Economics 102: WalMart Cuts Worker Hours After Hiking Minimum Wages

Capture

Retailer cuts workers’ hours in a desperate attempt to offset wage hikes

by Zero Hedge | August 31, 2015

This year, some American executives who heeded loud calls for across-the-board wage hikes for America’s lowest-paid workers received a complimentary refresher course in undergad economics courtesy of the free market.

Take Dan Price for instance, the 31-year old CEO of Seattle-based Gravity Payments Systems who found out the hard way that setting the pay floor at $70K comes with all manner of unintended consequences.

And then there’s Wal-Mart.

Earlier this year, the retail behemoth became one of several corporate heavyweights to raise wages for its meagerly compensated workers, around 500,000 of which are now set to receive at least $9/hour and $10/hour by Q1 2016. The move will cost somewhere around $1 billion this year.

Now one thing that should have been abundantly clear from the start is that if ever there were an employer that could ill-afford a $1 billion across-the-board pay raise without immediately making up the difference by either firing some employees, cutting hours, or squeezing the supply chain it’s Wal-Mart. After all, they’re the “low price leader”, and you don’t hold on to that title by passing labor costs on to customers.

Predictably, the company moved to extract more “value” from its suppliers and when that didn’t prove sufficient, the folks in Bentonville brought in the “plumbers.”

But the story didn’t stop there. Late last month we highlighted an internal memo circulated at Arkansas recruiting firm Cameron Smith & Associates which looked to be an attempt to prepare the firm’s employees for layoffs at Wal-Mart’s home office. Then, not a week later, Bloomberg ran a story detailing the grievances of some senior Wal-Mart employees who suddenly realized that although they may still be making more than their subordinates, the wage hierarchy had been distorted and that distortion had nothing to do with merit. As we put it, “higher paid employees don’t understand why everyone under them in the corporate structure suddenly makes more money and if people who are higher up on the corporate ladder don’t receive raises that keep the hierarchy proportional they may simply quit which means that, for Wal-Mart, raising the minimum for the lowest paid workers to just $9/hour will end up costing the company around $1.5 billion if you include the additional raises the company will have to give to higher paid employees in order to retain their ‘talents’and avoid a mid-level management mutiny.”

Well, don’t look now, but undergrad economics is rearing its ugly again at Wal-Mart as the retailer cuts workers’ hours in a desperate attempt to offset wage hikes. Here’s Bloomberg with more:

Wal-Mart Stores Inc., in the midst of spending $1 billion to raise employees’ wages and give them extra training, has been cutting the number of hours some of them work in a bid to keep costs in check.

Regional executives told store managers at the retailer’s annual holiday planning meeting this month to rein in expenses by cutting worker hours they’ve added beyond those allocated to them based on sales projections.

The request has resulted in some stores trimming hours from their schedules, asking employees to leave shifts early or telling them to take longer lunches, according to more than three dozen employees from around the U.S. The reductions started in the past several weeks, even as many stores enter the busy back-to-school shopping period.

A Wal-Mart employee at a location near Houston, who asked not to be identified because she didn’t have permission to talk to the media, said her store had to cut more than 200 hours a week. To make the adjustment, the employee’s store manager started asking people to go home early two weeks ago, she said. On Aug. 19, at least eight people had been sent home by late afternoon, including sales-floor associates and department managers.

The employee said she’s covering an area once staffed by multiple people at one of the busiest times of the year — the back-to-school season. On a recent weekday, she had a customer who had to wait 30 minutes for an employee to unlock a product the shopper wanted to purchase, she said.

The staff at a location in Fort Worth, Texas, were told that the store needed to cut 1,500 hours, according to a worker who asked not to be named for fear of being reprimanded.

So there you have it. Further proof that across-the-board wage hikes – like socialized medicine and free college – is a concept that sounds good when considered in a vacuum, but when implemented is subject to economic realities that conspire to make the end result look far less desirable than proponents might have imagined.

And therein lies the problem. Projecting how these “experiments” might turn out isn’t difficult, which makes one wonder how policymakers and corporate management teams seem to get them wrong on a fairly consistent basis. Then again, when you live in a world governed by the principle that the cure for debt is still more debt, it’s easy to see why some still believe, despite all the evidence to the contrary, that you can have your cake and eat it too.

Houston deputy shot 15 times…

Capture

HOUSTON (AP) — A man charged with killing a suburban Houston officer first shot the 10-year veteran in the back of the head and fired a total of 15 times, authorities said Monday.

