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This cuts to the core of the ethics of the free market. It is more ethical for McDonalds to make a higher profit, and pay lower wages, if they can. This is be

This cuts to the core of the ethics of the free market. It is more ethical for McDonalds to make a higher profit, and pay lower wages, if they can. This is because they have an agreement (and I don't care about the precise legal nature of this agreement) with the shareholders to maximize the profit of the company. The employees on the other hand, they never made any promises to. Employees have a relationship with the company as long as they are willing to take the wages/conditions on offer. You might think that it is ethical for McDonalds to redistribute money from their shareholders to their workers (and their workers are surely poorer on average). But this is solely the role of the government, and private charity. I can't prove this properly in a single post, but it is closely related to the First and Second Welfare Theorems.

grecy 13y ago
> This cuts to the core of the ethics of the free market. I know, that's why I left it as an open question. > They have an agreement with the shareholders to maximize the profit of the company. It's fascinating we let that agreement trump the implicit agreement they have with all humans on earth. > You might think that it is ethical for McDonalds to redistribute money from their shareholders to their workers (and their workers are surely poorer on average). But this is solely the role of the government, and private charity This is how the system currently functions, but I strongly believe the system needs to (and must) change. For a business to purely be concerned with profit can only lead to destruction for all of us. They'll bleed workers dry, kill the planet and be happy doing it.
- yetanotherphd 13y ago
  >This is how the system currently functions It's also the system that makes the most theoretical sense given the First and Second Welfare Theorems, which state (or more accurately strongly imply) that any desired outcome can be achieved by the free market, and government redistribution. "killing the planet" is an externality that can be addressed by environmental legislation (e.g. a carbon tax).
  - grecy 13y ago
    And how would you say it's working out for America vs. all the other Developed countries? One has to wonder what the end-game will be,
    - yetanotherphd 13y ago
      There is a distinction between free-market principles, and the way people on the right use free-market rhetoric to justify redistributing less money from the wealthy to the poor. There is nothing that I have said that would rule out a highly progressive tax system, and a generous welfare system. In fact that is exactly what I would recommend. I don't think the US is particularly free economically. It is true that most developed countries have higher minimum wages and, for example, more powerful unions, but this is not, in my opinion, why they have less inequality. They have less inequality because they have more progressive tax systems, and more generous welfare systems. Also the US has more cultural diversity, and many people (e.g. living in poor rural areas) could earn more money if they were willing to choose a very different lifestyle.
ronaldx 13y ago
> It is more ethical for McDonalds to make a higher profit, and pay lower wages This is a perverse use of the word 'ethical'. It attempts to remove corporations from any responsibility towards their employees. If it is, as you say, ethical for a corporation to follow their shareholders wishes and maximize profits and the cost to wages, then I consider it extremely unethical for shareholders to insist upon this, knowing that the result is exploitation of employees.
- yetanotherphd 13y ago
  Shareholders have no greater responsibility to pay living wage, than you have a responsibility to top up the income of some randomly selected low-income person. Let me ask you a question: where does the moral responsibility to pay higher than market wages come from? When I started my work, I had no doubts that my employer would rather pay less than more. However in my case there was competition for my skills that drove up the price of my labor. In the case of people earning minimum wage, there is not enough competition to drive the price above minimum wage. But in both cases the market is setting the price, and I don't see how the term exploitation applies to either. The fact that some people don't have the ability to earn more than minimum wage is a property of those people, not their employees. And the appropriate response is to transfer money to them via the tax/benefit system.
  - ronaldx 13y ago
    For as long as high unemployment results in a lack of competition for labour, and for as long as welfare is insufficient to cover a person's needs, people are obligated to take whatever employment is available. People are obligated to take employment even if that's at a far lower wage than the value of what they are offering. I am satisfied to describe this type of employment as exploitation. If a corporation makes an increased profit only by using the fact that its employees are in a very poor negotiating position and cannot refuse employer demands, I would be satisfied to call that unethical. Normally, people would call sweatshops unethical - on the same basis. I believe that corporations and already-wealthy shareholders both shoulder moral responsibility for that. Current economic conditions have converged to a point where [minimum wage] employees have almost zero negotiating position. I agree with you that this needs to be better addressed by politicians - partly, but not only, in the tax/benefit system - but I don't observe that it is being addressed.

