An article from US-based group, Unity & Struggle, on the prevalence of fast food work in the American economy.
I am still thinking many things through so at times this piece will be fragmentary and move from place to place. I am trying to use the three volumes of Capital to think through what the fast food industry means in capitalism today. I hope that does not distract from my fundamental point. I argue that the role of the fast food industry is key in lowering the value of labor power and that revolutionaries should make fast food organizing a central part of their work.
In Capital, Marx writes, “…the labour-time [sic] necessary for the production of labour-power [sic] is the same as that necessary for the production of those means of subsistence in other words, the value of labour-power [sic] is the value of the means of subsistence necessary for the maintenance of its owner” (274). Furthermore, the reproduction of the worker’s family must also be taken into account. Accordingly, Marx writes, ” The value of labour-power [sic] was determined, not only by the labour-time [sic] necessary to maintain the individual adult worker, but also by that necessary to maintain his family” (518). This passage has three processes happening at the same time: the reduction of the means of subsistence, the reduction of the labor-time necessary for the production of labor power, and the reduction necessary to feed, clothe, shelter and educate the worker’s family. One of the key means of subsistence in determining the value of labor power is the cost of food. This process did not occur overnight. Loren Goldner describes this process as,
By the late 1960s, the postwar boom had brought world capital to another moment in which the current cost of reproducing labor power could no longer serve as the systemic numeraire,س the common denominator, for commodity exchange. Capital again, as in 1914 but more diffusely, entered a new period in which physical destruction on a world scale was a necessary part of the movement of devalorization and potential revalorization. (Goldner).
This meant the restructuring of capital and labor power. More efficient food production and distribution per calorie were central in the lowering of the value of labor power. As the graph shows, there has been a clear and continuous decline in the percentage of food expenditure for U.S. households.
Undoubtedly this graph shows a clear trend downward. But a closer look in terms of income and food expenditure shows larger inequalities. According to Randy Schnepf in Consumers and Food Price Inflation on food expenditure, there is a clear relationship between income and food expenditure. As income rises, the food expenditure becomes a smaller percentage of the overall expense of a household. This is referred to as Engel’s law. According to the study, the lowest 20% of the income quintile spends 16.1% of income on food, the second 20% spends 14.5%, the third 20% spends 13.3%, the fourth 20% spends 13.0%, and the highest income quintile spends 11.6% on food (9). According to the Bureau of Labor Statistics total food spending by U.S. consumers in 2011 was 789.7 billion dollars (Bureau of Labor Statistics). Of this near 800 billion dollar economy, 195 billion dollars are made up by the fast food industry (Statistics Portal).
What is also true is that the downward trend of food expenditures alone does not explain periods where there were real wage increases such as the 1950s to 1972 where the real average weekly wage was the highest it has ever been at $315.44 (Moody 80). So there is not always a one to one relationship between declining food expenditures to lowering of value of labor power, let alone the power of real wages.
However in the post 1970s period, I argue that fast food has been central. I can only briefly explain this here as it has been gone over in-depth by Loren Goldner in Remaking of the American Working Class. U.S. capital has been ruthless in making sure Department II goods are produced as cheaply as possible. This has been done through using the cheapest labor-power available. By way of example China is a cheap labor platforms to produce primarily goods for Department II as this table shows. However some key shifts are taking place as the Congressional Study highlights:
Does this mean there is a shift occurring where China is a global producer of Department I goods instead of Department II? I will not speculate for now, and leave that for another time. I only want to recognize possible future trends. Hopefully I have not gotten lost in the forest. The point I am making is that U.S. strategy has been to produce Department II goods in areas with extremely cheap labor. If we only take a moment to think about where fans, shoes, shirts, toothbrushes, toys, pens, etc are made it should give us a quick sense of how the global geography of Department I and II look like. Much more research is needed for to make sense of this for class struggle politics.
Below is a chart showing the relationship of wages to productivity. Notice the year when they diverge.
This graph speaks for itself.
Looking at the Industry
Compared to other sector of capital like auto, steel, or aircraft manufacture the fast food industry is highly fragmented. It is unclear exactly why, but it probably has to do with the relatively low cost of entry into the food industry. This means that more petit-bourgeois layers can open up mom and pop restaurants. So in the United States GM, Ford, and Chrysler are the only U.S. based firms. The fragmentation of the fast food industry could pose organizing problems. It is unclear to what extent any of the industries set trends for the others. Educated guess might lead me to guess that McDonald’s is one of the key trend setters not only for it’s large share in the industry, but also because of its cultural presence in our society. This is part speculation and only class struggle will reveal the real relations of forces. At the same time we should not let fragmentation of the industry demoralize organizing possibilities.
Sucking up Value
To the extent that concentration of workers is crucial in organizing workers, the statistics below can be read in many ways. While there are an abundant amount of very small shops, there are a sizable number of shops with fifty or more workers.
