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dwot (99.54)

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February 07, 2010 – Comments (46)

An article I am reading about teen unemployment reminds me of the teen sentiment of my youth.  I remember being too young to get a job at 13, but watching 15 and 16-year-old go out for a day or two job hunting and landing a summer job.  By the time I was that age jobs were hard to come by.  I remember going all over the place with my resume and not getting any where.  I eventually did land a job through someone I knew who knew a place was hiring.

But, I remember many other teens wanting jobs and not being able to find them.  My father had to be one of the worst for being critical of teens that said they could not find a job.  He never had a problem finding a job and never went without a job so they were just lazy and good for nothing, and that simply has been a common label that I have heard repeated time and time again when there has been any mention of teens having a hard time finding a job.  The economy has nothing to do with it, it is the young person's character.

Funny, it is the same people that are handing out the label "something's wrong with you" label to young working people who are absolutely struggling to make ends meet, even with two jobs.  These jerks are grossly unaware that they went through the most favorable economic times in history and their success had far less to do with their character then circumstance.  They honest believe they did a lot more because they worked two jobs to pay off their homes early and they don't see the gross inequity of the young people today working two jobs just to pay off their student loans, never mind even saving for a downpayment.

Their perceptions on entitement are also off the rocker.  I can't believe how often I have heard drivel about young people expecting everything, when they aren't even close to the lifestyle they grew up in and absolutely struggling and have practically none of the benefits the older workers have and ultimately the older worker feel entitled to unsustainable pension that if you applied an ounce of math to you would know they go beyond unfair to everyone expected to pay them.

I never thought I would be grateful that I didn't have a pension plan to lean on for most of working life.  I lived my life expecting to provide for my retirement without any help and it made me a far more financially responsible individual and in the end I expect to come out ahead because of it.

 

 

46 Comments – Post Your Own

#1) On February 07, 2010 at 3:20 PM, dwot (99.54) wrote:

 Some further quotes in the article

 

In fact, some economists believe that minimum-wage laws, by raising salaries, actually give a boost to the economy, creating jobs.

I believe that one big time.  You can lower wages to the point that you snuff out disposible income and that completely stagnates your economy.  Relatively speaking, I had huge disposible income 30 years ago, yet that disposible income was already grossly declining from what my father had.  In the short term companies paying lower wages do better, but in the big economic picture, if no one has disposible income, where do the jobs come from?

 

 


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#2) On February 07, 2010 at 3:27 PM, RVAspeculator (83.66) wrote:

dwot....

Good to see you out here blogging...   I thought you were a Canadian school teacher.  They don't have pensions?

My company has one but when I leave I will probably take the payout so I don't have to worry about it blowing up at some point.

On the flip side of your blog today is I believe too many people BLAME what is going on in the economy at the time on their situation when really you make your own luck, recession or no recession...  

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#3) On February 07, 2010 at 3:44 PM, dwot (99.54) wrote:

I got into teach late and then had problems finding a permanent job. 

Get this in how they discriminate against workers that aren't full time.  There are about 21 working days in a month, but about 30 days in a month.  I'd work about 18 days of the month so that should be 18/21 or about 86% of the pension of a person with a permanent job.  The way they were doing it was 18/30 days, or 60%.  Then add in that the pay was lower.  My statements on what I was going to get in 25 years for my pension if I continued going at that rate was about $500-600 per month.  That contrasted with the approximately $3,000/month a teacher with a contract is building up in "entitlements."  That massive difference come from about 40% lower wages, 25% under employment and 30% a discriminatory calculation against permanent works.  It seems the under employment and lower wages weren't enough of a kick in butt.

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#4) On February 07, 2010 at 3:47 PM, dwot (99.54) wrote:

And June and September days worked are always waaaay down for on call teachers.  I have had like one day of work for the month.

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#5) On February 07, 2010 at 3:51 PM, dwot (99.54) wrote:

And I am now in my 3rd year employed where I have what I consider a rich pension plan, very rich, and unsustainable.  I am still planning my future to not rely on it, or rely on it much.

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#6) On February 07, 2010 at 4:21 PM, TMFBomb (94.70) wrote:

Good post...I hate the phrase, "back when I was a teen..." It's almost always a prelude to drivel.

-Anand

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#7) On February 07, 2010 at 6:49 PM, alexxlea (34.71) wrote:

When you peg your nation's economic health as including consumption then you are indeed screwed if no-one has any disposable income to speak of.

So you go and do what nations have been doing, which is allowing banks to lend out credit that will never be repaid.

It's pretty funny that everyone is so freaking idiotic that they can't see that not having wages or benefits and having to rely on debt backed by a single rising asset that you couldn't afford in the first place hints that something is horribly wrong with the way things are.

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#8) On February 07, 2010 at 7:11 PM, russiangambit (29.98) wrote:

Dwot, good post. Looking back I wonder how people where able to live well in the two previous generations in the US - only one parent working, no overtime, stable jobs, high standard of living.

I think a big part of it was that the US was so isolated so people didn't have to compete with labor in other countries,  which is a big problem today. Also US was growing fast, its industry was ahead of any other country. And so people where able to afford better life with each coming year.

The projections for the future were based on that paticular sweet spot in the US history and union and pension contracts were based on those assumption.

But around 1980s the other countries started catching up while US kept snoozing on the laurels of its achievements. That is when US started falling behind in education, in industry, in wealth. But the issues were masked by creation of debt and immigration. Now these boosters ran their course. And US finds it impossible to keep the extend and pretend game. And as with any country in crisis the most of burden is on the younger population because older people are the one in power , ones with experience and able to get better jobs.

At the same older generations keep clinging to what used to be ( think unions) and unwilling to accept new reality only make matter worse.

The poltical gridlock is also very much to blame for the US current situation. Issues were left to fester for 30 years because two political parties are mor intrested in scoring points than in future of the country. Now these issues require emergency measures yet the doctors still arguing bout the course of treatment as they have been for 30 years and at this rate the patient will die on their watch.

I makes me mad every time I hear CNBC anchors telling us that markets like gridlock, they like the status quo, they don't like politicans rocking the boat. Then "the markets" are suicidal because continuing with gridlock is no longer an option for the US.

For the young people to have any hope the entitlements have to be cut back but also the wages have to be cut down to make US competetive with the rest of the world. US is no longer growing fast enough to maintain high standard of living.

