Minimum Wage Robots

Does mandated federal and state minimum wage increases help those struggling on low paying jobs?  Or does it simply give more jobs to robots?

In this opinion piece from the Wall Street Journal, The Minimum Wage Should be Called the Robot Employment Act, Mr. Pudzer makes the case that the increasing minimum wage will do nothing to help low wage earners and will, most likely, force more workers out of the market place as employers, restaurants especially, automate.

It’s already  happening. McDonald’s kiosks are rolling out all over the country. Wendy’s is doing the same thing, and as Mr. Pudzer explains, a California burger joint is going a step further by hiring robots to grill, flip burgers, and put the patties on the buns.

There is no mystery here. Many places simply can’t make a profit where, especially in some areas, the minimum wage is going to hit $15 an hour in the next couple of years. Who will this hurt? Mostly inexperienced youth and it will disproportionately affect minorities. Liberal governance is once again going to be hurting the very population which they say they want to help. But government can’t control capitalism to the degree it needs to in order to for minimum wage laws to work. In order for that to happen, you need to shift everything into a highly controlled mixed if not bordering on command economy. Oh, and with that, you’ll get a loss of freedom and more widespread poverty as everyone becomes the same: unproductive and poor.

I defer to the experts on things like this. One such expert I respect and quote a lot is Thomas Sowell. Do yourself a favor and spend some time on Youtube marveling at his logical and concrete examples. He’ll tell you what minimum wage actually does, it robes the poor and the youth of valuable work experience. The only way a youngster is going to get experience – learn how to show up to work  on time, learn skills, learn to function as a subordinate, etc… – the only way someone is going to get that experience is to get an entry level job. The unemployment rate for under 25 is already high. A higher minimum wage is not going to help that. In fact, it’s going to do the opposite because jobs will be scarcer as companies “hire” robots to fill positions rather than pay an unskilled 18 year old $15 an hour.

I wish the government would  let the market work. Of course, it should look out for abuses and step in when someone is clearly being taken advantage of, but it should stay out of private agreements between individuals. If I agree to work for $8 an hour, I should be allowed to do so, and it is a death to freedom and individuality when I’m told I’m not allowed to work for $8 an hour. But I am allowed to stay at home and gain no experience and no income.

If we don’t let the market work, then we are only giving way to a robotic takeover. I’m afraid there’s no stopping it now.

McDonald’s is a Link to My Past

Perhaps I am the product, indeed. If so, quite the job well-done McDonald’s marketing team!

With all the gluten-free, vegan, anti-milk, and anti-fast food which pass around daily on the web, McDonald’s has certainly taken a hit, and I am certainly not one who will bemoan anyone else wanting to eat healthy by steering clear from modern fast food. Maybe you’ve even seen the post recently about a doctor who has been displaying a McDonald’s burger and fries at their practice for the last few years, seemingly making the point that whatever is put in their food makes it very well preserved and perhaps we shouldn’t put it in our bodies. (Although, my body might need a few preservatives, but that’s another point.)

So I thought, just to be contrary to the persnickety people out there, to write a post shining a positive light on McDonald’s. It’s good to be different, right? OK, here goes.

When I think of McDonald’s, the first memory that pops into my mind is high school youth group and hanging out with a bunch of different girls after some youth event. Yes, we always stopped at McDonald’s and do whatever teens do. Talk, flirt, steal french fries. I still remember what I used to order. How I ate all of this, I’ll never know:

  • 2 Big Macs
  • 1 Regular Hamburger
  • 1 Large Fries
  • 1 Large Coke
  • 1 Hot Fudge Sundae

Just to clarify, this would not have been my dinner. I would have eaten dinner at home around 5:30 or so. This would have been my 9 PM snack. I was so proud of how much I could eat back then.

From high school, move forward to college. This poor college student lived within walking distance of a McDonald’s and, luckily, it would have occasional specials of buy 1 get 1 free Big Mac. Wow! Those were the days. Daily runs down to the arch to fill up what the cafeteria couldn’t do. Or perhaps a late night jaunt with my girl for a quick snack.

Move forward to our first few years living in Vietnam. At that time, Vietnam didn’t even have Coke, let alone anything resembling American fast food. But during our winter break, we would go to Hong Kong. Our leaders always warned us not to over-eat on fast food upon arriving in Hong Kong because our diets in Vietnam were so incredibly different. Well, that was a warning I never heeded. After months of green vegetables, rice, soup, and grilled meats, I wanted a burger! So I would bee-line it to the first “M” I could find and indulge in all that horrible food. It was wonderful, and I never got sick from overindulging or shocking my system. No, indeed. It was like I had finally come home. My stomach felt 12,000 miles away in America. It was content.

