Ed Rensi is the former CEO of McDonalds and he commented on the reality of a $15 minimum wage and how most businesses will handle it:
“I was at the National Restaurant Show yesterday and if you look at the robotic devices that are coming into the restaurant industry — it’s cheaper to buy a $35,000 robotic arm than it is to hire an employee who’s inefficient making $15 an hour bagging French fries — it’s nonsense and it’s very destructive and it’s inflationary and it’s going to cause a job loss across this country like you’re not going to believe.”
He continues, “It’s not just going to be in the fast food business. Franchising is the best business model in the United States. It’s dependent on people that have low job skills that have to grow. Well if you can’t get people a reasonable wage, you’re going to get machines to do the work. It’s just common sense. It’s going to happen whether you like it or not. And the more you push this it’s going to happen faster.”
That’s the one he got right. Here’s the one he got wrong:
I think we ought to have a multi-faceted wage program in this country. If you’re a high school kid, you ought to have a student wage. If you’re an entry level worker you ought to have a separate wage. The states ought to manage this because they know more [about] what’s going on the ground than anybody in Washington D.C.”
Good grief, Mr. Rensi, why not let the market handle it? You know, supply and demand? What the heck is wrong with you? You wouldn’t even be discussing this if government hadn’t intruded and decided unilaterally that you should pay your employees a certain amount of money for their labor. It is because of government you’re even discussing automation above. And now you think government – even state government (you know like California or New York?) – would be the solution?
And you were a CEO of a major corporation?
Note the operative word – "may". It doesn’t say it will, it doesn’t say it might, it says it "may" drop it because of the type of health insurance it offers and the impact of new regulations governing what amount of money must be spent by insurance companies for care. Specifically:
The requirement concerns the percentage of premiums that must be spent on benefits.
Last week, a senior McDonald’s official informed the Department of Health and Human Services that the restaurant chain’s insurer won’t meet a 2011 requirement to spend at least 80% to 85% of its premium revenue on medical care.
It is called the "medical loss ratio", but in reality it is government telling a business how it must spend its money. What the business is telling the government is, given the type of insurance offered by the business, driven primarily by the type of business it does, it won’t be able to comply with the regulation and will have to drop it’s present coverage altogether.
Of course this is bad news for the administration which is still out there pushing the lie that if you like your insurance nothing changes and you get to keep it. Naturally this flies right in the face of the lie and it’s such a high profile company that, well, something has to be done.
Like, make them an exception to the rule maybe? You know, special interest government. If you’re big enough and you can cause us enough embarrassment, we’ll “except” you from that which we require all the other drones to comply.
And that appears to be exactly what’s in the works if Jonathan Cohn is to be believed:
By this morning, both McDonalds and the administration were saying the story is overblown. McDonalds says it has no plans to drop the coverage and that it’s been in discussions with the administration over how to make sure it can keep offering the policies. The administration is saying much the same thing–that it’s aware of the issue, has been talking to industry representatives, and has already made clear these plans will be exempt from some of the early regulations on insurance.
Of course those plans obviously aren’t yet exempt since one assumes the legal team at Mickey D’s was able to successfully interpret how the new law would apply to them. So what Cohn is really saying is “nothing to see here citizen, move along, nothing to see” – a fairly routine attempt at spinning a situation in which the administration got caught with its pants around its ankles on the road in front of a school into one that’s “no big deal”.
But it is a big deal. And, if “these plans” are exempt, why? And which plans aren’t exempt. Is Burger King off the hook too? How about Taco Bell?
More importantly, where does the government get off telling a business how to spend its money? Cohn tells us it is because the want to make sure executive salaries and perks aren’t excessive and overhead is kept to a minimum. I say it is plain and simple unwarranted government intrusion that is becoming all too familiar since this administration has been in charge:
More important, the administration has yet to finalize the rule about how insurance companies spend their money (or what is known as the "Medical Loss Ratio".) It’s entirely possible the administration will phase in the requirement slowly. Most likely, then, McDonald’s employees who like these plans will get to keep buying them, at least for the immediate future.
Good thing we can read the bill now to find out what’s really in it, isn’t it?
You remember the story yesterday about Santa Clara county’s desire to ban toys in meals the board of supervisors had decided were unhealthy?
They’ve passed the provision:
On Tuesday, the Santa Clara County Board of Supervisors took action by prohibiting fast-food restaurants from using toys to lure kids into buying unhealthy meals. The vote was 3-2.
Have to love the “reporting”. Obviously a supporter of arbitrary government intervention the LA Times’ Karen Kaplan gives us another example of unbiased reporting:
Not surprisingly, the toy ban has angered folks who resent government efforts to help Americans eat healthier.
And if you’re wondering, the link above brings you right back to the QandO story yesterday on this subject. I, of course, make no bones about being biased, never have – this is more “nanny state goodness”. You see, Ms. Kaplan obviously thinks it is the role of government to “help Americans eat healthier” even if it means banning things. My guess is she’d not be quite as ready for government bans it they had to do with, oh I don’t know, books or something similar.
In Santa Clara County, one out of every four kids is either overweight or obese. Among 2- to 5-year-olds from low-income families, the rate is one in three. The county health system spends millions of dollars a year treating kids for health problems related to obesity, and the tab is growing.
If you haven’t yet figured out that the passage of ObamaCare has emboldened the nannies at all levels, this ought to make the case. Trust me, this reporter didn’t dig this nugget out. It was handed to her by those trying to justify this power grab.
Anyway, how will this work? Well, just as the FDA is going to be fiddling with the salt content in your favorite spaghetti sauce, the board of supervisors – all board certified nutritionists I’m sure – have decided on these criteria for a “trinket” to be included in order to “lure kids into buying” the meal:
In order to combine trinkets with burgers, chicken nuggets or other children’s fare, a meal must meet some basic nutritional requirements. Among them:
— No single food item can contain more than 200 calories, the drink cannot have more than 120 calories, and the entire meal cannot exceed 485 calories.
— No single item can contain more than 480 milligrams of salt, and the entire meal is limited to 600 mg of salt.
— No more than 35% of the calories can come from fat.
— No more than 10% of total calories can come from added sugar.
What has to be understood here is this is one of those precedent setters – if you give the Board of Supervisors this without a fight, how can you deny them the right, next time, to go after something else? Legitimate question. Because you know if they win this, there’s very little to restrain them from managing the rest of your life.
So where does this fight have to be won now that the board of supervisors have voted? Well thankfully it has to be approved again at a second Board of Supervisors meeting in May. If the article cited is to be believed, a poll shows 80% of the county opposes the ban. A bunch of that 80% needs to be in attendance at that BoS meeting next month and tell the emboldened nanny to butt out.