McDonald’s CEO Don Thompson

McDonald’s CEO Don Thompson

Not earning enough? Take responsibility for your life, says Anthony Bradley in the second of this week’s Acton Commentary.

In today’s culture of entitlement people believe that they deserve certain rewards simply because they exist — not because of hard work, perseverance and wise choices. Entitlement is the only way to explain the lunacy behind recent demands that fast food chains like McDonald’s arbitrarily pay workers $15 per hour. Unlike many politicians, business leaders do not make decisions according to public opinion because they have fiduciary responsibilities to their boards and shareholders. As a result, McDonald’s Corp. Chief Executive Officer Don Thompson is doing the right thing by not cowing to ridiculous wage demands. In short, McDonald’s has become a scapegoat for a series of failed economic and public policies.

The full text of the essay can be found here. Subscribe to the free, weekly Acton News & Commentary and other publications here.

  • http://azspot.net naum

    Wow, so it’s cool to pay less than a living wage to workers. I guess we’re down with slavery too!

    “Let them eat cake!”

    Sorry, if you can’t pay a living wage, you don’t deserve to be in business.

    And so sad that you call yourself a Christian.

    • CC

      There are quite plainly practical and more complex matters associated with wages (which are prices after all) and the consequences that come from raising them, by government fiat, about what the market price for that service would be than your facile response suggests.

      One of those consequence is simply, plainly and unquestionably that some of the people who either were or might have been employable at the lower wage (due to their current level of skill, knowledge and experience) will not be employable at all or, put another way, will have their “wage” reduced to zero. I would say that’s not a very livable or dignity fostering condition to be in. Wouldn’t you agree?

      • http://azspot.net naum

        So, in other words, the slave should be happy with the pittance received and shut up, lest he or she be denied any employment at all.

        So many presuppositions and faulty reasoning in that thread. Especially given a corporation that rakes in billions, built on essentially treating workers (which there is an inexhaustible supply at low level/bottom rungs) like chattel.

        • jim8107

          Last time I checked, “slaves” as you put it, were not free to leave their “jobs” to seek other options – fast food workers are, even if the only option at the moment is unemployment compensation or some sort of public assistance, which right now, they don’t have to work for.

    • Jens2Cents

      Not, “Let them eat cake!” but “Let them find ways to improve their lot in life through the use of their God-given talents and abilities!” Going to school, getting additional training, applying yourself, working hard to move up the ladder…this is about giving people the dignity of owning their own choices in life. McDonalds might provide a stepping stone but shouldn’t be a stopping point!

    • Stephen Paulsen

      Sorry you know nothing about market economies and how to operate a business with a budget. You prove every point the writer makes about people feeling entitled with your emotional reaction to an economic question.

  • quif

    This doesn’t even vaguely pretend to acknowledge Catholic understanding of social ethics and market. I know Mr. Bradley is a Presbyterian, but yeesh, come on, Acton.

    • http://www.acton.org/ Elise Hilton

      The Acton Institute is ecumenical, and embraces the full range of Judeo-Christian ideals. Dr. Bradley’s presentation here represents one aspect of that.

      • quif

        Thank you for correcting me on his title.

  • Tommy Brann

    Thank you. As a small businessman I am sick at being looked at as the problem when I am the solution. David Bonior and ex liberal congressman from Michigan bought 2 restaurants and he said how hard it is to take a risk and work so hard in this business. I was pay 8.50 15 years ago because the market demanded it. The free market does work. I am working on free enterprise being taught in the school systems so people understand the good businesses do and the risk we take and we do not have to used as a political football anymore for the do good politicians that really do not do good.

  • Jeff Crichton

    Great points Anthony. Ultimately people need to take responsibility and pride in their work. People who complain should focus their energies on providing value for someone else, to be other centered and not self centered. The same is true on the employer side. But complaining about the other side is very self focused and not others focused.

  • http://www.oaoutreach.org Kenneth Peters

    Rather than raising a static wage, why not incentivize workers with some form of profit sharing. With such bonuses in place, it puts the shareholders and the stakeholders ( employees) on the same team… win/win. The next time you are in line in a fast food enterprise, watch the movement of the workers. It is quite a pace and although they receive their training on the job, it requires a valuable skill set to hang in there at that pace.

