More DUmmie economics

[ScubaGuy]

I have never seen such a bunch of clueless DUmmies like on this thread.

kentuck  Donating Member  (1000+ posts)  Journal  Click to send private message to this author  Click to view this author's profile  Click to add this author to your buddy list  Click to add this author to your Ignore list      Tue Sep-14-10 05:15 PM
Original message
Suppose I have a gadget that I want to sell ...   Updated at 2:02 PM
   
Edited on Tue Sep-14-10 05:16 PM by kentuck
And I sell out all of them in one week and I need to make more because the demand is high. Everybody wants one!

But I can't make them fast enough to keep up with the demand. What should I do?

So I decide to hire a couple of people to help make some more of these wonderful gadgets. I pay them slightly above minimum wage.

Now I'm making some pretty good money. I decide to expand the small plant where the gadget is produced and hire more people. So I hire a couple of dozen people and the product goes nationwide! I am making more money than I've made in my entire life.

It turns into a multi-million dollar operation. How much money should I pay my workers now that I have more money than I will ever use? Should I make them partners in the operation? Or should I give them a small raise, just above prevailing wage? What would be the "fair" thing to do?

Since I could not have become wealthy without the labor of those that helped get the business off-ground and I could not sell my product if people did not want it, what is the driving force behind my new found wealth? Is it my original idea? Is it the labor of others? Or is it the demand from all those folks that wanted one of my gadgets?

Please tell me how supply-side theory fits into my thriving new business??

Dreamer Tatum  Donating Member  (1000+ posts)  Journal  Click to send private message to this author  Click to view this author's profile  Click to add this author to your buddy list  Click to add this author to your Ignore list      Tue Sep-14-10 05:17 PM
Response to Original message
1. And if your product DIDN'T take off, how much risk were your hourly employees exposed to?
   
Not much. You, on the other hand...

Benefits accrue to those who assume risk.

Lousy freeper troll.

kentuck  Donating Member  (1000+ posts)  Journal  Click to send private message to this author  Click to view this author's profile  Click to add this author to your buddy list  Click to add this author to your Ignore list      Tue Sep-14-10 05:23 PM
Response to Reply #1
4. Well, they had to work around some machinery...   Updated at 2:02 PM
   
They could have been injured. Some of them had children. If they did not have the job, the kids might have gone hungry? One needed the job so he could pay his mortgage. I feel like I put some money into the operation but my workers were not without risk. In fact, they probably risked more than I did if I looked at it realistically. I was mostly investing the profit made from their labor when I expanded. Now they all have good insurance and a pension plan. If and when the business goes under, they will not be broke within a week or two.

 

sandnsea  Donating Member  (1000+ posts) Click to send private message to this author  Click to view this author's profile  Click to add this author to your buddy list  Click to add this author to your Ignore list      Tue Sep-14-10 05:24 PM
Response to Reply #1
5. Gaa, think man
   
The business owner is exposed to NO risk because they incorporated and there is no personal loss if they go belly-up. And just about any business that hires people is incorporated in some way.

The worker, on the other hand, has everything at risk and is completely dependent on that job. If that business goes belly-up, the worker is the one who loses everything and has their credit destroyed in the process.

Now that's not to say each worker deserves the same amount as the owner. The owner has knowledge, skills, massive hours of time invested, there's no comparison to a line worker for instance.

But the argument that the owner deserves more because of risk has always been assinine. They're the ones who say you should never use your own money when starting a business, so I don't know how they get away with also saying they have their money at risk. They Don't.

Obviously someone who never invested in anything more than a bag of pot.

Dreamer Tatum  Donating Member  (1000+ posts)  Journal  Click to send private message to this author  Click to view this author's profile  Click to add this author to your buddy list  Click to add this author to your Ignore list      Tue Sep-14-10 05:25 PM
Response to Reply #5
9. Um, what?
   
If I lose my seed money, I don't have any seed money.

You call that no risk?

kentuck  Donating Member  (1000+ posts)  Journal  Click to send private message to this author  Click to view this author's profile  Click to add this author to your buddy list  Click to add this author to your Ignore list      Tue Sep-14-10 05:28 PM
Response to Reply #9
10. If you lose your life while working...   Updated at 2:02 PM
   
is that less important than your "seed money". The gadget was my idea. Is it OK if I make 400 times more than my average employee?

Dreamer Tatum  Donating Member  (1000+ posts)  Journal  Click to send private message to this author  Click to view this author's profile  Click to add this author to your buddy list  Click to add this author to your Ignore list      Tue Sep-14-10 05:30 PM
Response to Reply #10
12. What are you making where people are getting killed right and left?
   
