$15 Minimum Wage Effects | The Business Newsroom Episode 19

$15 Minimum Wage Effects | The Business Newsroom Episode 19



better idea let's make it fifty pay me to sit on my couch in my underwear and do nothing always hardy do that I'm sorry hi everybody Neil winter IKEA were the Matterhorn business development welcome back to the newsroom today I am joined as usual with my number one guest dr. Greg winter egg author and CEO of Matterhorn business development and my dad so he has to be in every episode that's right so today we're gonna talk about something that's a little bit unique something that has been in the news a lot I don't have a specific news article talking about it but it's something that everybody knows everybody knows but I want to talk about the $15 minimum wage that is supposedly going to revolutionize workers and the workforce middle America yeah it's gonna change middle America because as you know all the money in the world or all the money in the US is owned only and specifically by giant corporations that's right and we need to take it away evil bastards because having money is bad right so anyway I wanted to talk about it because I keep hearing about it and again we're gonna we like to keep things from a business perspective not a political perspective it's just that nowadays with already somehow two years from now there's gonna be another election and everybody's already you know about the election right so I cannot hear about this crap all the time so I want to talk to you about it because I think a $15 minimum wage sounds great but there's all of these materials and data and for the uninformed they don't realize how things work mm-hm and what that would do to America yep so I wanted to get your take on it yeah well there are consequences so it I'm not an economist I've just been in small business laughs I was in the comments as always yeah yeah make fun of us were uninformed whatever but I was raised in the restaurant business so I've been in business my entire life except for the like eight years when I was in college in dental school I don't know I think when I was growing up date myself I think in the 60s I was making 50 cents an hour all right and one of my should have had $15 exactly and one summer job I remember during college I was making big bucks man it was four dollars and fifty cents wow that's a pretty dumb and then you can sit back and you can do okay well with inflation and all of that and now minimum wage is like around 750 I think maybe in Florida here at seven and a quarter and if back then it was 450 if that wasn't minimum wage minimum wage was like I think 225 but I was making 450 because I went to a place where I was gonna work harder and get paid more etc etc so now if we just think from a business standpoint we're going to double minimum wage let's just say from 750 to $15 all right well where is that money coming from the the one idea is well it's going to come from the rich owner right all right but that money then is either gonna do one of two things it well several things it could bankrupt the business and it just closes yeah because the margins aren't that great it can get people fired and the existing employees then the ones who stick around or going to have to work twice as hard okay I could maybe think with that or first thing I'm gonna do is an owner's I'm cranking up the I'm cranking up the prices yeah and that's exactly what's gonna happen is that everybody wants their cake and wants to eat it too we we love being able to go to the grocery store and buy loaves of bread for buy-one-get-one-free we want all these we want all these goodies we want all this freakin yeah we want our Netflix subscription to be less than twelve dollars a month and we want all these things and we want to make our $15 an hour while working less and asking for reduced work weeks and things like this now the problem is is that every time the expenses of the business go up you have to compensate by increasing your prices or go out of business right which means that you either go out of business or the gallon of milk that you're now paying $4 for goes up to 550 which means that your minimum wage increase actually did nothing it got you nothing a guy you're nothing now also it's small businesses that fected the most buy all this stuff now I don't disagree that large companies like Amazon and Google and Apple Lehrer yes they could technically pay their employees more and still not really be that affected by it but you see everybody's attacking Google and everybody's attacking these big companies when they actually bring about all sorts of tax benefits to areas and sever but they make up such a small small percent of the United States workforce yes they are not the majority we're just we drive by on the freeway we see the you know 1 million square-foot Amazon warehouse and we think a million people working it no its shelves of junk it's not people it's machines let's just talk about the robots ok they have feelings too ok well let's talk about the robots all right so if you're Amazon you can hire smart people and pay smart people a hundred thousand a year to cram the robots and then the robots run and everybody seen the video if you haven't seen the video it's amazing the robot runs around it picks up the crate it takes it over in front of a person when that person some of the crate