Ooooh, now plot the avg wage across this period. Y=min wage.
I was talking with a coworker the other day and they were talking about how raising minimum wage causes inflation because businesses will raise prices to offset to rise in labor costs. I asked if he thought inflation had gotten bad in the past 5ish years in particular. He said of course. I said well federal minimum wage hasn’t risen since 2009, which was 15 years ago, so it sounds like inflation is gonna happen regardless of wages and is based on the capitalistic goal of infinite growth, so maybe we should raise minimum wage so lower income people have a shot at affording basic necessities.
He just said no, then inflation just would’ve been worse. It’s maddening.
The response to this is that inflation is a market force working against the downward pressure of demand. There is a limit to the amount prices can go up before people stop buying altogether.
Another inflationary force is greed, funneling additional profits into the pockets of the 0.1%.
Let the inflation due to minimum wage be X, and the inflation due to greed be Y, and the maximum total inflation be Z. X+Y=Z
Of course there are other variables, but in a general sense, if X goes up, Y must go down. If X does not go up, Y does.
So yes there will be inflation, but increasing wages takes more money from the ownership and puts it into the pockets of the bottom 99.9% where it will do far more good.
And in case it wasn’t clear, this is precisely why the oligarchy opposes increasing the minimum wage. It has nothing to do with inflation, and everything to do with they make less money.
There is a limit to the amount prices can go up before people stop buying altogether.
Not when those items are necessities, like food. Damn us poor people and our need to…checks notes…eat.
Except that they have studies that prove that they make more money when they increase wages. Tons of em since the '70s have shown that putting more money in the hands of the poor just means that the rich get to skim off even more money. They oppose thriving wages because they want suffering.
Honestly, I think there’s 2 ways to think through this. Way 1: Magically the minimum wage is increased, and everything about the legislators stays the same.
This would increase inflation, as what’s causing inflation is the lack of legislation and enforcement. Thus allowing companies to raise prices and profits unchecked.
Way 2: The legislators change in such a way that it’s logical and possible to raise the minimum wage. Also logically other legislation would be passed to reduce the unchecked greed.
This would not increase inflation on it’s own, and likely would keep it to a healthy minimum.
I think most who complain about the minimum wage talks can only imagine the first way.
To be fair states, and even cities have their own minimum wage too, and those have gone up. Federal minimum wage is just the base line.
That’s true, but the baseline should be able to afford food and housing somewhere. Currently it affords that precisely nowhere. As a result, multigenerational homes are becoming more prevalent, children are working to help support households more, and single income families are nigh extinct. My wife and I are DINKs in a 2 bedroom apartment because the cost of houses is absolutely insane here. It’s hard find even a fucking townhouse for less than $500k lol. Most single family homes are at least $700k. At this rate, we’ll see polyamory and polygamy become more accepted because it’s gonna get to a point where only working throuples can afford shit anymore.
This companies are able to generate billions in profit every quarter, let alone every year. They have also been reporting record breaking profits quarter after quarter for the past several years. I’m pretty sure the 17 y/o Burger flippers aren’t the problem here.
https://www.macrotrends.net/stocks/charts/MCD/mcdonalds/gross-profit
- McDonald’s gross profit for the quarter ending March 31, 2024 was $3.439B, a 3.77% increase year-over-year.
- McDonald’s gross profit for the twelve months ending March 31, 2024 was $14.688B, a 9.03% increase year-over-year.
- McDonald’s annual gross profit for 2023 was $14.563B, a 10.26% increase from 2022.
- McDonald’s annual gross profit for 2022 was $13.207B, a 4.98% increase from 2021.
- McDonald’s annual gross profit for 2021 was $12.58B, a 29% increase from 2020.
[1]Average franchise profitability at Burger King rose nearly +50% last year (2023) compared to 2022
https://www.macrotrends.net/stocks/charts/SBUX/starbucks/gross-profit
- Starbucks gross profit for the quarter ending March 31, 2024 was $5.914B, a 0.06% decline year-over-year.
- Starbucks gross profit for the twelve months ending March 31, 2024 was $25.104B, a 8.86% increase year-over-year.
- Starbucks annual gross profit for 2023 was $24.567B, a 12.01% increase from 2022.
- Starbucks annual gross profit for 2022 was $21.933B, a 7.93% increase from 2021.
- Starbucks annual gross profit for 2021 was $20.322B, a 28.43% increase from 2020.
I wonder how da fuq did McDonalds think that this is okay?
Setting aside all considerations of ethics or morality, from a pure greed standpoint even a very naive person could realize that if you squeeze the sheeple too much they may choose to go elsewhere rather than continue to rely on you for easy comfort food.
Do they think they have a monopoly on the market? Even just from the fast-food burger places that were included in this graphic, there are multiple cheaper options - Burger King and Wendy’s - plus Arby’s & Taco Bell and Chick-fil-a are somewhat similar.
