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San Fran Raises Minimum Wage, Kills Local Book Store

San Fran Raises Minimum Wage, Kills Local Book Store

“The long-term costs just end up getting too high.”

Progressives love the idea of raising the minimum wage and the City of San Francisco is taking the issue to new heights. Unfortunately, the success and survival of small businesses rarely figure into these decisions.

One small but successful independent book store in San Francisco is now closing. The owner recently appeared on MSNBC’s Morning Joe to discuss the situation.

The Washington Free Beacon reported:

Bookstore Owner Describes How San Francisco’s Minimum Wage Increase Killed His Small Business

What happens when the minimum wage is raised to double the current federal level? San Francisco is providing a perfect example–and the results are not all that surprising.

Alan Beets, founder of independent bookstore Borderland’s Books, is closing his doors because the city raised the minimum wage to $15.

The bookstore, which employs five people, has weathered challenges such as bigger bookstores and online shopping, but the minimum wage hike proved too much to overcome.

“It’s not that I can’t afford to pay higher than minimum wage, but I can’t afford to pay minimum wage that gets that high,” Beets said.

Raising the minimum wage is a challenge for all small businesses, but the increased cost for owners is especially troublesome for bookstores. Beets said that while other businesses mark up their prices, shifting the cost to consumers, his product, books, has a price labeled on it so he cannot do the same.

“The long-term costs just end up getting too high,” Beets said. “About two years from now, I will be running in the red. It will get worse from there.”

Here’s the video segment:

People who support raising the minimum wage never seem to appreciate the effect it has on jobs.

Ronald Bailey of Reason recently touched on the issue:

The Minimum Wage and Magical Thinking

If all other factors remain equal, the higher the price of a good, the less people will demand it. That’s the law of demand, a fundamental idea in economics. And yet there is no shortage of politicians, pundits, policy wonks, and members of the public who insist that raising the price of labor will not have the effect of lessening the demand for workers. In his 2014 State of the Union Address, for example, President Barack Obama called on Congress to raise the national minimum wage from $7.25 to $10.10 an hour. He argued that increasing the minimum wage would “grow the economy for everyone” by giving “businesses customers with more spending money.”

Featured image via YouTube.

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Comments

nordic_prince | February 7, 2015 at 8:15 pm

Raising the minimum wage doesn’t work, and these progressive idiots never learn. Apparently they’ve never heard what happens when you kill the goose that lays the golden eggs ~

See, this is why they are called “laws of economics”. When you violate them, you naturally pay for it.

I saw a good Venn diagram a while back…

one circle was the number of people who believe raising taxes on some thing (say, cigarettes) will cut demand.

The other circle was the number of people who DON’T think raising wages will effect labor demand.

The intersection was Collectivists. Or “too stupid to live”.

    Estragon in reply to Ragspierre. | February 8, 2015 at 12:50 am

    Remember when Hillary was questioned about the effects of raising costs on small businesses? I think it was during her HillaryCare push.

    She said, “Well, I can’t be held responsible for every under-capitalized business in the country.”

    She and Obama have raised a couple of billion dollars, you might think they could have bought a clue along the way.

      NC Mountain Girl in reply to Estragon. | February 8, 2015 at 2:53 pm

      Too bad there isn’t a federal law that all candidates for federal office who support Labor have to unionize both their campaign staffs and their office staffs, if and when elected. Let’s see them paying overtime for those 20 hour days that the staff outs in near the end of the campaign. Heck, its supposed to be such a privilege and an opportunity many of they expect people to work practically for free.

        What good would that do? The increased union wages would just come out of the taxpayers’ pockets after the candidate was elected, and out of donors’ pockets before. Very rare is the officeholder who paid her own way.

Henry Hawkins | February 7, 2015 at 9:45 pm

Well, they say the states are good places to experiment in government policies and programs, perhaps to discover something that will help the whole country.

As a North Carolina resident, I am more than willing to let California lead the nation in proving what doesn’t work.

Raising the minimum wage is a killer in many ways, not just the higher costs to the business owner. It artificially raises the “value” of the workers’ time, so those who actually are worth more get paid the same as the slackers at the bottom. It discourages anyone from trying to work harder to try to get a raise, because the business owner just had to give a raise to everyone, not just the hard workers.

When minimum wage was $5.15, I paid my good employees $7.00 or $8.00. That’s 40-60% above minimum wage. I had a waiting list of kids lined up, wanting a job (at a fast food joint). Now? Everyone makes $7.25, including my kids, and it’s almost impossible to find workers, even in this crappy economy. The good workers have been worn down and have given up, knowing that all they have to do is show up.