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#9) On February 07, 2010 at 8:03 PM, AvianFlu (39.70) wrote:

I have worked for many years as a volunteer with juvenile court. Kids usually tell me they want to find a job. However, for some reason they only seem to consider working in a fast food restaurant. I often suggest they try mowing lawns or shovelling snow. The money is good and they can be their own boss. This is usually met with blank stares. I sense a true lack of motivation.

You would be surprised at how many of their parents do not work. Usually they tell me they are disabled, although they appear to me as if they are healthy enough. They don't seem to be missing their legs or eyesight.

I'm thinking that private charitable organizations would do a more efficient job with these people than our government. At least that is what the stats suggest.

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#10) On February 07, 2010 at 9:43 PM, russiangambit (29.98) wrote:

#9 - I don't know if these kids can compete with illegal immigrants anyway. There is a lot of competition for the low-skilled jobs.

And even kids with college degrees have hard time because all the jobs they would normally take are already taken by older people with more experience.

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#11) On February 07, 2010 at 10:21 PM, FleaBagger (31.23) wrote:

Dwot -

I want to take issue with the endosement of the minimum wage. Two things: money isn't anything except what it represents, i.e. what it can be traded for, so raising the minimum wage can't increase a country's wealth any more than printing more money. In fact, it decreases wealth, because if an employer could pay an unskilled teenager $7.15, he would without a minimum wage, but he can't (largely because of government-imposed costs in addition to the wage). The skills of teenagers are limited by their lack of experience, and the minimum wage doesn't change that. It just says that it's illegal to hire them at a wage that would be worth it for the employer. 

Back to money not being wealth, per se. If government declared tomorrow that everyone's wages were to double, and they printed new money to cover the cost, GDP would spike upward. Of course, nothing would change except those collecting interest on savings or Treasury securities would be ticked off, and debtors would have it easier, if they had a job. And in fact, government really does this, except instead of the largesse going to indebted wage earners, it goes to banks in the form of debt leverage, favorable interest rates, and deposit insurance.

The reason increasing currency levels and currency flow cannot possibly increase real wealth is because real wealth comes from production, valuable goods being created from less valuable components, which in turn were created from commodities... in short, people have to do useful things to increase wealth, not just be government-aided consumers in a GDP equation.

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#12) On February 08, 2010 at 1:37 AM, AbstractMotion (63.49) wrote:

I don't know that we should be competing with illegal immigrants really, that's part of a much larger problem involving unskilled labor bracket in this country.  Despite all the outcry given to the issue the US identification system is deeply in need of a revamp, and doing so along with stronger penalties for businesses that hire illegal immigrants could quite frankly eliminate this as an issue.  There's just absolutely zero will to do it politically because every so often a President or Congress can pass a bill opening up the option of naturalizing a few million people in a short period of time for an extra boost at the polls.  Obama is already talking about doing it again for 12 million or so people.  On the flip side of this we actually have very firm quotas when it comes to legal immigration of highly skilled workers looking to go through proper venues, so it's really no surprise that we've seen the kind of pressure and overcrowding in the unskilled labor market that we have.  On the other hand given the dropout and literacy rates that plague certain areas of the country and the rising need for an educated workforce it's hard to expect some people to compete at all in the job market.

Personally I hate it to hear people claim that the younger generation doesn't know how to compete, that they went through "the exact same thing" or that it's all simply squandered opportunity.  The fact is that things have been getting progressively more competitive and less lucrative since the 1970's.  There's lost of causes and decisions that brought us here:  Peak domestic oil production, the fall of market socialism/communism for a large part of the world, rising medicare/SS taxes, inflation(in education, healthcare costs and monetarily), poor immigration enforcement and most recently the formation of the WTO.  In effect the job market is much more competitive and what the average worker takes home has a lot less purchasing power then it use to.  Personally I'm not looking for pity, but the sheer ignorance of claiming that this is all a lack of motivation and there hasn't been a profound change in the employment environment is astounding sometimes.  

 

Likewise I think that it's kind of ridiculous that we're being stuck with the bill for not only the national debt, but the time bombs in our entitlement programs.  They were never sustainable funded for long and quite frankly the boomers have turned a blind eye to the blind looting of social security in particular for years and years now.  I do think push will end up coming to shove at some point in the future in all this, quite frankly in the scope of social priorities dumping an enormous amount of money into a program like Medicare for seniors should be at the bottom of the list.  You're going to tell me that as someone looking to work for the next 45 years of my life, raise a family and hopefully make my own way in the world that one of our top domestic priorities is making sure a bunch of people who's bodies are failing them simply due to old age is a top national priority?  How does that not sound insane?  We're actually proposing a freeze on the productive part of our Federal budget while allowing for increases in the military and entitlement portions of it.  In effect education and infrastructure have become small priorities then Kabul and power chairs.  So if the future generation just isn't meeting the standards of the retirement class try not to blame them, it's because they won't know any better and the road they've been asked to travel wasn't an easy one to traverse.

 

 

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#13) On February 08, 2010 at 3:35 AM, devoish (98.76) wrote:

Medicare and Social Security are both sustainable programs. The decision not to sustain them was made when Gov't aligned itself with industry against employees. Once "right to work" States were allowed, unions lost their power. Once unions were broken jobs were allowed to leave the country in the name of free markets. The wealth of the middle class, earned by decades of union organised labor was exchanged for cheap goods made by foreign captives of sustainance only wages. As lower taxes allowed even more private money to be invested outside the USA, the truly unsustainable path was taken. Instead of wages in the USA increasing to fund medicare and SSI, global corporations captured most of the difference between wages in the US and third world countrys, in the form of executive pay, driving the wage gap even further as the savings of US workers were bled down. Once the jobs were gone to the lowest bidder, there was nothing left to sell but the "value" of having good credit and acquiring debt.

And the financial industry said it was good. Just ask them. Even now the only business plan they have is the lowering of wages and benefits to employees. They have nothing better to offer, and never did.

There are great business's in America. The worst crime we are committing against our kids future is allowing the investment banking industry to bleed them to death through the manipulation of debt.

It is no crime to guarantee our childrens medicare in their old age by collecting the taxes to fund it. It is the right thing to do, and always was.

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#14) On February 08, 2010 at 8:49 AM, russiangambit (29.98) wrote:

#13 - devoish , unions destroyed themselves. What do you mean when you say "jobs were allowed to leave the country"? It is the nature of competition. Most people already lost this attitude that somehow they are entitled  to a job. For those few  such as unions who still don't get it - on what morla authority do they think they are entitled  to 50-70K job when a starving engineer somewhere else will take the  same job for 10K and will work 3 times harder? It is " me me me" mentality and I can't stand it.