So people can say what you will about McDonald’s, and probably most of it will be true. But this is also true – it plays a part – a pleasant part – in the memories and experiences that I have had during many different periods of my life. McDonald’s is like a guilty pleasure always nearby, reminding me of where I came from. The consistency, the taste, the smells, the familiarity, the colors, the brand, the clown, the commercials, the sayings, the conversations, the laughter, the memories. Good or bad, McDonald’s has always been there for me.

That’s all I want to say.

Fast Food, Globalization, and Culture (Part III)

Here’s part III (the final segment) in this series. The most interesting part (in my opinion) of this post is the fascinating way that fast food has helped change and mold certain parts of modern China. 

Read Part I HERE!

Read Part II HERE!

The new fast food culture that has been introduced into many countries over the past thirty years has also had a profound impact on society at large. Many bemoan the presence of fast-food as the homogenization of the world.  Rightly or not, these behemoths of tidy restaurants with standardized food have become the symbol of American cultural imperialism overseas.  They are often the target of activists who complain of the loss of traditional culture at the expense of corporations pushing low wage “McJobs” and low quality “McFood.”  Whether these criticisms are justified or not, these trans-national corporations have changed many countries.

China provides an interesting study of how the fast-food industry used its’ foresight, capital, and perfect timing to impact a nation.  American fast-food has done nothing less than start a consumer revolution in China which has been led by children (Watson 125).  This is not by accident.  McDonald’s took its playbook from Disney when franchise founder Ray Kroc began successfully marketing to children (Schlosser 33); the franchises in China have done the same thing but merely adapted their approach to local circumstances.   Birthday parties, which never existed a generation or two ago in most parts of East Asia, have become commonplace and the fast food industry has become at the center of it (Watson 126).  McDonald’s has become the ‘hang-out’ for grandparents and the study zone for high school students.  McDonald’s and other like-minded places have taken advantage of the changes in Chinese family life and have adapted their offerings to meet the changing needs of society.  In Hong Kong, McDonald’s has become such a part of the fabric of life there that it is difficult to see exactly where the transnational corporations ends and the local begins (Watson 134).  Chinese scholar James Watson claims that fast food did not create a new market but responded to opportunities which were presented by “the collapse of an outdated Confucian family system” (127).  Even the success of KFC in China is largely due to how it has become local in focus (Phillips 41).  Some contend that societal changes brought about by the rise of fast food is not all bad.  Watson cites cases where fast food restaurants have contributed to teaching Chinese mobs how to properly queue while encouraging other restaurants and eating establishments to raise their standards of restaurant cleanliness to match those of the big franchises (Schlosser 128-129).  Whether fast food has improved or degraded society in China and other countries is a matter of opinion.  However, what is clear is that these corporations have used their vast influence, their tax incentives, and their capital to create a fast food niche supported by a massive food production system which previously did not exist.

How should we properly evaluate these trans-national fast food corporations?  Certainly they have impacted food production, labor, and culture.  But they could not have done it all on their own.  It was a combination of government policy and consumer approval which ultimately had its way. Phillips cites various studies that show that the corporate power and impact of food related trans-national corporations is not a “given” but is a byproduct of many different stake-holders including growers, laborers, investors and marketers (41).   Watson adds that global issues must take the consumers’ perspectives into account (134).  Throwing a brick at a McDonald’s in Mumbai to protest globalization seems to be missing the point.  The corporation is just one of the stakeholders that brought it into existence.  The fast food restaurants have become the cultural domain of Muslims in Malaysia, Buddhists in China and Hindus in India.  When you attack their McDonald’s, you are attacking them, and not a foreign entity. The world has asked to have their burger their own way, and the corporations have gladly provided it.

But what ultimately can be expected from these trans-national food corporations?  Can food globalization ever be proactive to spur on competition, protect labor, and purposefully reduce poverty?  Or is production consolidation, degradation of labor, and more power in fewer hands merely the nature of the capitalistic beast which precludes it from productively contributing to a more equitable society?  It may be foolhardy to presume that profit driven corporations would willingly make the right choices concerning the vulnerability of workers and poverty at large when profit is the driving force.  These powerful corporations are the ones receiving the tax breaks, trimming labor costs and consolidating their grip over supply and distribution.  Many trans-national firms do have social responsibility policies that have been built into their corporate framework, but they have mainly come to fruition in order for them to avoid bad publicity which might ruin their name (Jenkins 528); these policies make sure the corporations are avoiding human rights violations rather than positively moving to reduce poverty in their locality (Jenkins 528).  These token gestures are more smoke screens rather than positive steps which might raise wages, ensure health coverage and safe working environments which would ultimately do a lot to help alleviate global poverty.

