Our opinion: A living wage versus a cheap burger
A study just released by the University of California at Berkeley's Labor Center and the University of Illinois at Urbana-Champaign, revealed that $1 burger you just purchased at your local fast-food drive-up window actually cost you a little bit more than $1.
Between 2007 and 2011, nearly $7 billion a year was spent to provide public assistance to people who work in the fast-food industry, according to the study. That assistance comes out of everyone's paychecks via state and federal taxes.
On average, fast-food workers earn $8.69 an hour, and often work fewer than 40 hours a week, qualifying them as part-time workers who don't get benefits from their employers, such as health care assistance.
While many people conclude that fast-food workers are mostly teens picking up some extra cash, in fact, 68 percent of them are single or married adults who aren't in school and 26 percent are raising children.
"These statistics paint a picture of workers not being able to get their fair share of the largest, richest economy in the world," Sylvia A. Allegretto, lead author of the report by the university economists, which was paid for by Fast Food Forward, a group that supports walkouts by fast-food workers, told the Washington Post. "It is a good thing that we have these work supports, but they should be a last resort."
Many franchisees say they operate on thin profit margins, and raising wages could put them out of business, but the authors of a report from the National Employment Law Project, a worker advocacy group, contest that notion.
The nation's seven largest publicly traded fast-food companies netted a combined $7.4 billion in profits last year, while paying out $53 million in salaries to their top executives and distributing $7.7 billion to shareholders, according to the report.
"While fast-food interests call their business a low-margin, low-profit industry, there are actually billions of dollars at the corporate level," Jack Temple, a policy analyst who authored the report by NELP, told the Washington Post. "There are plenty of resources to change this business model that involves workers having to rely on public assistance to make ends meet."
Venessa Wong of Bloomberg Businessweek calculated that if fast-food wages doubled and companies did not reduce other costs, the price of a Big Mac could increase by $1 to offset the increase.
Of course, the National Restaurant Association called the reports misleading, but what can you expect from the mouthpiece of an organization meant to lobby the government for preferential treatment?
Scott DeFife, the trade group's executive vice president of policy and government affairs, said the report fails "to recognize that the majority of lower-wage employees works part-time to supplement a family income."
But Rep. George Miller, the senior Democrat on the House Education and the Workforce Committee and proponent of a bill to boost the federal minimum wage to $10.10 an hour from $7.25, said the recent reports "highlight the significant costs to our families and our economy of low wages paid by the multi-billion dollar fast-food industry."
The reports were on top of a third report that revealed in California, taxpayers are shelling out $86 million a year to subsidize Wal-Mart operations. That's because Wal-Mart's average worker receives $730 in health care and $1,222 in other forms of assistance from the Golden State.
"Wal-Mart dismissed the study's findings, arguing that many of its 44,000 California workers would otherwise be unemployed, placing an even greater burden on government welfare programs," wrote Stacy Mitchell, for the Institute for Local Self-Reliance. "There is strong evidence, however, that Wal-Mart produces no net growth in employment. The jobs created by its stores replace other, often higher-paying, jobs at existing businesses that are forced to downsize or close."
While some might utilize the reports as a way of buttressing their argument that the "War on Poverty" has been a monumental waste of money, others might characterize it as proof that our economic system has failed to ensure all Americans receive a living wage.
Privatizing profits and socializing expenses and the social and economic costs of promoting a philosophy of radical self reliance has driven the country backward, to a new Gilded Age, where the wealthy are incredibly, almost inconceivably wealthy and the rest of us are just struggling along.
And let's not forget that while nearly $60 billion a year is spent on traditional social welfare programs, $92 billion is spent on corporate subsidies.
While we do not doubt some of the corporate subsidies are legitimate, many of them should be abolished. And while we will admit that some people who accept government handouts are taking advantage of the system, there are many, many more out there whose lives, and their children's lives, depend on assistance.
But in the end, the people that will force the corporate fast-food honchos to pay a living wage to their employees are those that must make it explicit they are willing to pay a little more for their fast food in return for knowing their neighbors are earning a living wage. If we are all willing to pay 25 cents more for that $1 burger, it could mean less public assistance for fast-food workers.
That, of course, depends on whether the fast food corporations actually raise wages and don't pocket the 25 cents for themselves as a windfall from the suckers who love their product.
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