Of course, I understand where you  are coming from. 50 years ago when the global labor competition wasn't there, the labor costs where much higher portion of the overall cost. That allowed comfortable living for many workers, stable jobs environmet, pensions etc. And the corporations where so much less profitable, stocks weren't a good investment. Things were more expensive, we people had less clothers, smaller houses, less stuff alltogether. Yet they had more balanced lives. Not a bad way to live.

Enter global competition and labor costs get lowered, and develioped countries workers struggle with competition, they struggle to keep up. Because the labor is cheaper, corporate profits are higher, stocks become a good investment and voila stable pensions get shifted into 401K , which turns out very bad indeed for an average worker. The globalisation is a true boon for emerging markets since now they finally can the utilize their most plentiful resource - cheap labor and that bring growth and prosperity. Corporations margings grow and in pursuit of higher profits price wars ensue and bring us cheaper stuff. So, in the end we lost stability and balance and gained more stuff. While this is not the outcome we like there was never stopping it. Globalisation was only a matter of time.

What we should do now, instead of holding on to the past, look to the future and see how we can make the best of it. That means - less stuff, with our lower standard of living we cannot afford ths suburbua dream anymore. Les stuff, smaller houses means lesss expenses so that should allow people to be able to live on lower wages because with global competition wages are going to be very comparable eveywhere across the globe with variaitions to account for local tax and labor laws and  productivity. We also have to cut the entitlements accordingly in this picture, if younger workers are forced to live like chinese ( may be like middle class chinese) then so should the retireees.We also should fix education and that means bringing back competition on all levels - among teachers and among the students. Make it OK to fail, make students to repeat the classes if they can't keep up , separate advanced a, medium and lower achieving students. Competition is good. Lack iof competition is what killed US economic system. You'd be surprised how much competition there is in so called socialist countries when it comes to education.It is because it works.

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#15) On February 08, 2010 at 8:53 AM, starbucks4ever (99.49) wrote:

" The skills of teenagers are limited by their lack of experience, and the minimum wage doesn't change that. It just says that it's illegal to hire them at a wage that would be worth it for the employer. "

In the blogosphere, employers like to complain about overpaid workers. If only we could pay them half that much, we'd provide full employment to everyone, blah blah blah. In the real world, these employers will throw away any resume that indicates a desired salary below $7 an hour, and 90% of them will also throw away any resume that asks for anything under $20 an hour. If we abolish minimum wage requirements, you will just get a legal right to compete with illegal Mexicans. Then your willingness to compete with illegal Mexicans will make you an un-touchable in the eyes of employers and they will still hire an illegal Mexican.

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#16) On February 08, 2010 at 10:25 AM, lemoneater (88.28) wrote:

Thanks for bringing up an important topic. I have to say that I didn't have good work prospects when I was a teen in the rural WV. I had just a few sporadic babysitting jobs here and there from people I knew at church, and a few times helping my father mow some graveyards and other odd jobs. (I never mentioned mowing graveyards on any job application. Perhaps that was a mistake.) My brothers, who were tall, strong looking teenagers by then, were usually in demand to help with haying and brush-hogging and other physical labor jobs. They often were mistaken for adults.  They both got into construction early on which helped them to pay for their college degrees. One is now a technical writer and one is a lawyer, but their construction skills have stood them in good stead.

Parents can do a lot to encourage their teens to gain job skills if not a job. Start before they are even teens. Having an allowance based on chores is not a bad idea. Also yard sales do give retail experience of the most rudimentary sort. Have them help elderly relatives with tasks around the house. Who knows what they will learn from Grandpa! The more skills they learn, the more confidence they will have when applying for their first real job.

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#17) On February 08, 2010 at 12:48 PM, skeptic86 (91.66) wrote:

im not sure what the teen empoyment market is now bc i am not a teen. but a few years ago i did whatever it took to get a job. i worked at walgreen, randalls, and local deli's. i also did some odd/unoffical jobs like mowing lawns, helping people move, painting houses, babysitting, tutoring, and general labor (aka moving stuff). you have to be humble as a teen. i remember got rejected by bestbuy and other electrionics retailers too. i even got a CCNA at 17 (cisco certified network associate) and couldnt land a decent job with it until i got to college and worked in the school's IT dept. most of those odd jobs i got through friend's parents or church. it is rough, but you have to do whatever it takes.

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#18) On February 08, 2010 at 7:18 PM, devoish (98.76) wrote:

Russian,

Unions gained a foothold in the 1930's and from that time until the late 1980's represented anywhere from 25-35% of the US workforce. They were unable to gain a larger percentage because their leadership would occaionally fail and drive membership away. F,GM,GE,and many other companys became blue chips with union employees. Graham, Buffett and many investors did very well in this time period.

In 1980's Reagan and Congress allowed "right to work" laws making it much harder to form unions in States that adopted them. Companys like GM and Ford which had large union workforces still had to work with them. Toyota, which opened its first US manufacturing plant in 1983 had an immediate labor advantage, a newer lower paid work force. To compete against Toyota's Gov't deregulated advantage F and GM opened plants in the Southern "R to W" States and slowly weakened unions. For GM that disadvantage ended in bankruptcy. As more and more people bought into the idea of "deregulation" and "free markets" environmental laws were attacked, human rights were disregarded, and the USA traveled down the path of lowering US living standards to third world levels, becuse we did not insist on doing business only with Countries that matched our own child labor laws. Also in 1983 Reagan lowered the top marginal tax rate from 60% to 34%, suddenly giving the wealthiest Americans a huge chunk of cash they hadn't had a day earlier. With nothing else to do they threw it into the stock market, and the wealthiest Americans gained the most from the increased earnings of companys that had sent jobs to the third world.

 I could not have taken any better steps to concentrate America's wealth in the hands of the fewest number possible if I had tried.

Now here we are, in your post pointing out that we have moved from a time of more equitable wealth distribution, and it's not like people did not get rich when there were unions. McDonalds made a fortune off of the incomes of middle class union workers.

So thirty years ago we had unions That allowed comfortable living for many workers, stable jobs environmet, pensions etc. and now you say we must look to the future and see how we can make the best of it. That means - less stuff, with our lower standard of living we cannot afford ths suburbua dream anymore. Les stuff, smaller houses means lesss expenses so that should allow people to be able to live on lower wages because with global competition wages are going to be very comparable eveywhere across the globe with variaitions to account for local tax and labor laws and  productivity.

