If he’s not careful, his workers are going to end up like those in Seattle – what happened when a town in California raised it’s minimum wage (reformatted, emphasis mine):
Small businesses are already struggling to survive the spate of minimum wage increases to $15 per hour in parts of California.
Last month, the small Bay Area town of Emeryville, California, (population 10,000) decided to act as flag-bearer for raising the minimum wage in California, hiking its minimum wage to $14.44 per hour. Even though businesses with less than 56 workers are exempt from the $14.44 rate and do not have to raise their wages to $15 until 2018, Vic Gumper, who owns Lanesplitter Pizza, with outlets in Berkeley, Oakland, Albany and Emeryville, decided not only to bite the bullet but swallow it, paying his workers $15 to $25 an hour while eschewing tips or raising prices.
This MUST have been a guy who knew “his numbers” – the important stats about his business that served as his indicators of “working? not working?” as to whether he could BETTER the now mandatory minimum wage. WHY else would he have gone whole hog (er, large special) in raising his labor costs? Was he one of those mean, profit mongering, money greedy capitalists taking advantage of the help to line his own pockets? Umm….
Not quite, I think. Market prices, I know, are different in CA than here in NH – pizzas are generally $10-$15 for a large pie. So what did that labor cost hike do? Yikes-a-mighty!
He advertised his $30 pizzas and other food items as “sustainably served, really … no tips necessary,” according to the Los Angeles Times.
Sustainable? Maybe out in CA that’s a big deal (right, all I want is that pizza to be sustainable until just after I eat it) and perhaps some liberal havens here in NH where Communitarians clump, but for most people, would YOU pay $30 for large pizza? Seriously – $30 bucks, I thought to myself when reading this. What is wrong with this picture??
Ah, and here it is – ordinary folks took note of that $30/pizza, took note of their own self-interest and own wallets, and Gumper showed he didn’t know his numbers (or his customers) all that well:
Sales at Gumper’s locations have plunged 25% in the last few months, forcing Gumper’s to close during lunch hours at some locations.
Yeah, numbers. Gotta know yer numbers. Good intentions won’t pull in most people most of the time, especially when they decide a $30 pizza is no pizza at all. And look what happened – by closing at lunch, hours were cut for workers. THAT’s what good intentions are for?
Let’s face it – when Government takes effective control of private companies (in this case, demanding wage levels be met or Government will met out serious consequences), it is fascism. Capitalism can be bent a long way but even exceeding good capitalists can be bent to far and then the biz model can no longer cope. And Vic is now realizing that people that do not care as much about his company as he does (note to “useful idiots”: they don’t care about you at all except to use you until you are all used up and are worthless) have tanked your company. And Vic, in going even further, showed that in actuality (unless you REALLY learn your numbers right), he was more than willing to trade his “Owner” title for that of “useful idiot” – and now he will pay the price:
Gumper admitted, “The necessity of paying people a living wage in the Bay Area is clear, so it’s hard to argue against it, and it’s something I’m really proud to be able to try doing. At the same time, I’m terrified of going out of business after 18 years.”
Progressives never seem to worry about actual results – only their good intentions (but those intentions don’t pay for pizzas). He fell for the ideology and was a True Believer that the Progressive ideology would shepherd his business onto better profitability. Instead, he just ran into the conundrum that just like the Law of Gravity, the Law of Supply and Demand will ALWAYS trump good intentions and an ideology that doesn’t care whether you succeed or not.
But they did get control because you let them.