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- inactive, on 10/12/2007, -0/+5I love when these groups, journalists, or bloggers use the term 'fair.' What is fair? Is fair the same for me as it is for everyone else? Anyone who would phrase it this way would be laughed at, and rightfully so. Fair value is what a buyer and seller in a trade determine is fair at that particular moment in time for them and themselves only. This applies to using cash to buy clothing, your credit to get a mortgage, and a wage, which is nothing more than a trade of labor/productivity for money and possibly other benefits. These are all VOLUNTARY!
So because fair is not the same for everyone, why is it these groups claim to know what fair is. If people weren't willing to work at Target for less than $10 per hour, Target would be forced to pay more. Of course, if FORCE is used, as these groups want to impose, then that voluntary trade is done. But what these groups and politicians cannot force upon us is the laws of basic economics. If Target does not agree with these policies, then they certainly have the right to not open stores, which hurts consumers, and the poorest ones the most, because less competition is around. If Target does open stores, they will have to raise prices, which hurt the poor the most. So despite these groups claiming to want to help the poorest people, because of their ignorance of simple, basic economics, they are doing the exact opposite.
If you are going to debate this, I'll respond if I see a logical argument. - seanl, on 10/12/2007, -0/+4The bully here is the city, telling people they cannot work for a big box store for less than a certain amount. This is nothing more than bending over for the increasingly irrelevant unions. It's crap like this that's making the "new cities" like San Jose and Phoenix the real contenders for businesses in the 21st century. San Jose's mayor may be corrupt, but nobody's talking about charging people for shopping bags (like in SF) or telling people who they can't work for or that they need to have 500 hours of experience to be a massage therapist.
- inactive, on 10/12/2007, -0/+3Hey Tracey, I appreciate your reply, and I can understand your argument. However, with that said, you say that morality is not an area that economics, or economists, like to deal with. I believe you are a bit misguided in this statement, because at least Austrian Economics (Ludwig von Mises, Murray Rothbard, & articles on mises.org, fff.org, fee.org) is all about morality, specifically the morality of individual freedom (as you want in your ability to shop) and property rights.
I think you point out something very interesting and enlightening, that is how government messed with this right from the beginning, by offering tax incentives for Target to build in a certain area. (You can also read how their meddling in welfare, etc has caused tremendous harm as well on the sites above I mentioned). If you think about this, is it moral for a group of Alderman to give one group tax breaks, but not others? This hurts the consumers as it plays favorites with large companies, who love (and lobby for) these favors and protection. This is anything but a free-market and Target is just as guilty as the politicians. Everything sounds really nice (and moral) when it's spoken, but the consequences of these market interferences are always different than intended. This is because just as there are laws of physics, there are laws of economics that always take precendence. For instance, if you put wings on your arms and jump off a 30 story building claiming the ability to fly, you will still encounter the law of gravity. Economics has similar laws, such as price caps cause shortages, price floors (such as minimum wage and living wage) create surpluses.
The beauty of a free-market (absent of government interference in trade) is it is 100% voluntary. Target would not get tax incentives to build in any area, people would be allowed to trade their labor for any wage and benefit they choose, and shoppers would determine whether Target is successful or not based upon their shopping habits (i.e. where they spend their money). You have a right to not shop at Target for any reasons you believe in. But I do not think you have a right to force other people to trade when they don't want to, as that is very immoral. But it starts with government intrusion in the marketplace, where instead of being voluntary trades, it is force.
Again, I would highly recommend doing a search on mises.org, fee.org, or fff.org for morality, and you will be amazed at how moral the basis of free-market economics really is. - kacihoward, on 10/12/2007, -0/+1Hi Gary,
Thank you for the websites and information. I am reading the information on them now. I never took an economics class in college and had no idea it dealt with such philosophical issues as morality. I always thought it was dry boring stuff about market, numbers, money, interest rates, and stuff like that. I am looking forward to learning more. I was wondering if you would contact me through the contact page at my website (http://www.bellaonline.com/about/democraticparty ) I would like to ask you some question about this topic through email if you don’t mind. Thank you for your wonderful posts, I am learning a lot.
Tracey-Kay Caldwell
Democratic Party Editor
Bellaonline.com - BellaDemocrat, on 10/12/2007, -0/+0I am the columnist who wrote the article you are commenting on. As for the word “fair,” I never actually used the word. It appears in a quote from ACORN, the social activist group. However, I will try to respond to some of the issues you brought up. First, I am not an economist, I majored in English Literature, about as far away from economics as you can get.
I do know that the reason cities give tax incentives is because they would like to entice business to do things they would not otherwise do if they only concerned themselves with their bottom line. The city offered Target the tax incentives to encourage Target to build the stores, a resource the community needed. When Target entered into the agreement to build the stores, they enter not just a legal contract, but also a social contract with the city. And while reneging on the contract may not violate any legal obligations, it does violate the social obligation they entered into. They have built the stores in the more profitable areas, stores that they probably would have built anyways because it does benefit their bottom line. Now they are threatening not to provide the stores in the less profitable area, despite the fact that they have accepted the tax incentives. This is, in my opinion, morally wrong. Having entered into the agreement, they have an obligation to fulfill the needs of the community, not just their own needs.
I also feel it is morally wrong for a CEO to make more than $20,000 an hour while his employees are living below the poverty line. I am guessing that by your saying no one is forced to take a job at Target, you have never been in a situation where for financial reason you were forced to accept the only job you could get. When a single mother takes a job at the federal minimum wage, she often does so because it is a requirement for her to do so, in order to receive the financial assistance she needs to care for the child she has. Sixty-five percent of her paycheck will go to pay for childcare. The remaining thirty five percent of her paycheck will not cover the cost of housing, food, transportation, and healthcare for her and her child. She will have to accept government assistance for these basic needs.
Because of the government assistance she receives, she can go to work, knowing her child is safe, she is well fed, rested and healthy. These factors make her a more productive employee. The employer directly benefits from this increased productivity. When he does not pass along the profits he gains from this increased productivity to his employees, it is the taxpayer who ends up picking up the tab, by paying for the social programs, we end up subsidizing the CEO’s $20,000 an hour paycheck. That is gaming the system.
I realize that morality is not area economics likes to deal with. You don’t have to agree with my moral judgments. The point of my column was to point out how hard it is for people who do feel these are moral issues, to find a place to shop. I was looking for recommendations from my readers of companies who do share my values, so I can reward them with my dollars.
Tracey-Kay Caldwell
Democratic Party Editor
Bellaonline.com
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