Union incomes made the housing and auto industrys possible and great investments, clothing retailers had customers, as did CocaCola and Burger King and RCA.

There was no reason to surrender the common defense of individuals to a few employers. Many say this has helped the third world countries and they are correct, but it has helped corporate executives more, and global companies the most. A long time ago in the school system Dare and David do not like, a teacher warned that in a Democracy I could vote for Communists, but it would be my last vote ever. He should have warned against voting for a Corporate ruling class, because the same result is upon us.

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#19) On February 08, 2010 at 7:37 PM, Superdrol (98.56) wrote:

I think that is a good point.  HOWEVER, credit is much looser than it was back in the past and getting student loans is very easy.  Back in the day it was harder to get a student loan, so naturally a 'bachelors degree' was good enough and sufficient.

 

Now with the economic conditions changing and new knowledge and advancements being made, a bachelors degree is the same thing as a GED.  A masters degree or PhD is the new bachelors and what will be required in the next 20-30 years.

There are a lot of worthless young people out there who just want to have fun and not commit or work hard.  Not all, but a good amount.

 

I'm 25 yrs old, I have a full-time job, plus I manage 3 seperate accounts as a trader/short-term investor.  If I am not at school or working at my regular job, I am doing research for my clients.  Not to mention I am also going to school part-time and nearly finished with my MBA in finance.  Sometimes people just need to be held to a higher standard and that's what it takes moving forward.

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#20) On February 09, 2010 at 10:15 AM, devoish (98.76) wrote:

Sometimes people just need to be held to a higher standard and that's what it takes moving forward.

I'm curious about the higher standard. What is the reward for performing at the higher standard? Is it the goal many that Unions achieved, according to Russian? That allowed comfortable living for many workers, stable jobs environmet, pensions etc

Or is the reward of long hours and a second job going to be longer hours and a third job?

I would also like to know what you think this idea means for your future, especially as you are being told that older workers don't deserve the pensions and retirement benefits they negotiated for in their contracts.

Now with the economic conditions changing and new knowledge and advancements being made, a bachelors degree is the same thing as a GED.  A masters degree or PhD is the new bachelors and what will be required in the next 20-30 years.

When I was a teenager in the 70's many of my older friends and their parents thought college was a "goal" not a neccessity, and dropping out of HS to begin working in a trade was disappointing, but not the end of the world - their would always be a need for competent tradespeople - whether they began their careers one year early or not. Last year we were talking crap about many of those welders and machinists when the GM bankruptcy was being sold by CNBC as the fault of unions, not the fault of a labor law change whose timing gave an advantage to some companys over others.

The legal advantage also went to many companys to move production to foreign countrys. Once our elected leaders were sold the idea that "free trade" would trickle down to employees they began weakening trade laws to move in that direction. A man named Ross Perot stood up and said the
"sucking" noise we would all hear would be the sound of jobs leaving the USA. He was correct. You hear the "free marketeers" preach on it all the time. They say "companys left to go where enivronmental laws and labor laws don't cost them money". And so their rivers are polluted and water table is sucked dry. "We shouldn't impose our culture on them and tell them their children cannot work". And we hear of "evil-do-gooders" standing in the way of a childs right to work or hear that its ok because "they chose to leave the farm for the factory". But not that the contract that drew them off the farm was never enforced.

Now you have the idea being sold that employees have to settle for less healthcare, less retirement, less vacation and longer hours, but "executive talent" has to be paid for.

So while you think about how the idea  "a bachelors degree is the same thing as a GED" and what that might mean to your future, also think about the retirement you are asking the older GED'er to accept. And remember that GED'er started out ahead of where you are now. He started out broke, not in debt. And he had four additional income generating years.

 

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#21) On February 09, 2010 at 1:08 PM, russiangambit (29.98) wrote:

> I'm curious about the higher standard. What is the reward for performing at the higher standard? Is it the goal many that Unions achieved, according to Russian? That allowed comfortable living for many workers, stable jobs environmet, pensions etc

Devloish, only temporary and that was my point. Unions were able through sheer power of bullying to slow down the oncoming competition and keep labor costs high but in the end they lost everything. Instead of adpating they became extinct.

I can stand unions , they make everyone to come down to the lowest common denominator and that kills the progress. In a union you can't work too hard because you are making others look bad. It is a fact. And that kills progress and eventually dooms unions to failure.

Just look at teacher's union for example -  what is an incentive to worki harder? There is none. It kills people's  drive to achieve even if they had it in the first place.

You need to let go of the past because that past only existed due to a confluence of circumstances which are no more. And adpat to the future. And in that future if youw ant to be paid 5 times more than a chines you ahve to be 5 times better than a chinese and that is that.

Also, look at it this way - if you get extra $100 per month, it is nice but not a major change. If a chinese gets extra $100 per month it probably doubles his income. On from thats standpoint I say, sure $100 should go to the chinese all things being equal. It is the more efficient allocation of the limited resources.

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#22) On February 09, 2010 at 3:48 PM, devoish (98.76) wrote:

Russian,

I can stand unions , they make everyone to come down to the lowest common denominator and that kills the progress. In a union you can't work too hard because you are making others look bad.

What you describe there is a real problem in many unions. And in non-union workplaces. I worked in one shop when on a slow day my boss asked me to build some shelving. I banged it out in 15 minutes, and a coworker came over and told me not to tell the boss I was done. He told me the boss had no idea how long it should take, and if I finished quickly he'd no longer be able to milk those jobs. No union.

I bet there's lots of workers here that have similar non-union issues. "Don't rock the boat", "we've always done it like that", "don't go against that guy - the boss loves him", "dock his pay", "if he won't go up that ladder in the lightning, get me someone who will", "I don't care if its aluminum", "I don't care if the mask is broken if you don't spray today, don't come back tomorrow", "good luck getting any job when I tell them you wouldn't spray".

I could go on, but just so you know, I've personally heard all of these.

Just look at teacher's union for example -  what is an incentive to worki harder? There is none. It kills people's  drive to achieve even if they had it in the first place.

Dwot is a teacher, I have the feeling she thinks she works hard and cares. What is her incentive?

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#23) On February 09, 2010 at 4:01 PM, russiangambit (29.98) wrote:

Devoish, no this problem is union specific. In most other places people are forced to compete due to performance reviews. People are forced into 20-70-10% brackets by performance. I don't necessarily agree it is the best approach, but it still much better than having union workforce.

