That Taco Bell Boycott
Well meaning or not, the boycott of Taco Bell by misguided activists, in the name of helping labor, is deeply ignorant and very destructive. Stopping the market transactions of mutually benefiting exchange, even in the name of moral obligations, does not produce anything of lasting value to assist in capital accumulation or increasing standards of living. It interferes with the freedom of contract and makes people poorer. [Full Article]
Comments (32)
boycotting yum foods / taco bell because of personal preference for corporate management techniques / wages is as valid, if not more so, than marketing and advertising "propaganda".
this organized boycott simply reflects consumer demand for more of their chalupa revenue to divert to farm hands and less to commercial advertising. in fact, to propose that the standard inverse methodology is superior actually suggests a docile and maliable consumer -- ideal for COMMUNIST planned economies perhaps.
customers are (bounded) rational. the asymmetry of information is simply breaking down and "advertising" by people exlaiming the plight of the farm hands has been valued *higher* than the "advertising" by marketers that "this commercial made you feel good; feel good again by buying our meat-like product".
in other words -- pay the farm hands decent wages or we (the customers) will bankrupt you (yum foods), create a *temporary* depression, and a better company which does pay its farm hands more (according to customer preference in the market) will receive that revenue and take your place.
stop trying to defend a defective, though established (stable), corporation with misperceived libertarian / austrian economic values.
-z
Published: October 4, 2004 9:39 AM
With due respect, Mr. D'Amico is wrong. I'd like to know how many of Yum Brand's "migrant workers" entered this country illegally - quite a few, I imagine.
Americans OUGHT to boycott Yum Brands and any other company that gives jobs to illegal aliens. Such companies have no loyalty to the American people - MY people. As part of that effort, it may make sense to boycott Taco Bell and others who buy from such companies.
Every job that goes to an illegal alien is a job that could (and should) have gone to an American, or at least to a non-citizen who is a legal permanent resident.
I am willing to pay more for products and services if that's what necessary to employ Americans rather than continue bringing in a flood of Third Worlders. Combined with further reductions in government "welfare" benefits, higher wages in these menial jobs will attract Americans to do the work.
Moreover, the higher prices needed to pay Americans to do these jobs, must be balanced against the huge indirect costs of hiring aliens.
For every American who's unemployed or underemployed because he's undercut by a Third Worlder working for absurdly low wages, we pay a heavy price:
1. The American may become unable to pay his property taxes - or, as in NY, may be granted a far lower prop tax rate while he's unemployed. If so, everyone else in his town will bear a proportionally heavier load to keep funding local gov't services (mainly, public schools). This tends to lead to higher property taxes.
2. If the American becomes unable to afford health insurance, the rest of us will end up paying to take care of him and his family through Medicaid. That tends to lead to higher taxes.
3. The American can still afford health insurance but becomes unable to afford his copayments and unreimbursed medical expenses, the hospitals will have to pass that cost along to the rest of us. That tends to lead to higher health-care prices for all of us. (It also tends to lead to hospitals clamoring for yet more taxpayer subsidies.)
4. The migrant workers may not be paying fed and state income taxes, whereas an American citizen on-the-books would be. The difference in income tax revenue is, again, made up by the rest of us. (leave aside the fact that we ought to repeal the sixteenth amendment and remove the fed government's power to directly tax our incomes - right now there is a federal income tax)
In short, noone who breaks our laws to enter this country should be allowed any employment, at whatever wage. They should be tracked down and deported. Second, invoking the free market to excuse the employment of non-Americans at Third World wages is short-sighted.
Our priority should be protecting the rights, interests, and culture of AMERICANS. Those interests include the opportunity to compete for a wage which can support a family -- without having to "compete" with a limitless supply of Third Worlders who will work dirt cheap.