  • jim8107

    The problem with the minimum wage is that it is too broad of a solution that fails to consider actual living expenses and the idiosyncrasies of different labor markets and industries. A minimum wage that is sufficient to live on in a high cost area like NYC will be a windfall in a lower cost area, assuming that workers don’t get their hours cut, lose their jobs altogether, or the new wage does not create a price spiral. A better solution is a targeted wage subsidy, that lowers the cost to employers in the targeted markets and/or industries for hiring and training a low skilled worker, while improving (raising) the wage paid to the employee. True, the wage subsidies must be paid by taxes, but the drag created on the economy is a small, perhaps even a negligible price to pay compared to a Federally imposed minimum wage that creates far more distortions and undesirable unintended consequences. Further, the Federal government should delegate this task, along with the tax bill, to local governments, who are in a far better position to assess the situation and determine what the subsidy should be, and of course, bear the cost.

    Regarding the individual who suggested that any business that cannot afford to pay a living wage should not be in business, I fear that this is not realistic given the statistical likelihood of the number of businesses, that if forced to pay a living wage, would simply go out of business, creating significant damage to the economy. It is difficult to design a plan that would mine the data needed for a full analysis of the effects, but that should not render invalid a cautious generalization that such an approach would do more harm than good. It is also important to remember that business operators have rights also – if they are “blessed” in the material sense, they incur obligations, but they do not lose said rights. Thank you.

  • Dickie Bush

    The most incredible fact about the action against McDonald’s is that the protesters in front of McDonald’s are actually paid SEI you and other union paid personnel

  • http://www.stephendekuyper.com/ Stephen DeKuyper

    We cannot assume an easy upward mobility for minimum wage workers such as this article seems to suggest. Yes, some people such as Thomson have made it out of poverty, but was he paying rent and supporting a family of 3-4 at the time or was he living with his grandma who was paying the rent and collecting social benefits? Many more have not and it is simplistic to assume they are lazy or incompetent and deserve to be where they are. A single mother of 2 kids, working 2 jobs (because working hard all week at 1 full time job doesn’t pay enough money to actually live) doesn’t normally actually have a lot of choices. The cycle of poverty is not very forgiving.

    We are called by Jesus (so it doesn’t really matter if you are Catholic or Presbyterian) to compassion. The Jubilee served as a mechanism to help break the cycle of poverty leading to slavery and concentrated land ownership. As people became poor because of loss (primarily bad crops or illness – often beyond their control), they were forced to sell themselves into economic slavery to pay off their debts. The Bible is very specific that these brothers and sisters were to be treated with dignity. In the Jubilee, they went back to their clans and effectively got a ‘do over’. Can we not show some compassion for our ‘neighbors’ and act as if we have more faith in the Gospel than Darwin’s theory of the survival of the fittest?

    McDonald’s is not a faith based organization, but the church is, so when the church and Christians and even others, call for a living wage, it would probably show a bit more grace not to call them ridiculous, entitled, lunatics. Calling for a just or living wage is not lunacy. According to God’s Word, people do deserve certain things simply because they exist – they are made in the image of God. “The King will reply, ‘Truly I tell you, whatever you did for one of the least of these brothers and sisters of mine, you did for me.’ (Matt 25:40)

    • Andrew_DeMoray

      Please define “living wage” in terms of an absolute number. When an employer is required to pay a living wage does the employer get to decide what expenses are actual necessity versus desires?

      As for Jubilee, that system is effective in the absence of a welfare state. Eliminate governmental support and there would be much more support for a ‘do over’ Otherwise, I counter with 2 Thessalonians 3:10 “For even when we were with you, we used to give you this order: if anyone is not willing to work, then he is not to eat, either”

    • JohnE

      The problem doesn’t seem to have a simple solution. If you mandate a “living wage” that is higher than market value, then hours are cut back or prices increased to offset the increased cost of labor. For businesses where the profit margins are thin, it puts pressure to decrease employment. What about those who are graduating from school and are willing to work for less than “living wage” in order to gain job experience? This would diminish their opportunities. If prices are increased to make up for the increased labor cost, it will cycle back into increasing the “living wage”. Another option is to reduce profit, but that decreases the incentive for entrepreneurs to start new businesses and puts further pressure on decreasing employment or raising prices the next time the “living wage” is increased. I think the only way it might work is if consumers are willing to pay “extra” for comparable products and services to those companies who pay their employees better — but that’s difficult to determine, and would enough consumers be willing to go through that sort of research every time they make a purchase?

    • pduggie

      Note that the jubilee only was every 50 years. That’s a long time till the do-over.

