Business in New Orleans
Submitted from Dave Gallagher:
I was sitting at Starbucks this morning sipping a Venti Latte which I obtained via a mutually beneficial voluntary exchange. My companion, a good natured but eternally self contradicting "progressive" had been yacking about "Big Oil" price gouging. I flipped open the local paper to the business section where the following article caught my eye.
BATON ROUGE, La. - Burger King is offering a $6,000 signing bonus to anyone who agrees to work for a year at one of its New Orleans outlets. Rally's, a local restaurant chain, has nearly doubled its pay for new employees to $10 an hour...
- On any given day, contractors and business owners pass out flyers in downtown New Orleans promising $17 to $20 an hour, plus benefits, for people willing to swing a sledgehammer or cart away stinking debris from homes and businesses devastated by Hurricane Katrina ...
"I'd say I'm paying two to three times as much as I would in normal circumstances," said Iggie Perrin, the president of Southern Electronics, a supplier in New Orleans, who has offered as much as $30 an hour when seeking salvage workers on Canal Street...
"This region is going to be going through a huge boom for the next three to five years rebuilding the coast," Bollinger said. "That's very good news for those who want work and really worrisome news for employers who have to compete with everyone else for labor."...
For Bollinger, welders are just one of his labor headaches. His company pays welders $16 to $17 an hour. "When Sheetrock layers start paying $25 an hour," he said, "I'm either going to match it or I'm out of luck...."
And the money line:
"Employees are these precious commodities right now," said John Kallenborn, president of the New Orleans region for J.P. Morgan Chase.
I immediately thought of Lew Rockwell's excellent talk on Free Markets at work following natural disasters.
We've already had the requisite claims of how wonderful Katrina will be for the economy.
I wanted to read the article to my friend, but I new this would invite a lecture on the tireless fight of the Democrats to re-instate Davis-Bacon.
So instead I enjoyed my Latte in grateful contemplation that I was at least one Senate price gouging inquiry from being limited to a Venti "Victory" Coffe.
Comments (9)
Such a wonderful surplus of cash they have, thanks to the thoughtful government. Could NO be the first city in America to experience $10 loaves of bread?
Published: November 13, 2005 3:48 PM
Yes, they have a surplus of cash, but those without a real plan will simply burn through it. New Orleans will come back stronger and better than ever simply because of competition. The city is being inundated with entrepeneurs and risk takers.
Published: November 13, 2005 4:24 PM
An influx of entrepreneurs is indeed good news. I suppose the smell of fresh fiat is compelling.
Why do I sense Venti-sized graft brewing? I mean, I don't recall NO having any real history of public corruption.
Published: November 14, 2005 12:48 AM
New Orleans' wages for low-skilled workers were depressed by having so many of them (i.e., "working poor") around. I remember reading about a woman who was making $5.15/hr (minimum wage) at Church's Fried Chicken. Elsewhere, experienced fast food workers make $7-10/hour and managers complain about losing entire crews over a nickel an hour more from a competitor.
This particular woman was pleasantly surprised that she could make much more as a fast food worker in Houston, along with a higher quality of life, so that's where she was staying.
Like all such disasters, there is a perverse good side. Doubtless though, government grift will screw that up as well. Though there are some indications that the white bluebloods are, via the explicit threat of capital flight, trying to ensure that the rebuilt city follows the Atlanta model instead of the Detroit model.
Published: November 14, 2005 9:01 AM
shouldn't these workers be charged with PRICE GOUGING -- benefitting financially from a crisis
it seems if the logic holds that big oil is guilty of benefitting from supply disruptions -- then shouldn't these workers also be subject to any "windfall" tax if passed
Published: November 14, 2005 1:14 PM
bob, you are right, these greedy bastards must be punished for their gouging. And because they are working in the same city they obviously have a collusive arrangements to screw the people they work for. They are violating anti-trust laws. I suggest FEMA should return to harass the citizens again. Unless the governmnt declares New Orleans a "no mans land" - we will continue to see atrocities like these.
Published: November 14, 2005 2:33 PM
Sure, guys, and you know what they'd if workers were charged with gouging? Shortages! So the shoe really IS on the other foot! Good comments, all.
Jeff, you're WAY too nice of a guy. I would have had that whole Starbucks in a donnybrook if it were me! :o)
Published: November 14, 2005 4:00 PM
When I think about the situation with current gas prices I go back to 1973,when reg. unleaded gas was 29.9 per gallon. I was involved with a tanker transport Company at that time. The Oil Companies began teir crusade for $3.00 a gallon gasoline. There was several Independent Oil Companies around in those days,most were dependant on the Major Oil Companies for their supply,they were forced out.
The Oil Companies created shortages by cutting production and closing refineries over the next several years. In the early seventies were importing 43% of the oil necessary to meet the demand. I am not priviledged with the current percentage imported,my point is,simple math determines there is something wrong with the picture.
The recent tragedy in New Orleans and the outrageous profits admited by the Oil Companies that followed should be reason enough for anyone to be suspicious of Major Oil.
Published: November 24, 2005 2:17 PM
In regards to the woman who went to Houston making more money at a fast food joint, what would you do? Especially with the price-gouging from the landlords here which fema will be paying some which "we" will be paying back. New Orleans could be a great city if we allow quality wages to fit the cost of quality living. The month pre-katrina, "New Orleans" magazine stated the average two income family made 28,000 a year and the average cost for a "middle" home cost 350,000.
America is a rich country yet we have an enormous increasing job wage gap which diminishes socialization between people and promotes proverty/crime.
Hopefully, the politics here will use the minds and financial powers to rejuvenate this great city & state and not destroy it.
Published: January 8, 2006 7:08 PM