Walmart vs. Washington, D.C.

The whole fabricated ‘minimum wage’ issue can be summarized by looking at the decision by Walmart to avoid opening stores in the Washington, D.C. area due to the new minimum wage proposed at $15.00 per hour.

Walmart could’ve sold a lot of goods in that populous region, BUT it could not make a profit doing so if it were held to having to pay a minimum wage of $15.00 per hour.  This was not ‘rocket science’, but, instead, it was a lesson in real life which often seems to have been lost on politicians.

A 40 hour-per-week employee paid $15.00 per hour has a base cost of $31,200 per year which likely soars to some $39,000 or more per year with benefits added.  Walmart executives were no doubt hard-pressed to make the decision to stay away from such a seemingly lucrative market, but they deal in a real world with which many politicians seem to have little or no experience.

Not only was this a tough decision for Walmart, it was also a bad decision for the people who populate that area, politicians excluded, who would’ve been major patrons of the Walmart stores had there been any.  Just because the politicians were able to mandate a 50% increase in minimum wage, that does not mean the Walmarts of the world can automatically increase their selling prices to accommodate the need for higher revenues given the new laws.

$15.00 per hour sounds great.  But how great is it if there are no jobs available because those jobs were kept away from the marketplace given the high cost of labor?  How many of the citizens who thought they were going to be making at least $15.00 per hour will connect the lack of employment to those same politicians who made them think they, the politicians, were their friends?

Memories of such failed tactics seem too short by at least half.  All too often the politicians who came up with, and voted for, these kinds of ‘feel good’ bills are ready with the fingers of blame that point to anyone but themselves.  This particular political fiasco will likely never make the front page of any local newspaper since reporters are not always able to separate emotion from reality in such cases.  It is, unfortunately, much easier to blame the big, ugly corporation than it is to blame the local politicians who might be able to do a favor for the newspaper organization somewhere down the road.

A final thought:  if the politicians do not understand what this kind of decision does in the real world, maybe they ought not to be standing for re-election.  They are making the situation worse rather than better.  Maybe they should be finding ways in which to cut tax rates through better run government entities.  That would’ve resulted in Walmart stores being located where they’re sorely needed.  It is shameful that outwardly helping the voters actually seem to hurt those same people all too often.

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