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Topic: Starbucks workers go on strike!

Peter Berrett
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From: Victoria, Australia
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posted 11-26-2005 12:28 AM

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Actually Aaron the quote is from the article, not from me.

On the subject of whether people who believe that they are entitled to a reasonable wage are communists I would say that wages and conditions are not necessarily a matter of ideology. On the other hand being anti-unions IS a matter of ideology.

Here in Australia we have long held views that recognise the reality that we all aren't born with an equal capacity to get a good income. Some people, despite trying hard, just aren't business savvy or talented in areas demanded by the economy. So our solution to this is a mixed economy where we recognise that whilst people should be free to run their businesses and make money, on the other hand the strong have social obligations and this means the strong helping the weak both financially and in other ways. This also means protecting the weak from those who exploit them.

The outcome of this is that children of financally disadvantaged
parents at least have a chance of bettering themselves and are not stuck in a rut from which they cannot extricate themselves. For example if your family is so poor that you have to work to leave school to support them how can you get an education? Worse still your low wages caused by your lack of skills limit your capacity to pay for an education to better yourself.

The unfortunate truth is that many middle and upper class families do not understand the reality of poverty traps.

Here in Australia you rarely see beggers on the streets. When you do they are rarely genuinely needy people as we have alternative social support mechanism (i.e unemployment benefits, rent assistance.) I was shocked the first time I went to the USA to see the level of poverty there in the form of beggars at many major places. It is ironic that one of the most christian nations in the world still has beggars on its streets.

Is redisributing wealth socialism? No, the idea that some wealth and social benefits needs to be redistributed to the poor is not exclusively a matter of ideology. Open your Bible or yoru Koran. I regard it as simply a matter of human decency.

Having said the above I recognise the tensions that exist between running a profitable business and paying reasonable wages. However the Australian experience is that you can do both and still keep unemployment reasonably low.

Regards Peter

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Bobby Henderson
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posted 11-26-2005 12:52 AM

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quote: Peter Berrett
I was shocked the first time I went to the USA to see the level of poverty there in the form of beggars at many major places. It is ironic that one of the most christian nations in the world still has beggars on its streets.

It's just another example of the arguably cosmetic morality we have here. Window dressing values.

A major corporation will wave the American flag and exude patriotism in its marketing, yet move factories over to Red China to exploit an impoverished and persecuted labor force. We talk a big game about things like "freedom," but when our quarterly report is involved in the equation we look the other way when human rights crimes are committed.

There's an endless example of moral contradictions in our society. The contradictions only make sense when one understands profit is the only motive.

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Matt Fields
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posted 11-26-2005 01:13 AM

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Minimum wages laws are simply a price control on labor.

Price controls produce:

1. Increased demand
2. Decreased supply
3. Lower quality
4. Black Markets

Take for example the recent Muslim riots in France. 40% of the young male Muslim population in France is unemployed, not because of discrimination, but because of the mandatory wages and benefits the government of France places on employment.

These young Muslim men have little job related skills, and are not worth hiring at the high costs of the French price controls on labor.

Also, the minimum wage in America was originally enacted to stop black from getting construction jobs during the depression. The blacks would work cheaper then the Whites.

Here is a column I read about the French situation that also talked about the history of the US minimum wage.

Economist Thomas Sowell column

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David Buckley
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posted 11-26-2005 03:56 AM

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quote: Dave Williams
Even here in the states, Fast food is costly enough as it is, and I have no intention no matter where I go in this world of putting a Hummer in the driveway of every soda jerk on the planet, when I cannot afford one myself.

The reality is that these "jerks" cant actually afford a driveway, let alone anything to place on one.

The other point is that minimum wage is what the worst employers in the worst industries can just afford to pay their workers before their business collapses. It is not a target to be aimed for, its a line of disgrace below which you need to go out of business. To be fair, Starbucks pay a little above minimum wage here.

Starbucks are a premium brand, which has premium pricing, and therefore I expect their outlets to be better "quality", serving better fare in a better manner in better locations, and for them to pay their staff better than some shed somewhere with flies crawling all over it.

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Peter Berrett
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posted 11-26-2005 04:09 AM

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quote: Matt Fields
Minimum wages laws are simply a price control on labor.

Price controls produce:

1. Increased demand
2. Decreased supply
3. Lower quality
4. Black Markets

Take for example the recent Muslim riots in France. 40% of the young male Muslim population in France is unemployed, not because of discrimination, but because of the mandatory wages and benefits the government of France places on employment.

These young Muslim men have little job related skills, and are not worth hiring at the high costs of the French price controls on labor.

Also, the minimum wage in America was originally enacted to stop black from getting construction jobs during the depression. The blacks would work cheaper then the Whites.