The folks at CATO wouldn't be so sanguine about open borders and the employment of Third Wolders at Third World wages, if their own jobs were at risk. Perhaps we should hire some folks from India to write CATO's publications at a fraction of the cost - and fire D'Amico and the rest of the CATO staff. After all, don't you want a "free market"? Who are we to care about Americans more than the other 6 billion people in the world? ;)
Published: October 4, 2004 10:21 AM
Consumers don't "buy" farmhands, they buy tacos. It's not that consumers are docile and malleable, but that, as consumers, their main concern is for removing their felt uneasiness, i.e. hunger. Not buying tacos from Taco Bell doesn't necessarily communicate that they're unhappy with how much the farmworkers are paid--it may just mean that they prefer pizza or hamburgers to tacos. Yes, you can issue press releases and other statements to that effect, but that doesn't necessarily make such statements true.
A more important consideration is the view of the farmworkers themselves. Would they be working for such low wages if they thought they could get better wages somewhere else? So a "depression" for farmworker labor, even if only temporary, requires restricting the farmworkers' choices "for their own good". The boycotters are trying to force their views onto the farmworkers as well as onto Taco Bell management, although admittedly, they are not actually using coercion to do so.
But the ultimate question is whether they are, in fact, actually helping the farmworkers by not buying the products of their labor. That's what seems so far-fetched. I suspect that the farmworkers would prefer to keep working rather than take a forced "work stoppage".
Published: October 4, 2004 10:22 AM
Wait a minute. All Taco Bell wants to buy is tomatoes. It does not matter where Taco Bell gets the tomatoes from, as long as the tomatoes are of the quality its customers desire. I'd say Taco Bell is doing the farmowners a tremendous favor by buying tomatoes from them, as opposed to imported tomatoes. Say what you want about the wages the farmowners are paying to the workers, but if there's a "villian" in this scenario, it's the farmowners, not Taco Bell. Of course, if you boycott them, they'll go out of business, all the poor migrant workers will lose their tomato-pickin' jobs, and Taco Bell will have to buy tomatoes from someone else anyway. So, who wins here?
Published: October 4, 2004 11:00 AM
First two commentators: Immigration per se is not the issue at hand here. The fact that illegal workers are not subject to government regulations and that consumers and business are benefiting from this, in terms of their labour, is. It shows empirically what would happen without government regulations.
Published: October 4, 2004 11:19 AM
Mr. Brendel:
Most of those indirect costs that you refer to are caused by government intervention in the economy, not by the free market. Socialized health care, public education, property taxes, etc. Thus, you should be in favor of a free market instead of against it.
And you are certainly free to pay more for "American-made" and American employees if you want to. However, that won't make Americans more productive. The real question is whether you want to force me to pay more, and thus prevent me from engaging in voluntary exchanges with other people.
Published: October 4, 2004 11:19 AM
If it were only so easy as to take some of the advertising budget and move it to the 'tomato expense' category. The demand (perhaps imperfectly) is set by advertising. The 'concerned' consumer may merely be saying "we want only what is fair", but how did they come to know who Taco Bell is in the first place? Would they be willing to pay $4 for a Taco to make up for the overall lost revenue from a decline in advertising?
In a static, everything else being equal world, maybe Yum Brands would be more than willing to adjust their business plan if all these 'concerned' consumers would guarantee demand through none breakable blanket purchase orders or some such. That is how supply chains work, and a relatively exacting interrelationship is done through such contractual guarantees. Since the average consumer, even these 'concerned' consumers would make no such guarantee to Taco Bell, likely leaving their decision until bar time and how much jingle they have left, they have no right, moral or otherwise, to dictate the business plan of same.
Of course, with non-coercion, they can do as they please. I don't have to like it, but I AM going to Taco Bell this noon for lunch (and I'll ask for extra tomatoes).
Published: October 4, 2004 11:20 AM
I have a serious question: Mr D'Amico states that the employers of these illegal immigrants are not bound by minimum wage law. How is this possible? Is it because the minimum wage laws are not enforced, or do the laws simply not apply??
It seems that there is a large consitutency arguing for creeping legalization of illegal immigrants; I have heard about access to health care and drivers' licenses, but not the enforcement of minimum wages.
Information would be appreciated.
Published: October 4, 2004 11:54 AM
Rothbard on boycotts:
Making Economic Sense, Chapter 38: "The Legacy of Cesar Chavez"
Published: October 4, 2004 12:13 PM
I really think that 99% of the time boycotts are merely created and reinforced by competitors of the company being boycotted. Unless popular opinion is HUGELY weighted on the issue, boycotts simply don't work.
