How McDonald's and Wal-Mart Became Welfare Queens
- Thread starter Banjo
- Start date
article is spot on
Oy vey, where to begin here. OK kids, here we go. First of all, let's start with correlation does not lead to causation. These people are not on welfare BECAUSE they work at mcdonalds or walmart, they are on welfare despite it. They were on welfare before walmart hired them and they will be on welfare after walmart fires them. To try to indict firms in this mess is absurd. In fact, let's take this a step further. If walmart did NOT hire them, where would these people go? Goldman Sachs? Selling option premium next to Richard Ryhmes? LOL. No, they would be taking even more welfare from the state. It's best to think of walmart and mcdonalds as a subsidy to their existing welfare.
Now, let's look at these "solutions" proposed. Raising minimum wage. The math has been done on this forwards and backwards. The net effect is a marginal increase in prices to the very goods that poor people purchase and a marginal decrease in employment for those working low skilled jobs. In other words, the net effect is zero for the worker. The money would be MUCH better spent EDUCATING these people into SKILLED jobs so their wages increase naturally as a by-product of actually adding value to the economic system instead of destroying economic value by overpaying for labor.
Now, as for the ludicrous idea of charging the firms for the welfare support their employees receive? Oh this one is too easy. They'll simply hire less of them. You've essentially put price tags on these people's heads that will allow employers to single out anyone who actually needs the work the most. Brilliant idea!
And Barry Ritholz is not middle of the road. He makes Obama look like a member of the tea party. I've been reading Barry for years and the guy always appears one blog post away from cutting his ear off. Why the left in this country can't understand that there is a solution to poverty. One that has been mathematically proven time and time again with statistical significance and that is education. But the left has destroyed our public schools, made college unaffordable and destroyed the middle class economically to the point where for many, the only options are low skilled jobs or the military. It comes as no surprise to me that they continue to push welfare as the final solution.
Now, let's look at these "solutions" proposed. Raising minimum wage. The math has been done on this forwards and backwards. The net effect is a marginal increase in prices to the very goods that poor people purchase and a marginal decrease in employment for those working low skilled jobs. In other words, the net effect is zero for the worker. The money would be MUCH better spent EDUCATING these people into SKILLED jobs so their wages increase naturally as a by-product of actually adding value to the economic system instead of destroying economic value by overpaying for labor.
Now, as for the ludicrous idea of charging the firms for the welfare support their employees receive? Oh this one is too easy. They'll simply hire less of them. You've essentially put price tags on these people's heads that will allow employers to single out anyone who actually needs the work the most. Brilliant idea!
And Barry Ritholz is not middle of the road. He makes Obama look like a member of the tea party. I've been reading Barry for years and the guy always appears one blog post away from cutting his ear off. Why the left in this country can't understand that there is a solution to poverty. One that has been mathematically proven time and time again with statistical significance and that is education. But the left has destroyed our public schools, made college unaffordable and destroyed the middle class economically to the point where for many, the only options are low skilled jobs or the military. It comes as no surprise to me that they continue to push welfare as the final solution.
I am wondering when McDonalds will be able to operate a store without humans..
pay them a penny for every hamburger served.
first question prospective employee asks management at job interview, "What are the sales projections for the upcoming year?"
"Is there a bonus if we exceed the daily quota?"
"If business is good, do we have to close at midnight?"
first question prospective employee asks management at job interview, "What are the sales projections for the upcoming year?"
"Is there a bonus if we exceed the daily quota?"
"If business is good, do we have to close at midnight?"
When I worked at McD's, way back in 1968, it really wasn't what most people would call a career opportunity. It shouldn't be today either. People bagging burgers for 5, 10, 15 years really don't have much ambition.
However, I can say this. For those with ambition, one can go far at McD. There were 3 guys I know that stayed on at Mac's after we all graduated High School. We gave them hell for being losers, but they went on to be quite successful with the company. One became a V.P. in Marketing, and the other two went on to become store owners. None of the three came from a wealthy family. They/We were all the sons of steel workers. Of course, this was many moons ago when people were actually willing to work for, and earn their way up the ladder of success.
BTW, I made 90 cents an hour and was walking in tall cotton on payday.
Edit: This has got me thinking about how the pay has increased for these type jobs. In 1974 a Journeyman Machinist was making just under 8 bucks an hour in a Union Shop. I know, cause that's the job I had. A fast food worker was probably making a buck and a quarter or so at the same time. So we fast forward to today. Fast food worker making about 8 bucks an hour, say a 700% increase. I can tell you with absolute certainty that there are no Journeyman Machinists making 56 dollars an hour, union or not. So it appears the pay scale has done quite well for the lower level workers in our society when compared to skilled blue collar labor.
However, I can say this. For those with ambition, one can go far at McD. There were 3 guys I know that stayed on at Mac's after we all graduated High School. We gave them hell for being losers, but they went on to be quite successful with the company. One became a V.P. in Marketing, and the other two went on to become store owners. None of the three came from a wealthy family. They/We were all the sons of steel workers. Of course, this was many moons ago when people were actually willing to work for, and earn their way up the ladder of success.