the robot takes it and puts it back why do we not have people doing that well because we have to have health insurance and tax taxes and Social Security taxes because we bringing these restrictions about and then we have to have sick days I mean I talked to a fellow two days ago who's from California very upscale fellow IT programmer makes a lot of money for a major company and he lives in California he's on a four month he is on a four month paternity leave he is getting paid his full fee which is six figures yeah by the government to not work because his wife had a baby no now that is a really cool benefit from him but my god it bankrupts estate yeah so there are consequences to this and now you know it's been $15 an hour or 15 dollars an hour last night I read one of the Congress fellows Congress women says let's make it 20 I got a better idea let's get 50 better idea let's make it fifty pay me to sit on my couch in my underwear and do nothing always gonna party do that I'm sorry so here's another thing I want to point out the numbers are amazing you got to listen to this so this is from a website called SBE council small business and entrepreneurship council and these are some facts and figures and according to data from the Census Bureau's annual survey of entrepreneurs this says there are 5.6 million employer firms in the United States in 2016 okay firms with fewer than 500 workers accounted for ninety-nine point seven percent of those businesses fewer than 500 fewer than 500 so point three point three percent has more than 500 more than 500 so GM Ford maybe M whatever the big companies yes have more than 500 500 play that point three percent okay yeah firms with fewer than 100 were 98.2% Wow fewer than 100 fewer than 100 okay firms with fewer than twenty was eighty nine percent so fewer than twenty workers in a business or corporation business really at this point in time our corporation we're talking about mom-and-pop small but this is what drives America right 80 90 percent of the employers in the United States if you take that up to $15 an hour you actually negatively affect eighty nine percent of Americans and you can talk about well what what about this person their lifestyle is going to change its going to go from seven dollars and 50 cents an hour to 15 look at them what about the $7 and 50 cent an hour person that gets fired yeah what happens to them yeah we have more unemployment we have more government welfare I mean these there's a natural selection process businesses the survival of the fittest and that the the prices kind of settle in the fee settle in the wages all my family I'm all for people getting paid and being able to survive and make a living and pay for diapers and pay for her cell phone bill I am all for all that stuff and I think that there probably needs to be more work done for you know basic living conditions for certain people or whatever right but here's the thing people that work hard and take care of their money and take care of their families are always going to be kind of secured mm-hmm but as soon as we start mandating these things for people that are unwilling to work then it starts to negatively affect everybody and I think that that's really I saw an interview yesterday this is sort of on topic and sort of off topic but just on this line right okay LA County has 56,000 homeless people okay living on the streets and the tenth row and all that kind stuff right okay they refuse to work and they refuse to do anything for themselves mm-hmm and now it's becoming like more and more of like okay we have to help these people which we talked about yes in our previous video people have to be willing to work to be able to exchange something and there needs to be more programs like that right but as soon as you start just like mandating all these things it actually hurts people who are working right and rewards people for not working mm-hmm which means I'm better off not working yep than I am to work yep which is a complete in it's just like that's wholly backwards well I saw a video once and I don't know which ecologist was but a college professor was getting upset with blowback from students about grades and the curve and all of that and I think it was at a liberal university so he said okay well here's what we're going to do we're not what we're gonna practice grade equality yes I remember this all right so what we're gonna do is we're gonna give the test and then everybody in the class is going to get the average yep so we're gonna practice a great students all for that so well this is just what he mandated so there are people in the first test who worked really hard and got A's yeah and then there were people who did nothing in got an F yeah so the people and I don't remember the exact but the people got a is got to see the people who got enough got to see and so now we have great equality no and for the next test nobody studied yeah because the people who've gotten and say well it doesn't matter I'm just and the people and so then everybody got a deep yeah so it bakes college it's so so here's the bottom line production needs to be rewarded know the best employees need to be rewarded we've talked about it before I always have a bonus system and when the company does better then the employees do better and if the government comes down and gives me a mandate now give