Tuesday, August 18, 2015

 No, on Minimum Wage!

Does Anybody Remember the

Meaning and Intention of "Capitalism?”

I am shocked that nobody is screaming for government to get out of the routine affairs of entrepreneurial ambitions!

 1.0.  Example

If I want to start up a company and I have done my homework to show me what the costs of my business will be in order for me to make a profit, who the heck is government to tell me what I have to pay my potential employees?

A.  Employer/owner Risk taking
       As private enterprise, also known as “Capitalism,” I am to assume all of the following risks when
        undertaking a business enterprise: 

(1) Spend my personal savings money, borrowed financing and/or investor capital on the feasibility, marketing, and, if required, environmental impact studies necessary to obtain all the permits and licenses in order to receive approval to conduct my desired business.

(2) Provide all the capital investment from my bank accounts, borrowed financing and/or investor capital needed to:

Purchase/lease workspace,

Cover the costs of all the necessary overhead items such as utilities, general liability insurance, furniture and fixtures,

     Consumable office supplies,

     Employee health plans, sick leave, holidays and vacation time.

3. Provide the operating money borrowed from myself, financing institutions and/or investor capital sufficient to cover the cash flow requirements of paying all the month-to-month operating expenses and payroll for all employees during start-up and until sufficient service or product sales are streaming in on a continuing basis to pay such expenses.

               4. Pay for all the governmental employer required salary taxes, sales taxes, inventory taxes,
               and company earnings taxes.

5. Pay myself back (with fair interest) for the money I took out of my savings account [which is, designed to pay for my living expenses when I am no longer able to work], to pay back the borrowed principal with interest, and/or to pay dividends to the investors.

   B.  Employees have no risk
          Please notice that the employees do not share in these employer expenses. Also, notice that
          governmental bodies do not share in these risks. As the owner/employer, I take all of the risks. 
          Who is going to protect me as the owner/employer? Who is going to protect me so I can keep
          employing people?

               1. Has that government body conducted a market assessment analysis to see what the
               impact of its required labor wage value will do to the potential success of my company?
               2..  Is the government body willing to guarantee to cover the difference in fluctuating   
                consumer sales demand so that I can recover the following?

(a) My out-of-pocket loans from my saving account

(b) Borrowed money repayments

(c) To ensure that any investors receive a reasonable return on their investment

(d) It would also ensure that I receive a reasonable profit for taking all the risks of

 (e) Employing people who might otherwise be unemployed and surviving off public funds.
          C. Will these government bodies share with me, as the employer, in the costs of government
           required health benefits provided to employees?

    D.  A willing “seller” and a willing “buyer.”
            As an employer, I make an offer to pay somebody so much money to provide a service or,
            make or a product. A person reads my offer and can decide to accept it or not. If that person
            accepts a position in my company, the conclusion is that there is a willing “seller” and a
           willing “buyer.”

           That is the nature of doing business in a capitalistic society. If nobody wants to accept my
            wage offer then I will have to recalculate my numbers to determine whether the intended
            business is viable or not as a private enterprise. 

2.0   Let Government Makeup the Difference

If government bodies want to ensure that all employees receive a “livable income” then they should look to themselves, providing the difference in pay from what an employer is willing to pay to whatever the government bodies determine is a “livable income.” However, this would just be another form of Social Security! Is that what we all really want to create?


3.0 Cause and Effect of Forced Minimum Wages on Employers and Employees

A.  Increasing the minimum wage encourages some unscrupulous employers to use illegal immigrants in order to maintain a wage that works for the success of making  a product or providing a service at a profit.  When employers use illegal workers they look for alternative ways to make up the money such as the following methods:

(1).  Pay the illegal worker in cash thus the employer’s share of payroll taxes are not paid into the system.  The extension of this effort is that the illegal employee does not report the illegal income thus they do not pay their share of federal and state payroll taxes or annual income taxes.
(2).  The employer shaves the number of vacation days, sick days and holidays that the illegal employee could receive, that is, if they were to receive any at all.  And, these days off would be without employers paying the illegal worker for those days of missed work.

