Comment 28390

By A Smith (anonymous) | Posted January 30, 2009 at 21:39:37

Grassroots, >> you keep going on about profit margins, so you are referring to gross or net profit margins.

Net margins.

>> I will focus on the amounts paid to those at the top, are they overvalued to the contribution as a whole, as it is the labour force, that actually makes the product or does the work, not the CEO types

It is possible, but that is up to the shareholders (owners) to decide, not government.

>> Why do you go on about Walmart,

These same arguments apply to any company, I picked Walmart simply because most people have the impression that it makes obscene profits. The truth is that Walmart is in an extremely competitive marketplace and passes most of it's lower labour costs onto the consumer in the form of low prices. How is this a bad thing? Furthermore, if people don't like the fact that Walmart pays it's workers low wages, don't shop there. If Walmart started suffering low sales due to a bad reputation, I'm sure they would change their wage policy very quickly. The consumers in this case have the power to force companies to do what they want.

>> Please put some thought into things. Instead of attacking the workers, wage rates why not attack the root cause, the big multinational corporations that are consolidating their power. Aren't these guys that ones that influence policy? Taxes?

You do make me smile grassroots. To tell you the truth, I really don't care what government does. If it wants to tell companies what to do, then that's okay with me. Keep in mind, however, that if labour costs per unit of output is more than what the product sells for, then the firm will simply go out of business. Seeing that Walmart currently has 3% margins, this does not leave much room for wages to increase. But go ahead, try to extract every last cent you can from the evil corporation. It will only mean that prices for goods go up for consumers (primarily low income), but if you don't poor people having to pay higher prices, jack that minimum wage up.

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