Free Republic
Browse · Search
News/Activism
Topics · Post Article

To: aposiopetic
It's called the market.

No. The "market" is driven by economic activity. Over time, as wages increase and economic activity expands, producers raise prices to compensate for inflationary pressure. Inflationary pressures increase demand (measured by consumers having greater income) to balance with supply as increased revenue compensates for greater costs of production.

What is happening here is the opposite of the market. Here, the government has stepped in to inflate the cost of labor to the point that the costs of production will be greater than consumer demand. When this happens, there is an imbalance as demand falls due to the inflated price while the producer doesn't receive the benefit of the inflated price to compensate for the cost of production. Choice: as mentioned in the article... out of business.

Margins are very thin in the food industry.

23 posted on 05/21/2015 7:29:53 PM PDT by pgyanke (Republicans get in trouble when not living up to their principles. Democrats... when they do.)
[ Post Reply | Private Reply | To 4 | View Replies ]


To: pgyanke

As said in other posts above, the firm is charged with knowledge of the risk that the cost to the firm of the factors of production, such as labor, will increase. If they calculated poorly, the miscalculation is on them. I don’t want taxpayers in Germany or here to bail them out.


26 posted on 05/21/2015 7:32:59 PM PDT by aposiopetic
[ Post Reply | Private Reply | To 23 | View Replies ]

To: pgyanke
I blame it on *hole kids that hate pickles ☺ Pick the pickles of yer Mc Burger if you don't like it! *Whah! I still taste pickle juice*
30 posted on 05/21/2015 7:39:18 PM PDT by mylife ("The roar of the masses could be farts")
[ Post Reply | Private Reply | To 23 | View Replies ]

Free Republic
Browse · Search
News/Activism
Topics · Post Article


FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson