Things I take for granted part 2 : Washing machines

It's Saturday. You roll up your sleeves, gather all the sheets, clothes, rags and towels and bundle them up in a big batch. You mount the bundle on top of your head, grab your washboard, your

pack of lye, your bristle brush and prepare for the 6 mile walk to the river bed to put in a good 8 hour day of work washing it all. In much of the world that's still the way housewives clean the family's garb each week. It's back-breaking labor and almost none of us in the modern world have ever experienced it. 

I even left out the wringer used to wring out the water, and then having to carry all the wet clothes back home to hang on lines and waiting for a good day of sunlight so they can dry. Not to mention that if it rains or snows you have to start the process over again. It's quite ridiculous to a westerner that this is even a reality anywhere in the world. What's funny is that it's likely that your parents or perhaps grandparents can remember a time where they had to do something similar. Most likely though they had plumbing inside the house and they filled up a few tubs with warm water and saved themselves the walk to the river. 

Knowing this, it's incredible that we complain about having to do laundry. I literally have to walk about 8 feet and dump everything into the machine, hit a couple of buttons, and then watch 30 minutes of TV while millions of scrubbing bubbles magically and gently wash the grime out of my clothes and magically soften the fabric.

So next time you have to do laundry, pour your self a glass of wine and give a big hug to that massive white box that does all the work. And for the love of god, stop bitching about having to do your laundry.

The minimum wage debate and why it's ridiculous

I have so little time to write these days and in fact I'm writing this on my only break of the week. I writing because apparently, according to the numbers, most of you reading the article think the minimum wage should be at $15 instead of whatever it is in your area. Supposedly because you don't think there is any harm in increasing the minimum wage. Well follow me down this rabbit hole for just a few minutes and if you still think the minimum wage should be set by the government and imposed on all employers then you will probably always make the minimum wage. Here are a few things to consider:

1) The minimum wage doesn't just affect the people making minimum wage. If you're currently making $15/hour, you're likely not in an entry-level position at your company. The problem is, if the new minimum wage is $15, then your wage will have to increase to at least $20 to keep you at your current job. So the wage increases affect your employer's entire payroll, not just the people they're paying minimum wage to. 

2) The reason minimum wage jobs exist is to allow for entry level jobs from which you can pull yourself up with your own bootstraps. They are not meant for you to stay in for life. If you're making minimum wage right now and you don't have a solid plan for how to work your way out of that position and into a higher paying position then what is lacking is ambition, not regulatory policy. If we were to increase the minimum wage to meet living standards of a city like Los Angeles then there would literally be no reason for anyone at the minimum wage to ever excel in life. All the people with no drive in their life would basically stay put in their position and make a living. 

3) I don't pay people minimum wage, because I know that as a business owner, if I want quality people to work for me, I'll have to pay them what they're worth. Most of the consultants who work for me make over $100/hour. That's how the free market economy works. So why do I care about the minimum wage? Here's why: Let's talk about Costco. Costco is known for limiting markups on items to 14%. In the quarter ending 8/31/14 Costco had $35B in revenue with $34B in operating expenses. They don't really report what percentage of that is labor but they do report that $3.4B is from "Selling/General/Admin. Expenses". Which includes labor. The rest is likely just the cost of product. So that $3.4B comes right out of that $14% mark up. Now if we increase minimum wage $9 to $15, that's a 66% increase in the minimum wage which is likely to eat right into that 14%. Costco doesn't pay anyone the minimum wage, in fact their average is $19 per hour, but remember, raising the minimum wage increases all wages (see #1). So now what? Well, no problem, Costco will just increase their markup from 14% to say 20% to make up the difference because if they report any less they will lose all their investors. So that increase is going to come directly out of the pockets of all the people who buy from Costco, including those who make the new $15/hour minimum wage. And their landlords, and the people who provide them services. Everyone's costs will go up tremendously which will inevitably increase all prices of all goods and services. Much like the increase in the price of gasoline (another basic business expense) has raised prices over the years across the board. At this point you might say, well who cares? Everyone gets paid more and everything costs a little more, so who are we hurting by increasing the minimum wage? We're hurtin the dollar. Because as you noticed from above, it lost value almost instantly. The other problem is that the wages don't increase by the same amount in China, India, Europe, Brazil and the rest of the world and the dollar loses a lot of ground in the world market. 
Don't believe me? Check out this graph that the pro-minimum-wage-hike side has put together to demonstrate the plight of the lower working class. To me though this represents the fact that the value of the dollar is directly affected by changes in the minimum wage.

4) The small business owner will have to find new ways to eliminate labor as the cost of labor begins to match the cost of technology that will replace those workers. (See local grocery store check out line robots.) Business who can't cut labor costs have two options: 1) Go out of business 2) Increase prices and risk losing customers. And many times those lost customers are not just going to the competitor, they're going away for ever. When the price of a pizza goes from $19.99 to $26.99, the consumer doesn't just go to a different pizza place, he stops ordering pizza and makes a sandwich at home. The pizza place dies and so do the dozens of jobs it was creating. Including the jobs it was creating indirectly, like jobs at suppliers and service providers to whom the pizza place was a customer.

5) You might say that a rising tide lifts all boats. True that! The minimum wage goes up, so all wages go up, so prices go up, so rents go up, so the living expenses will not be met by the minimum wage, so the minimum wage goes up, so all wages go up and on and on and on. 

In short, increasing the minimum wage is like saying that there are people drowning in the pool. But instead of teaching them how to swim and get out of the pool, you move the pool to the 2nd floor of the building. Guess what?! The same people will still drown. 