B. When employers use legal workers they will look for alternative ways to make up the money such as the following methods:

(1).  There will be employers who will reduce the number of paid vacation, sick and holidays that can be earned by an employee.

(2).  The employers will reduce the weekly number of hours an employee can work thus letting the employer avoid paying their share of health benefits.  

(3) Additionally, these employers will likely reduce the amount of their company health cost payments to that minimum percentage required by governments imposing a minimum to be paid by an employer.  This increases the share amount that has to then be paid by the employee.

(4). There will be employers who will reduce the weekly number of hours an employee can work thus avoiding that employee reaching the point where they must be paid overtime for working more than a 40 hour work week.

(5) There will be employers who will stop providing the employer-matching share for employee savings towards retirement plans.  Some will cease retirement plans entirely.


4.0 . Big Business/Government Contracts and Requests for Proposals

I have no problem with a government entity or public enterprise requiring that a private enterprise bidder must pay a minimum wage to its employees should that proposer be awarded that contract.

It is the right of the government entity and public enterprise to set the terms on which they will allow a company to work on their contract.  As an employer, I have the right to decide not to bid on the proposal if I do not want to pay that minimum wage or I must decide to pay it if I want to bid and if I win the proposed work.


1.  Why not a maximum wage that can be paid an employee?  What is the constitutionality that allows the government to propose a minimum wage value on a private business and then present it to the voting public for a vote of approval or not to enforce?

If a minimum wage can be forced on a private enterprise business owner, then that same logic says that the same proposal and enforcement process can be applied to establish the maximum amount that an employer can be allowed to pay its employees. This is just simply wrong in a democratic society operating a capitalistic economic system! 

Who is going to tell Bill Gates or Warren Buffet that they can only make, say $250,000 a year including monthly payroll checks, bonuses and stock options?    Who is going to tell the wine giant Gallo’s, a wholly family owned private business enterprise, how much they can make?
2.  Why not a maximum stock price or dividend that can be paid to an investor?  When will the government and the general voting public start setting what the price of a company’s stock will be allowed to be?  How much dividend can be paid on each stock unit?

3. Stifling innovative thoughts and business! If the government and voting general public can set minimum wages on private enterprise then capitalism and democracy as we know it today are doomed and we will become a socialistic country stifling free thought and entrepreneurial  motivation where persons seek reward for the risks that they take while seeking to make their fortune.


Leave private enterprise alone!  Stop trying to regulate things where government has no right to interfere.  In other words, the work place must run under the doctrine of “Laissez- faire.” If not, government will eventually squelch innovation and move our economy to a socialistic state, stagnating and forcing all the ambitious and hard working to carry the lazy on their backs, all for the same pay. Economic collapse, therefore, is inevitable


interesting articles


Meaning of  Private versus Public Enterprises

A. Private Enterprise

Here is what Thefreedictonary.com and The American heritage dictionary say

“1.  business activities unregulated by state ownership or control; privately owned business

2. A privately owned business enterprise, especially one operating under a system of free enterprise or laissez-fare capitalism.”   

Factsaboutbusiness.com says it is “an economic system that rewards firms for their ability to perceive and serve the needs and demands of consumers.”

Dictionary.com uses the Collins English language dictionary which defines private enterprise as

“1.  economic activity undertaken by private individuals or organizations under private ownership.

2. another name for capitalism”

Businessdictionary.com says it is the “basis of a free market capitalist system, it is a business unit established, owned, and operated by private individuals for profit, instead of by or for anybody by or for government or its agencies.”

B. Public Enterprise

Here is what Britannica says:  “a business organization wholly or partly owned by the state  and controlled through a public authority.  Some public enterprises are placed under public ownership because, for social reasons, it is thought the service or product should be provided by a state monopoly.  Utilities, broadcasting, telecommunications and certain forms of transportation are examples of this kind of public enterprise.”

 Businessdictionary   addresses another segment of a public enterprise  it is “a company whose shares are available and traded on the stock market or other over-the-counter market.  Subject to more regulation than a privately owned company, a public enterprise  has greater access to financing.  Shareholders own a percentage of the company based on the amount of stock they own.”


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