What kind of dangerous pieces of shit are you selling, anyway?

You should be regulated and shut down.

kentuck  Donating Member  (1000+ posts)  Journal  Click to send private message to this author  Click to view this author's profile  Click to add this author to your buddy list  Click to add this author to your Ignore list      Tue Sep-14-10 05:40 PM
Response to Reply #12
19. One was almost killed just driving to work...   Updated at 2:02 PM
   
Life's a gamble. Who knows how dangerous it is to sit in front of his computer for long periods of time? Sometimes all risks are not visible.

I was almost killed by lightning one night leaving work..   Damn you Exxon, I should own you right now.  Look at the risk I took going to work.

Kurt_and_Hunter  Donating Member  (1000+ posts)  Journal  Click to send private message to this author  Click to add this author to your buddy list  Click to add this author to your Ignore list      Tue Sep-14-10 05:20 PM
Response to Original message
3. hmmm...
   
Edited on Tue Sep-14-10 05:22 PM by Kurt_and_Hunter
There is no reason for a job to be a gambling proposition. Set-ups where workers benefit from the success of the company are great... if the company succeeds. A lot of folks who did a perfectly good job for ridiculous dot.coms in the 1990s ended up holding a lot of worthless stock options despite having done nothing poorly themselves.

Pay your employees whatever it takes to get the requisite quality of work to maximize the success of your business.

And then have that success taxed at a good rate to, for instance, help out people who worked for businesses with less clever owners or worse luck and are now out of work.

"A good rate" is whatever tax rate best evens out the rough spots in life for the citizenry while not unduly deincentivizing success.

A whole new level of stupid.

The DUmmies have no idea how much cash is needed to get a company off the ground and then how much it takes to grow the company. 

So you have a great widget idea.  Who paid for the IP search to see if someone else owns the idea?  Who paid for the building and machinery to start manufacturing?  Who paid all the government taxes to start the company?  Who paid for the marketing, engineering and labor to start making the widget?

Want to expand?  You're probably going to need a whole lot more money to get bigger.

DUMMIES!

[jukin]

It is clear that:

!. No DUchebag has started a company and made a product.

2. They would treat their employees like dogs (Obama/muslim jab) as they always accuse evil business owners of doing.

3. No matter how much the demand for the DUmbass's product another, far smarter, far more savvy competitor would come in and beat him up in the market place.  thus all the employees would lose their jobs and be posting on DU about the MAN.

[Carl]

kentuck  Donating Member  (1000+ posts)  Journal  Click to send private message to this author  Click to view this author's profile  Click to add this author to your buddy list  Click to add this author to your Ignore list      Tue Sep-14-10 05:15 PM
Original message
Suppose I have a gadget that I want to sell ...   Updated at 2:02 PM...

If only real life was so simple as to have this product magically at hand with no R&D costs,no marketing expense,no tooling or production investments,no research into sales volume or price needed to recoup investment on top of day to day production costs.

It is just suddenly there.

Stupid fools.

[AllosaursRus]

Since none of my employees helped in the rent or ownership of the building where they work, didn't have to supply a frikkin' dime in order to buy materials that I am more than likely in hock for, didn't buy a single tool in order to make my widget, doesn't share in the loss if I go belly up, doesn't have to deal with the red tape Uncle Sam piles on me on a regular basis, doesn't have to worry about their taxes other than their W-2, will never get penalized if I miss some piece of shit red tape regulation, benefits by the group insurance policy I provide that costs me more money than it does them, if they're handicapped, they don't share the expense of making it so they can do their job, which, BTW has to be furnished whether or not you actually have a disabled employee,............

Should I continue, DUmbass??????????????????

ETA:

Also, I have a question. Since you think everyone and their brother should make a "living" wage, why are you paying just over minimum wage? Shouldn't you be union and payin' closer to $30/hr???????

****in' morons!!!!!!!!!!!!!!!!!!!!!!!!!11111111111111eleven

[Chris_]

Dreamer Tatum  Donating Member  (1000+ posts)  Journal  Click to send private message to this author  Click to view this author's profile  Click to add this author to your buddy list  Click to add this author to your Ignore list      Tue Sep-14-10 05:30 PM
Response to Reply #10
12. What are you making where people are getting killed right and left?
   
What kind of dangerous pieces of shit are you selling, anyway?

You should be regulated and shut down.

[Tantal]

If only real life was so simple as to have this product magically at hand with no R&D costs,no marketing expense,no tooling or production investments,no research into sales volume or price needed to recoup investment on top of day to day production costs.

It is just suddenly there.

Stupid fools.

