Dunkin’ Donuts Closures and Min Wage: Nothing to See Here

@TBPInvictus here:

In a “story” that minimum wage critics couldn’t wait to latch on to, Speedway, a wholly-owned subsidiary of oil giant Marathon Petroleum, announced it would discontinue its Dunkin’ Donuts franchisee operations at about 100 locations. Although the Fortune story mentions nothing about minimum wage being an issue, a Google search using [Speedway “minimum wage” “dunkin’ donuts”] produces over 26,000 hits, the first of which is, of course, at foxnews.com.

While not Fox’s piece, fact-free, fear-mongering content like this is peppered among the hits:

Screen Shot 2015-10-15 at 6.32.05 PM

Okay, that’s probably the hackiest of pieces I could find, as it’s virtually fact-free (“countless jobs”), but I’m trying to drive home a point.

Let’s be clear here: It is Speedway, the franchisee, that made this decision, not Dunkin’ Donuts. DD’s CEO, Nigel Travis (2014 compensation: $10.2 million), is a staunch opponent of the minimum wage. That said, as mentioned, this was not his decision.

I do, however, have correspondence from Speedway, which is responsible for the closures, and responded to my inquiry on the matter, saying:

Thanks for reaching out – yes, the rumors are true we are removing the Dunkin’ Donut self-serve coffee stations and replacing them with our name brand coffee. The self-serve kiosks removal, to my knowledge, has not caused any changes in employment as it is being replaced with another coffee that still needs to be made.

So, to recap: Speedway is replacing Dunkin’ with its own name brand coffee, no jobs appear to be in jeopardy (someone’s gotta make the coffee), and the minimum wage doesn’t seem to figure in at all.

The funny thing here is that anyone could do the minimal amount of investigative work I did to have figured this out. But they don’t. Because the truth doesn’t matter to them. Only the narrative and the ideology do.

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  1. wally commented on Oct 15

    “DD’s CEO, Nigel Travis (2014 compensation: $10.2 million), is a staunch opponent of the minimum wage.”

    Ha – says it all, doesn’t it?

    • BennyProfane commented on Oct 15

      Maybe, but, isn’t 10.2 mil minimum wage for CEOs these days?

  2. bigsteve commented on Oct 15

    The Dunkin Donuts shop down the road from me open up about a a year ago. They have been going gang busters ever since. And this is in Orlando a place with more restaurants per capital than most any other city in the world. You can find hokey in more ways than one.

  3. CD4P commented on Oct 15

    Invictus has a slogan to roll out for t-shirts: “Because the truth doesn’t matter to them. Only the narrative and the ideology do.”

  4. willie commented on Oct 15

    I have followed Invictus’ comments over the years and find his analysis and commentary to be as ideologically biased and short sighted as any of those who he has called out.

    To conclude that jobs will not be lost, because ‘look- they raised the minimum wage and nothing happened’, is to be economically disingenuous. Just as ‘sticky prices’ affect market adjustment to deflation, business owners will stay open in the short run as long as they cover their variable cost, and more importantly can avoid default on bank loans or long term lease obligations. When having to decide whether to continue to operate or to sign another lease to stay in business (and keep the minimally employed in their jobs) the equation changes dramatically. The jobs usually survive until the business owners decide they have had enough, which may take a couple of years.

    In 1955, when the minimum wage was raised from $.75 to $1.00, there were thousands of mom and pop diner and drive-ins with servers who made tips. By 1962, a huge number of them had gone out of business. The business model was made obsolete by the minimum wage increase as diners and drive-ins were replaced by McDonalds, minimum wage all the time for everyone. Anyone defending the argument that we are better off as a society for having eliminated small locally owned restaurants which were replaced with minimal service fast food joints, is not going to win a debate. Morally, moreover, was wiping out the investment and savings of small business owners, who worked as hard if not harder than their minimum wage employees- often for less than the minimum wage- a good idea?

    Why load the solution to inequality onto competitive business with demonstrably small margins. Is the purpose just to see how much more straw can be placed in the load. Competitive businesses all ready deal with the inadequate products of the educational system and the poorly parented children of a welfare state. Invictus should not waste time justify the minimum wage increase when his argument really is about inequality. If he believes inequality needs to be addressed then he needs to support one idea:

    There should be a government funded guaranteed income for every citizen.

    Any argument for an imprecisely targeted measure such a minimum wage, or minimum wage increase, is an intellectual embarrassment.

    If micro-economics teaches us anything, there are short term and then long term solutions in the market place to every change. As Patrick Moynihan pointed out in 1967, the short run effect of AFDC would help children, in the long it would destroy black families. Which it did. To some that was an unintended consequence. To others, it was willful ignorance since the result was foreseeable yet ignored. Moynihan, chose to ignore what he knew for a short term solution. He should have argued for a minimum income program with standards of performance (look at Younis’ micro-loan rules in Bangladesh) required to continue participation

    If one stops thinking because they have arrived at a short-term conclusion that makes them feel good, and ignores the long term consequences of their proposal, they are intellectually bankrupt.

    And if Invictus can’t give up the cause, then maybe he will also advocate for an Income Return for everyone in the country to report not just income to the government but each and every federal, state and local subsidy recieved so that the government can truly know who needs additional help and who doesn’t. The paperwork requirement can’t be anymore difficult than those imposed on tax payers.

  5. ilsm commented on Oct 16

    DD franchisees I know are too rich, and their kids far too spoiled!

    While you and I support their employees with Food Stamp and Medicaid.

  6. DeDude commented on Oct 16

    Yep they don’t need any of those stinkin’ liberal facts – they make up their own.

  7. krice2001 commented on Oct 16

    Yes, DeDude… As the wise Stephen Colbert once said, “facts have a liberal bias”……..

  8. howardoark commented on Oct 16

    Did anyone notice that the coffee stations were “self serve” – the one’s being replaced and the new ones. So, yes, no current jobs were lost. But we didn’t have self serve coffee (or sodas at McDonalds) when I was a kid. I’m in favor of a guaranteed national income (financed by higher taxes on CEOs and robots) but don’t kid yourselves that higher prices don’t discourage purchases – that goes for donuts and workers. You can expect the kids handing out the donuts to be replaced by robots once the minimum wage gets high enough and the cost of robots gets low enough. I’d say less than five years.

Read this next.

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