  • jay kay

    Did white flight have anything to do with American urban decay, or was it just the guv’ment?

    Also, I’d be happy for some of that gov’t regulation the Danish have going.

  • Cynthia Youngblood

    Last time I checked, there was nothing in the Bible about government taking over the economy by force or redistributing income or deciding anything personal or economic in nature. The Bible also supports contracts, even contracts that don’t seem fair to us: Matthew 20:1-16, the parable of the of the vineyard workers. Key points: v13 “But he answered one of them, ‘I am not being unfair to you, friend. Didn’t you agree to work for a denarius?” and v15 “Don’t I have the right to do what I want with my own money? Or are you envious because I am generous?”
    Some have said this is about the wages being the same for everyone, but it is not. It’s about contracts and property rights. First rule of Bible interpretation: “If the plain sense makes sense, don’t look for any other sense, or you will end up with nonsense.” (Quote attributed to a couple different people.)

    • pduggie

      There is nothing in the bible about large employers having workers who intend to work for long periods of time (the parable is about day laborers).

      the large employer is a kind of ‘power’ that has a responsibility to do right by its employees moreso than say a a single landowner (who DID have a responsibility to redistribute income from himself to the poor (gleaning laws))

  • Philip Daniels

    As a consumer I only go to McDonald’s because it is cheap. It is cheap because the workers are paid a small percentage of the total income which is reinvested as capital. I would rather have a greater share of that income so I could eat better food rather than it going to capital which is driving down the cost of supplying more hamburgers. Is the market for the consumer? There are healthier options out there but the diminishing returns for the production of fresh food seems to put McDonald’s at a market edge. So as a consumer I am going to have to pay a larger percentage of my income to buy fresh food because all the capital is flowing to where the better margins are i.e Mcdonalds. Also, to claim some link to judea / Christian morals is naieve. Poor decisions or not it is void of loving God or neighbour.

  • SmokeyOkie

    There are two separate issues discussed here that when co-mingled make it difficult to discuss and address remedies. The first issue is “What should a worker be paid?” The second issue is “What is our responsibility as Christians to help those who are unable to help themselves” Wages, like other prices in a capitalist country should be set by the free market. If an employer underpays its employees, the market will correct that problem because the employees will migrate to other similar employers who pay the market rate for those services. That should not be a government decision. The bible leaves no doubt that we have a responsibility to help those who are unable to help themselves. That also is not a government decision. That should be between each believer and his/her God. There will be an accounting one day. If the Church of Jesus Christ would rise up and be the people we are called to be, there would be no role for government in providing aid to those who are unable to provide for themselves. That is one reason that organizations like Poverty Cure are so important. https://www.youtube.com/watch?v=rT1Kcw8dZAc#t=42

  • http://rdmckinney.blogspot.com/ Roger D. McKinney

    The Church scholars of Salamanca, Spain in the 16th through the 18th centuries discussed minimum wage many times. No one can claim those scholars did not understand Catholic doctrines on social justice because they helped write them. No one cared for the poor more. Those Godly men devoted most of their lives to caring for the poor.

    Yet when confronted with demands for a minimum wage in the 16th century they said no because it would hurt the poor far more than it would help them. Advocates of a minimum wage today need to learn from those scholars why it does more harm than good.

    According to those Church scholars, if you hate the poor you will promote minimum wage laws.

  • http://ameryx.wordpress.com ameryx

    I teach economics at an inner-city community college. Here is what I tell my students about wages:

    1. Employers do not pay the employees what the employees are worth. They pay what the job is worth. Thus, a brain surgeon working at McDonald’s will receive the same wage as the high-school student working at McDonald’s. (This is because the market wage is equal to the value of the marginal product of labor.)

    2. If the government dictates a minimum wage above the value of certain jobs, those jobs will go away. Automated, outsourced, or pushed off to some other party. See Ikea, which offloads assembly onto the consumer. Or, see here (http://www.unitedliberty.org/articles/17751-warning-to-seattle-seatac-businesses-slashing-benefits-overtime-in-wake-of-wage-hike) for an example of offloading costs to the employees.

    3. The personal circumstances of the employee are not relevant to the wage. Does an employee get a pay bump when a baby is added to the family? Do married employees get paid more than single employees?

    The principle of subsidiarity applies here: who is best suited to deal with the issue of individual poverty? In the absence of an inability to care for oneself, individual poverty is best addressed by the individual. If the individual is incapable, then move up to the family, the community, the church, the town, the State, and so forth. At all times, the help should be customized to the individual (which is why blanket actions, such as the minimum wage, do not work.)

