We have seen oil tantrum in 2013 and in 2016 push the yields of 10 year treasury bonds higher. Well, there are retail tantrums now taking center stage. The retail tantrums are a clever attack on minimum wage growth. But some people are wising up to these tantrums. If people want their businesses and their jobs to survive, they need to keep pushing for a reasonable wage, which puts money into peoples' pockets. Spreading prosperity to labor will come back to help the capitalists.
Consider the attacks on minimum wage improvements from contributors to large financial websites.
Article after article speaks about the Amazon convenience stores and the plans to stop using cashiers. And the same happened with the new McDonalds stores experimenting with technology to eliminate cashiers. The list of articles is found down the page. But there are caveats to these stories that were posted in a few contrarian articles.
For example, we now know that Amazon does not plan to open thousands of stores according to CNet.
"Amazon is getting ready to take over the retail industry, replacing labor with technology, and make minimum wage irrelevant. At Amazon Go stores—a new chain of convenience stores to be rolled out in 2017—there will be no floor employees to assist customers, no store greeters, and no cashiers to collect payments. They will all be replaced by technology, which monitors customers entering the store, records what they buy, and ensures that they are charged the appropriate amount."
So, which is it Forbes? Is Amazon a threat to the minimum wage if it has no plans to open thousands of stores? I don't think it is. The financial people are as much at fault in this minimum wage scare as are the companies involved, maybe moreso. Maybe the companies involved can handle the minimum wage increase. An article on Business Insider a few years ago showed that McDonalds could easily absorb a $15 minimum wage with stats to prove it.
I realize that the Forbes article is posted by a contributor, and Forbes says that contributor opinions are their own. But surely the online magazine is thrilled that over 35 thousand page views have so far been delivered by the article. I am confident that it was not posted as fake news. But it has the same effect. It was posted on December 11th and yet it was on December 8th that Amazon told us they would not be opening thousands of stores.
Can you imagine going into a store where there are no employees? It isn't as bad as boarding a plane without a pilot, but it is flying blind, in a way. This is experimental stuff. The frustration with stores now is that there are not enough employees to talk to. Think about a store with no employees! What if you want to pump gas? Tell me how Amazon would have a convenience store with no pumps, and expect to compete with stores that have pumps and employees to help with issues with pumps. And there are issues from time to time with gasoline pumps.
And if you sell vegetables, you have to have employees. Obviously the Amazon store will not sell fresh vegetables or gasoline. That severely limits these stores' effectiveness.
As I said, not all articles are focused on fighting the minimum wage.
Geekwire writes about an Amazon investor who is taking the minimum wage fight to NYC.. This insider, Nick Hanauer, refuses to believe that companies like or McDonalds or Walmart or Wallgreens cannot keep workers off of the poverty line. From the site:
"Nick Hanauer, one of Amazon’s first investors, is no stranger to taking on battles about class warfare and income equality. As a tech-made multi-millionaire, he comes from the perspective of helping out regular working folks in these times of growing economic disparity between the haves and have nots...
...Now that $15 per hour is a reality here, Hanauer traveled to New York to testify in favor of $15 per hour for fast food workers there, he talked to Gawker about his quest for economic equality."
Hanauer went on to say:
“There is no earthly reason why Walmart and McDonald’s and Walgreens and these other giant, profitable institutions should have one worker in need of public assistance. It’s ridiculous.”
Hanauer believes that the argument that jobs will be lost if wages go up is not reality, but rather is a negotiating ploy.
The same is true of Amazon although the Go Stores had not been announced when Hanauer spoke. I can't find out anything on his view of the Go Stores, but he is pro labor and warns the wealthy to pay more in wages or else the pitchforks are coming.
Nick is a fabulously successful venture capitalist, worries about revolution. He warns other plutocrats that neglecting society will bring serious consequences. I have believed that asset purchases by the Fed should sometimes take a back seat to targeted Helicopter Money, to bail out the masses and prevent discontent. Let the masses hold the base money. It doesn't always have to be the banks, expanding the divide between the uber rich and others in society.
Hanauer argues for middle out economics, for better wages, not as a moral argument, but as an economic argument as a way to continue capitalism sans revolution. He argues that middle class prosperity is essential to, not simply a result of, a successful capitalistic society.
