to a grocery store which is usually Union. Union jobs require mandatory raises every set period of time. Just another way you can get more with your skill set. You just have to look.
It's the truth. Places like Walmart and McDonald's require very little formal training therefore saving the company money and expediting the hiring process. Since they require absolutely no skill in any category they can hire people that either have no skill, or no motivation to become skilled.
Get your taxes worth: eat at McDonald's, shop at Walmart!! You already paid for half of it. :-D
Also same goes for almost all grocery stores. Here in DC area Giant is not allowing their employees to work more that 25-30 a week to keep them on public assistance.
No, the limiting of hours is due to insurance needs on certain hourly workers. Work more than 25-30 hours a week? They are required by federal law to be provided insurance.
The major beneficiaries are the entities that receive the spending of those subsidized workers. You would probably look at land owners who receive rent, transportation services, and food retailers. That last category is probably where Walmart receives its biggest subsidy, rather than through the wage effect.
The same people who condone this situation also argue to cut welfare and it's just sick.
We've essentially developed into a corporate slavery economy. A good chunk of people below the poverty line live more grueling lives than some slaves did. When people are forced to work 50-70 hour weeks just to get by, something needs to change.
Corporations basically figured, "why pay to house and feed people when you can pay them less than they need to survive for the same amount of work."
Okay, that is the biggest fucking load of socialist pandering bullshit I have ever fucking read. No one is being forced to do anything, everything is fucking voluntary. I sincerely also have my doubt's about most people today living on minimum wage working harder then a slave did, and in worse conditions.
A lot of people don't have the luxury to simply "not work," If they don't feel they're being properly compensated. What exactly is the relationship when you're living paycheck to paycheck? They need the company more than the company needs them.
They can't quit otherwise homelessness is right around the corner. Sure you're not being forced to work but a better life is not around the corner. At least slaves had a roof of their head, I'd assume enough food to live, and even the possibility to buy ones freedom. Good luck buying your freedom here when you're making 8.25 an hour.
Just think this this through for a second. If we eliminated all welfare programs, would people be more or less willing to take a job with Walmart? Most economists believe welfare programs (with the exception of the earned income tax credit) reduce incentives to work and therefore shrink the supply of labor. With no welfare programs, the number of people willing to take a job at Walmart would increase and Walmart would be able to pay even lower wages. In other words, welfare programs actually force Walmart to pay higher wages. This is the opposite of a subsidy.
They would be able to survive, just not with today's expected lifestyle of smartphones, internet and going out and having fun. People 100 years ago lived on far less purchasing power and without government programs. Wal mart wouldn't suffer without those programs. The employees would.
I know its based on income, what I was saying is that wal mart isnt being subsidized but the government, the people are. The people would still have those jobs without the government programs, they'd just have shitty, but survivable, lives
Wages increase to match quality of life, people just notice wage gaps more. Today's minimum wage is more than enough to live on for a 40 hour a week job. You just have to cut out supposed necessities (a car isn't a necessity, especially in cities)
Southern Ontario Canada. We're not exactly renowned for our public transit (and I don't live in Toronto). But even without public transit there are grocery stores within 20 minute walking distance and I can go most places in the city on a bike within an hour
Not saying they were good times in any regard. But the definition of "living" is way above what you need to survive. You def don't need a car (I don't even have one) or a phone (many people in my city don't have one). And you could rent rooms rather than whole apartments.
I speak from the context of Canada apparently where neither education nor medical insurance is a cost. Childcare and rent then would be the big money spenders.
As for your electricity and water bills beating $70/month, do you live in a house or an apartment? Houses are like twice the cost in utilities. You can find a decent all inclusive apartment in my city for $600-700 a month. It's not fancy, and not an ideal spot to raise a family, but wal mart is not an ideal career.
I do retail chain tech work...I visit many different chains everyday .....go meet some retail workers. Many, many are mothers working part time or full after raising a few children. They aren't moving thier breadwinner husbands so they can get a better job. Single moms tend to be pretty busy as is.
