Biden's presidency

[pfife]

18 minutes ago, Tigeraholic1 said:

let me give you an example:

Do you remember during 2020 when the government paid a  large percentage of americans to stay home? Then a large portion of them said " I won't come back to work for that pay level"? Many employers had to start paying higher wages to lower income folks to get them back into the work force right? Do employers eat that cost? No, they pass the buck to the consumer. Hmmm what happens next, cost of consumable goods goes up. So said folks who got a bump from $13 per hour to $14-15 is negated due to higher costs. It's economics 101 my friend. 

 

so higher wages are bad?  Just want to make sure I'm following this economics lesson fully.

[pfife]

also is there part of the lesson where demand goes down because people "wont come back to work for that pay level" and thus don't have the resources to generate as much demand?  Or don't generate as much demand as a bi-product of working?

[Motown Bombers]

Why is staples like a Big Mac cost more in the US than anywhere in the world and yet American McDonalds workers are paid less than most other developed countries?

[Tigeraholic1]

15 minutes ago, Motown Bombers said:

Why is staples like a Big Mac cost more in the US than anywhere in the world and yet American McDonalds workers are paid less than most other developed countries?

I travel to California for work and always amazed how much more expensive things are out there. My partners son works at a McD's in Long Beach and starting wage for burger flipper is $17.50 an hour. My one bedroom apartment I keep out there 2 miles from Compton is $1500 a month w/o utilities. 

[Tigeraholic1]

30 minutes ago, pfife said:

so higher wages are bad?  Just want to make sure I'm following this economics lesson fully.

When the wage increase occurs without a higher profit margin for a company it's not absorbed. You think CEO's are going to take a pay decrease so their employees get a raise?

Edited December 10, 2021 by Tigeraholic1

[Motown Bombers]

The workers should accept lower wages and lower standards of living so the CEOs don't have to take a pay cut. Maybe we could also give the CEOs a tax cut and see if that extra money trickles down. 

[oblong]

inflations the fault of burger flippers making too much money.

But I'm the elitist around here

 

[Tigeraholic1]

1 minute ago, oblong said:

inflations the fault of burger flippers making too much money.

But I'm the elitist around here

 

? Cali has been historically higher wage region for years. Everything costs more out there. You are arrogant but that goes without saying.

[Motown Bombers]

I never mentioned California in my post but California is still part of the US with greedy corporations. 

 

[chasfh]

1 hour ago, Tigeraholic1 said:

let me give you an example:

Do you remember during 2020 when the government paid a  large percentage of americans to stay home? Then a large portion of them said " I won't come back to work for that pay level"? Many employers had to start paying higher wages to lower income folks to get them back into the work force right? Do employers eat that cost? No, they pass the buck to the consumer. Hmmm what happens next, cost of consumable goods goes up. So said folks who got a bump from $13 per hour to $14-15 is negated due to higher costs. It's economics 101 my friend. 

 

Thanks for the economics 101 lesson. I have a question:

What about when employers pay higher wages, raise prices so they can pass it all on to the customers, and customers simply buy less, or stop buying period, because the new prices are too high? What happens then?

[pfife]

22 minutes ago, Tigeraholic1 said:

When the wage increase occurs without a higher profit margin for a company it's not absorbed. You think CEO's are going to take a pay decrease so their employees get a raise?

As a super liberal, strident anti-republican, I hope the GOP runs on the "we want to lower your wages because high wages are bad" platform.   Unfortunately they don't really run on platforms anymore (didn't have one in 2020) so that's kinda passe' of me.

[Tigeraholic1]

13 minutes ago, Motown Bombers said:

I never mentioned California in my post but California is still part of the US with greedy corporations. 

 

I was just assuming the Big Mac cost you reffered to was an average cost in the U.S. inflated by states like Cali.

[Archie]

Part of the increase in price of goods is the shortage of those goods.  Many shelves are empty.  Car Dealer lots are empty and price of all cars including used cars have increased.  There are more than one factor that causes this.  Is Biden at fault for this?  I would say not 100% but he hasn't done anything to help.  He did say he talked to the longshoremen but that was just lip service.  Politicians have always taken credit for things things they had nothing to do with so it only fair they get blamed just the same.

[Tigeraholic1]

1 minute ago, chasfh said:

Thanks for the economics 101 lesson. I have a question:

What about when employers pay higher wages, raise prices so they can pass it all on to the customers, and customers simply buy less, or stop buying period, because the new prices are too high? What happens then?

Most families need milk and bread no? I guess not eat? 

[Motown Bombers]

7 minutes ago, Tigeraholic1 said:

I was just assuming the Big Mac cost you reffered to was an average cost in the U.S. inflated by states like Cali.

A Big Mac is the same price in Los Angeles as Dallas.

For shits and giggles I went on Doordash and a Big Mac value meal is $4 cheaper in California than Michigan. WTF. 

[chasfh]

1 minute ago, Tigeraholic1 said:

Most families need milk and bread no? I guess not eat? 