BTW, I made 90 cents an hour and was walking in tall cotton on payday.
Edit: This has got me thinking about how the pay has increased for these type jobs. In 1974 a Journeyman Machinist was making just under 8 bucks an hour in a Union Shop. I know, cause that's the job I had. A fast food worker was probably making a buck and a quarter or so at the same time. So we fast forward to today. Fast food worker making about 8 bucks an hour, say a 700% increase. I can tell you with absolute certainty that there are no Journeyman Machinists making 56 dollars an hour, union or not. So it appears the pay scale has done quite well for the lower level workers in our society when compared to skilled blue collar labor.
Right, these jobs were always geared towards younger people who just needed a part time job in high school or college. When McDonalds started out and Walmart as well, these were never jobs that were suppose to be targeted towards adults. It's just that out government has screwed things up so badly that working at Walmart and McDonalds is now a full time job for many older adults and even educated adults. I guess Barry didn't want to talk about that.
Who in their right mind would expect bagging groceries or flipping burgers to pay enough to support a family, let alone a single person?
Maybe in Sioux City Iowa or somewhere that real estate, gas, food, etc ,etc are more inexpensive. Maybe.
This pablum that the world owes you a living is going to be the end of us.
These types of jobs are for young people looking to get into the workforce and get work experience. Then when they realize they are spinning their wheels and the world doesnt give a sh*t they put down the blunt and get serious about acquiring employable skills. College, real world, or otherwise.
They are also supplementary jobs or 2nd or even 3rd jobs that a guy already working 40+ hrs/week would take on to get ahead.
Maybe in Sioux City Iowa or somewhere that real estate, gas, food, etc ,etc are more inexpensive. Maybe.
This pablum that the world owes you a living is going to be the end of us.
These types of jobs are for young people looking to get into the workforce and get work experience. Then when they realize they are spinning their wheels and the world doesnt give a sh*t they put down the blunt and get serious about acquiring employable skills. College, real world, or otherwise.
They are also supplementary jobs or 2nd or even 3rd jobs that a guy already working 40+ hrs/week would take on to get ahead.
I enjoy many of your posts, as they not only express valid alternative views based on informed opinion, you obviously read, but they are usually clever as well. I never expected to see what ails our public schools quite so succinctly expressed as in your correct observation that "...the left has destroyed our public schools.." Though this neither explains how, nor recognizes that the destruction occurred despite the very best of intentions.
You are wrong, of course
, when you say the left "...made college unaffordable." That's an argument I've clearly won, but I'm not going to be an ass and rub it in. What we decided, and recall please that in the end you had no choice but to agree that college isn't unaffordable because it costs more, but because wages and salaries of the lower two thirds of the middle class have gone down. (Talking constant dollars here, naturally) College costs the same as it did thirty years ago. Wages and salaries have gone down due to two factors: 1.the failed economic theories of the Chicago School that were adopted during Reagan's administration, and that nearly eliminated the progressive nature of the income tax, deregulated everything that could be, and contributed mightily to wealth polarization, and 2. Out of control medical and military spending that has led to excess inflation, the great destroyer of the middle class when wages and salaries lag. We can blame this equally on the left and right, though the worst offenders were Reagan and Bush II. Reagan, because he trusted his economists, like Wendy Gramm, when he shouldn't have; Bush II, because he wasn't very bright, and he trusted Alan Greenspan when he shouldn't have. Since these mistakes are in the past, let's not waste our time with them, they can't be undone. Here, however, is a statement of yours that is worthy of attention:
"... instead of destroying economic value by overpaying for labor."
Had you thought twice about that, you might well have taken it back.
I am neither prepared to prove it wrong, nor willing to accept such a bold statement on face value. My guess is, and it is only a guess, that this statement of yours, when carefully examined, will prove to be flat out wrong. It is very likely, in fact, that the low wage workers you were referring to are the most productive workers in our society, when their productivity is measured by standard methods. Far more productive, I would guess, than any CEO of any publicly owned U.S. Corporation.
For me to prove this to you, I would have to spend more time with the data than I am prepared to do, but I urge you to reconsider your statement and give it very serious thought. Why? Because should you be wrong, then, indeed, we have a very strong argument for a big raise in the minimum wage to bring it into better alignment with productivity. If it,i.e., the min. wage, were to match that of the mid-nineteen sixties, for example, it would be ~$10.50/hr. That's what McDonald's Workers were making back then in 2013 dollars.
Take heart, however, that your likely mis-evaluation of low-wage productivity in no way invalidates your call for educating low wage workers into skilled jobs. That's exactly what we need to be doing.
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"The reason to study economics is to avoid being fooled by economists." -- Joan Robinson -- probably the brightest economist of the Twentieth Century not to have won the the Nobel Memorial Prize, and J.M. Keynes best student.