Unions in Milwaukee, Detroit and other cities have held demonstrations at McDonalds’ restaurants demanding wages be raised to $15 per hour. And no doubt they also want full health care and retirement benefits. Some editorial writers in have opined that this not radicalism but a reasoned response to the decline of America’s middle class.
This argument is so economically stupid on so many levels that one hardly knows where to begin. Since when have low skilled workers in fast food restaurants been a linchpin of creating the middle class? Indeed, it was the growth of the middle class that led to the massive increase in discretionary income that permitted more eating out and the enormous rise of the relatively inexpensive food services. Restaurants that have provided entry level work experiences for millions of people.
A near doubling of market determined wages will not be achieved any time soon unless there is a huge increase in total spendable income, or a dramatic drop in available workers. Good luck with that if the unions are successful in getting amnesty for illegal immigrants, a virtual guarantee of a flood of cheap labor. The unions must know that and what they are really after is to have the government force companies to pay far higher wages while also maintaining or increasing benefits. This at a time when these companies are already reducing full time employment and taking other steps to avoid the costs that are coming with the implementation of the Affordable Care Act.
The inability and unwillingness of some groups and ideologies to understand the damage done by their do-good policies is nothing short of astounding. No lessons have been learned by the unions and their overweening demands on private sector employers with the attendant calamities those consequences have had for cities all over the once prosperous industrial heartland. Now they are wrecking municipal governments as well.
What the workers chanting "hold the burgers, hold the fries, make my wages supersize" are really mean is: forget the notion that what someone earns is a reflection of what their efforts contribute to the earnings of the business. If wages were somehow to double without a comparable rise in revenue, the firm would go out of business. Then wages would be zero and the employees would be on welfare or unemployment benefits. How is that for a strategy to build a middle class?
Better wages require jobs with higher productivity in terms of contribution to company revenue. With national economic policies and many state policies creating disincentives for businesses that inhibit good paying job formation. Nothing in the union chanting suggests there is any understanding of this reality.