That being said, all of this discussion really goes to show how muddled and fuddled our immigration policies, healthcare system, etc. actually are. It isn't the fault of illegal immigrants that our bureaucratic system makes it very dificult for them to enter the labor pool in America legally. Now, of course there IS a protocol for immigrating legally, and that protocol should be followed. But until our border policy is corrected, should we punish those people for our government's shortcomings? I am really putting that question out for debate, because I don't have the answer.
Honestly, if there is some Mexican that can do my job better than I can, my employer should be completely free to hire him or her if they want to. And the fact that I am an American doesn't grant me some kind of elite status, or right to have a job that people of other nationalities don't possess.
Published: October 4, 2004 12:15 PM
It is sad that some people are so badly off that they will work for such low wages.People start families before they have aquired valuable job skills. Is Taco Bell to be blamed for this?
Lots of people want to help the poor but not with their own money.Anyone is free to start a
business and pay higher than market wages.The Body
Shop is an example.
Published: October 4, 2004 12:42 PM
without having to "compete" with a limitless supply of Third Worlders who will work dirt cheap.
i suspect the issue has less to do with the third worlders themselves and more to do with the organization model of the companies which exploits them. particularly the *externalization* of costs to governments and other people.
Consumers don't "buy" farmhands, they buy tacos.
ugh, please look at this as a *process* not discreet *products* (or "goods"). customers do in fact "buy" farmhands as a function of which organizations they patron for the alleviation of hunger by taco. everything is connected to everything else.
this is perhaps best exemplified by wal-mart. as we should all know being good austrian economicists / libertarians, "there's no such thing as a free lunch". those "everyday low prices" aren't comming out of walton's ass, they're comming from the aggregate of paying sweatshop laborers $0.05/hr rather than $0.06/hr.
let us not forget that what makes free market pricing so wonderful is its ability to provide localized *feedback* of valuation. "how much do you like this shirt?" "i like it $15 much." but other forms of feedback also (and must) exist. my valuation of "this shirt" will change between whether my model as a "bounded rational agent" includes information of "made with 100% cotton" or whether it also includes "made with 100% cotton which required 20lbs of pesticide X which raises the cost of my drinking water + an 8 year old girl in honduras working 14 hour shifts in 100deg F weather without bathroom breaks which prevents her from educating herself and learning the importance of birth control".
free markets are not about sticking your head in the sand and saying "price is the only feedback i will ever pay attention to"; free markets are about saying that without price no other *distributed computational model* of relative value as yet succeeds in satisfying wants in the face of *scarcity*.
So a "depression" for farmworker labor, even if only temporary, requires restricting the farmworkers' choices "for their own good".
we're not talking about central planning here; we're talking about market demand. why is it so easy to accept market demand when talking about lower prices, yet so hard to accept that same market demand when talking about higher prices. look at the incredible success of the organic foods markets! many many people are willing to exchange more fiat currency for what they are chancing (*personal risk*) will be a lower cost of medical services futures and lifestyle quality.
All Taco Bell wants to buy is tomatoes. It does not matter where Taco Bell gets the tomatoes from, as long as the tomatoes are of the quality its customers desire.
stop over-simplifying your model; in fact, you are contradicting yourself. from the main article, what these taco bell customers are defining as "tomatos of quality" is in fact "plucked by farmhands paid decent wages". all taco bell wants to do is service their customers for a profit. if that means using tomatos produced by certain constraints and pricing them accordingly to their customers, so be it. again, i cite my organic foods example. perhaps replace "farm hand wages" with "non-GMO" and reconsider.
The real question is whether you want to force me to pay more, and thus prevent me from engaging in voluntary exchanges with other people.
nobody is "forcing" anyone to do anything. you can choose NOT to buy whatever it is if the asking price exceeds your personal valuation. however, i reiterate that what we're really dealing with here is not "paying more" or "paying less" but "paying differently". price is ONE, although (at least currently) VITAL, form of feedback in a distributed economic computation.
austrian economics / free markets get SUCH A BAD REPUTATION precisely because of this two-faced-janus behavior; just a stones throw away from neoconservativism and communism...