Do they think that people will suddenly not care about where their money is going? That strategy tends to work when you squeeze (bleed) them slowly, but this kind of a sudden spike carries the risk of waking them up to how much eating there is costing them - and once they are gone, it would be very hard to attract them back.
So this strategy even looks to be detrimental to the company of McDonalds, even if good for the short-term stockholders & CEO before they jump elsewhere.
If I had to guess it would be for 2 reasons, humans don’t like change so people that frequently go to McD will still go, and that all humans need food and a bonus of less people know how to cook
It’s a scary thing to think these companies can just get away with shit like this but at the end of the day until we as a society boycott them - and I mean a legit boycott, not some 3 day reddit boycott - they’ll find any excuse to fuck us for profit
Geez what happened in 2020 … Oh right.
I’m surprised the two lowest ones are Subway and Starbucks. Where’s the $5 foot long? And I guess Starbucks has always been expensive so $6 for a coffee isn’t much of an increase from what it was.
The $5 footlong hasn’t existed for years (honestly maybe a decade) at this point. It’s like a $10 footlong now.
Does every thread have to include a reminder of how old I am? I remember living life $5 at a time.
Yup, me too. I used to be able to get lunch for a week with $20 back in high school in the mid-late 2000’s. Almost everywhere had a dollar menu where you could get a pretty decent meal for a few bucks. Over time the portions got smaller and more expensive though to the point where you can’t really do that anymore.
I was surprised too, but then I found this vvv. This people are making 25 billion profit which now makes sense for the comparatively low percentage
https://www.macrotrends.net/stocks/charts/SBUX/starbucks/gross-profit
- Starbucks gross profit for the quarter ending March 31, 2024 was $5.914B, a 0.06% decline year-over-year.
- Starbucks gross profit for the twelve months ending March 31, 2024 was $25.104B, a 8.86% increase year-over-year.
- Starbucks annual gross profit for 2023 was $24.567B, a 12.01% increase from 2022.
- Starbucks annual gross profit for 2022 was $21.933B, a 7.93% increase from 2021.
- Starbucks annual gross profit for 2021 was $20.322B, a 28.43% increase from 2020.
I’m pretty sure the McDonald’s one is false, which makes me think all of the others are too. This is a bad faith argument. I’m assuming this is going around TikTok and that’s why so many braindead people keep repeating it
I’m definitely weary of posts like this with no data backup. Also what is “actual inflation”? Wouldn’t that be like average inflation across all goods? Doesn’t inflation affect certain markets differently?
I have found the article here: https://financebuzz.com/fast-food-prices-vs-inflation
At work so I can’t read it atm, but I’m interested to hear your conclusion later
I found this article yesterday, from none other than Fox (who I would think would lean into this narrative): https://www.foxbusiness.com/lifestyle/mcdonalds-pushes-back-hefty-price-hikes-including-18-big-mac-meal
According to the McDonald’s CEO, the $18 Big Mac (which is where this number comes from) was 1 location, and the average price of a Big Mac is up 21% since 2019 (less than inflation). So I think all of these numbers in your article are cherry picked or just made up
Not saying it’s right, but the spacing makes the drastic changes in 19-21 less obvious by spreading them across a wider area. Same with 21-24, just less so.
A consistently spaced graph would probably be more drastic looking.
10 years, double the prices? ain’t that far off.
at our mcd, at least that much for many, if not most, things on their menu. everything i (used to) buy there, anyway. and way more than that for the former ‘dollar menu’ items. beverages the least affected, although it’s now probably double, too (the large cup shrunk on top of the ~ 90% increase since then).
Could under reporting of real inflation that consumers feel be a factor here?
I’m sure these companies are exploiting consumers, but I’ve also been suspicious of the reported inflation numbers. It feels a lot higher than that and actually it could be more in line with the companies in the graph.
Maybe it’s not the fast food prices that are high but the inflation number that is too low.
MIT used to have the Billion Prices Project which tried to determine inflation numbers independently of the government, but it no longer exists. My recollection is that it was generally close to the official numbers.
If you think the reported numbers are wrong, you have to give a reason why, backed with evidence. As much as it sucks when rent and food, etc. are more expensive, but those are only part of the number. Inflation encompasses everything and some goods/services are higher than the average number and some are lower. For instance, car insurance has gone up a ton, but apparently fuel oil has gone down (https://econofact.org/inflation-and-prices).
I think what people are (rightly) concerned about is that the necessities of life are higher than the official numbers (because those are an average of lots of things). This makes them think the real numbers are “wrong” based their specific situation rather than the country at large.
My point exactly. I understand that some people feel the numbers are calculated very consistently, and I guess that’s fine, but does it really reflect what consumers are feeling? I don’t think so. Plus, inflation has been a hot button political issue. A healthy skepticism feels appropriate.