If I wanted to pay the good workers 40-60% above minimum wage now, we’re talking $10 to $11.50 and hour. Sorry, but that isn’t going to happen.

Right now, I employ less people than I ever have. So, the few workers I have are having to work harder and do more than in the past. It’s destructive to businesses. It’s destructive to people’s work ethic. It’s destructive to the experience of workers.

The commies running our government don’t care about any of that.

    redc1c4 in reply to windbag. | February 7, 2015 at 10:42 pm

    “The commies running our government don’t care about any of that.”

    actually, that’s exactly what they want… you can’t provide a future, due to their interference, so they will sell the naifs the idea of a governmental intervention…

    votes won, economy destroyed, but they stay in office, so “Winning!”

    Spiny Norman in reply to windbag. | February 7, 2015 at 10:43 pm

    …those who actually are worth more get paid the same as the slackers at the bottom.

    Isn’t that how union contracts work?

    pesanteur in reply to windbag. | February 7, 2015 at 11:01 pm

    Great comment, based on experience probably no one in Obama’s cabinet can either claim or is willing to understand.

HAHAHAHAHAHAHAHAHA…. reality doesn’t care.

stupid Leftards

(yes, that’s redundant.)

Apparently, Obama has the power to suppress, but not retract the natural laws of supply and demand. If his liberal fiscal policies do not close a book store in America, then they will blow up a small, dollar-denominated economy somewhere else.

One thing politicians don’t seem to understand is that a $15.00 per hour employee costs the employer more than $15.00 per hour. When you add in FICA, unemployment, workers compensation and whatever benefits you offer, that figure really starts to grow. They also don’t seem to understand that business owners, unlike politicians, can’t reach into the pockets of their customers and take their money by force.

    randian in reply to Sanddog. | February 8, 2015 at 2:15 am

    I wonder if said politicians think total payroll, and therefore total payroll taxes, will increase as the minimum wage increases.

    No one did the math on-air, but the BASE cost of raising the minimum wage in that situation (on just 3 employees) was about 25,000 per year. Now add bonuses, vacation, taxes, etc. The bookstore owner will wind up working simply to pay his employees, and he will find himself working for BELOW minimum wage.

    By the way, that guy could have a career as the next Spock.

MouseTheLuckyDog | February 7, 2015 at 11:35 pm

I like to point out that during the late 90s you could not find a minimum wage job. Every job paid at least 30% more then minimum wage because unemployment was so small.

The thing to do is grow the economy so unemployment falls and the effective minimum wage is raised instead of doing it artificially with laws.

    legacyrepublican in reply to MouseTheLuckyDog. | February 8, 2015 at 3:25 am

    Plus, not only was real unemployment a small number, it was not a fudged up number like it is today making it look small for political reasons.

He needs to move his bookstore north. That’s where the money is.

How’s this for the liberal mindset: this is a quote from the bookstore owner, in which he says he supports the minimum wage increase knowing it will put him out of business and cause the loss of every job at the bookstore!

The letter was soon seized on by conservative news outlets. On Tuesday, the Web site Breitbart posted an article about the store’s closure with the headline: “Liberals Surprised Beloved Bookstore Closes Due to Minimum Wage Hikes.” By Wednesday, Beatts was fielding inquiries from other conservative outlets about his thoughts on how government regulations are killing small businesses. He explained, with some awkwardness, that he actually supports the minimum-wage increase. “There are tens of thousands of people in this city that are going to benefit,” he told me later. “Businesses are going to pass the costs to consumers, and the product of that money that’s being spent is going to go to the lowest-paid people in this city. I think that’s a good thing. But the mathematics of it says that I can’t keep running my business.”
http://www.newyorker.com/business/currency/minimum-wage-dilemma-san-francisco

That arrogant fool Mika: if there is a hell, she and the rest of the MBNBC crowd will one day be forced to run a small business with small margins, and only be allowed to live on any profits.

The Left hates poor people. Raising the MW makes poor people move somewhere else. They have to follow their jobs.

Libs love minimum wage hikes because it helps drive a sector of the country into economic centralization by driving out small business which cannot tolerate higher payroll in favor of big business which can tolerate them – long enough for the small businesses to disappear.

Remember, it was the individual health plan holders connected to small businesses who were first targeted by Obamacare cancellations. The people of small business are expendable to the left, except where taxes are concerned.

    Progressives love minimum wage hikes because so many union contracts use minimum wage as the basis for their pay scales. When minimum wage goes up, so do union wages.

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