And as for teachers, there are good teachers but the union structure and regulations doesn't reward them, rather it rewards bad ones. There are a lot of people who will still do the right thing despite everything else. I should know, after all, coming from USSR. In USSR eveyone was equal in their misery except for party bosses. Yet majoirty of people still chose to do the right thing. But that was despite not because.

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#24) On February 09, 2010 at 4:56 PM, Superdrol (98.56) wrote:

Working harder and achieving more for yourself is not a bad thing.  Granted there is a balance between worklife and personal.  If you are working several jobs, then so be it.  I think there is a balance, and being able to work towards certain goals is, IMO, the basis for capitalism.

A higher standard in my opinion is being accountable.  No one is accountable for themselves either.  Overleveraging, piggybacking loans, excess debt, etc.  I know so many people who purchase things that they could not afford in the past due to loose credit.  Is it any surprise that the banks actually want their money back that they loaned initially ? Or is it really the bank's fault because they shouldn't have loaned it.  Of course, when the rubber hits the road no one is accountable.

 

I don't support unions or wall street big shots.  They are on both ends of the spectrum which represent corruption.  GM/Chrysler were both poorly ran companies that the fact that they even lasted as long as they did in the was purely a gift.  Nothing else.

 

When I get my car serviced or any type of repair work done on my vehicle, there labor almost always exceeds the cost of the product if not matches it exactly.  The reality is that labor costs and R&D costs are extremely large costs to a company.  GM/Chrysler in combination with their inept management and absurd union benefits, they are now bankrupt and living off the Government.  No matter how much the American automakers want to slam the foreign automakers (esp Toyota in lieu of their issues), they never went bankrupt or are on life support from the Government. 

If companies choose to go abroad and remove jobs from the US that is their own business and a company choice.  There are companies in the US who do not use outdated union business models and still survive.  I don't invest in unionized companies.  I don't have any problem buying domestic companies, but I'll support the US by buying Nucor who is not unionized.

To support the points earlier, I don't also agree with executives getting undeserved bonuses.  That is equally ridiculous as automaker union compensation.  They both are a joke.  Of course again, lack of accountability on both parties.  To a certain extent we are starting to realize that capitalism has been a mirage all along.  The propping up of zombie companies is a play from Japan's book in the 90's.

One aspect that I agree with from Peter Schiff, is that no one wants to make tough decisions, and as a result, there is still largely excess that has been supplemented from Government spending that once was a result of banks' loose credit standards.  Until the recession can fully run its course, we can get back to normalized GDP (3-4%) instead of a steroid induced 6%+ GDP, the problems that exist now will continue to mitigate themselves, and may only exacerbate the current economic situation in the future.

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#25) On February 09, 2010 at 8:15 PM, devoish (98.76) wrote:

Devoish, no this problem is union specific. 

?!? I'm sorry, are you saying I did not hear the words I heard?

Think about our recent housing implosion. One of the pieces that played a part was housing appraisers who were appraising houses at whatever price would keep the agents/lenders happy.

Not neccessarily for what they thought the houses were worth.

"If you can't give me the number I want, somebody else will".

No union. No protection if they tried to be honest. Just an opportunity to be unemployed.

As you said - There are a lot of people who will still do the right thing despite everything else. I should know, after all, coming from USSR. In USSR eveyone was equal in their misery except for party bosses. Yet majoirty of people still chose to do the right thing. But that was despite not because.

Interestingly, being non-union solved the integrity problem for employers in the appraisal industry.

In most other places people are forced to compete due to performance reviews.

And that is what solved it.

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#26) On February 09, 2010 at 9:23 PM, AbstractMotion (63.49) wrote:

It doesn't really matter what someone's views on labor unions are.  Labor unions simply thrived rare environment post WW2 created by a confluence of temporary factors.  The western world with the exception of the US and Canada was devastated after WW2 on top of that a huge number of countries we're competing with today either hadn't gained independence as a nation or were under some form of market socialism which kept them out of competition in the west.  

 

Once the 1970's hit the combined pressures of stagflation, the oil shock and the industrialization of many nations changed the position of the US in the global economy.  It no long maintained a positive trade balance and both the auto the steel industries were negatively impacted.  Chrysler was going bankrupt long before Reagan was President.  In addition most of the new jobs that came to replace the old manufacturing jobs were in sectors that never really unionized much to begin with like electronics and semiconductors.  Unions thrived in a rare period of unprecedented prosperity for the US as a whole, nothing more.  It's this same reason that lots of things you're advocating aren't practical anymore devoish, just like the ridiculous marginal tax rates of generations past.  If the world could really improved by people refusing to do anything without being payed more it'd much a hell of a lot easier to fix the numerous problems we face today, but then again that's just a fantasy to begin with.  Labor unions have their pros and cons like anything else, but they aren't sufficient to bring about economic prosperity.

 

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#27) On February 09, 2010 at 11:25 PM, dwot (99.54) wrote:

Wow, interesting discussion happening here.

 

Bottom line for unions is that they need public support to survive and when it gets too far out of line with the reality of the rest of society, you go from support to bashing.

The low wage earner had no representation and thinking it through my conclusion was the union workers had the most to lose from an increasing spread in wages.

Unions fought for and manage to maintain a standard of living when around them non-union workers were facing a declining standard of living.

That declining standard of living hurt unions in two ways, lower support for unions overall and people had less money to buy the union products.

 

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#28) On February 10, 2010 at 11:27 AM, Superdrol (98.56) wrote:

Unions are outdated in my opinion.  There are Government regulated agencies to address a lot of these issues.  Health and safety issues are regulated by OSHA, and proper pay is regulated by the Wage and Hour division in the Department of Labor.  I can say this because I work for OSHA and am an inspector.

 

Unions had a purpose at one point in time, esp. when the US was going through an industrial phase and there was a stiffer competition domestically and before the 1970s when OSHA was not implemented.

Things have changed, and the UAW's blatent arrogance over General Motors and Chrysler's bankrupcy is the reality of how their role is very limited in the present vs. the past.  Both companies were going under and some how each employee was 'entitled' to a certain wage and benefits.  With any other company, employees are hired/fired and this is called 'employment at will.'

What the unions represent is a semi-socialist attitude combined with arrogance.

The world has gone through these phases:

 

-Agricultural, Industrial (pre-1970), Informational (tech bubble), and where I believe will be next is 'the knowledge aka higher education).

 

I don't invest in unionized companies and I don't have any problem admitting it.  Unions are just fixed costs that I am not willing to put up with.

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#29) On February 10, 2010 at 11:37 AM, devoish (98.76) wrote:

Abstract,

If you are suggesting that unions were a unique creation of an American economic circumstance, you might be mistaken.

