Fast food poverty wages: a tax on everyone

In a few hours I’ll join in a series of protests, for December 4th will be the latest set of strikes by fast food workers. In around 150 cities at least some workers will walk off the job, joined with the low-wage workers in major international airports. The past 18 months has seen a dramatic change in the national discussion on wages. $15 an hour was viewed as a pipe dream. Yet with the election of Kshama Sawant in Seattle, running with $15 as her central policy goal, and an overwhelming majority of San Francisco voters voting in favor last month, things have changed. The debate in Washington about small, incremental increases that may not even keep pace with inflation has been overshadowed by the idea of radically higher wages that lift hundreds of thousands of people out of poverty.

These strikes will have the same conservative criticism, in particular that these companies cannot absorb higher prices, and your favorite items will see a sharp price increase.

I’ll break this down into the simplest form I know. Higher wages will increase item prices, but in a given industry that will hold true across the board. A hamburger costs an extra dollar, but all restaurants will face the same reality. This isn’t an issue for bottom-rung workers because they have more money to spend, and in fact their wages will usually increase by more than the prices do. Workers in Seattle will be going from about $9 to $15 plus inflation. Prices are not going up by two-thirds.

But won’t people just above the minimum wage have problems? No, because one of the fundamentals of the labor hierarchy is that wage hikes at the bottom echo throughout the system (PDF). If $10/hr workers go to $15, $14/hr workers in different jobs will go to $19, or something similar. Wage increases for the working poor are good for everyone.

The most crucial thing I want to get across is that we all pay for the current wage levels in fast food restaurants. Fast food workers received about $7 billion in government assistance because their wages fall below what is needed to survive. All taxpaying people in the United States subsidize these low wage policies. Unlike paying more for a burger after a higher wage law passes, this cost is not optional. We can choose not to eat at McDonalds (and really, why would you?) , but taxes are compulsory.

Almost all situations like this boil down to this: the economy is complicated. Groups like Heritage want to scare the public with the specter of high prices, but that ignores positive effects from higher wages, and current costs that we pay for low wages.

Finally, I want to speak out about the civil war among labor in this country. Many people look down at fast food workers. I understand that. But what happens to them will affect you- especially those in the lower echelons of the labor hierarchy. Strikes are inconvenient (oh lord, the BART transit strike in the Bay Area got tech workers into a frenzy), but there will never be an empowered working class unless the bottom has strength.

The twentysomething’s gauntlet

Presently, I attend a junior college and have been working my way towards transfer. Due to the overloaded (and underfunded) California public university system, spring 2014 enrollment is largely off the table. So with that bit of time I’ve thrown some of my P.E and “lifelong learning” classes out to spring. That still leaves me with plenty of time to kill come January, so I’m looking for an internship to move things forward.

For my generation, the internship isn’t about rubbing elbows with the power players and starting up the ladder early. It’s work with absolutely insane hours, that pays at most a token salary, likely minimum wage or lower given time demands. A New York Times feature on people my age in the creative sector (to some extent, my sector) showcased how internships are a way to deny entry-level positions and create competition for an ever-shrinking number of regular jobs. The freelance market is no less bleak. Since so many writers are unemployed or cannot meet basic needs with what work they do have, firms can crowdsource material and have many options to choose from. If you go to any craigslist “writing gigs” section you’ll notice a variety of compensation schemes, ranging from pocket change to outright theft of material. In order of how insulting they are, least to most:

  1. Hey, we’ll pay you a certain amount per article! The length, research, and quality commitments will mean you at best make minimum wage. Also there is no guarantee that will will accept what you write.
  2. Hey you’ll get money once the site reaches a certain level of traffic! You’re basically a stockholder without the contract or cash value of what you hold.
  3. You will receive exposure on our site that will increase your value! Our site will have very little traffic and thus be useless, or a lot and the revenue remains with us.
  4. A certain number of writers will get $10 gift cards for their trouble.
  5. We’re just a true old-fashioned scam.

Legal action has been proceeding in various states against the unpaid internship. It will take longer to address internships that don’t violate minimum wage laws with stated hours, but require large amounts of unpaid overtime. The trend is obvious though- twentysomethings like myself and spending large amounts of our college and post-college years doing work similar in scope to entry-level work in our field, without any of the salary, benefits, or status.

Frustrating is an understatement. When you look at a list of majors by starting and mid-career pay, there is a gulf between hard science and engineering, and everything else. The bottom- social work, elementary education- has always been a particular tragedy, given how much time is spent discussing the flawed schooling system and broken social structure. But it’s mixed with people in the liberal and creative arts that are there to fill societal niches, yet private industry and government effort ignore.

One must begin with question- why do so many graduating students, from undergraduate and graduate programs not have a career path in spite of all their work and skills? If the American economy does not value education, what does it value? What is all this GDP being used for if not employment and capital usage?

Dreams turned into debt

Dreams turned into debt

I’ve wondered how you would encapsulate the economic era that most Americans live in. The fundamental costs of living have skyrocketed. Many Americans are lucky to have zero retirement savings, because others are mired in long-term debt.

I decided to draw this graph to encapsulate what the post-industrial era had brought. With the death of high-wage unskilled labor and declining investment in training and education, wealth has turned into a sea of debt.