Everybody is a Capitalist

My daughter went to a concert where some anti-capitalism songs were sung. It was ironic that some capitalists were profiting from singing anti-capitalist songs to an anti-capitalist audience. You just have to love it.

Everyone is a capitalist, especially those who are selling socialism and communism for personal benefit or profit. Everyone has a product for sale and everyone wants to receive the highest profit they can from that product. That product is themselves.

Some people create a product and sell it. They are profiting from their idea, their work or their risk. That’s capitalism. Others are paid for their service. That’s capitalism. Some of these who work for a check also have retirement plans. Those retirement plans are invested in the capitalist stock market.

Almost every day I see an article or hear someone complaining about someone else’s pay and that they aren’t paid enough.

The fact is the guy or girl getting the big bucks either has or is perceived to have a higher value to the person writing the checks.

The irony of minimum wage is the mistaken assumption that everyone has the same minimum value. At the current minimum wage of $7.25, when an employer adds the taxes and other Government mandated costs, the cost for a minimum wage worker is over $10.00 an hour for an employer. Then there are other related costs that must be paid before the employer benefits.

Using a personal example, I once operated a honey packing operation. We were paid $ .30 per pound. After deducting the cost of jars, labels, lids, equipment, insurance, taxes, freight, storage, fuel, utilities              repairs, debt service, etc., we had 3 cents per pound for labor. That was $1.08 per case of honey for labor. With five employees we had to process 50 cases (10 cases per employee) per hour to break even. Less than that and we would lose money and none of us would have had a job.

The employees had no risk. They got paid every week for what they did. My wife and I had borrowed money for equipment and a building and would have to make the payments no matter what happened or how much honey we processed. We took a chance, created a service and created jobs. We deserved a profit also.

Some jobs required a level of skill, others were just labor. The skilled were worth more than the unskilled. Some employees were dedicated and worked hard. They deserved more money. Some were reliable and worth more. Some were worth less. There was an interesting situation-the ones who were worth less-who were producing less, were always the ones who complained about their checks. Not once did one of them ever say, “How can I increase my value to you?” Instead they complained that others were making more, always ignoring the fact that the ones making more money were doing more.

Ultimately we had to close the business. We were informed by the labor division of Government Contracts that the “prevailing wage” for Charlotte County, Va. was $15.00 an hour and that we were required to pay that. As there wasn’t enough to do that we closed, sold our equipment at a loss and spent years paying off the debt. Our employees were unemployed. No one benefited.  Ironically, several years later we received a correction. It stated an error had been made: the “prevailing wage” for Charlotte, N.C. was $15.00 an hour; the wage for Charlotte County, Virginia was $5.50.

The point is simple. The employees benefitted based on their ability and production but they had no risk or money invested. When we closed they moved on to new jobs. Capitalism works, even when a business fails.