How Greedy McDonald's Became the Most Effective Poverty-fighter

Until March 4th, you can buy any size of coffee at McDonald’s for only a dollar. But why is the coffee so cheap? It certainly doesn’t need to be, given its higher-priced competition. And we hear continuously from labour unions, anti-poverty activists and the NDP about how greedy corporations get rich by stepping on the middle class and the poor. Shouldn’t McDonald’s be squeezing every last penny it can out of people?

Maybe McDonald’s shareholders have seen the corporate-social-responsibility light and want to make sure poor people can afford coffee and food. No, that’s not it. McDonald’s shareholders are, like everyone else, in it for the money. And we all know the reason McDonald’s provides cheap coffee and cheap food — to the benefit of the middle class and the poor — is to earn profit. While corporation-bashing activists like to write fiction about how business profits are exploitative and unfair, it’s really big, profit-seeking corporations like McDonald’s that help the poor more than anyone. It’s entirely possible that the home of Ronald McDonald and the Hamburglar has done more to alleviate poverty in Canada than any charity or anti-poverty group.

Poor people (and not-so-poor people) are enriched by McDonald’s offerings of cheap and filling food. The popular economics blog Freakonomics has suggested McDonald’s McDouble burger could be “the cheapest, most nutritious, and bountiful food that has ever existed in human history.” With two beef patties, pickles and onions, McDoubles offer — for just a couple of bucks —half the daily recommended serving of protein, seven per cent of daily recommended fibre, and 20 per cent of your daily calcium and iron.

But it’s not through cheap food that McDonald’s helps those in need. Visit an outlet in any major city’s downtown and you’ll see, essentially, a temporary shelter for struggling people who badly need a rest, some warmth, or just a bathroom. As a report in U.K.’s left-wingGuardiandescribed a couple years ago,“for many of the poorest, for the homeless, and for people caught in an addiction, McDonald’s are an integral part of their lives.” The washrooms are clean, there is social interaction, McDonald’s restaurants are often safer than homeless shelters, and many locations are open 24 hours.

And many kids get their first job working at McDonald’s, developing work habits and customer-service skills that qualify them for higher-paying jobs down the road. When it comes to getting young Canadians onto the first rung of the economic ladder, McDonald’s has outdone every anti-poverty organization in the country.

In fact, McDonald’s has enriched the lives of just about all Canadians — including those (if they exist) who might have never set foot inside one. Competing for customers, McDonald’s forces other fast-food places to keep prices low and customers happy. And just as customers from Tim Hortons to Starbucks get better values and so are made better off because of competition from McDonald’s, so too do workers benefit as other companies compete with McDonald’s on pay and benefits.

Affordable food for the poor, a shelter for the homeless, heightened business competition that benefits workers and consumers and a jobs factory for young people. These are the results of McDonald’s greedy efforts to earn big profits. The company isn’t in it for the warm fuzzies, of course, but as Adam Smith wrote, “By pursuing his own interest (a person) frequently promotes that of the society more effectually than when he really intends to promote it.” That delicious coffee costs a dollar not because that’s the best price for you, but because that’s the best price for McDonald’s.

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