Whether a wage is $4 or $0.40 an hour, the price does not determine whether a white worker gets a job rather than a black worker or whether a white French worker gets preference for a job over somebody of North African origin. It is racism and discrimination that causes that.

It is accepted that dropping wages means that more businesses can become more profitable and more workers can be hired however the downward shift on wages also could cause reduced demand for goods and services because working class employees have less income to spend. Here in Australia we have a high minimum wage yet have a much lower amount of unemployment than France and certainly much less of the social problems. Mr Sowell's wage cutting proposal is the wrong solution for a complex social and economic problem.

Rather than cutting wages what needs to be done in France is firstly to address the issue of discrimination with tougher anti-discrimination laws. Next opportunities for education need to be expanded to the most disadvantaged groups (economically and racially) in society so that they are more employable or have a greater capacity to start their own businesses.

Also, what is needed is that their social welfare mentality (not necessarily a bad thing) needs to add the right to a job to the right to support when unemployed, to govt assistance in various forms, to a free education ect. There is scope for pruning government welfare outlays and using the resultant savings to invest in large scale national work for the dole type schemes as existed in the USA of the thirties. Schemes such as the building of the Hoover dam provided a foundation for decades of future properity in the US.

One must also take into account that some unemployment can be attributed to the bulge in the population due to the baby boom of the 50s and 60s. As these generations retire one can reasonably expect that unemployment will fall of its own accord. Here in Australia we have already started to see this occurring with labour shortages appearing in certain industries. Lowering wages won't solve these problems. Educating unemployed people so that they can fill vacant positions will.

In the case of the USA I would argue for an increase in minimum wages as it would stimulate domestic consumption (domestic demand).

Regards Peter

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Scott Norwood
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posted 11-26-2005 07:35 AM

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quote: Peter Berrett
In the case of the USA I would argue for an increase in minimum wages as it would stimulate domestic consumption (domestic demand).

It would also stimulate unemployment and higher prices. Some jobs just aren't worth very much in monetary terms, and not all compensation comes in the form of dollars. Re-read Jack's post about his business--he is providing part-time jobs and seasonal jobs for students, not full-time career positions. The same can be said of many minimum-wage positions. Also, in the US at least, few people who take minimum-wage jobs continue at the minimum wage for more than a few months; instead, they either get raises or move on to other positions of greater responsibility (or are students or other part-time workers).

I do support the right of the Starbucks workers to go on strike, but I also support the company's right to replace them.

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Michael Schaffer
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posted 11-26-2005 07:48 AM

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quote: Scott Norwood
I do support the right of the Starbucks workers to go on strike, but I also support the company's right to replace them.

But wouldn't that make striking pretty much pointless?
- We are on strike for more money!
- OK, noted. Now get out.

I have no opinion about this. I do understand that striking is a valid form of protest for workers to underline their demands. I personally would feel silly being on strike for wanting more money for working as a coffee maker. I have always tried to improve myself, and usually only asked for a raise when I felt I deserved more because I could do more. If I didn't get the raise, I usually left and looked for a better job. I think it's somehow a self-organizing market. Your work has a certain value and you try to sell yourself as well as the market permits. It is good there are minimum wages so that people don't get exploited (or at least not too much!). But the whole issue is rather pointless when, as it is here in California, countless of people can come over the border who work for less than minimum wage and without benefits and all that.

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Dennis Benjamin
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posted 11-26-2005 07:53 AM

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One lesson that I have learned over the years:

When looking for a job - pay attention to how long the current employees have worked there. If they have been there for long time - it means the company cares (somewhat) for their employees. If the company has a high turnover, remember there is a reason for it.

I have seen the 'corporate mentality' take over a majority of the large companies in the U.S. Pay the people as little as possible, work them to near death - until they wake up out of their coma and realize they are getting screwed.

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Matt Fields
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posted 11-26-2005 08:30 AM

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quote: Peter Berrett
Whether a wage is $4 or $0.40 an hour, the price does not determine whether a white worker gets a job rather than a black worker or whether a white French worker gets preference for a job over somebody of North African origin. It is racism and discrimination that causes that.

I will repeat:

It is a fact of history, reguardless of how one feels about the issue, that the minimum wage in the US was started by racist politicians to keep blacks from getting jobs. The politicians were racist, they knew that the wage increase would hurt blacks the most.

If the Muslims in France entered the job market at the price there skills are currently worth, they would gain skills and eventually move up the ladder, causing better economic conditions, leading to less disontent over time. The problem is not complex. You don't see riots in Beverly Hills. Economic difficulties breed discontent.

Today minimum wages and government taxes like social security do the same thing with illegal immagrants in the US. They work under the table (in the black market, an effect of price controls), because both employees and employers find it in their best interest to do so.