Two weeks earlier, more than a million workers in France demonstrated against layoffs and the government’s handling of the economic crisis, and in the last month alone, French workers took their bosses hostage four times in various labor disputes. When General Motors recently announced huge job cuts worldwide, 15,000 workers demonstrated at the company’s German headquarters.

You said, If the world could really improved by people refusing to do anything without being payed more

That is a nice stereotype to apply to unionized employees, but it is union workers out in the New England snow right now standing in for downed traffic lights, plowing streets, and agreeing to do something because they are paid more.

Interestingly enough, during the recent financial industry meltdown we had thousands of mortgage brokers, investment bankers and financial advisors who decided, rather incorrectly, that they could substitute refusing to do anything (the actual work of qualifying borrowers) with a math formula.

That was a non-union industry.

I spent all of 2008 listening to a marketing campaign against unions, blaming "lazy" union workers for poor GM quality, as compared to non-union competition driven, Toyota. Recent news offers an interesting perspective on those comparisons, as does the quality of work done by the non-union financial industry.

A lot of you seem to actually be convinced that unions destroy the opportunity for upward mobility. What if that is just an old wives tale, contradicted by facts?

The data, in other words, shows something superficially weird: The United States believes itself to be uncommonly meritocratic. But compared to European countries who don't believe themselves very meritocratic, it actually exhibits less income mobility.

It turns out that there's a bit of a paradoxical relationship between believing your country has a lot of economic mobility and your country actually having a lot of economic mobility

The Libertarians are very loud and very wrong. In a Libertarian society freedom is reserved for a select few, not a general populace. I have seen their policys implemented in my lifetime. From Reagan they got lowered taxes and weakened unions, from Greenspan's Fed they got non-intervention, from COX's SEC they got deregulation, from Bush senior they got privatization.

Americans have less free time and less opportunity for advancement than their counterparts elsewhere in the Global North. Nevertheless, most are convinced that they enjoy greater freedom than citizens of social democratic welfare states because they are free to retain a larger percentage of their earnings and because they are not subject to the degree of state regulation that, they imagine, hobbles businesses and restricts individual liberty elsewhere.

Given that freedom is conducive to well-being, this poses the question of what sort of freedom matters. Americans are freer from taxation and government regulation than their counterparts in other affluent countries, but spend more of their time at work, have fewer opportunities for advancement and are more likely to have their options restricted by poverty. Freedom from state intervention makes Americans far more likely to suffer the constraints of poverty and drudgery.

When the US had unions there was a real middle class with real property, real healthcare, real retirements, real vacation time. Without unions that middle class has real debt, no savings, and long hours. Employment based healthcare has become the chain that holds you to your employer.

I hear people express the idea that since they don't have benefits, then union workers shouldn't either. I hear the idea expressed that would like to take union employees benefits away. If they had real sense, they would join a union and get those benefits for themselves, because on their own they are really not very strong.

 

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#30) On February 10, 2010 at 11:59 AM, jddubya (< 20) wrote:

#28

"There are Government regulated agencies to address a lot of these issues."

I'm not sure what you believe to be most of a unions issues, but they surely include vacation, holiday, overtime pay, shift differentials, sick leave, health care and a slew of other issues that are not covered by gov't regulated agencies.

Not investing in unionized companies? Wow.  I think that would be very difficult to do if you're looking to make money in the stock market - or even trying to live life.  Does that mean you go out of your way to not purchase anything coming from a unionized company?  Car? Utilities? Phone service?  I think whether anyone can help it or not, almost everyone is supporting (not necessarily investing) a unionized company somewhere, somehow

FWIW - I'm not saying whether or not unions are good or bad. I've worked both sides of the fence and I actually like the non-union side of employment, but that's just me...

 

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#31) On February 10, 2010 at 12:04 PM, Superdrol (98.56) wrote:

If the benefits or wages for that matter are not up to standards, there's always an opportunity to go to another job.  Prior to this economic downturn changing jobs is always a possibility.  One of my friends worked for a marketing firm that had limited benefits.  Because of this, he ended up changing jobs to a better one with better wages/benefits.

There's a big difference between being entitled to something and having it provided to you.  The spread that you are referring to regarding middle class is a moot point.  Times have changed and referencing something in the past does not make it an accurate point today.  The long hours and low competitive wages are gone.

As time moves forward, a lot of blue collar labor jobs will be moved overseas, most likely permanently.  I don't blame companies for this, because as technology and new developments move forward, these primative jobs will be outsourced to where costs can be kept competitive.

In reference to my point above, sooner or later higher education will be key and even more important than ever.  Education has always been key, but will be even more so.  The way that the US does business and the way the economy operates will be forever fundamentally changed.  Companies need to stay competitive, while providing optimal low cost products. 

$100,000/year for driving a forklift truck at General Motors is done.  Those days are over, and they should just be fortunate to have experienced those day when they were a reality.  Same with the security guy at the General Motors parking lot that made $70,000/year.  I'm sure they all complained that they were not being paid enough either.  On top of the intentional damaged done to machines while collecting overtime.

Jobs banks where they get paid 95% for doing nothing because it is not in their 'job description.'  The maintenance guy who needs to be called in and gets guaranteed 3 hours of overtime to turn off a water faucet because he is the only one who can do that job, etc, etc.....some how this inefficient behavior was negelected to be mentioned while getting their bailout.  Most people are not aware of this non-sense.  And that's exactly what it is is non-sense.  There was also a video in Dec 2008 where Ford employees clocked in then went right to the bar for their entire shift.  Intoxication combined with heavy machinery use, seems like a problem to me, but CNN and the other networks would of course rather focus on Toyota's issues instead.

 

The days of squandering and wasteful behavior will be brought in or atleast better controlled.  During the Great Depression, the generation that lived through that taught people to save, which we seem to have forgotten again.

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#32) On February 10, 2010 at 2:02 PM, devoish (98.76) wrote:

There was also a video in Dec 2008 where Ford employees clocked in then went right to the bar for their entire shift

I guess it is not a corporate tax deduction unless it involves 3 martini's and someone says "this company sucks". Do you think people are aware of these abuses?

Not for nothing, but one video doesn't even compare to the abuses executives think they are entitled to.

You say 100,000/year for driving a forklift truck at General Motors is done.

It doesn't seem so outrageous as compared to an executive that makes 1000 times that amount for his 5 hour day. In fact that forklift driver seems underpaid by comparison. Maybe a good strong union could restore some balance between those paychecks. I bet there is someone better qualifed who would do that execs job for $250k.