Shannon J. Miles, who is accused of capital murder and whose criminal record includes convictions for resisting arrest and disorderly conduct with a firearm, appeared briefly in state District Court in handcuffs and shackles. The 30-year-old Houston resident said little, other than to answer the judge’s questions. He’s being held without bond.

Harris County District Attorney Devon Anderson would not comment on a motive, saying investigators were still trying to figure that out. When asked if it might be connected to heightened tensions around the country between law enforcement and civilians, Anderson said, “I have no idea whether it does or not.”

This weekend, Sheriff Ron Hickman said the attack was “clearly unprovoked,” and there is no evidence Goforth knew Miles. “Our assumption is that he (Goforth) was a target because he wore a uniform,” the sheriff said.

Anthony Osso, one of Miles’ two court-appointed attorneys, told The Associated Press that his client intends to plead not guilty.

“He had indicated to the investigating officers that he was not involved in the case,” Osso said in a telephone interview after Monday’s hearing.

Osso said Miles’ defense team is distancing itself from the sentiments expressed by the sheriff, the district attorney and others.

“What I want to do is investigate the case and defend my client based on the facts of the case and not opinion in the public eye or rhetoric that’s espoused on social media. It’s difficult enough to handle these types of cases,” Osso said.

In court, Anderson read the probable cause statement, saying that police first received a call at 8:20 p.m. Friday. When authorities arrived at the gas station in the Houston suburb of Cypress, they found Deputy Darren Goforth, face-down. He was already dead, she said.

Surveillance video from the gas station showed Goforth, 47, had just come out of a convenience store after he had pumped gas and that Miles got out of his red truck, she said.

“He runs up behind Deputy Goforth and puts the gun to the back of his head and shoots. Deputy Goforth hits the ground and then he continues to unload his gun, shooting repeatedly into the back of Deputy Goforth,” Anderson said.

Goforth was shot 15 times and a witness saw the shooting, Anderson said. She added that the shell casings match the .40-caliber Smith and Wesson handgun found at Miles’ home.

Miles’ next court date is Oct. 5.

The killing evoked strong emotions in the area’s law enforcement community, with Hickman linking it to heightened tension over the treatment of African-Americans by police. Goforth was white and Miles is black.

The nationwide “Black Lives Matter” movement has sought sweeping reforms of policing. Related protests erupted in Texas recently after Sandra Bland, a black woman, was found dead in a county jail about 50 miles northwest of Houston three days after she was arrested on a traffic violation.

“We’ve heard Black Lives Matter, All Lives Matter. Well, cops’ lives matter, too,” Hickman said Saturday.

Houston Police Lt. Roland De Los Santos, a childhood friend of Goforth’s, called the deputy a “simple guy” who was focused on providing for his family, noting that Goforth’s wife is a teacher and the couple has a 12-year-old daughter and a 5-year-old son. Goforth’s funeral is planned for Friday, he said.

Miles’ criminal record stretches from 2005 to 2009, with three convictions for resisting or evading arrest, as well as convictions for disorderly conduct with a firearm, criminal mischief and giving false information to police. Records show he was sentenced to several short stints in jail, anywhere from six to 10 days.

Associated Press writers Seth Robbins in San Antonio and Alan Scher Zagier in St. Louis contributed to this report.

This story has been corrected to show that the defense attorneys were at the Monday morning hearing, not that they weren’t in attendance.

Armed Black Panthers to Texas Cops: ‘We Will Start Creeping Up on You in the Darkness’

Capture

by Bob Price and Lana Shadwick

HOUSTON, Texas – Armed Black Panther members marched in front of the Waller County jail and shouted, “You’re gonna stop doing what you’re doing, or we will start creeping up on you in the darkness.”

The statement was made just two weeks prior to the assassination of a Harris County deputy sheriff.

Shannon Miles, a black male, allegedly came “creeping up” behind Harris County Deputy Darren Goforth in the darkness on the night of August 28. While Goforth stood at a convenience store pumping gas into his patrol vehicle, Miles allegedly raised a pistol and shot him dead.

The comments, made by a leader of the Houston-based chapter of the New Black Panther Party, were captured on a short video clip (below) from the scene by the Houston Chronicle. The writers from the Chronicle made no mention of the threat in their article published that same day.

http://launch.newsinc.com/?type=VideoPlayer/Single&widgetId=1&trackingGroup=69016&siteSection=houstonchronstudio_hom_non_sec&videoId=29531533

Not part of a chant, the march leader, wearing the rank of colonel, shouted directly to Harris County mounted deputies through a megaphone. “You think we’re not pissed off a bunch about y’all killing our sisters? You think it’s okay? [We’re] the wrong n***ers to mess with. You’re gonna stop doing what you’re doing, or we will start creeping up on you in the darkness.”

