Monday, September 02, 2013

Fast food and class warfare

CAUTION: The fast food wage debate is heating up. Get too close and you could get burned.  Consider recent actions against McDonald's undertaken by labor unions and community organizers and then...
Big Mac
Wikipedia image
read Al Lewis' column, ("Let Them Eat Burgers" September 1, 2013).  Lewis concludes a super-sized minimum wage increase is justified on the basis of a single data point (average age of minimum wage workers has increased) and comparison to an Australian business model.  

Mr. Lewis' account of a recent protest demonstration, reminds me of the danger I've been talking about since 2008.  Here's the story...

A mob is demanding a doubling of the minimum wage to $15 an hour, in front of a Denver-area McDonald's which had to shut down because of the ruckus.  Lewis interviews a man working at McDonald's (albeit a different McDonald's) -- twenty-six year old Dakota Bosma, who had this to say about his employer, 

"They'd rather line their own pockets, than take care of us." 

According to the Bureau of Labor Statistics (BLS), there are over four million workers employed at fast food establishments in the U.S. and half work part time. Turnover is high and this job pool is expected to narrow as new technologies become cost efficient alternatives to tasks currently performed by humans.

The education level required to perform most of these jobs is less than a high-school education.  Such jobs were not conceived as self-sustaining careers.  They are low skilled, temporary positions for which the market pays a correspondingly low wage.  Nothing wrong with the work of course -- most of us have performed such jobs -- I have -- and I take Lewis' point that if the average age of minimum wage workers is increasing, it says something troubling about the employment picture.  I never said that no increase is warranted.  So far, we're fine.

However, does McDonald’s have a primary responsibility to "take care of us" or satisfy their customers, franchisees and shareholders?  What are the larger implications to our system if a corporation like McDonald's is pressured to act less like a great American business than a social safety net that also sells burgers?

What motivates these protests?  Is it a feeling that one has no choice?  What disturbs me most is the implication that employees are "owed" more by McDonald's.  Most McDonald's restaurants are not even owned by McDonald's Corporation -- they are franchised to individuals or small businesses that pay royalties and franchise fees to McDonald's. This fact might not matter to Mr. Bosma who added,

"The corporation makes billions of dollars every year -- they can afford to pay us $15".

Piling on, Mr. Lewis writes, "Companies have paid the lowest wages they could, for as many years as they could" but Mr. Lewis fails to add that unions sought higher wages and benefits with capped productivity requirements.  It's called labor negotiation.

Microsoft Clip Art