Friday, December 6, 2013


If the birth of communism is traced back, it was a reaction to suppression of labor by the employees through low wages and facilities. The world has traveled a lot since the early years of communism and its domination in s few countries under the aegis of erstwhile Soviet Union during 19th and early 20th centuries and to day communism exists as a force only in Russia, China, North Korea, Cuba and Vietnam, that too in a liberalized form. The success of Capitalism in bringing prosperity to the citizens was touted as the USP of this form of economic system. However if recent agitation in the US where fast food industry labor for increased wages is an indicator of what type of strain Capitalism may face in coming years. Here is a take on this development in a country which is supposed to be a shining example of successful capitalism.

Hourly wage increases advocated by labor groups could kill more than 450,000 jobs, according to a new report. Union-backed labor groups, including Fast Food Forward and Fight for 15, are staging nationwide walk-outs and demonstrations at fast food chains across the country calling for starting wages of $15 per hour. Their success could spell economic disaster for nearly 20 percent of the nation's 2.5 million fast food workers, according to an analysis from the Employment Policies Institute. "We find that roughly 460,000 jobs would be lost in the fast food industry as a consequence of a $15 minimum wage," the EPI report found. "This is a conservative estimate because it only includes employment loss among those who hold a fast food job as their primary employment. Including those who work in the industry as a second job would increase the estimates." The group estimated that employment falls 3 percent for every 10 percent increase in labor costs. The $15 wage is more than double the federal minimum wage of $7.25—and nearly 50 percent higher than the $10.10 wage proposed by congressional Democrats. EPI warned that the doubling of wages would lead the restaurants to "replace jobs with less costly, automated alternatives—including self-service ordering kiosks and even automatic burger makers."

Is it not interesting to hear the argument that increasing wages will cause acute unemployment?
Does it imply that the workers must work like slaves sacrificing the quality of life in order to help the corporate industry to make hefty profits, harm the society through junk foods at low prices and blackmail the government  to toe their line? It is pathetic to hear that if the wages are increased to a level where the workers can outpace inflation , the country will face the consequences of unemployment, resulting in economic stagnation! At a time when this country is facing the obesity epidemic with people suffering from bloated bodies and many life style disorders, is it not fair to makes the very same foods more costly in order to discourage their consumption? Government must seriously consider raising the wages of these workers to a decent level in tune with the increasing inflation.


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