You say As time moves forward, a lot of blue collar labor jobs will be moved overseas, most likely permanently. You are kidding yourself if you think the next major job shift will not be white collar. There is no paper pusher whose job is secure. No engineer, no tax preparer, there is no executive who cannot be replaced by a lower paid overseas employee. Tomorrow morning I will fill out a form online and it will be reviewed by an Indian employed by BAC.

That was a fun little round of class warfare, let's talk about how special you are next. I remember when union employees were special because they were trained on the latest, most modern and expensive euipment and in the latest safety standards. Are you special, trained as you are on the latest and most modern computer program?

 

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#33) On February 10, 2010 at 2:38 PM, Melaschasm (85.85) wrote:

The minimum wage laws in my area have created at least one lazy teenager.

I would like to hire a teen from my area to clean my house, shovel the snow from my driveway, weed my flower garden, and mow my lawn.  However, I am only willing to pay $3 per hour for these services.  There is a teenager who is willing to do the work for $3 per hour, however, we are both law abiding citizens of the US, so I am still doing all that low skill work, while the teen is sitting around without a job.

Not only is the high minimum wage law causing higher unemployment, but it is reducing government tax revenue, because that teen would be paying 15% of his income in payroll taxes.

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#34) On February 10, 2010 at 5:45 PM, AbstractMotion (63.49) wrote:

Devoish I never said that unions were an American creation, simply that the environment that allowed them to thrive was universal, not a result of unionization itself.  I also don't see the point of constantly bringing up that a lot of executives are overpaid. I haven't seen anyone here advocating for their rights to be overpaid either, to the contrary I've seen a lot of people agreeing that it's part of the problem.  Regardless executives in the US auto industry aren't exactly doing stellar now either, GM was shaken up and the industry as a whole is subject to the price czar and salary caps.  So the idea that some how management and executives aren't making any concessions is fairly ridiculous.  I'll also point out that very few executives make 100 million dollars a year, and those that do are certainly overpaid.  Really though a bunch of German workers protesting that a bankrupt foreign auto company is looking to cut some jobs doesn't exactly scream sustainable to me, if the US tax payer wasn't bailing out that failed company they wouldn't have jobs anyways.  Likewise French unionists taking their boss hostage sure doesn't seem societal progress to me, to the contrary it probably affirms the stereotype that unions often have as much in common with organized crime as they do with organized labor.  

 

Yeah people in New England are doing their job for overtime pay, I'm willing to bet non union labor would too, especially with unemployment at it's current levels.  Hell I know there's several contractors doing the same thing here in Virginia.  Sure I'm thankful people are willing to work the overtime, but the notion that they're the only ones who will do it on those terms is fairly ridiculous.  I still have not seen anything in your post which seems to substantiate your claims that unions caused prosperity instead of just benefiting from it.  To the contrary it seems that unions tended to thrive only in an environment where there was enough slack to meet their extensive demands.  I don't think it's a coincidence that countries with higher percentages of union workers also tend to institute many more trade barriers and have slower growing economies.  That said I'm not against union labor, it has it's pros and it's cons like anything else does.  There are situations where it's workable, but greed isn't isolated to just executives and the rich. 

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#35) On February 10, 2010 at 5:55 PM, Superdrol (98.56) wrote:

I don't disagree that there are executives out there that are overpaid.  If anything, I don't condone that kind of payment anymore than overpaid union employees.

 

I think the real crime here is that executives make so much more than doctors, medical professionals, soldiers, and teachers, but that's a different topic.

My job does not require specifically technically oriented skills in the context that you were referring to.  Regardless, I still hold my view that union employees at GM during the time of the bankrupcy really humiliated themselves and the company by their rediculous stance towards not renegotiating wages.  Equally worthless is the CEO Rick Wagoner who had every excuse in the book and every solution for the company except for the one that really matter which was keeping it profitable and solvent.

I also agree that white collar jobs can and some are outsourced, however; education that is obtained is more valuable than lower levels of education of another person.  I don't think that you can find someone who actually believes that education does not have any value.  Normally the people I hear about that say a college degree is overrated or a masters degree is overrated normally don't have one.  Weird how that works.

Reiterating the previous point, it is not the unions 'job' to force companies to pay competitive wages, it is the free markets and no one is forcing an employee to work at a certain job.  This goes back to some sort of entitlement that an employee is entitled to get paid a certain wage because someone pocketing his union dues says so. 

The card check law being proposed which removes the anonymity votes from unionization is such a political kickback.

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#36) On February 10, 2010 at 6:02 PM, Turfscape (41.23) wrote:

Melaschasm wrote:
"The minimum wage laws in my area have created at least one lazy teenager."

I have to call B.S. on this one...either that or your ignorant of laws. The minimum wage law applies to employees. You would have to, in fact, take that teenager onto your PAYROLL in order to be subject to minimum wage laws. I'm assuming you weren't figuring on incorporating and filing payroll taxes, obtaining unemployment insurance and such just so the neighbor kid could cut your lawn?

AND if you were intending to hire the kid as a freelance contractor, it would be HIS responsibility to insure minimum wage laws were met. And if he is a sole proprietorship, or even an LLC or otherwise incorporated, then he is not subject to minimum wage laws as the prinicpal of the corporation or as the sole proprietor. You would not be paying wages to him as an employee. You would be paying a fee for service from an independent company. That company has the right to set its fee as it sees fit.

Sounds to me like that kid just got a job! Unless, of course, I'm right, and your story is just B.S. to make a political point...

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#37) On February 10, 2010 at 7:42 PM, devoish (98.76) wrote:

Abstract 

Labor unions simply thrived rare environment post WW2 created by a confluence of temporary factors.

Devoish I never said that unions were an American creation, simply that the environment that allowed them to thrive was universal, not a result of unionization itself.

Rare or universal? Europe was the same post WW2 environment as the US? Temporary, as in Europe for 100 years?

Am I to undestand that you are arguing that the rare American environment of being the only industrialized Nation left after a devastating war wiped out Europe, allowed unions to thrive. If so I am pointing out the obvious flaw in your argument by pointing out the entirely different circumstances in Europe where Unions also thrived with their industry wiped out by the war. The entirely different circumstances in Europe that exist now, that also allow unions to thrive. I could also point out the very different circumstance during the depression when US unions also thrived.

The loss of unions is purely due to Gov't aligning with corporations instead of employees, an idea sold to Americans under the misguided notion of trickle down economics which has now been abandoned in favor of cut employee pay economics.