you an example it was the late 80s and the government mandated all of this mandatory sterilization equipment it cost me 5,000 in dentistry it cost me $5,000 new uniforms new dental lenses amazed yeah by today that's probably 15 or 20 products yeah dollars I had to put a washer and a dryer in the staff lounge so that we could wash the uniforms you guys used it all and use it all the time and so so then I'm talking to friends other dentists like oh wow this is gonna kill me man you know it's costing me this much so like I'm charging oh you can't do that you can't charge people I said well the heck I can't it here comes the mandate so when the government says air bags have to go into the car GM didn't eat it the car went up by a 500 bucks so I printed a letter that went to my patients and explained all the changes that we had made and we now meet or exceed the OSHA standards and there's an eight dollar charge at every visit and I had a consultant tell me I was crazy no that was gonna upset people you know how many people got upset one one boom one guess what they got a Yelp wasn't around then you felt it he was a multi-millionaire ran a big company he's like what is this $8 and I said well you know I can take the gloves that we're using today and put them in your chart and keep them so that they're here the next time they might be a little gross by then and he kind of got it and then what's interesting is for his next appointment he brought me an article from Wall Street Journal there was an oral surgeon in Manhattan who is charging 18 so all of a sudden I'm looking like cheap there's a nice guy I mean I skate bucks but I refuse to get dictated to and regulated into going out of business yeah so then I'm gonna raise my rates I'm gonna raise my fees and in this day and age if I would have to lay people off I'm gonna have to lay people off and I'll tell you what's happening right now you can go online you can find the videos robots are being created and built that can do these jobs it and you're gonna walk into a McDonald's and it's happening right now at airports you and I see it hey they're arts and here's an iPad and you just this is the restaurant there's 10 restaurants around you and you punch you order they bring your food you swipe you pay and nobody nobody what the consequences of that the service is total crap the service rep and there's fewer workers yeah they don't get tipped what am i tipping for so when you swipe your credit card and all I've done was order everything off the iPad yeah by the way the credit card machine never works it takes me ten of times then I have to call somebody over anyway so when you swipe and I've ordered everything on my iPad and it hasn't been the the tip percentage and is always at 18% mhmmm I always drop it down to 10% I never tip less than 18% right I mean except when the server doesn't do anything some of the person doesn't do anything right so now what what is driving this well it's mandatory health care mandatory this mandatory that and and just like mandatory paternity leave that costs money there are consequences yeah so for me that was the point I love your stats 89% of small businesses have 20 or fewer employees the movies and you go ahead and double the minimum wage and think there aren't going to be consequences you're high you're just you're on drugs just think like you're your favorite coffee shop your favorite restaurant your favorite Taylor yeah our favorite shoe store most of these are probably independent or small businesses yep in reality 90% of places that I go to our small businesses yeah family-owned family-owned okay so imagine that that's not there anymore yeah where do you go and where do all those employees go right right yeah it's it's it's bad so I guess the the point that I wanted to make today is on the surface it sounds great yeah all right but if 89% of businesses in America have fewer than 20 employees there are drastic and dramatic consequences that will affect everyone so this is not a political statement no this is just basic business stand back take a look take a deep breath pump the brakes on this free enterprise actually works yes it's there it's the it's the right way to go and there's a lot of things that if they were given to the free enterprise healthcare system things like that they would be better off yeah then with all of their mandates and other craft that is in there that Andalus renewer is always quicker and faster than a big multi headed yes and I've said it before on video and I'll say it again the legislature has not been born that can out smart the entrepreneur right you go ahead and make a regulation we're going to figure it out yeah there will be consequences but there's a little or your air you know $15 or you know of as 89% some of them are gonna figure it out yep people like you I'm gonna charge make sure eight bucks for this do that yeah whatever but a lot of people won't yeah go under and that's a consequence yeah so those are our thoughts I hope you guys that we we went a little bit longer than we normally do but comment about this yeah I mean you're gonna hear some feedback on this stuff tell me how stupid I am anyway we'll see you next time on the newsroom like subscribe leave your comment down below tell us what you think we'll see you next time [Applause]

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