The chart below shows the structural costs of the industry. It is not clear what the “Average Costs of all Industries in sector (2010)” refers to. Furthermore, it would be helpful to get some data on what the cost structure of other industries are so we can get a sense of what these numbers mean via comparison.
Source (http://virtualbutterfly.files.wordpress.com/2010/04/72221-fast-food-restaurants-in-the-us-industry-report.pdf p 35)
Fast food is a labor intensive industry in Department II. Marx divided the capitalist economy into two departments: Department I produced means of production and Department II produced means of subsistence. The food produced in Department II feeds workers and capitalists in both Departments. George Caffentzis points out in, ” Capital, volume III, “Conversion of Profit into Average Profit,” which shows the existence of a sort of capitalist self-valuation. In order for there to be an average rate of profit throughout the capitalist system, branches of industry that employ very little labor but a lot of machinery must be able to have the right to call on the pool of value that high-labor, low-tech branch create. It there were no such branches or no such right, then the average rate of profit would be so low in the high-tech, low-labor industries that all investment would stop and the system would terminate” (79 In Letters of Blood and Fire). As far as I am aware, there has been little research done in the history of class struggle of how this affects struggle, the composition of capital and the proletariat. How we might view class struggle from a vantage point such as this is unclear to this author. However, the strategic implications seems clear. What if the transfer of value decreased from sectors which employ lots of labor to sectors which employ less labor? NPC from Kasama in a recent blog post, cites Richard Florida’s 66% argument. While Florida does not provide theoretical detail to his argument, Michael Robert’s has shown:
As the graph below shows, when the organic composition of capital fell, as in the neo-liberal period, due to the slump in the early 1980s and then from the cheapening effects of new technology in the 1990s, the rate of profit rose. But in the 2000s, those cheapening effects have worn off and organic ratio has risen back to levels not seen since the crisis period of the 1970s. But this time, the rate of profit has not fallen as much because the rate of exploitation (surplus value) has also risen, unlike in the 1970s.
The rise in exploitation and growing inequality (well recorded by many and in this blog) may lead to social upheavals down the road, but it does help to keep the rate of profit up. But there are limits on increasing the rate of exploitation and the US economy has probably reached them, especially with productivity growth slowing and real GDP growth so weak. So the current rate of profit can only be sustained by a sharp fall in the organic composition of capital. That can only happen if there is large depreciation of the value of the means of production (and in fictitious capital, as I have discussed in previous posts). And that means another slump or recession, perhaps equivalent to 1980-2.”1
In Letters of Blood and Fire George Caffentzis argues that low and high organic compositions of capital are dialectical twin (unity of) opposites with one other. That it is precisely the high organic composition of capital which cannot live without the low organic composition of capital. It is only through the transfer of value from the low to the high sectors of the economy that an average rate of profit is produced and more importantly it is only in that way that sectors which employ immense capital, can make profit at all. The burdening sectors of highly labor intensive industries across the United States and the globe are the mirror reflection to mega projects like the International Thermonuclear Experimental Reactor in Cadarache, France.
For all the doom and gloom prophecies of capitalism’s end, the system has shown itself to be profoundly adaptive. Crisis is not necessarily the signal of capitalism’s end. As Joseph Schumpeter and Karl Marx have both written on extensively, a creative destructive process gives new life and fire to the system. Could we be witnessing the remaking of U.S. capitalism once again? This could powerfully explain the growth of low wage-labor intensive sectors. The growth of this sector could be exactly the valorization of labor power capital needs to continue accumulating in more capital intensive sectors of the economy.
Fast Food Workers
The largest fast food chains in the United States are (10 Biggest):
In the New York Metropolitan area there were 70,000 fast food workers (UnitedNY and The Center for Popular Democracy, 24). An additional 6,850 cooks are in the fast food industry in NYC (Ibid). (Depending on the source there are anywhere from 2 to 4 million fast food workers nation wide.) It is easy to lose perspective without something else to compare. I have compared New York City’s 10 largest employers with the fast food industry (Lutz and Lubin).
Fast food jobs have historically been seen as summer jobs for high school students or younger people in general. It has not been considered a job where older workers raise families. However the latest trends show something different in the recent period. In 2000, the average age of fast food workers was 22 and by 2013 it 29.5. Among women, who make up two-thirds of the industry, the median is over 32 (UnitedNY and The Center for Popular Democracy 25).
According to the Fast Food Forward website workers make on the average of $11,000/ year in the industry. Meanwhile the fast food industry is a $200 billion/ year industry. What strategy does Fast Food Forward have when it comes to capitalists inflating away wage gains by raising the prices of commodities. If anything, the history of unions on this question is non-existent.
