This morning's Times tells us that in Denmark McDonalds pays $20.00 an hour. Not, of course, because it wants to, but because it has to in order to do business in Denmark. It's employees can actually live on what they make working there. An amazing thing! The downside is that MacDonalds can't make the same obscene profits (although they do turn a comfortable profit) it makes here, and the CEO of MacDonalds Denmark likely doesn't make as much as his American counterparts. So sad.
But I come not to praise Denmark.
The Times, of course, being staffed with good journalists, searched out some right wing voices who could tell us why such pay would never do here in the land of “We're Number 1!”. Check this out:
Many American economists and business groups say the comparison is deeply flawed because of fundamental differences between Denmark and the United States, including Denmark’s high living costs and taxes, a generous social safety net that includes universal health care and a collective bargaining system in which employer associations and unions work together. The fast-food restaurants here are also less profitable than their American counterparts.
“Trying to compare the business and labor practices in Denmark and the U.S. is like comparing apples to autos,” said Steve Caldeira, president of the International Franchise Association, a group based in Washington that promotes franchising and has many fast-food companies as members.
“Denmark is a small country” with a far higher cost of living, Mr. Caldeira said. “Unions dominate, and the employment system revolves around that fact.”
The argument seems to be that a lesser degree of inequality would never work here because we have a high degree of inequality, that high degree of inequality brought to you by the very people who are telling us that a lesser degree of inequality would never work here because we have a high degree of inequality. What they're really saying is that they pay well in Denmark only because they have to, and they damn well won't pay more here unless someone forces them to, and they'll sure as hell do everything in their power to make sure that never happens.
But I must justify the name of this post. The article quotes a number of “liberals” (code for rational), who take the not unreasonable position that if MacDonalds can make money paying a decent wage in Denmark, it can do so here. None of the factors cited by the unnamed “economists and business groups” have any bearing on the question of whether the liberals are correct. The cited factors may enable Danes to get paid decently, but, for example, the absence of universal health care here doesn't prevent MacDonald's from paying decent wages here. The conclusion we're supposed to reach simply doesn't flow from the cited facts.
What this does help prove is that individual states here in the land of the free can help their own citizens by raising the minimum wage. Most minimum wage workers work for entities such as MacDonalds. MacDonald's can scream all it wants about the job destroying effects of the minimum wage, but the fact is that if it's given the choice between making less money or leaving a state entirely, it will shut its yap and pay, just like it's paying in Denmark. Here in Connecticut, the money that we diverted to workers through our minimum wage increase will, for the most part, stay right here in Connecticut, where it will provide a little extra stimulus, instead of being exported to wherever the Dark Lords that run MacDonalds have their lair. Of course, optimally, we would re-empower the unions, so that, as in Denmark, they would make minimum wage laws unnecessary, but that's not in the cards, and the reason for that is a post for another day.