  • Lester M.

    Bradley shouldn’t beat around the bush here: most of this entitlement “lunacy” goes back to Mr. Entitled-to-a-Fair-Wage himself, Pope Leo XIII. The life choices of these McDonald’s workers is more than enough evidence that we don’t owe them anything, particularly any notion of human dignity. Great to see Acton take a stand against this deranged way of thinking.

  • pduggie

    Wage for a man to support a wife and kids IS A GREAT IDEA, and prohibited by law: Note both of bradley’s examples were loosely attached women with kids. Not sure Rerum Novarum speaks to that.

  • JRDF

    Dr. Bradley hit the nail on the head on every point.

    It is sad to see our (Catholic) Bishops pushing this minimum / living wage communist, racist non-sense. They ignore the very catholic social doctrines they profess to uphold.

    Subsidiarity — It is the local community (and it’s local economy) that can best set the minimum wage, not the federal government. How many leaders & business folks of the black community would love to help / hire a struggling youth in their community; but cannot because the federal government prices that black business owner and struggling youth out of the LOCAL labor market. The black entrepreneur in rural Duplin County NC would have to pay that struggling youth a NATIONAL “living wage” that would allow that youth to live in New York City — a place where the employer could not even afford to live.

    And for the lazy individual, who better to know, understand and reform the sloth of an individual, than the very members of the local community that would be personally faced with either admonishing or enabling the slothfulness?

    Solidarity — Minimum wage pits the employee against the employer as adversaries; instead of the solidarity required of efficient, productive, sustainable human endeavors. Mandated minimum wages fundamentally start from the anti-solidarity assumption that the employer (even the poor rural black employer) are innately greedy and evil; while all employees, even the slothful, are pure and saintly.

    Speaking of anti-solidarity — minimum wage has always been a racist’s economic weapon. Minimum wage laws were originated in the US as Jim Crow laws to price newly freed black entrepreneurs & laborers out of the labor market. During WWII, the Federal government set minimum wage contract laws to protect the northern trade unions from southern black entrepreneurs & laborers that were immigrating north; willing to work at a lower contract and wage to send money back to their families in the south. — Just as Unions today oppose immigration reform to protect the unions from Mexicans willing to work for less & send money back to their families in Mexico where the cost of living is very low. In South Africa, the unions / government officials freely admitted to utilizing minimum wage as their official national policy to maintain Apartheid.

    Sustainability — As arbitrary increased wage mandates continue to prime the feed-back loop of increased cost of living / increase wages; the economies of local communities, businesses, families become unsustainable. Rural black communities become unsustainable / deserted, as the youth move to the big city looking for other jobs [and the politicians & CRONY capitalists swoop in to buy up the black community's real-estate.]
    Consequently, one should see that national minimum wage is moralistic. As Cardinal Ratzinger warned; Moralism, which ignores the technical and the consequences, is the
    antithesis of morality.
    Thus is the ubiquitous progressive call for a blind Tyranny of Compassion: while intentionally
    blind to unintended consequences, exists simply to document one’s own“compassion” [Matthew 6: 01-06] and bully those it deems non-compassionate. And on a similar note, see: http://www.ticenter.net/component/content/article/52-featured-articles/286-is-social-justice-an-empty-abstraction-by-jean-bethke-elshtain

    Today, due to a national minimum wage, the members of local black communities cannot work in the spirit of solidarity in order to sustain their community, because the federal government [and the USCCB] ignore the fundamentally just social doctrine of subsidiarity, which is essential for a sustainable solidarity.

    (For more on these social teaching see the CCC, as well as writing of St. Pope JP II & Pope Benedict)

    Actually, much of this minimum wage talk is quite fanciful; ignoring reality. It is interesting that those self-righteous, who demonize the “rich” companies, ignore their own reality.
    They go to college to be hired by these rich companies that always pay far above the minimum wage. And these “evil rich” companies always advertise (and pay) a “competitive salary”; so that they can out-compete other companies for the best possible job candidate.

    One also finds it interestingly sad how obsessively materialistic the USCCB is on this topic. They see no dignity in poverty. By insisting upon minimum wages, the USCCB obscenely professes that “man CAN live by bread alone.” That an individual’s wages and the materialism acquired from those wages is the exclusive dignity of labor.