Would they be willing to pay $4 for a Taco to make up for the overall lost revenue from a decline in advertising?
i have been fortunate enough to pay $4 for a *quality* local-economy burrito and considered the value transaction far superior than anything taco bell has to offer. but that's me, and that's the point of free markets.
Yum Brands would be more than willing to adjust their business plan if all these 'concerned' consumers would guarantee demand through none breakable blanket purchase orders or some such.
get off your keynesian central-planning stability high-horse. "GUARANTEE"?!?!?!?! are you serious?! this is a free market fraught with *risks* and *experimentation*; want guarantees of stability, nazi germany was a *very* stable marketplace until the near-end of its government collapse.
That is how supply chains work, and a relatively exacting interrelationship is done through such contractual guarantees.
this is a *model*, it has little to do with reality. "supply chains" to their logical extremes are known as "regimented economies" -- aka "wartime central planning".
if you really want to improve the lot of grape workers, don't boycott grapes; on the contrary, eat as many grapes as you can stand, and tell your friends to do the same. This will raise the consumer demand for grapes, and increase both the employment and the wages of grape workers.
i'm not sure what to think about rothbard yet. but OVERPRODUCTION or "global glut" is very real and has been since the early 1900s. ever hear of the great depression? eating all those grapes will incur previously unknown costs, and artificially inflate the grape market - distorting the value of grapes.
boycott and consumer preference are the *same thing*. prefer to purchase a toyota car and not a ford? you are, technically, "boycotting" ford.
and that's the end of my show; donk!
-z
Published: October 4, 2004 1:15 PM
America's Great Depression, by Murray N. Rothbard.
Read the book (PDF), buy the book, or read a shorter article by Rothbard here.
re zuzu:
Published: October 4, 2004 2:15 PM
Quotes are a wonderful tool to subtly alter the meaning of a given word or phrase, and such alteration has been performed here on the word "compete." Specifically, it is Mexican/Indian/otherwise non-U.S. workers who "compete" while the rest of us can get along simply competing. Subtle difference: Juan or Deepak will "compete" with Joe for his job but Dick and Jane compete with Joe for the same job.
So...a) is there any actual difference in a brown-skinned person competing with a white person for their job than two whites doing the same exact thing? b) is "competition" something to be done between proper white Christian folk, to the exclusion of anyone else?
This is a bit like the British redcoats confronting minutemen, the crown's troops wearing uniforms visible a mile away and marching in a proper battle formation. These colonials, though, wear shoddy, if any, uniforms and quickly attack from multiple directions and hide in trees and amongst the hills and all sorts of other rubbish. How uncouth! If they do not desist in their methods then we may have to pass laws to stop them from competing!
Thankfully, "aliens," whether legal, illegal, space, or otherwise do not want to keep political and economic freedom away from us. They're just trying to make it in the world, much like our white native selves.
It helps to remember that all of our skin is some shade of brown. I'm no egalitarian but if you convince yourself that your very-light-brown skin is an entitlement, you'll find that your whiteness and $2.50 will get you an ice cream cone.
Published: October 4, 2004 2:18 PM
"i'm not sure what to think about rothbard yet. but OVERPRODUCTION or "global glut" is very real and has been since the early 1900s. ever hear of the great depression?"
There's a global glut? By all means, let me lend a hand in correcting the situation! I'll sign up to assist with any glut of doughnuts, cookies (esp. Mrs. Field's), luxury cars, four- to five- star hotel rooms, and a few other whatnots.
bkMarcus, what are you doing on a message board? There's a grape glut? Go get that 4L jug of Carlo Rossi and let's start drinkin', brother! We all have to do our part! :v)
Published: October 4, 2004 2:24 PM
Whenever I dine at Taco Bell I only order chili cheese burittos, the boycotters should do the same. Soon Taco Bell wouldn't have a need for any tomatoes.
Published: October 4, 2004 2:54 PM
this smells like neocon trickery.
taco bell is a favored food of US mercany "servicemen" cowards. yum foods is clearly part of the military industrial complex.
eating taco bell is a fascist act of war.