The rally, also covered by Breitbart Texas, took place at the Waller County Jail where inmate Sandra Bland took her own life by hanging herself with a trash bag after her arrest following a traffic stop in the town of Prairie View. She was accused of an illegal lane change and assaulting a police officer. After being left in jail by her family for three days, Bland hung herself.

In the video below, Breitbart Texas recorded several other violent statements towards police. “The revolution is on… Off the pigs,” and “Oink Oink… Bang Bang!,” was the message leveled by the heavily armed Black Panthers directly at Harris County deputies who had been asked by the Waller County Sheriff to come out to help keep the peace.

Two weeks later, a black man, Shannon Miles, allegedly walked up behind Deputy Goforth and shot him in the head and back fifteen times, according to a Breitbart Texas report on Miles’ first court appearance.

The Waller County jail is located just over 30 miles from the Chevron station where Goforth was executed. The alleged killer, Shannon Miles, also attended the same university as Sandra Bland. It is possible that her arrest and subsequent suicide could have played a role in Miles’ possible motivation.

WAR!… RINO Jeb Bush Calls Trump “Buffoon”, “A$$hole” and a “Clown”

Capture

BY JIM HOFT

Jeb Bush declared war on Donald Trump today before the first debate of the election season.

The Politico reported:

Jeb Bush, the man who would be frontrunner, was as surprised as anybody when Donald Trump jumped into the 2016 presidential race in June. His instinctive first reaction was to hold his tongue, and his advisers agreed the best option was to keep his distance from an interloper who wanted to drag him into a reality-show shouting match.

Bush stayed strategically silent even when Trump delivered his infamous crack that some Mexican immigrants were “rapists.” It wasn’t easy, considering Bush speaks nearly flawless Spanish, backs comprehensive immigration reform and is married to the former Columba Garnica de Gallo of Leon, Mexico.

Like everyone else, Bush soon found Trump impossible to ignore. When Trump reposted a nasty tweet a couple of weeks after his contentious announcement speech— “Bush has to like Mexican illegals because of his wife”—the former Florida governor was forced to respond. “You can love your Mexican-American wife,” he told one interviewer before telling another that Trump was “preying on people’s fears.”…

“Seriously, what’s this guy’s problem?” he asked one party donor he ran into recently according to accounts provided by several sources close to Bush—and he went on to describe the publicity seeking real estate developer now surging in public polls far ahead of Bush and all the 15 others in the Republican field as “a buffoon,” “clown” and “asshole.”

The Politico dropped this report just in time for the first debate.
This ought to make tonight’s debate an even bigger draw.

*Ugh* Jeb Bush Sides With Jorge Ramos, Says Reporters Deserve “A Little More Respect”

Capture

BY JIM HOFT

Last night leading Republican presidential candidate Donald Trump held a press conference in Dubuque, Iowa.

During the press conference Trump was heckled and interrupted by Univision reporter, Jorge Ramos.

Jorge Ramos refused to wait his turn and refused to quit talking.
*Ugh* Jeb Bush Sides With Jorge Ramos, Says Reporters Deserve “A Little More Respect”

Jim Hoft Aug 26th, 2015 4:10 pm 91 Comments

Last night leading Republican presidential candidate Donald Trump held a press conference in Dubuque, Iowa.

During the press conference Trump was heckled and interrupted by Univision reporter, Jorge Ramos.
trump ramos
Jorge Ramos refused to wait his turn and refused to quit talking.

Trump had Ramos escorted from the room for his outburst.

Today Jeb Bush defended Jorge Ramos and criticized Donald Trump for not putting up with his abusive outburst.
NBC News reported:

Jeb Bush says that Univision anchor Jorge Ramos, who was escorted out of a press conference held by Donald Trump on Tuesday night, should have been “treated with a little more respect.”

“I think people with the press ought to be treated with a little more respect and dignity,” he told reporters.

Ramos was removed from the press conference after Trump accused him of interrupting another reporter to ask a question about immigration policy. Ramos was later allowed back into the room.

Bush’s comments came after a town hall event in Pensacola, Florida, where Bush continued to blast Trump’s immigration proposals as “not conservative” and said the real estate mogul should be held to the same standards as other Republican candidates.

“This guy is now the frontrunner,” he said. “He should be held to account, just like me.”

“Go through these questions and what you’ll find is this guy doesn’t have a plan,” he added. “He’s appealing to people’s angst and their anger. I want to solve problems so that we can fix this and turn immigration into what it’s always been: an economic driver for our country.”