Geography and Fast Food
There is a whole other piece which can be written using Capital Volume II in describing the logistics of fast food. But for now I will merely give some empirical data which points the way. Unlike the auto industry or steel, fast food firms have to stay close to where labor power circulates. Workers will not travel 200 miles for a burger. This means that fast food firms have to say at a relatively convenient geographic location for workers to quickly get their food, consume it, and return to either work or their home. While fast food firms can quickly shut down individual shops when organizing efforts begin, they cannot shut down all shops or move all shops at the same time. Depending on how broad the struggles become, this could become a major leverage point for workers in the industry. The multitude in this case cannot be broken up in the same way auto-workers, electronic workers, or steel workers were in the last forty years.
According to Fast Food Nation, “A typical McDonald’s or Burger King restaurant has about fifty crew members. They work an average of thirty hours a week. By hiring a large number of crew members for each restaurant, sending them home as soon as possible, and employing them for fewer than forty hours a week whenever possible, the chains keep their labor costs to a bare minimum” (31). Eric Schlosser writes, ” The high turnover rates at fast food restaurants, the part-time nature of the jobs, and the marginal social status of the crew members have made it difficult to organize their workers. And the fast food chains have fought against unions with the same zeal they’ve displayed fighting hikes in the minimum wage” (32).
Furthermore, Schlosser says
The fast food chains feed off the sprawl of Colorado Springs, accelerate it, and help set its visual tone. They build large signs to attract motorists and look at cars the way predators view herds of prey. The chains thrive on traffic, lots of it, and put new restaurants at intersections where traffic is likely to increase, where development is heading but real estate prices are still low. Fast food restaurants often serve as the shock troops of sprawl, landing early and pointing the way. Some chains prefer to play follow the leader: when a new McDonald’s opens, other fast food restaurants soon open nearby on the assumption that it must be a good location (29).
He goes onto describe McDonald’s take to choosing specific sites using the latest technology,
The McDonald’s Corporation has perfected the art of restaurant site selection. In the early days Ray Kroc flew in a Cessna to find schools, aiming to put new restaurants nearby. McDonald’s later used helicopters to assess regional growth patterns, looking for cheap land along highways and roads that would lie at the heart of future suburbs. In the 1980s, the chain become one of the world’s leading purchasers of commercial satellite photography, using it to predict sprawl from outer space. McDonald’s later developed a computer software program called Quintillion that automated its site-selection process, combining satellite imagery with detailed maps, demographic information, CAD drawings, and sales information from existing stores. “Geographic information systems” like Quintillion are now routinely used as site- selection tools by fast food chains and other retailers (Ibid).
Schlosser correctly recognizes the impact of fast food restaurants in the suburbanization of U.S. cities. Considering the growth of suburbs in the United States, the relationship to fast food and suburbs is a topic waiting to be explored. Suburbanization has created a new geography for working class composition and potential struggle. This vast geographical expansion has also require complex logistical support and supply chain management.
The key component in the McDonald’s supply chain is Reyes Holding which includes a division called Martin-Brower which is the distributer of all McDonald’s in the United States. Reyes Holding’s is the 14th largest private company in the United States. Reyes Holding employs 14,000 workers. Without Reyes Holding McDonald’s logistical support would have a literal heart attack (Forbes). What relationship does the Fast Food Forward organizing have with the workers delivering all the key materials for McDonalds is very unclear.
McDonald’s has one of the most sophisticated supply chains in the quick service business. The Martin-Brower Company LLC, under the leadership of Brian Hancock, president, delivers product to nearly all 15,000 McDonald’s restaurants in North America (Harrington). An example of what Martin-Brower does is in a trade journal called Inbound Logistics. This is a space where the most cutting edge of just in time shipping and production are put into practice and discussed amongst capitalists and business insiders. The crunch Martin-Brower was facing were high costs in transporting potatoes from Manitoba, Canada to Manassas, Virginia. The story showcases the ingenuity of Todd Hopkins’ switch from using trucks to railroads. It highlights the difficulties he faced from finding refrigerated cars to shortening the very long route of the trains from 19 days to 14 (Loudin). The point being that McDonald’s has an entire back end operation, while separated along corporate lines, is virtually the same company or at least part of the same production process.
One of the weaknesses the fast food sector faces is the lack of a monopoly position any one fast food firm holds. For example, if all of McDonald’s was shut down because of a strike action, consumers can go to other fast food chains. What the political and economic impact on the rest of society will be is highly speculative. Again not to downplay how a total McDonald’s wide strike could have the potential to galvanize the poorest layers of the working class.
One of the most interesting dimensions of such chains is how quickly workers can move from one chain to the next. Automation and division of labor have homogenized what seems like fundamentally different skills. Within a few days, a worker can be cooking pizza, or making tacos, serving donuts. This requires low-skilled workers who bargaining power in the labor market is weak.