Why not? It appears to have worked for Skinner. He's taking his gay lover to Barbados after every fund drive whilst his minions have had to cut back to 2 joints per day to pay for it.

[MrsSmith]

I also notice that this boss somehow manages to avoid the 16 hour days of most small business owners.  Lucky, lucky fool.   

My sis-in-law owns a small business with her hubby...she is currently "privileged" to be working 14 hour shifts at one of their shops, 7 hours away from home, trying to get it "off the ground."  Obviously, she's raking in way too much money for this priviledge...oh, wait, she doesn't take an hourly salary, or get overtime.  OOOPS   

[DumbAss Tanker]

Pay them?!?  What kind of Socialist crap is that?!?

 

But seriously...you pay them whatever it takes to get enough qualified, reliable people with the right skill sets (Or economically trainable to them) to fill all the necessary positions, up to the point the cost of doing that exceeds your return.  It has nothing whatsoever to do with the profit margin on the item beyond the point of making a net profit at all. 

[true_blood]

A whole new level of stupid.

That says it all right there. DUmmies = FAIL!

[delilahmused]

Okay, you make widgets. Being a typical DUmmie, you forget the patent. You only make a few but the demand is high. You can't make them fast enough and decide to expand. However, since you only sold a handful you don't have the money to expand and buy new equipment, move to a larger building, etc. Considering how stupid you've been thus far investment capital is impossible to find.  People who wanted your product get tired of waiting and lose faith that you'll ever make more. Luckily for them, while you've been pedaling your 5 widgets without a business plan, across town Fred has figured out a way to manufacture enough to exceed demand (Fred knows once once a few customers buy his widget they'll tell their friends and he wants to have plenty to fill ANTICIPATED demand). Fred invested his own capital and found a couple of venture capitalists who liked his widgets and thought he had a solid business plan. This allowed him to find a building that he could afford and the equipment and employees needed to produce his widgets. His business takes off and he becomes a filthy rich capitalist pig. You go back to DU and whine about how someone stole your idea and it wasn't fair!

Cindie

[Texacon]

I would LOVE to see everyone paid based upon production.  Whether it is commission or piece work or some other formula.

I was thinking about this last night while I was watching that show on Discovery called 'Swords, Life on the Line'.

The boat captains state right up front how much they have invested in a trip and how much fish they have to catch before the boat is 'even'.  Once the boat is even THEN they start catching fish that is going to pay the crew and the crew knows up front.

This is business in its purest form.  DUmmies should watch this show.

They would hate it!

KC

[AllosaursRus]

I would LOVE to see everyone paid based upon production.  Whether it is commission or piece work or some other formula.

I was thinking about this last night while I was watching that show on Discovery called 'Swords, Life on the Line'.

The boat captains state right up front how much they have invested in a trip and how much fish they have to catch before the boat is 'even'.  Once the boat is even THEN they start catching fish that is going to pay the crew and the crew knows up front.

This is business in its purest form.  DUmmies should watch this show.

They would hate it!

KC

They already hate it! The poor, poor, fishies, doncha know.

[njpines]

kentuck  (1000+ posts)        Tue Sep-14-10 05:40 PM
Response to Reply #12
19. One was almost killed just driving to work... 
 Life's a gamble. Who knows how dangerous it is to sit in front of his computer for long periods of time? Sometimes all risks are not visible.

ah, one can only dream . . .

[AllosaursRus]

[Karin]

The DUmmie economics threads have never failed to make my jaw drop from the sheer stupidity. 

Kick-ass post, Cindie. 

[DumbAss Tanker]

The DUmmie economics threads have never failed to make my jaw drop from the sheer stupidity. 

Kick-ass post, Cindie. 

They provide an extremely fertile field for mockery, but at the same time the illogic and magical thinking they use to get from premise to conclusion sometimes makes my brain hurt.  I also get a bit depressed if I think about it too long, because it's so deeply tragic that people with such a profound misunderstanding of economics (Hell, plain old reality for that matter) actually managed to put the Boy King on the throne and gain control of Congress, and stand fair to gain the upper hand in the Supreme Court before we can wash our hands of the Chosen One. 

[true_blood]

They provide an extremely fertile field for mockery, but at the same time the illogic and magical thinking they use to get from premise to conclusion sometimes makes my brain hurt.  I also get a bit depressed if I think about it too long, because it's so deeply tragic that people with such a profound misunderstanding of economics (Hell, plain old reality for that matter) actually managed to put the Boy King on the throne and gain control of Congress, and stand fair to gain the upper hand in the Supreme Court before we can wash our hands of the Chosen One. 

Very well said Tanker.