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Fast Food Wages and Fabian Follies

Protesters rallied in Michigan and nationwide recently to claim that wages at fast food restaurants are too low. Here’s an alternative compensation schedule.

These workers should be paid as much as doctors and lawyers and executives. Those in turn should all get the same salary. Every member of their staffs should make that amount too. The same principle should prevail in government: A receptionist at a state agency would make the same as the governor; a custodian cleaning a public university’s toilets would be paid exactly what the university’s president gets.  

Everybody gets equal pay. All across the board, throughout the economy, wherever and whoever and whatever, everybody’s wage is exactly the same as everybody else’s.

The author of this scheme was the celebrated Irish playwright George Bernard Shaw. He was also the most prominent member of the British Fabian socialist movement — “the highly respectable Fabian Society,” as he called it — and one of its leading economic theorists. In 1928 he published, “The Intelligent Woman’s Guide to Socialism and Capitalism.” It had more than 450 pages devoted to capitalism’s defects in causing “the evil effects of a division of the people into rich and poor” and to socialism’s virtues as a corrective. At the core of true socialism, Shaw maintained, was “equality of income.” He was serious that such a policy would work.

Fabianism’s unique socialist twist was gradualism, a slow and steady conversion from private ownership of production to public, in contrast to the explosive worker revolution predicted in “the so-called Scientific Socialism of Karl Marx,” as Shaw put it. Great numbers of government workers — all paid exactly the same, of course — would manage the Fabian transition and ultimately the publicly owned industries and businesses.

Shaw lived until 1950 and so witnessed the early implementation of his theories. Fabian infiltration of the British Labour Party converted it into a de-facto socialist party, which gained political control in 1945. Its nationalization of industrial sectors was undone by later governments, but its National Health Service lives on.

A similar single-payer health care system for America is the goal of many Fabian-influenced advocates. Other socialist notions also abound here. For instance, “equal pay for equal work.” The only equal work is identical work, so any “equality” of disparate jobs must be determined subjectively. Shaw-style public workers (but with superior compensation) would execute that assignment.

The so-called “living wage,” defined as how much a person must have to pay for basic necessities, is also a bureaucratic calculation. The concept is founded on the ancient socialist principle of “to each according to his needs.”

Many of the aggrieved fast food workers are unwitting socialists, complaining that they should be paid more money because they “need” it.

As a playwright, George Bernard Shaw spent a career in make-believe, which also is the foundation of his economic visions.

In the real world of fast food, economics looks like this: If the workers sell their services to their employers for $15 an hour, the businesses will have to adjust their prices upwards. Potential customers will then assess whether their higher costs represent enough value for making a purchase there. Loss of sales, loss of jobs.

That ancient proverb — even older than the utopianism of socialism — applies to those demanding the $15 an hour for their fast food employment: “Beware lest you get what you want.”

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Daniel Hager is an adjunct scholar with the Mackinac Center for Public Policy, a research and educational institute headquartered in Midland, Mich. Permission to reprint in whole or in part is hereby granted, provided that the author and the Center are properly cited.

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.

News Story

State Taxpayers Pay For Journalists to Go on Golf Course Tours

'Golf Writer Familiarization Tour' part of Pure Michigan campaign

When Golf Magazine rates a course such as Bay Harbor Golf Club as one of the top in the country, that publicity comes at a cost to taxpayers.

That's because every year the state puts on a tour of Michigan golf spots for a select group of national golf writers. It's part of the "Golf Writer Familiarization Tour" the state puts on, which escorts the writers to courses where green fees can cost as much as $199 a round.

Shanty Creek, Grand Traverse Resort and about a dozen other elite golf courses are part of the tour that attracts writers from national publications such as Golf Digest, Forbes and USA Today.

"It's a very substantial state effort for a very small part of the economy," said James Hohman, assistant director of fiscal policy at the Mackinac Center for Public Policy.

In 2012, the state held five group press trips and five individual visits for 30 journalists.

In 2013, the state has held two golf tours thus far, said Michelle Begnoche, spokeswoman for the Michigan Economic Development Corp.

The first in 2013 was June 24-28 and included three golf courses and seven journalists. The second was Aug. 11-15 and included five golf courses and 10 writers.

"There's no need to use taxpayer dollars for this," said State Rep. Tom McMillin, R-Rochester Hills, in an email. "These golf courses could and should kick in their own money to pay for the trips for the journalists to golf at their courses."

The state's "Golf Writer Familiarization Tour" is part of the Pure Michigan ad campaign.

According to the state, the $13.7 million spent on Pure Michigan advertising in 2012 and generated $79.1 million in Michigan taxes. A breakdown of costs for the golf writer tour was not available.

"Those businesses and industries that supposedly benefit from the advertising inside and outside of Michigan could and should pay for the ads," Rep. McMillin said. "The supposed benefits calculated by the MEDC have always been sketchy, (for example) using emails gathered at certain hotels by out of state customers. If, instead of taxpayers, the industry or certain businesses actually had to pay for the whole ad campaign, then I'm sure there would be much better methods used to determine cost/benefit."

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.