Today a group of fast-food workers in the Triangle plan to rally to demand “better pay”. Their primary objective is to raise the minimum wage to $15/hr, and the “right” to form a union.
I’ll dispense with the usual comments reminding people that if the price of labor is forcibly increased, employers will demand less of it; resulting in low-income people losing jobs or seeing their hours cut. Rather, I will refer readers to the comments of economist Tom Woods on the subject:
Fast-food workers have begun protesting their low wages. ..“We are worth more,” their signs read.
Are they? How can they know? If they were worth more, other firms would have captured their extra worth by bidding them away from the fast-food industry and hiring them themselves. Then we can know they were “worth more,” at least in some other line of production.
Since no one else seems willing to hire them at their current wage rate, it seems to me that the very last institutions they should be angry at are the fast-food restaurants themselves, the only institutions on earth doing anything to improve their standard of living. Why don’t they protest all the places that pay them $0, having refused to hire them at all?
Articles written in support of the strikers claim the restaurants could increase the workers’ pay by raising the prices of their food. This gives the game away: the real constraint on these workers’ pay, as this concession inadvertently reveals, is erected by the consumers. So the logic here is: we can help some poor people by hurting other poor people (by charging them more for food).
In other words, if fast food places could raise their prices more, they already would have. But we as consumers have demonstrated we are not willing to pay more for the product. Therefore, if fast food workers want to blame anyone on their wages, blame consumers who dictate the price of the finished products, which in turn determines the price of the inputs (such as labor) used to create the products.
Woods further offers this challenge to the protesters and those sympathetic to the protests:
Incidentally, if you want to help poor people, why not just go ahead and do it? Why go the absurdly circuitous route of trying to make food more expensive (which in turn hurts other poor people)? Why not just seek out the working poor directly and help them? And why castigate the only institution in society that has lifted a finger to improve their material condition?
Answer: these people are all talk. They’d love to help everyone in the world, as long as someone else pays the price. These critics pay McDonald’s employees zero, but they are upset at McDonald’s, which gives them a paycheck.