The fast food corporations are an easy target to criticize. They are big; they are powerful; they are slick marketers, and shrewd managers of capital.  They seem to represent the best and worst of the capitalist system.  By pushing efficiency, standardization and expansion, they create a marginalized workforce and a depleted market for competition especially in the area of food production.  They have globalized common brand names, yet have adapted the brand to suit the local environment.  Whatever the ultimate verdict on their impact will be, it is clear that there is no stopping their expansion. But the world’s governments would do well to scrutinize their food production policies and determine how “… food citizenship may be developed as a sustainable politics to include everyone, not just the privileged” (Phillips 48).

Works Cited

Jenkins, Rhys.  “Globalization, Corporate Social Responsibility and Poverty.”

International Affairs 81, 3 (2005) 525-540.

Krugman, Paul. “We Are Not the World.”  New York Times  13 February 1997, A33.

Phillips, Lynne. “Food and Globalization.” Annual Review of Anthropology 35.1 (2006): 37-57.

Schlosser, Eric. Fast Food Nation. New York: Harper Perennial, 2005.

Shari, Ishak. “Globalisation and Economic Insecurity: A Need for a New Social Policy in Malaysia.” Asian Journal of Social Science 31.2 (2003): 251-270.

Watson, James L. “China’s Big Mac Attack.” Foreign Affairs 79.3 (2000): 120-134.

Fast Food, Globalization, and Culture (Part II)

Here’s part two of a three part series.

Read Part I HERE!

Many of these food related trans-national corporations are now controlling a large portion of food production and distribution in various parts of the world (Phillips 40).  McDonald’s and other trans-national franchises do not merely set up restaurants overseas but import entire systems of agricultural production (Schlosser 230) by spending years preparing the food and supply lines which will enable them to maintain consistency in quality and presentation from one country to the next.  More than five years before McDonald’s entered India, they began to teach Indian farmers how to grow ice berg lettuce by providing them with the specially designed seeds (Schlosser 230).  This approach puts a growing number of farmers more and more dependent on these corporations.  The list of companies who are currently controlling a large portion of overseas food production in many countries is a veritable list of powerful American led corporations (Schlosser 230-231) who have pushed expansion and consolidation in every market they have entered.  These expansions are in a never ending search for new markets and cheaper labor (Phillips 40) and they are having a strong impact on government policy regarding economic development, capital, and labor.  Ishak Shari from the Institute of Malaysian and International Studies writes “national production systems are increasingly determined by foreign development, and links between firms and parts of transnational enterprise are increasing” (254).  As the food production system continues to be globalized and consolidated, many small overseas farmers like their American counterparts have found themselves in very vulnerable positions (Phillips 41). As the small farmer gives way to larger corporate farms, the continued consolidation will undoubtedly have serious consequences for labor and poverty.

Countries are drawn to trans-national corporations for the promise of capital investment which will, hopefully, spur on development, increase wage earning potential, and help alleviate poverty and unemployment.  These corporations and the capital they bring with them have become major elements into how a country writes labor and social policy (Shari 253).  In many respects, countries desperate for investment increasingly make business conditions more favorable to entice these trans-national corporations.  These investment incentives and enticements give corporations huge advantages which are often too good to ignore.  Shari argues that one of the changes that has occurred is that as capital has become more mobile than labor, the tax burden has been shifted away from capital and placed onto labor (254).  Countries are now competing for foreign investment by offering subsidies for capital investment; the one offering the greatest subsidies wins the investment while other countries are left behind (Shari 254).  Labor is taxed, but capital is subsidized.  This is an example of how money talks and those without it are put at a decided disadvantage.   In essence, the labor and working class of many foreign nations end up subsidizing large, wealthy corporations by virtue of using their tax revenue to subsidize foreign investment.  The carrot at the end of a trans-national corporation’s stick is often too tempting for a developing country to pass up especially with the alternatives of having less investment being even less appetizing; however, the fact remains that the workers and the farmers are often the ones caught in the middle.

The large fast food corporations have brought about large consequences for domestic and overseas labor.  In America, they have created minimum wage jobs which require little training and very little independent thinking.  The consolidation of food production has led to low wage immigrant jobs in the food processing plants and even poverty wages for illegal immigrants (Schlosser 150).  These immigrants often have no recourse of action if their labor is abused and end up being stuck in poverty-like situations.  The same has become true for many of their overseas counterparts. The need for corporate profit continues to push firms to find ways to minimize labor costs whether it is through finding cheap labor overseas or by importing foreign workers who are willing to work for less. More and more overseas firms are depending on temporary workers, part-time workers and outsourcing (Shari 255).   Anyway you look at it the labor force is being pushed around by corporate initiatives and government policies which often allow and encourage these actions.  We must, however, temper our criticism of the trans-national corporations by acknowledging foreign investment has literally helped millions of third world workers who now have unprecedented opportunities because of global expansion (Krugman 33). The wages received by many workers may be low and the conditions may be poor, but it is often better than what they would receive by working for a local company.