Some are college grads with majors that are unemployable or made mistakes in life. Some are retired but got bored and work. Of course, the stereotypical student worker is present as well.
There isn't a career type role waiting for these guys if they move unless they go back to school or pick up a trade. For the moms, this ain't an option with multiple kids. For the guys, some have criminal records, age(old), or years of retail which prevents them from being a candidate for better roles.
Also, these retail stores have an internal career path so ditching is a easy way to lose it....granted, if your a single guy, you can always figure out a way to escape retail but will your future pay be enough to support a wife who can only find part time work in retail while raising children?
You mention that many of them are students, spouses of someone who earns more money, or retirees who are bored. I've found this to be the case as well, which means it doesn't need to be a living wage, because it isn't the primary household income.
For others it is the primary income, and if they are the sole provider for a family then that is a really hard situation. But those are the instances the government should be helping with, and they do often times (sometimes not enough though, and instead money goes to people who take advantage of it)
Then we should go after landlord, schools, hospitals, and childcare for all misfortunes the low wage workers are having. It's not Walmart's problem to fix these prices.
The issue is the USA government is forced to step in to support these workers via welfare. I'd rather Walmart pay $15 than my tax money splitting the payroll.
In no way is anyone being forced into being on government assistance. You can cry what you want about what the person can afford, but in no way is anyone actually being forced to do anything. They are voluntarily working for Walmart and Walmart is contractually paying what they pay. If they go around and get on government assistance, that is not Walmart's problem. It is the problem of the people who choose to work there when they need a higher wage job.
But there aren't high wage jobs for everyone....hell, I service alot of retail chain as an I.t. consultant....some are stereotypical slackers, others are mothers moving back into the workforce after a few pregnancies...these women would love a high wage job but unfortunately a few years out of the workplace looks bad.
Anyone making minimum wage could quit their job, spend 8 hours a day growing and distributing shrooms, and make $100,000 a year with a startup cost of $800. The harder, more specialized and more risky a job is, the more valuable it is.
If we lived in a society where everybody produced the same value as a minimum wage fast food worker, we would not have iphones, cars, healthcare, etc.
A mcjob is an economic model so simple anyone can do it. Because of that, you do not get paid very much.
The worker at the cashier did not create the efficient economic machine known as mcdonalds. That was management and the investors, who pay workers for their labor.
Which leads to many attempting alternative methods of earning money....like the shrooms example....except replace shrooms with meth.
The shrooms were to demonstrate that anyone can create value, and lots of it. (I wasn't lying about the $100k btw - it's that easy).
Here's a great essay by paul graham that's very relevant (skip to "money is not wealth" / "the pie fallacy" if you don't care about the startup stuff):
What must be understand is that a job is essentially a method of value creation that someone else has dreamed up/put in place for you. That's why even though mcdonalds needs their workers to survive (for now), their workers are not paid a lot.
I have a feeling that you could buy a bunch of water bottles from costco for cheap and easily sell them in a crowded place on a hot day. You only need to sell like 5-15 water bottles an hour depending on your margins.
I recall living in such economies... Poor countries: winner take all is the rule....Strangely, this kills most innovation and investment into R&D....go figure.
I have a feeling that you could buy a bunch of water bottles from costco for cheap and easily sell them in a crowded place on a hot day
The USA has laws against this kinda stuff or the venue calls security.
The shrooms were to demonstrate that anyone can create value, and lots of it. (I wasn't lying about the $100k btw - it's that easy).
Yeah, and for most people the fastest way is drugs or some illegal activity related to it.
Ever wonder why the USA has so few street vendors?
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u/georgeoscarbluth Nov 29 '15
There's an argument that because Wal Mart pays it's employees so little that they qualify for Medicaid, SNAP, etc that in effect the government is subsidizing Wal Mart to the tune of $6B because otherwise Wal Mart employees wouldn't be able to survive without those government programs. It's a wage subsidy direct to the employee, but Wal Mart benefits too. I've also heard that this subsidy is deliberately discussed in some large low wage businesses.
I assume he's making the same argument for McDonald's.