Applebee’s Franchise Owner Forced To Cut 1,000 Jobs After New York’s Minimum Wage Hike

By Andrew Kerr – Re-Blogged From Western Journalism

The CEO of Apple-Metro Inc., a company that operates about 40 Applebee’s restaurants in the New York metropolitan area, said he’s been forced to cut at at least 1,000 servers in the past year as a result of New York’s recent minimum wage hike.

“We have 1,000 less servers this time this year than we did this time last year,” Zane Tankel told Fox Business’ Stuart Varney on Monday.

That amounts a two-thirds reduction of his total workforce, Tankel said. Continue reading

Minimum Wage Hurts More Than it Helps

By Jeremy Frankel – Re-Blogged From iPatriot

There has been much discussion and debate over whether to raise the minimum wage, and this debate is still going strong.

The positions range from minimum wage advocates who are part of the #FightFor15 movement, claiming that everyone should make enough money to live on; to opponents of a minimum wage, who believe that minimum wages are counterproductive to both employees and businesses, in the sense that anyone whose work isn’t worth the minimum wage wouldn’t be hired, or that the business cannot afford the minimum wage and therefore, no one has a wage at all, since the business cannot operate.

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Harvard Study Shows Minimum Wage Increases Kill Businesses

By Keely Sharp – Re-Blogged From Eagle Rising

While there are McDonald fry cooks out protesting for $15 an hour to flip burgers and almost always get our orders wrong, some of us can actually see the harm in minimum wage hikes.

When wages are increased, then a business must then charge more for their product in order to cover the costs, due to inflation. For example, you may go from $7.25 an hour to $15 an hour, but now a gallon of milk jumps from $4 to $8. So you aren’t really able to afford anything more than you were in the first place, and it hurts the businesses.

A new Harvard Business School study found that minimum wage hikes lead to closures of small businesses. “We find suggestive evidence that an increase in the minimum wage leads to an overall increase in the rate of exit,” the researchers conclude.

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What Creates and Sustains Jobs?

By Dale Netherton – Re-Blogged From iPatriot

The politicians mutter the word “jobs” as if they understood where jobs come from and what conditions are necessary to sustain jobs.

First, without revenue to pay wages no job can exist or if created continue to exist.  The question then becomes, where will the revenue come from?  There are two sources of revenue for jobs.  One is the direct granting of revenue by the government which funds government jobs.  If there is funding available the job can continue until the funding disappears.  The other source of revenue is profit.  If a job is created to supply a good or service and it is sustained by paying for itself, this job is sustainable as long as it is competitive.  This is the only job that can exist that doesn’t rely on confiscation and redistribution.  Jobs that rely on “government funding” are not self sustaining since they must have confiscation and redistribution.  Government cannot create wealth, it has nothing it doesn’t confiscate or borrow.

All government created jobs are necessarily temporary.  Debt and eventual inflation destroys the foundation for government funding of jobs as the private sector that supports sustainable jobs shrinks under the regulation and taxes that eventually destroys the profit motive and therefore the only source of self sustaining jobs.  The CCC camps could not have been retained as permanent jobs.  The demise of the Post Office and Amtrak are examples of where government “jobs” must eventually falter.  The source of these two government jobs comes from the government subsidies.  Neither is self sustaining based on the income they generate.  This means a private sector is being taxed and the confiscation of their earnings is being channeled to the subsidy the government is supplying.

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Rules Still Matter

By Andy Sutton & Graham Mehl – Re-Blogged From Silver Phoenix

While economics is a science and should be treated as such, economic forecasting is both a science and an art at the same time. However, anyone can forecast. Just like anyone can forecast the weather. To do so accurately and furthermore to do so frequently is a true talent. We think of it along the lines of the ability to hit a major league fastball; a gift granted to maybe 1 in 500 or a thousand babies each year. Then add to that the ability to hit a major league fastball for an average of .300 over an entire career and we’re talking a few babies in an entire generation.

Economic forecasting is no different. Anyone can take the classes, read the textbooks by all the proper authors, write the research papers, the thesis, and the dissertation, and still muddle around in the dark for the entirety of a career, issuing bum forecast after bum forecast. We would surmise at that point that there might be a problem with the assumptions going into the exercise of forecasting. Think of the scientist who starts conducting chemistry experiments without knowing Boyle’s Law or the Ideal Gas Law, etc. Or maybe has no clue about Avagadro, let alone the number ascribed to him. Your scientist is going to waste a lot of time and produce nothing of value.

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Why Inflation Is Unlikely To Return

By Rick Ackerman – Re-Blogged From http://www.Silver-Phoenix500.com

Is it possible that wage inflation is re-emerging in the US after a 35-year hiatus? That’s what the experts seem to believe, but there are good reasons to think they will be wrong. Consider the substantial pay increase that minimum-wage workers received in many cities and states where this issue was on the ballot in November. In theory, they will have more money to spend, and this will push the prices of goods and services higher.  In practice, because their employers, particularly those in the fast food business and brick-and-mortar retail, are in a last-ditch fight for survival, it is far more likely that a vast number of low-wage jobs will be eliminated. Even now, we are seeing workers who received raises in 2017 ask their employers to reduce their hours so that they can continue to qualify for food stamps and Obamacaid.

This is the reality of the minimum wage world, and arbitrarily boosting hourly pay to $15/hour will only make things worse for employers and employees.  At best, the economic result will be a push with the broad benefits of higher wages offset by a reduction in entry-level and low-paying jobs. In any event, the day is surely coming when McDonald’s will be able to operate a busy franchise with just two or three employees behind the counter. Amazon is already making similar strides in the grocery-store business. And Uber, having already made taxicab medallions worthless in many cities, could someday displace half the taxi drivers in America with driverless fleets like the one they are testing in Pittsburgh.

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