Published: October 4, 2004 3:11 PM
re bkMarcus:
thanks. i'm aware mises.org provides pdf editions of rothbard's books, as well as a very large article repository.
rather, at the moment, i haven't read enough rothbard for me to share a well-formed opinion of his theories and opinions.
-z
Published: October 4, 2004 5:09 PM
The concern about who has the job of picking tomatoes is misplaced. I suppose that one could claim that there are jobs available for plowing a particular field if we can find people who are willing to dig by hand for some rediculously low wage that will undercut the cost of using a motorized tractor to plow it.
Poor countries have people doing back-breaking jobs including plowing and picking crops. Rich countries tend to have and should continue to tend to have machines doing these jobs. The solutions mentioned so far in this discussion are all "inside the economics and politics box."
The better solition is to create machines or robots to pick the tomatoes and employ legal citizens in air-conditioned factories making and repairing the robots.
Progress tends to occur because of the increased use of technology, not boycotts or economist philosophy.
Donbot
Published: October 4, 2004 8:20 PM
This is in response to John Brendel's comment, about me getting fired from CATO. I don't know where that came from, but I don't work for CATO, so getting fired would be ridiculous. As for the rest of his comment and a few others that have been posted I have only one comment to make. I don't want to pick tomatoes for a living and neither do most Americans, give those jobs to people who do.
Published: October 4, 2004 11:34 PM
i have been fortunate enough to pay $4 for a *quality* local-economy burrito and considered the value transaction far superior than anything taco bell has to offer. but that's me, and that's the point of free markets.
I pay 2 bucks down here for an order of 5 tacos, REAL tacos, not the phony stuff Taco Bell peddles. Here I can go anywhere and find taco stands as often as you find hotdog stands near Yankee Stadium, no regulations, no silly legislation, just you and the supplier; I don't care how much the tomato pickers get for the tomatoes in my salsa, I just care that my taco peddler gives me the best tasting tacos for the best price. Now THAT is a free market.
Published: October 5, 2004 9:58 AM
I enjoyed Mr. D’Amico’s article and it displays once again how little the American understands economics and how the university educational system is still in the hands of the mothball communist.
One point that I have not read about and never see in any socialist articles or from places like Catholic Social Action when these little boycotts spring up e.g. fair trade coffee and Mount Olive Pickles, is the responsibility of the Mexican government? Mexican worker would not have to come here if the corruption and injustice ended in Mexico. When was the last time we saw Amnesty International filing a complaint against Mexico for human rights violations? The answer is never. Yet the American corporations and farmers are the villain. Look for the root of the problem and we find the Mexican government. Here is the real injustice.
Published: October 5, 2004 12:13 PM
I'm not arguing against boycotting per se, but whether or not boycotting Taco Bell would actually achieve its desired result of helping a particular group of tomato growers. It is this that I doubt.
Of course people make purchases based upon various factors, and not just upon price. $4 tacos has nothing to do with this boycott, because it is being addressed to people who are already buying Taco Bell tacos.
The only thing that's going to help these particular workers is if there's a greater demand for their tomatoes, or if they increase their skills and/or get a better job. Am I wrong?
Published: October 5, 2004 12:15 PM
The only thing that's going to help these particular workers is if there's a greater demand for their tomatoes, or if they increase their skills and/or get a better job. Am I wrong?
by definition what's going to help these people will be LESS demand for "their" tomatos. as long as people demand, for whatever reason really, tomatos not picked by exploited/sharecropper labor (rather, well-paid people, with or without technology), their condition will improve.
think of it in terms of a pressure differential. a healthy sustainable free market will not "suck" people into jobs such as manual labor. rather the pressure will be equalized for people to move freely. by subscribing to this form of labor, we are actually retarding the innovation of tomato-picking technology and the greater growth from that innovation.
Published: October 5, 2004 1:22 PM
by definition what's going to help these people will be LESS demand for "their" tomatos. as long as people demand, for whatever reason really, tomatos not picked by exploited/sharecropper labor (rather, well-paid people, with or without technology), their condition will improve.
So let me get this straight: losing their jobs and starving to death is an improvement?
