Q1 Food Policy : Why ADSP & ACP Are In Economic Error
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by Australian Warlord
The ADSP/ACP demands that Q1 food remains at $1. Simple fact, Q1 food at $1 results in a loss. The demand for Q1 food at $1 is merely linked to their ideological dislike of people progressing.
Current economics is as follows.
Worker level 4 85% wellness produces 16.2 food.
16.2 food x $1 = $16.2
$16.2 minus 10% tax = $14.58
$ 14.58 is the amount of money a eBusiness has to pay for expenses plus make it's own living.
Wheat costs $0.40.
1 wheat = 1 food
Worker produces 16.2 food
Therefore $0.4 (wheat) x 16.2 = $ 6.48
Now we have income (per worker) after tax of $14.58
We have wheat costing $6.48
$ 14.58 - $ 6.48 = $ 8.10
Therefore for the eBusiness to make a profit, the wage of this level 4 worker can be no more than $8.10
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This is a problem. That's because wages for level 4 land is currently $ 14. That means that at the price demanded by ADSP, a Q1 food eBusiness would lose $ 5.90 per worker. And this is assuming that the eBusiness is operating at peak efficiency. Such a eBusiness can expect to lose 59 AUD per day.
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ADSP/ACP's pricing policy is a clear fail. What everybody should be asking ADSP is whether they want all Q1 food eBusinesses to fail & close up shop (resulting in no Q1 food) or do they intend to force everybodies wages to be drastically cut?
Everybody ask yourselves, do you believe that you should have your eWage cut in half, just for ADSP/ACP ideological ideals? If not then vote AIP, TBP or a carefully selected ANP candidate.
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have you spoken to any Q1 GMs? I have and 1AUD is a not only break even, it can be profitable. BTW Q4 workers shouldn't be in a Q1 company
Level 4 workers is the average active worker here. If however the average worker was level 2 (manu) then you have a following basic calculation
L2 50% wellness (they normally haven't fought) = 6 x Q1 food produced = $5.40 after tax
6 wheat = $2.40
$5.40 - $2.40 = $3
L2 manu wages are between $4 & $6.50
Therefore again a loss. Infact even if by some miracle the L2 worker got 85% wellness, a Q1 food eBusiness would still make a loss at current market eWages. As such the only Q1 food eBusiness that can currently make a profit at $1 for food are those with slave labour.
ADSP is supporting the players and people. What your suggesting is looking out for one thing, profit.
If you don't agree to a country holding its people over financial profit, then what exactly is your goal in congress ?
The ADSP policy is for economic failure. How can it serve anybodies interest for a eEconomy to fail & collapse. Secondly surely giving people the opportunity to progress in this game is what's in peoples interest. Surely nobody wants to be a slave forever.
Simple fact, for the ADSP Q1 food pricing policy to hold yet not cause the collapse of the Q1 food market, average wages have to fall by almost 50%.
What ADSP congress members can't understand is that any business that makes losses will eventually close. It's a basic economic fact. It's as true here as in the real world.
As such the only thing ADSP promises in their Q1 food policy is either a dramatic fall in eWages or the ultimate collapse of the Q1 food market.
ADSP has been in power for 5 months AW our economy has been in good shape. AW have you spoken to any Q1 owners? I have a sneaky suspicion your figures are wrong
AW... I try to see the good side in having such an influential critical voice in Australia... but dammit, you suck at it.
We built the economic model using corny-ratbag's GM Records. It doesn't lie. The RRP works. Period.
BTW... why the ACP? They've never been in power, far from it in fact. Your own party True Blue is more like ADSP than ACP.
In fact, I believe corny, a proud believer in the RRP, is your very own PP.
Also let's look at one more thing:
Raw Materials company's only have to pay wages to workers, whilst manufacturing companies pay for raw materials & wages.
So why is it in your example a Q1 grain producer can sell at $0.40 and yet you claim a Q1 food can't sell at $1.00 when it SHOULD by your example be able to sell at $0.80.
- This is because labour costs would be the same - $0.40
- Raw material costs are $0.40
Hence by your example a Q1 food company should MAKE a 25% profit if it sells at $1.00. Fairly reasonable profit.
Also again you're failing to recognise that the RRP is only recommended (amazing considering the word recommended is part of the acronym RRP). The government never has nor will be able to 'force' companies to sell at any designated price. Thus the free market continues to work whilst the RRP & recommended wages guide helps, in combination with other guides/tools, new GM's work out the viability of different projects (companies).
I would like to take up another problem with the Australian economy.
I currently own an gift Q2 company in Canada with a license to Australia, however, with a import tax on 99% my company got it much harder.
Australia currently hold 2 offers on the gift Q2 market, both over 5 AUD. I could lower the price to a new extrem low so that all the aussies could afford Q2 gifts, but with the current economic policy you will just have to live with Q2 gifts at 5 AUD.
Pez wrote a great article recently. Let the Free Market work. It will find a profit for the Q1 GMs and an affordable price for the consumer. 🙂
John (Icey1174)
In part i agree with AW here, but not from a profit point.
Having waded into this debate a week ago, i don't think $1 is necessarily the solution, and i'm not sure anyone is expecting that. But going back to a situation where new people cannot afford Q1 food would certainly be worse.
Perhaps wages do need to come, not sure about that - but somewhere there needs to be a line drawn. Quite simply the cost of Q1 food should not exceed the minimum wage.
Double the minimum wage and it may solve all the issues ?
