Huffington Post Retracts False Claim About McDonald's Wages

Huffington Post Retracts False Claim About McDonald's Wages

With a scattering of fast food workers waging a media-friendly strike in some parts of the country over the minimum wage, the left-wing Huffington Post waded into the debate Monday with a headline that read, “Doubling McDonald’s Salaries Would Cause Your Big Mac To Cost Just 68¢ More.” The thrust of the story was that a mere 17.1% increase in the price of McDonald’s food was all that was needed to double employee salaries.

The thinking behind this came from the mistaken belief that out of every dollar McDonald’s earns, only 17.1% goes towards paying its employees’ benefits and wages.

Wednesday, the Huffington Post published a lengthy retraction correcting its error:

A typical fast-food restaurant spends 30 to 35 percent of its income on labor, according to a recent release from the Employment Policies Institute, a research organization whose work is often cited by those who argue against increasing the minimum wage. The institute estimates that small-business owners who run McDonald’s franchises spend about a third of their income on wages, which would mean the price of a Big Mac would go up by $1.28 to $5.27.

A doubling of wages at McDonald’s would almost certainly involve some layoffs, asserts Dean Baker, co-director of the Center for Economic and Policy Research and a HuffPost blogger. At the same time, more workers would stay in their jobs longer, Baker added.

The fact that the Huffington Post would believe such an absurd and simple-minded premise in the first place is rather startling. The left is just too eager to believe the worst about private business (but never the government). The idea that thousands of franchise owners wouldn’t nudge prices a bit to pay their employees more (or boost their own profits), would strike most people as a fairy tale from the start.

The left is very impressive with all its talk about diversity, but a diversity of thought, worldview, and background would do enormous good in all aspects of journalism.

At any rate, the Huffington Post is to be commended for its detailed and transparent retraction.

UPDATE: Let me take back what I said about diversity. Forbes also published the debunked study.



Follow John Nolte on Twitter @NolteNC