refer to this article: http://onenewsnow.com//ap/business/obamacare-worries-prompt-companies-to-cut-hours
My ex-wife was a professional dinner waitress at some of the highest-priced places in Albuquerque and Colorado Springs. When I say, “professional,” I mean that she’d been doing it for 40 years because she loved the work and made darned good money, albeit through tips, rather than wages. I was shocked when she described to me that employers could essentially deduct declared tips from the minimum wage. In NM, the law was amended to allow owners to estimate the tips, and deduct that amount! Talk about setting the fox to guard the henhouse! That same law made it a felony for people to not declare all of their tips, which, of course, instantly made felons of about 99% of all waitresses. My wife’s take-home almost immediately dropped by a third. These places were NOT small businesses: Mariott, Skychefs (part of American Airlines), Hilton, Four Seasons, etc..
Then they started tip-sharing, which not only cut more deeply into her take-home, but also introduced a distressing level of intrigue, brown-nosing, and backstabbing into the workplaces. That’s why I always tip in cash. That way, if the server wants to slide a little off the top and keep it, “just between us,” he or she can.
The vast majority of people in food service work part time, mostly because most of the trade comes during traditional meal times. I can’t see that changing. Part time employees have always been exempted from most benefits, though Mariott and Skychefs did provide a modest health care plan, paid vacation, and a few other things. (The vacations were paid at the rate shown on the last paycheck before the vacation, so we’re not talking a heck of a lot of money for the employees, although it came to hundreds of thousands for the corporations.)
I think all of us are on the same page regarding the the industry, as a whole. How-ever, the point I got out of the article was that Obamacare will be unsustainable for many businesses. Corporate profits – that’s NET, not GROSS, of course – are generally under a nickel per dollar. In retail, it’s generally under .03 cents, and I’d be amazed if it’s any more than that in food service. Obamacare will take fully half of that profit, leaving the owners, themselves, to work for about minimum wage, but without tips. In the case of the big outfits, like Darden, this will eviscerate the stockholders. The stockholders are not savage Simon Legrees; they are people who are trying to make a buck on investments so they can retire, or at least have a few bucks put back for their own old-age health issues. In fact, a lot of shareholders are the same servers and kitchen staff who will supposedly benefit from Obamacare. These people will ultimately suffer more than the owners, who will always take theirs off the top – as it should be.
The whole thing is an insane, self-defeating mess, like Heinlein’s golem, Igli, eating himself. The pattern, as I see it, is that the government identifies who has the money, then takes the money from them. This leaves the former money-holders unable to pay their employees, so the government steps in and gives some of the money to the people who would have originally received it had the process been allowed to run it natural course. Of course, the government employees who administer the redistribution scam must be paid, and their bosses, and their bosses, and various campaign funds get their skim, and most ironically, some of it goes to pay unemployment to the bankrupt former owners. So the end result is that the employees are no better off than they were before. The employers are out of business, every business with which they did business – suppliers, etc. – is less profitable, and the government, which invented the insanity, are the only ones who are actually doing well. Except, of course, the choice of restaurants is a lot slimmer.
The left has always been more concerned with what is done with money than with how it is made. That’s because they are Keynesians, or some variation thereof, and think money just happens, or is grown, or printed, or pulled out a magic mason jar. Many capitalists and individualists think liberals are against wealth, but in point of fact, they are not. They are only against wealth they do not control. They will forgive any criminal behavior by the person who amasses wealth as long as that person allows them to control it. Capitalists and individualists (whom I will call, “conserv-atives” for convenience’ sake, but with great trepidation due to the jaw-dropping ignorance about what the term may imply) are more concerned with how the money is made than with how it is spent. If you earn it legally and morally, you are welcome to do with it as you please. Liberals say, “There is no wrong done as long as your actions were to benefit others – and we are the others.” Conservatives say, “Your money is your money. Just make sure you don’t break the law in earning it” (Opposition to parts liberalism does not make one a conservative. Gaining wealth by forcibly abusing others is antithetical to the definition of capitalism or individualism, and anyone who does so and calls himself a conservative is a damned liar.)
There is great injustice in the food service industry, especially at the bottom of the food chain, if you’ll pardon the pun. On that we all agree. Our nation’s health care industry is in dire need of reform, and I think we all agree on that, too. Obamacare addresses neither problem. It creates new problems that, because they are lodged deep within the body of the law, will be vastly more difficult to fix.
I believe the ultimate solution to the matter of low wages and lack of benefits in any industry is to free the market to create new businesses and even entire industries, so there will be more opportunity in breadth as well as in depth. If an aspiring restaurant owner wants to hire an outstanding server away from his competition, he can offer a higher wage with some assurance that his profits won’t be seized. If a company, such as Darden, wishes to pay sweatshop wages, they are free to do so, but they are not free to escape the fact that nobody will work for them. In the interest of keeping it real, I can’t imagine anyone with a shred of sanity wanting to own or manage a restaurant, in the first place, and sure as hell not on the pittance that will be left after the Obamants have eaten all the sugar in the kitchen!
10 Oct., 2012