To be honest, striking, minimum wages, and other corporate/government issues are all political issues. Everyone here is giving political opinions. You can just about tell about how people would vote. This thread should probably be shut down.

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Greg Mueller
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posted 11-26-2005 10:56 AM

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My you can sure tell who's in business for themselves and who aint.

I agree with Jack's statements 100%
....and I'd add that most of the fast food workers I've been served by, aren't worth minimum wage. That goes for bank tellers too.

Unions have out lived their usefulness. All they do now is ferment discontent, and get in between people who want to work and people who want to employ them. Heaven help us if a guy had to be paid upon his own personal merits instead of some blackmail negotiated contract. It's just plain unbelievable that the idiot machinists at Boeing (who make tons of money for doing relatively nothing) go on strike during the most stressful of times for the airline business. Thanks to the unions there's always an adversarial position between employer and employee and they "we've got them over a barrel" attitude. Like they aren't affected by their screwing the company into the ground?

Raising the minimum wage just takes away jobs. Little businesses that barely bump along can't afford to pay big wages, so they eliminate the job and have to work harder themselves.

I worked for minimum wage at my first job. I got $1.50 per hour 20 hours a week. It was a good education and gave me a little pocket change. It was not meant to provide enough money to live on, no minimum wage job is

As far as being political, you can make anything political if you try hard enough, specially the socialists

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David Buckley
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posted 11-26-2005 12:37 PM

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Its interesting this discussion, as you guys are arguing about something happening in NZ with attitudes, values and from life experiences that are distinctly American.

Matt argues that this disucssion is political, and yes it is, but not in terms of Republican versus Democrat (ie it fails the Brad test), but rather from "The American Way" versus "The European Social Model" perspective.

The interest to the USA from this storm in a teacup a universe away is that both Starbucks USA management and the fledgling union of American Starbucks workers (who was on telly here a few days back and spoke fairly ineloquently, so I guess he's new at his job) are interested in how this plays out.

Starbucks in NZ isnt the same as I'm ASSuming Starbucks is in the USA - I'm ASSuming USA Starbucks are either franchise stores or Starbucks owned stores. Here in NZ Starbucks is a brand run by a company called Restaurant Brands , who in addition to Starbucks also own the KFC and Pizza Hut stores nationwide.

There is (so the informed opinion goes) no question that Restaurant Brands could afford to pay their staff more, but obviosuly they dont want to. And of course Starbucks USA doesnt want their workers to have something achieved elsewhere to come back to haunt them back home...

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Bruce Hansen
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posted 11-26-2005 12:59 PM

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quote: Greg Mueller
Raising the minimum wage just takes away jobs

WRONG! Clinton proved this wrong some years ago, when the minimum wage was raised to get the economy started (and it worked). I remember, at that time I heard the whine about raising the minimum wage cauing companies to fire people, but that is NOT what happened. Companies had to hire MORE people, here is why: 3/4 of our economy is consumer spending. When you raise minimum wage it puts money into the hands of people who will spend it. This causes business to hire more people to fill those orders, which puts more money in the hands of consumers, and the economy grows. If you know about the "just in time" principal that business works on, business will not hire people to build product or provide services until there are orders. Where do the orders come from? Remember, 3/4 or our economy is consumer spending.

One thing to think about: it's the employees that do the work that brings in the money. It's the employees that should be making the money. The upper management pays the employees as little as possible, so they can give themselves multi million dollar raises. The employees are making the money that is paying the upper management, not the other way arround. Upper management does not do anything that directly brings in money.

By the way, the communists did not allow unions, and decided what you would do for a living, and how much you would get paid. Unions are a product of the free market, and you are not working in a sweat shop today thanks to the unions.

And another by the way, I have been in business for myself for close to 20 years, and have done quite well, thank you.

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Gordon McLeod
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posted 11-26-2005 01:36 PM

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Bruce said "The upper management pays the employees as little as possible, so they can give themselves multi million dollar raises."
Yes and when they screw up they get let go with a multi million dollar golden handshake or misrepresent the net worth of the company's performance and assests to get a bigger bons that isn't earned

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Aaron Mehocic
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posted 11-26-2005 02:21 PM

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quote: Bruce Hansen
When you raise minimum wage it puts money into the hands of people who will spend it.

Yes, but what about those of us who make only a few dollars more than minimum wage? We see no cost-of-living adjustments when businesses raise prices to cover labor costs. I'm all for the working man living the "American dream", but I still cringe everytime there is even the hint of a raise in the minimum wage.

And believe me . . . there are millions out there who feel the same way I do.

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Gordon McLeod
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posted 11-26-2005 02:45 PM

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Up here at least one usually doesn't see a "massive"price hike after an increase in minimum wages in fact it is often some period of time down the road that there will be a small adjustment

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