grecy 13y ago

> This cuts to the core of the ethics of the free market. I know, that's why I left it as an open question. > They have an agreement with the shareholders to maximize the profit of the company. It's fascinating we let that agreement trump the implicit agreement they have with all humans on earth. > You might think that it is ethical for McDonalds to redistribute money from their shareholders to their workers (and their workers are surely poorer on average). But this is solely the role of the government, and private charity This is how the system currently functions, but I strongly believe the system needs to (and must) change. For a business to purely be concerned with profit can only lead to destruction for all of us. They'll bleed workers dry, kill the planet and be happy doing it.

yetanotherphd 13y ago
>This is how the system currently functions It's also the system that makes the most theoretical sense given the First and Second Welfare Theorems, which state (or more accurately strongly imply) that any desired outcome can be achieved by the free market, and government redistribution. "killing the planet" is an externality that can be addressed by environmental legislation (e.g. a carbon tax).
- grecy 13y ago
  And how would you say it's working out for America vs. all the other Developed countries? One has to wonder what the end-game will be,
  - yetanotherphd 13y ago
    There is a distinction between free-market principles, and the way people on the right use free-market rhetoric to justify redistributing less money from the wealthy to the poor. There is nothing that I have said that would rule out a highly progressive tax system, and a generous welfare system. In fact that is exactly what I would recommend. I don't think the US is particularly free economically. It is true that most developed countries have higher minimum wages and, for example, more powerful unions, but this is not, in my opinion, why they have less inequality. They have less inequality because they have more progressive tax systems, and more generous welfare systems. Also the US has more cultural diversity, and many people (e.g. living in poor rural areas) could earn more money if they were willing to choose a very different lifestyle.

ronaldx 13y ago

> It is more ethical for McDonalds to make a higher profit, and pay lower wages This is a perverse use of the word 'ethical'. It attempts to remove corporations from any responsibility towards their employees. If it is, as you say, ethical for a corporation to follow their shareholders wishes and maximize profits and the cost to wages, then I consider it extremely unethical for shareholders to insist upon this, knowing that the result is exploitation of employees.

yetanotherphd 13y ago
Shareholders have no greater responsibility to pay living wage, than you have a responsibility to top up the income of some randomly selected low-income person. Let me ask you a question: where does the moral responsibility to pay higher than market wages come from? When I started my work, I had no doubts that my employer would rather pay less than more. However in my case there was competition for my skills that drove up the price of my labor. In the case of people earning minimum wage, there is not enough competition to drive the price above minimum wage. But in both cases the market is setting the price, and I don't see how the term exploitation applies to either. The fact that some people don't have the ability to earn more than minimum wage is a property of those people, not their employees. And the appropriate response is to transfer money to them via the tax/benefit system.
- ronaldx 13y ago
  For as long as high unemployment results in a lack of competition for labour, and for as long as welfare is insufficient to cover a person's needs, people are obligated to take whatever employment is available. People are obligated to take employment even if that's at a far lower wage than the value of what they are offering. I am satisfied to describe this type of employment as exploitation. If a corporation makes an increased profit only by using the fact that its employees are in a very poor negotiating position and cannot refuse employer demands, I would be satisfied to call that unethical. Normally, people would call sweatshops unethical - on the same basis. I believe that corporations and already-wealthy shareholders both shoulder moral responsibility for that. Current economic conditions have converged to a point where [minimum wage] employees have almost zero negotiating position. I agree with you that this needs to be better addressed by politicians - partly, but not only, in the tax/benefit system - but I don't observe that it is being addressed.