Published: October 5, 2004 11:10 PM
That statement is filled with so much nonsense I don't even know how to start responding.
Published: October 5, 2004 11:19 PM
I forgot about taco bell (I am hungry now), it is only a few minutes out of my way, I think I will eat there for lunch.
Published: October 6, 2004 11:23 AM
A few comments:
why do people who discuss economics so often use value judgements to try and solidify their arguments? have they not realized there is no way to prove one value judgements is better than another?
this applies to this article and some of the blog comments. mr. d'amico apparently thinks someone cannot call themselves a libertarian if they support this boycott. this is ridiculous and has nothing to do with evaluating a real life situation from the point of sound economic theory.
instead, this article could have simply stated that decreasing (effective) demand for taco bell products won't help tomato pickers. the article, however, failed to point out that taco bell could also decide that increasing wages to tomato workers may increase their revenue because more people would be willing to buy from a company they believe uses ethical practices i.e. bring the boycotters back into the taco eating fold.
such a scenario as this will be worked out in the real world by taco bell. those in taco bell will have to make the entrepreneurial decision whether increasing tomato workers' wages will increase revenue. its entirely possible that it could.
such an article, however, that focuses solely on the economics of the various scenarios and what they mean to taco bell, would not have to resort to the pointless value judgements determining whether one is a "true" libertarian or not.
Published: October 6, 2004 2:59 PM
I am amazed that "Libertarians" discuss the difference between lawful and unlawful immigrants, and support migration control at all. Surely liberty includes the right of everyone to live and work in any place in the world, provided we all pay for the goods and services we use. Exploitation of migrants would not be an issue if we were all at liberty to come and go, to work however and wherever we wish, and to move our assets and liabilities with us.
Published: October 6, 2004 5:13 PM
decreasing (effective) demand for taco bell products won't help tomato pickers. the article, however, failed to point out that taco bell could also decide that increasing wages to tomato workers may increase their revenue because more people would be willing to buy from a company they believe uses ethical practices i.e. bring the boycotters back into the taco eating fold.
Or moving dollars to pay for the increased tomato pickers' wages from the advertising expenses (as the boycotters intimate should happen) could piss off the advertising industry as people are downsized after the reallocation. One would have to trust that Taco Bell knows somewhat what it is doing, has a business plan, and is very successful at it. It is performing the perfect function of allocating resources most effectively. It is only when those who think they know what they are talking about, who feel that they can better allocate resources than those who have a track record of concentrating, exploiting, and preserving capital, that such actions take place. They introduce value judgements that have nothing to do maximizing resources, but are a disassociated sense of 'doing good', and never take into account the other costs involved. For every reallocation, there is a cost. It is most insufferable when such boobs use the Force of the state to make their notions reality, but is still rubs the fur the wrong way when it's within the realm of voluntary association. I just would not use Force to change their minds or stop them. They are free to be wrong.
In a nutshell, if no one felt that picking tomatoes for 50 cents a bushel was worth it, no one would do it. It must be better than some other alternative, hence why they do it. So people are entitled to judge in a manner they see fit. Others are entitled to call them out and set them straight. But again, I have yet to see a full analysis by these folks as to the shrinking business for TB when they advertise less, the declining business for the advertising industry causing cut backs and layoffs, the disruption in the menu options that might occur alienating other customers (if they're paying for tomatoes they're damn well going to find a way to use them), TB cutting back on other charitable allocations (that very well could be tucked away in advertising expense).
Maybe Wrench (the guy who sued over the chihuahua scandal) can allocate some of his $42 million with the tomato pickers.
Published: October 6, 2004 5:55 PM
why do people who discuss economics so often use value judgements to try and solidify their arguments? have they not realized there is no way to prove one value judgements is better than another?
Aren't you aware of Hoppe's work? Try this link, and read chapter 10 from The Economics and Ethics of Private Property.
Published: October 7, 2004 5:48 AM
I'm for Human Action. All should feel free to boycott to the heart's content. All who fear boycotts should protest the boycotters.
Any who pretends they know more than the other is a narcissist, and should be ridiculed. Like Hoppe.
Published: October 7, 2004 6:46 PM