So we're talking only about milk and bread?

[Motown Bombers]

Average Big Mac costs $5.11 in California. The average cost in Texas is $4.39. That's a 14% increase. Average hourly rate of a crew worker in California is $14.86. In Texas it is $11.11. That is a 33% increase. While higher wages do raise the cost of goods, the entire wages increase isn't rolled into the price of goods. 

There's more. I know the retort will be well they work less hours. The average annual salary in California is $30,906 vs $23,106 in Texas. An increase of 33% so it doesn't appear hours are affected at all. 

[Motown Bombers]

4 minutes ago, Motown Bombers said:

Average Big Mac costs $5.11 in California. The average cost in Texas is $4.39. That's a 14% increase. Average hourly rate of a crew worker in California is $14.86. In Texas it is $11.11. That is a 33% increase. While higher wages do raise the cost of goods, the entire wages increase isn't rolled into the price of goods. 

There's more. I know the retort will be well they work less hours. The average annual salary in California is $30,906 vs $23,106 in Texas. An increase of 33% so it doesn't appear hours are affected at all. 

Since someone will bring up taxes, the salary would fall in the 4% bracket for California's state income tax. That would be roughly $700 in income taxes vs 0 in Texas. That would bring down the total California salary to $30,206 vs. $23,106. An increase of roughly 30% but the Big Mac only costs 14% more. 

[Tigeraholic1]

12 minutes ago, Motown Bombers said:

Since someone will bring up taxes, the salary would fall in the 4% bracket for California's state income tax. That would be roughly $700 in income taxes vs 0 in Texas. That would bring down the total California salary to $30,206 vs. $23,106. An increase of roughly 30% but the Big Mac only costs 14% more. 

Good stuff, I love seeing antylitics of costs by regions. $1 goes much farther in Texas vs Cali I would suspect.

[Tigeraholic1]

Not sure how old that data is for hourly in Cali but the kid I mentioned was hired last month $17.50 just turned 16 no experience of course.

[Tigeraholic1]

47 minutes ago, chasfh said:

So we're talking only about milk and bread?

No idea what you are talking about. You just said they would stop buying if it cost to much.

[Motown Bombers]

2 minutes ago, Tigeraholic1 said:

Good stuff, I love seeing antylitics of costs by regions. $1 goes much farther in Texas vs Cali I would suspect.

Right but the higher wages in California, amongst McDonald's crew members, offsets that and a crew member would have more purchasing power. An employee in California making $14,86 an hour, minus the 2.2% effective tax rate would make $14.33 per hour vs $11.11 in Texas. A $5.11 Big Mac would be 36% of that person's take home hourly wage. A $4.39 Big Mac in Texas would be 39% of that person's take home wage. Even though your dollar goes farther in Texas, you still have more purchasing power in California in this example of McDonald's workers. It also shows that McDonald's can raise wages without raising prices equal to the pay increase. The conclusion is higher wages are better. 

[Motown Bombers]

6 minutes ago, Tigeraholic1 said:

Not sure how old that data is for hourly in Cali but the kid I mentioned was hired last month $17.50 just turned 16 no experience of course.

Of course it's state wide so certain markets will be higher and other markets will be lower. I'm sure there are areas in Texas that make more than $11. 

[Tigeraholic1]

6 minutes ago, Motown Bombers said:

Right but the higher wages in California, amongst McDonald's crew members, offsets that and a crew member would have more purchasing power. An employee in California making $14,86 an hour, minus the 2.2% effective tax rate would make $14.33 per hour vs $11.11 in Texas. A $5.11 Big Mac would be 36% of that person's take home hourly wage. A $4.39 Big Mac in Texas would be 39% of that person's take home wage. Even though your dollar goes farther in Texas, you still have more purchasing power in California in this example of McDonald's workers. It also shows that McDonald's can raise wages without raising prices equal to the pay increase. The conclusion is higher wages are better. 

Higher wages are better but you still are not accounting for the cost of living.

 

Cali gas per gallon today $4.68

Texas gas per gallon today $2.92

Thats huuuge

 https://gasprices.aaa.com/state-gas-price-averages/

Edited December 10, 2021 by Tigeraholic1

[Motown Bombers]

7 minutes ago, Tigeraholic1 said:

Higher wages are better but you still are not accounting for the cost of living.

 

Cali gas per gallon today $4.68

Texas gas per gallon today $2.92

Thats huuuge

 https://gasprices.aaa.com/state-gas-price-averages/

The issue was that higher wages would lead to companies charging more for their goods. That is only true in a sense. Increase in wages outpaced the increase in the cost of goods that company provided, meaning McDonald's can raise the wages of workers. There's no reason that McDonald's can't raise the salary in Texas without increasing prices. 

There's more to the cost of gas in California than employee wages which is what this was about. New Hampshire pays McDonald's employees $15.01 and they don't have income tax and their gas prices are $3.23.