Both of which ideas have at their core that surrendering financial authority to unelected individuals is smart, regardless of the fact that the living conditions for most Americans have declined in the living in the reality of such foolishness.

I think I'd like a union to keep a captured Gov't in check.

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#38) On February 10, 2010 at 8:02 PM, Superdrol (98.56) wrote:

Unions are a business, don't forget that.  The loss of unions is not purely due to Government aligning with corporations.  That is the most absurd comment I've read thus far.

Honda (where I worked before)/Toyota, and Nucor employees (among many) have chosen voluntarly NOT to have a union.  Unionizing is a choice among a group of workers.  There is no Government influence among those small to organize or not.

Unions may have a hand in politics in the Government (like the gimmick bankrupcies of GM/Chrysler), but they are not the sole cause of lack of unionizations.  I don't even understand where that rational comes from, even with an ultra liberal president right now.

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#39) On February 10, 2010 at 8:05 PM, Maximus88 (< 20) wrote:

Melaschasm wrote:

The minimum wage laws in my area have created at least one lazy teenager.

"I would like to hire a teen from my area to clean my house, shovel the snow from my driveway, weed my flower garden, and mow my lawn.  However, I am only willing to pay $3 per hour for these services.  There is a teenager who is willing to do the work for $3 per hour, however, we are both law abiding citizens of the US, so I am still doing all that low skill work, while the teen is sitting around without a job."

If I were you i'd pay a flat rate per job. $3 per hour is very low. A teenager could pocket more by being their own boss picking up cans and bottles. Hell I see adults doing it! Anyway if a kid wants a job I love the idea of going house to house mowing lawns or shoveling sidewalks. It gives the teen responsibility and a sense of ownership...something we all need to see more of.

 Maximus - http://www.betteryourbudget.com/

 

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#40) On February 10, 2010 at 9:07 PM, devoish (98.76) wrote:

The loss of unions is not purely due to Government aligning with corporations.

Union membership ranged between 25% and 35% of the American workforce from 1940 until 1980. Reagan and Congress changed that by allowing "right to work" laws if States chose them and also by actively breaking the air trafic controller union strike.

The range between 25% and 35% was a function of the actions of unions and how well they worked with employers and members, and the notable corruption of the teamsters union.

The loss of unions down to where they are now is predominately a result of Gov't aligning itself with corporations. I should not have said "purely",  as there are rarely absolutes.

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#41) On February 11, 2010 at 5:13 PM, Melaschasm (85.85) wrote:

It appears the consensus is for me to circumvent the minimum wage laws, and use a legal loophole to avoid the limitations of minimum wage laws.

As an 'evil businessman' I already take advantage of several loopholes to minimize my tax burden.  In fact, I will be able to deduct half of the expense of the outdoor work as an expense to support the half of the Duplex I rent out.

However, if the minimum wage law is a good thing, then doesn't it mean it is bad to avoid the minimum wage law?  On the other hand if it is a good thing for me to avoid the minimum wage law, then doesn't that mean the minimum wage law is bad?

*Confession:  I have already contracted some yard work this spring, which will be done by a kid who lives near me.  The money will flow through his mom's landscaping business, and I am getting a small discount since it is the kids first unsupervised project.

 

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#42) On February 11, 2010 at 6:32 PM, Turfscape (41.23) wrote:

Melaschasm wrote:
"It appears the consensus is for me to circumvent the minimum wage laws, and use a legal loophole to avoid the limitations of minimum wage laws."

Uh, no. The Minimum Wage Law doesn't apply in your situation. You have a misunderstanding of the law and how it is applied.

Someone who cuts your lawn is, in almost all cases, not your employee. He or she is self-employed or works for a landscaping company. Minimum wage law does not apply to those who are self-employed.

Think of it this way...you buy a refrigerator from Sears. Two delivery men bring the item to your home for a delivery fee. Are you going to provide those two men with a W-2 form the following January? No. They don't work for you. They provide you a service...but they are not your employees.

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#43) On February 12, 2010 at 1:05 PM, Melaschasm (85.85) wrote:

I appreciate the legal distinction. 

However, the stated purpose of the minimum wage is to insure that people earn no less than that amount per hour of work.  If I knowingly pay someone less than that for each hour of work, I am legally safe, but I am not following the intent of the law.

If a person believes that no one should work for less than $10 per hour, but they can legally pay a person $7 per hour, it is legal for them to pay $7 per hour, but they consider it unethical to do so.

Lets see if I can find a different example.  The Walmart hired a bunch of independent contractors to clean the floors of their stores at night.  These independent contractors were illegal immigrants getting paid less than citizens were willing to be paid for the same work.  Walmart did not hire illegal immigrants, nor did they tell the independent contractors to hire illegals.  However, there was a great public outcry against Walmart because it was obvious that what Walmart paid for the services was not enough to hire legal workers.  Walmart was technically following the law.  But their actions were ethically questionable, and thus they suffered criticism, and risked losing customers.

 

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#44) On February 12, 2010 at 9:36 PM, coralbro (93.56) wrote:

wow, definitely a loaded article.  Definitely got me thinking.  I can see both sides of the coin.  I have seen both those who work hard, but see very little benefit, and those who truly are lazy good for nothing...  Keep up the great posts!

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#45) On February 13, 2010 at 1:12 PM, Turfscape (41.23) wrote:

Melaschasm wrote:
"If I knowingly pay someone less than that for each hour of work, I am legally safe, but I am not following the intent of the law."

Again, wrong...but, boy, you're getting closer. The intent of Minimum Wage laws is to protect the vulnerable from those with more power and influence. It's to protect a worker from an unscrupulous employer. In your case, you have no employee. The yard worker is the boss in your scenario!

Thanks for playing. Better luck next time. 

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#46) On February 13, 2010 at 1:18 PM, Turfscape (41.23) wrote:

Melaschasm wrote:
"Walmart was technically following the law."

 In that case, Wal*Mart was not technically following the law. A company does have a responsibility to insure its suppliers are adhering to laws and regulations. The 'uproar' was not over the amount of pay. It was over the immigration status of the workers.

 If Wal*Mart had hired a company to paint a wall for $50, and the sole proprietor of that company comes in himself to paint that wall, and spends 12 hours on the job (bringing his hourly earning to less than $5 per hour), Wal*Mart has done nothing unethical nor illegal. The Sole Proprietor has done nothing illegal. The minimum wage law would not apply in spirit nor letter.

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