What Im still trying to grasp is that your a supporter of free enterprise, yet your blaming the government for not doing enough?
http://www.aviecreative.com/egovernment/index.php?department=11" target="_blank">http://www.aviecreative.com/egovernment/[..]t=11
http://erepstats.com/en/default/work" target="_blank">http://erepstats.com/en/default/work
These two sites have the same result. 16.2 Q1 food produced. The maths is quite basic from there. If Patti thinks the maths is wrong then surely he'd be able to point out where it's wrong. I challenge the ADSP to show the error in my maths.
@Son of Rambo : You do realise that there's a difference between the production of raw materials & manufactured goods. A Q1 raw materials eBusiness may not (probably not) be able to make a profit however a Q3 raw materials eBusiness would be able to.
@Son of Rambo : RRP. Maybe you should tell the ADSP what it means. That's because members of the ADSP are continuously attempting to enforce it. As little as two weeks ago we saw Cottus writting to employees of a eBusiness telling them to leave because of high eWages, ePrices & a (false) claim that it wasn't eAustralian.
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@patti11 : Economy in good shape??? The eAus news is filled with many articles relating to unstable product prices. That's not a sign of stability. I'm not going to blame the ADSP for that. However could you tell everybody why the budget is massively in the red or what plans there are to correct this?
@Patti, have you ever *left* eAus? Actually spent any time in healthy economies?
For both my responses.. I haven't received an answer.
I can say I am disappointed at the least.
See 4th Comment Pred.
Fair Enough, and my second response?
@AW: 16.2 food is indeed correct. Wage btw for land is not 14AUD, and if it was when you wrote this article I guarantee it wasn't, due to the fact my Q4 food company picked up workers at 12AUD. I didn't mean your math was wrong but your actual figures. No GM would hire 10 Q4 workers in a Q1 company. That is 162 food a day, and no company would sell that much. Running a company requires a lot of skill, to get the right mix of employee's possible and not to be sucked into wage battles.
At the time of printing, the standard market wage for a level 4 manufacturing worker in a Q1 eBusiness was $14.
However even if it was $12, a Q1 food eBusiness would still make a massive loss as brake even is $8 for employee wages (if Q1 food is $1).
http://www.erepublik.com/en/company-employees/australian-food-189673/1" target="_blank">http://www.erepublik.com/en/company-empl[..]673/1 average = 3.7 (est)
http://www.erepublik.com/en/company-employees/eradicate-foods-187245/1" target="_blank">http://www.erepublik.com/en/company-empl[..]245/1 average = 4.3 (est)
Some Q1 food eBusiness clearly do have these employees as the standard worker.
this 12AUD was for a Q4 company. No Q1 GM in the right state of mind would or shuld compete against Q4 companies in wage battles. Q1 companies at Q4 should be around 8AUD if they were needed in a Q1 company. As I said previously, no Q1 food company should be having Q4 workers as the supply would not meet the demand.
GREAT NEWS!
Our Governments over magnification and quick reaction of a short term spike in Q1 Food pricing and our governments refusal to stay out of the Free Market has resulted in many new Q1 Food companies and as of right now there are 2000+ pieces of Q1 Food both on the market and in company inventories.
We go from a "crisis" of people paying a little more money for a couple days of their early elife for Q1 Food to dozens of employees that work for companies that can not afford strong wages to a new crises of way too much food and no real demand for it. Not to mention all the Gold that was wasted creating the new Q1 Food companies in hopes of "cashing in" on a good business.
Could our Government PLEASE keep their dirty little hands out of the Free Market and JUST LET IT WORK! 🙂
AGAIN I ask, who is starving because they cannot buy Q1 Food at 1.5 AUD? NOBODY has yet to produce one single person for me. 🙂
John
I'm going to have to use a net meme here, if you are using +s4 workers in a Q1 then "your doing it wrong".
Those workers should be in Q2+ earning a better wage and producing more for their skill, THATS the free market at work...
@AW - yes i do understand the difference between RM & manufacting companies and even if your figures were based on a Q3 grain company (please specify next time) the point is that you still have a 150% increase in the amount the manufacturing company is charging for labour compared to the grain company.
Also as a member of ADSP, i've never once been notified of a policy requiring companies to stick to the RRP. I've discussed with several prominent ADSP members about starting up my own business and never has my pricing (which didn't match the RRP) come up as an issue. Furthermore i believe the incident with cottus was more a mis-communication in the idea between personal and official mail. I agree this is an ongoing problem for ministers and the senate and some means to make this 100% clear in the future needs to be found.
Long story short AW, RRP are recommended, and all of this is hypothetical. The Q1 companies aren't going bust and so therefore i don't see what all this complaining is about. If it was just political point scoring before the election, fine. But i hope once you're in senate (which so far looks to be a good likelihood) you'll do less hypothetical situations and more real ones.
Well Said Rambo, And Completely Spot On.
This article and debate is so awesome. I love it and AUS needs much more of it in order to keep ecitizens thinking about the economy, problems and solutions. Even if you disagree with the article or think the numbers are slightly off, please vote for this article so that we can promote this type of rational thinking and debating.
Where's my last commnent on how we should we vote for this to promote this type of debate and critical thinking in AUS?
For the ACP perspective here. The fact of the matter is that expensive Q1 food massively disadvantages new players. If food is more expensive that the minimum wage then these players will not be able to afford it and will starve.
Its less a question of economics and more a question of social justice.
If a govt company was providing Q1 food for cheap then they could afford to take the loss, and force the competition down to more reasonable prices for everyone
Perhaps they should lower the taxes.
Besides, in a country without wars, you can't expect a level 4 worker to work in any company higher than Q2.