The constantly expanding geography of the fast food industry gives capitalist firms immense power against the working class. But as I have shown, there are possibilities of using the de-skilling and mobility of the job as an advantage against such firms. The geographic dimension has far been largely neglected to the detriment of workers’ struggles. But as discussed by Eric Schlosser, the fast food industry is a vital part of the suburbanization of American society. Understanding the in further details what the entails is a major task for scholars and organizers. In this paper I have tried to place fast food workers in the context of a period of capitalism which is radically different than any other. It is not different because there is no more working class, or that working class struggles are destined to defeat. It is different because a revolution in value has drastically changed the composition of the class. As of yet the only response has been an economistic vision of organizing. While it has slowly caught on a few major cities, it is unclear if this will turn into something larger. I argue that struggles in fast food will play a decisive role in the upcoming years. They have been a key determinant in the attack on the broader working class. Below is a map that shows states and the percentage of fast food firms.
First some broad points. All this does not mean fast food workers are the vanguard or are inherently revolutionary. That is yet to be determined and will ultimately be known based on what they do, not necessarily, although not divorced from who they are. I have tried to sketch a minimal Marxist-compositionist analysis of fast food workers. More work has to be done. I have probably reached the limit of research without having been involved in the actual organizing. Further information will only come by such efforts.
Organizing around fast food workers might by pass many of the difficulties faced by a revolutionary left that has no roots in the unionized movement, no roots in sectors such long shore, auto, semi-conductor industry, etc. While this is not a magic bullet for the separation of the revolutionary left from the working class, it is a sound starting place. The point is that many of these other workplaces face obstacles such as geographic, security, organizational barriers. Regarding fast food workers, the chains are everywhere, there are no metal gates we have to cross or apartheid walls blocking us to their workplace, and there are no unions organizationally screening us. Fast food workers might be a very accessible way to get deeper into the class. These workers will have family and friends who are in industries which we might not have immediate access to. A successful struggle in fast food, might spread the word to family and friends in other industries.
I will loosely use NPC’s 6 points as a reference point to list what revolutionaries should be doing.
1. Build our own struggles. This means we should begin by agitating fast food spots in our neighborhoods and spread out from there. We do not need to jump right away into battling Fast Food Forward. That will certainly come, but we have plenty of space and time it looks like to build a more militant/ radical wing in the movement. A more militant/ radical perspective will only have credibility if it has a base with fast food workers themselves. This will mean having clear agitational material, a strategy, and demands.
2. Agitate Among the Organizers. I am unsure about this. I see the professionally organizers to be highly conservative and slow to move. They will tail the militant workers, not lead them if I had to guess.
3. The Union Question. We should not push for building a union. If we think about the question from what the fast food workers need to do, it might explain why no union in the world is capable of successfully fighting capital via the fast food workers. Fast food workers sit at the middle of complex logistics-distribution node, a complex-shitty food web, meeting place for many people in the neighborhood, and sit at the center of the healthcare problems facing working class Americans. Lastly, fast food workers are structurally in a similar position to many undocumented workers and have a clear line of sight in terms of potential solidarity–arguably more than any other layer of the class in terms of workplace solidarity. No union can do these things. Something different will have to be born to take on such complex problems and solidarities.
4. Have devastating critiques of Fast Food Forward and SEIU ready. Be able to explain this stuff clearly.
5. I agree 100% with NPC on pushing for militant tactics.
6. We need a complex and clear analysis which accurately explains the role of fast food in capitalism today. It needs to be understandable to millions of workers. How do workers deal with automation? What about inflation which might result from substantial gains in fast food wages?
There are some glaring omissions in this document that I wanted to acknowledge.
1. To what extent $15/hour be a Keynesian boost to the economy needs to be considered. We will ultimately not know until this demand is won I think. In the meanwhile our own political perspectives will frame the argument, but we should not be ignorant of the other possibility.
2. What relationship does this struggle have to communism in our public agitation, propaganda, how we talk to workers etc? How do we not end up in the economistic/ political divide which happens so often in waged struggles
3. What does this struggle mean for race and gender in the United States?
4. This document is not a completed compositionist analysis. It is missing subjectivity. In the document, the fast food workers are still more of an object of capital then a subject. It is missing the actual movement of the class in the fast food industry. It is missing connecting organizational form, political content to the composition of the class. It is missing interviews and the details. I argue this is only 25% complete.
5. In the end this research needs to be turned into a pamphlet for fast food workers. The knowledge of the broader industry needs to be become a weapon for the workers.
6. Hopefully this document did not draw too mechanical of a link between the composition of the class and its potential radicalism. There is not always a link.
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Originally posted: October 7, 2013 at Unity & Struggle
- 1 http://thenextrecession.wordpress.com/2012/11/25/the-us-rate-of-the-profitthe-latest/