What a dumb comment. There are a lot of people who mortgage everything they ever worked for in order to buy a fast food franchise. A good number of these people aren't rich as you would think them to be. Good job trying to come up with a fictitious boogeyman. You never did address, in all of your "scholarly" musings, the issue of price elasticity in the low cost food industry. I wonder why that is...
Probably because he doesn't know what you are talking about.....? Is there some evidence that an across the board increase in the minimum wage is going to spur a massive shift into Hot Pockets or non fast food items? I don't know if there is - and why should we care even if so? So more people buy bread and make sandwiches (from a supply chain that's also subject to a higher minimum wage). Hell there's probably a substantial public health benefit if that even happened. The better argument btw is that multibillion dollar companies like McDonald s and Walmart are only able to get away with only paying a sub poverty level min wage because their workers are subsidized by public assistance programs to make up for the shortfall. Why should the government subsidize their (or even the noble small businessmans) labor costs? edit: Here is a good ritholz piece on this:
FWIW, I don't see where he said anything about fast food franchise owners being rich. He talked about how many rich people who are eager to avoid paying taxes ignore statistics and data in favor of "common sense" in the form of Fox provided talking points.
I think there's a big hole in that argument. As I've said many times before, McDonalds/Walmarts are employing minimum wage labor b/c it's cheaper than automated alternatives. However, if minimum wage keeps rising, then companies will make greater use of automation (i.e. self-service kiosks). Once that happens, what do you suppose will happen to all of those displaced, unskilled workers?
Raising the minimum wage isn't as important to the cost of the Big Mac as to its effect on all jobs. If somebody can make over $30K doing the simplest of tasks, why bother spending time/money to improve skills towards jobs that pay that wage now, unless they substantially increase those pay rates as well? Those jobs won't have to double compensation, but they will have to increase somewhat substantially. The major problem with minimum wage jobs, is most often scheduling. It is hard to find a minimum wage job with a fixed full-time schedule (w/ vacation), so instead of making $15K/year, they end up making less than $10K.
False choice, son. Increasing minimum wage is one of the main ways to get people out of poverty. Go back to your trickle down theories, though they are getting a bit long in the tooth. What will be the next spin to justify transferring more money from the poor and middle class to the elite?
And what happens to those people when, due to increases in minimum wage, automation becomes a cheaper source of production than unskilled workers?
Would you say that increasing the minimum wage is absolutely, 100% necessary under all circumstances to lift people out of poverty, or could other options exist?
Here is the main article, I forgot to link it. http://www.bloomberg.com/news/2013-12-17/the-minimum-wage-and-mcdonald-s-welfare.html Jobs at Wal Mart and McD's will be automated when they can be automated - right now they can't be without an *epic* capital investment. The fact of the matter is that somebody cleaning toilets at 10 bucks an hour is still far cheaper than a magic toilet cleaning robot, including all in costs. My question to you is why we should care? - let's publicly subsidize McD's and Wal-Marts cost of inputs to keep them from being automated - why does this particulary industry deserve to be saved from the automation grinder more so than any other? Why low-wage fast food workers and not secretaries, e.g.? If you care about market-distroting impacts being minimized, as many free-marketeers profess to - this is a huge factor.
Hey it may be necessary to "pay" some folks to not work if automation increases. Quit fighting modernity. Actually there is an unlimited need for many important services, such as psychotherapy, tutoring of kids who are falling behind in school, substance abuse counseling, basic legal services and personal financial planning etc, but there is no money demand for these needs. Let's have paid government workers or perhaps contractors paid by the government to do this. I know the well off don't need this as they have the money to pay on the private market for these services, so why do it? Well, many, including such religious leaders, such as Pope Francis feel that an economy should not be just run for the well off.
. Not necessarily. Well you could just give folks government support to supplement their very low paying wages as we do now. You could just transfer money to poor folksif they work or not. I think it is good for people to get the experience of actually supporting themselves through their work. I sort of thought that conservatives thought that, too?
Of course not all minimum wage jobs can be easily automated. But a great deal can. Let's say that Wal-Mart/McD's does automate many of the minimum-wage functions. What happens to those displaced, unskilled workers? They'll most likely turn to the government for further financial assistance, right? Are you ok with the government providing that level of support? I'm not. That's why we should care.
If they can be, than they will be - then they will be. What you're arguing is that the magic zone of where automation lies somwhere between 7-and 10 dollars an hour - do you have any eveidence at all to support that this is a significant worry in this particular industy (i.e., there is a magic burger making robot that costs 8.50/hour to operate) or you're just arguing pure conjecture? That's not what I'm asking you - I'm asking you why this particular industry (which is not easily automated, or else it would have been already, wouldn't it?) deserves to be saved from the mechanical scourge where others do not? Look, your whole argument is speculative - what's not specualtion is that McD's is exploiting a loophole to pay less for labor than it should actually cost. Why should the government continue to subsidize this loophole?
Self-ordering fast food kiosks can already be found in Europe. Which industry are you referring to? Retail? Fast food? It doesn't matter. I'm talking about any industry that relies mainly on minimum wage labor. Everyone's argument is speculative. Even if you take studies based on historical changes to minimum wage and its effect on unemployment, it's still speculative to try and apply that to the unknown future. If the government doesn't pay a little now, it'll pay a lot more later. That's why the government should continue to subsidize this loophole.Sure, that's speculation, but that's the logical conclusion. Can you think of an alternative?
Indeed - yet the vast majority of fast-food in Europe is sold at old-fashioned brick and mortar stores by human beings. What you need to show is this: 1. scalable technology for fast food worker replacement exists 2. cost of this technology is somewhere north of 7 bucks an hour + expenses yet south of 10 bucks an hour + expenses 3. Switching costs/other considerations won't prohibit this (i.e. - this is a valid substitute/replacement for a store. You're about 10% done with number 1. Good luck with the rest of it. It's not a logical conclusion if it's based on factual assumptions that you're basing them on aren't true. And right now, you haven't proven a single assumption - and it doesn't look like you're going to be able to. We should raise the minimum wage and stop giving a subsidy to McDonalds et al. The evidence does not support the view that this will lead to millions, hundres, or thousands out of work. Full stop.
For the 9 millionth time McDonald's and fast food franchises are not multibillion dollar entities. If you are going to complain about fast food workers making $9/hr then you need to complain about every small business in America paying younger people $9/hr. Secondly, the average age of a fast food worker is 28 and the average age of the American worker is 42. So we are dealing with a much younger, less skilled, and less educated worker at fast food restaurants. Additionally, any reasonable changes to minimum wage laws wouldn't give younger workers living wages. The min wage should be adjusted by age.
For the first time, McDonalds has a market cap ~100 billion dollars. That fits the bill. I understand that there's a franchising model in place (though MCD's itself owns 15% of the stores...) - that doesn't change fact that McDonald's Corp isn't the single largest beneficiary of these subsidies indirectly, if not directly. It's irrelevant to the ultimate problem here. OH NOES, the poor small businessman - why should we distort every discussion around one of the smaller yet more romantic interest groups around that really doesn't mean sh-t in terms of employment or growth compared to large corporations? But if it matters - consider me complaining about them as well - you happy? Who cares if they're younger - most of them have families to support which is what this graphic shows: If you don't see anything anomalous about this I don't know what to say.
