Posts tagged ‘Soviet Russia’

Minimum Wage Deja Vu

This letter to customers from San Francisco bookstore Borderlands is making the rounds.  Apparently, the new "living wage" legislation in San Francisco is killing this store:

In November, San Francisco voters overwhelmingly passed a measure that will increase the minimum wage within the city to $15 per hour by 2018.  Although all of us at Borderlands support the concept of a living wage in [principle] and we believe that it’s possible that the new law will be good for San Francisco – Borderlands Books as it exists is not a financially viable business if subject to that minimum wage.  Consequently we will be closing our doors no later than March 31st.  The cafe will continue to operate until at least the end of this year.

I find the authors surprisingly open to the Progressive assumptions behind this bill, despite the death of their business.  I don't know if this is a pair of hipsters destroyed by their own cause, or if the nods towards Progressivism are merely boiler plate that is required in any San Francisco conversation, like having a picture of Lenin on your wall in Soviet Russia.

Anyway, I found the language here familiar because I spent most of last year writing such letters to angry customer bases.  In our case, fortunately, we had the ability to raise prices so the letters were to defuse customer irritation rather than to announce a closure.  Here is one example I wrote in Minnesota:

Labor and labor-related costs (costs that are calculated as a percentage of wages, like employment taxes) make up nearly 50% of our costs.  The Minnesota minimum wage is set to rise from $7.20 to $9.50 in the next two years, an increase of 31%.  Since wages and wage-related costs are half our expenses, the minimum wage increase raises our total costs by 15.5%. This means that all by itself, without any other inflation in any other category of expenses, the minimum wage increases will drive a $3.10 increase in our camping fees (.155 x $20).  Note that this is straight math.  The moment the state of Minnesota passed their minimum wage increase, this fee increase was going to be required.

One of the problems with these minimum wage increases is that the people behind them, with their hazy assumptions and flawed understanding of economics, typically think that companies will just absorb the increase.   Our net profit margin runs in the 4% range, so it difficult to see how any such retail company can absorb a 15+% cost increase, but it happens all the time.  After some trial and error, the "this is straight math" phrase seems to work the best in communicating the need for price increases.

The Dog That Didn't Bark

There may be something interesting coming out in the climate front over the next few weeks from CERN.

Years ago, a researcher named Henrik Svensmark developed a hypothesis that cosmic rays can seed cloud formation, and thus when there are more cosmic rays, there may be more clouds.  This is interesting because it may act as a sort of solar amplification.

Changes in the sun's output through varying solar cycles are measurable, but seem to some scientists to be too small to drive substantial temperature changes on Earth.  But a more active sun tends to blow cosmic rays away from the Earth, thus reducing their incidence.  Therefore, if a more active sun reduced cooling clouds, and a less active sun increased cooling clouds, this might explain a larger effect for the sun.

I have avoided discussing Svensmark much, since the evidence seemed thin, though several labs recently have confirmed his hypothesis, at least in the laboratory.  But Svensmark is definitely a topic among some climate skeptics.  The reason is that higher solar activity levels  in the second half of the twentieth century coincided with much of the 20th century warming that is blamed on manmade CO2.  Svensmark's theory, if true, might force scientists to apportion more of the historic warming to natural causes, thus reducing the estimated sensitivity of the climate to man-made CO2.

But apparently the CERN lab has been undertaking a substantial study to confirm or deny Svensmark's hypothesis.  The results have not been released, but skeptics are beginning to anticipate that CERN's work has confirmed the hypothesis of cosmic ray cloud seeding.  Why?  Because of the dog that did not bark, or rather was told not to bark.

Via Watts Up With That:

CERN Director General Rolf-Dieter Heuer told Welt Online that the scientists should refrain from drawing conclusions from the latest experiment.

“I have asked the colleagues to present the results clearly, but not to interpret them,” reports veteran science editor Nigel Calder on his blog. Why?

Because, Heuer says, “That would go immediately into the highly political arena of the climate change debate. One has to make clear that cosmic radiation is only one of many parameters.”

Skeptics are suggesting that had CERN disproved Svensmark, and thus protected the hypothesis that CO2 is driving most current warming, they would not have hesitated to draw exactly this conclusion in public.  Only a finding considered more consistent with the skeptical position would cause them to go silent, trying to avoid the taint from the politically correct intelligentsia that would come from even partially confirming a skeptic talking point.

I have to agree that Heuer's comments seem to telegraph the result.  I have read a ton of global warming related studies.  And every single one I have read that has ever published negative results vis a vis the hypothesis of catastrophic manmade global warming has felt obligated to put in a sentence at the end that says something like "but of course this does not in any way disprove the hypothesis of anthropogenic global warming and we fully support that hypothesis despite these results."  The absolute fear of becoming an outcast for coming up with the "wrong" result is palpable in reading these papers, sort of like the very careful language a report in Soviet Russia might have used to even mildly criticize some aspect of the state.  Of course, no such disclaimer can be found with narrow positive results - these are always immediately extrapolated  (in fact over-extrapolated in press releases) to be the final nail in the coffin proving once and for all that man is changing the climate in dire ways.

Introducing Obama to Capitalism


In his commencement speech at Southern New Hampshire University
this morning, Obama - like most commencement speakers - delivered a
call to public service; unlike many, however, he also warned against
the charms of doing what most college graduates set out to do: Make

"In a few minutes, you can take your diploma, walk off this
stage and go chasing after the big house and the large salary and the
nice suits and all the other things that our money culture says you
should buy.

"But I hope you don't. Focusing your life solely on making a
buck shows a poverty of ambition. It asks too little of yourself. And
it will leave you unfulfilled," he told the crowd.

This statement would certainly be true in 18th century European monarchies, in Soviet Russia, in third world Kleptocracies, in Cuba, and in Chavez's Venezuela.  Because making money in these environments is a zero-sum game, and the only way to get rich is to loot it from some poor schmuck who is actually creating the value.

But here in America, we (mostly) have this cool system called capitalism.  In capitalism, all interactions are based on the voluntary self-interest of the parties involved.  This means that one only can "make a buck" by doing something or making something that is of value to another person.  And only by successfully serving the needs of a LOT of people does one get really rich. 

TJIC's conclusion is wonderful:

Far better that they spend their life

  • majoring in political "science"
  • working for a meaningless non-profit
  • trying to register more people to vote so that the negative-sum game of politics can have more credibility
  • helping political partisans redrawn electoral district boundaries in the same negative-sum game of politics
  • being a senator, pushing for more regulations and tax increases

That, clearly, is a fulfilling life.

Let the suckers create value.

The best and brightest should just steal it, and move it around
(while taking some portion of it for themselves, and destroying another
portion of it).

Beware of people who try to demonstrate how much they "care" using other peoples' money.