So to those of you who now hate me because you make minimum wage, or close to it. I will leave you with this. I worked at a restaurant while I put myself through college. I got paid minimum wage at $4.25/hour while the average rent in the city I lived in was $1200/mo for a two bedroom. The average rent is now $2400 while the minimum wage is $9. Same same. But the only thing different is the dollar is now worth half as much. I worked hard at that restaurant and the wages were a joke. But I knew that I had to find a way to change my station in life. It never even occurred to me that the fix would be to bitch about the minimum wage. I knew that if I worked harder, and pushed my way through life I would eventually do better. 

Low paying jobs are an incredibly important part of the economy. They are absolutely vital because to employ the very beginner work-force, a very low wage is required. The investment a business has to make in a entry-level employee who is not generating revenue is tremendously high and it must be offset by a very low wage. Once you have gotten that training and experience it's up to you to move to another job. The employers know this and it's figured into the low wage. That's why the wage is low. So you get yourself out of it and make room for the next guy who is going to work his way up. Instead, we raise the minimum wage, which keeps people in those jobs and doesn't allow for the entry-level work force to enter the market because the minimum-wagers are hogging all the jobs.

The minimum wage is NOT meant to be a living wage and it should NOT be! It should instead inspire you to learn new skills, make new connections, and lift yourself out of poverty. A low wage job is what makes America a land of opportunity, because anyone who wants to work, can find a legal job to do. It might be at a low wage, but that's how you start, it doesn't have to be how you always live.

Put all your love or hate in the comments below.

5 things you should stop complaining about right now

All I hear lately is complaints. From people right here in the US. The most comfortable, abundant country in the world. Most days, your biggest problem is: "Dude! I ate too much, I feel sick." Or, "Man, I am so hung over, we drank way too much this weekend." Here is a list of 5 things you so called "intellectuals" complain about every day and why you should just stop.  

Lack of jobs

If you spent the time you have spent complaining about and analyzing the job market in the US on learning some 21st century skills like social marketing or software development you would probably have a new lucrative career by now. But no, you'd much rather bitch about how Mexicans are taking our jobs and waa waa India, waa waa China, waa waa Phillipines. They moved your cheese, get over it, find new cheese already. For god's sake, it's never been easier to make a bit above minimum wage. If you own a car you can be an Uber/lyft/sidecar driver in in less than a week. You can do any of nearly 10,000 tasks for $5 on Fiverr and make a living. You can sell stuff on eBay, Amazon, Etc, etc...
So please, stop complaining about the job market and change your state in life. It may never be as good as your mortgage days, but you can earn a good living and have a roof over your head and food on your table if you are willing to, umm, you know, work. 

Global warming

All your environmentalists make me sick. You think you're saving the planet with your Prius or Tesla or whatever and scoff at the likes of myself who drive a 20 mpg vehicle. Well, lets get one thing straight. If you even take a single commercial flight each year, your carbon footprint is increased by 10,000 times what you "saved" with your electic "car". The earth is not dying because everyone isn't as smug as you. The earth is dying because you don't understand the impact of the things you do. Blaming global warming on cars is like blaming your obesity on, ummm, Chicken. Yeah, sure, chicken has calories, and you can get fat from it, but you should look into that after you cut out pizza, doughnuts, ice cream, pasta, garlic toast, chili fries, and fried rice. 

GMO products
Do you know where you would be without GMO products? Not alive. And I don't mean that you would have died by now. I mean that you would likely never have been born. The world's food supply depends largely on mass-farmed products. It has to because there is now just way too damned many of us, and we love to eat so goddamn much of everything at our favorite time, not only when they are in season. Well, guess what, melons, lettuce, apples, and tomatoes don't just grow all year long. So unless you wanna stop eating those things 6 months out of the year, I suggest you educate yourself about GMO foods and direct your opposition to the subset of them that hurt us rather than the 90% of them that help us survive. True, GMO foods are engineered for the wrong reasons and more commonly than we would like, but if you don't understand GMO, and just run your mouth about it ignorantly, all you are doing is hurting your own cause. 

High gas prices

This is my favorite one. At the time of this writing Current price of Petrol (Gas) in the UK is £1.34 (and higher) per litre. 1 US gallon = 3.78541178 litres so the true price of a gallon of gas in the UK in American dollars is about $10. That's more than twice what I paid at the pump today for 91 Octane ($4.10). In fact its 2.4x the price. And the UK is not even the highest prices. According to Bloomberg, UK is #13 on the list with Norway, Netherlands, and Italy rounding out the top 3. The US is actually number 51 of their list of 61 countries. With Venezuela paying only $0.04 per gallon of gas, followed by Saudi Arabia and Kuwait at $0.45 and $0.81 respectively. But get this through your head, if you are NOT okay with us getting involved with wars in the middle east and you don't want our troops to be all up in that bitch, then you CANNOT at the same time complain about high gas prices. So to recap, our gas prices are actually quite low compared to nearly every other civilized nation (Although we do spent a disproportionate amount of our income on gas at nearly 3%). And, you can't have it both ways, we're either the a'hole super power causing sh*t in the middle east to get our foothold on where the black gold is, or we end up paying as much as all other European countries. 

China is stealing our products

This one sucks. I agree. But have you ever read Sun Tzu's Art of War? You really should. This is just textbook stuff to the Chinese. In a war, and the economic war is a war, every thing you do is fair. There is no honor in losing because you were fair. In fact, the sneakier you are, the higher the praise. So if you found a way to cheat and get your way against the enemy, then good for you. If you lost, because you didn't take advantage of obvious things like infringing on patents and copyrights, then you have dishonored your troops and country by being a bad general. Win at all costs. So knowing that mentality (and obvious cultural difference), you can sit there and whine and bitch about how China is stealing your junk, or you can develop better customer service, refine your product, and win the heart of your customer with good marketing. And With all the time you'll save not crying, maybe you can find a way to screw the Chinese out of a couple of bucks while you're at it. 

Waaaaa