Fox News turned to a fast food CEO notorious for his opposition to paying employees livable wages during a misleading segment alleging that social safety net programs trap low-income Americans in poverty.
On the June 24 edition of Fox News' Fox & Friends, co-host Steve Doocy invited CKE Restaurants (Hardee's, Carl's Jr.) CEO Andy Puzder to argue that low-income workers might be wary of higher paying jobs if the salary increase results in a loss of government benefits. Doocy referenced Puzder's June 22 op-ed in The Hill as evidence of the so-called “Welfare Cliff,” where employees turn down promotions that could lead to $80,000 salaries because they “don't want to lose the free stuff from the government” (emphasis added):
PUZDER: The policy guys call it the “Welfare Cliff,” because you get to a point where if you make a few more dollars you actually lose thousands of dollars in benefits. And, quite honestly, these benefits are essential for some people. They are how they pay their rent; they are how they feed their kids. So, what happens is, we have people who turn down promotions or, if minimum wage goes up, they want fewer hours. They want less hours because they are afraid they'll go over that cliff.
DOOCY: And, it's got to drive you nuts, because you're always looking for good people to run your stores. And, if they would just take the next step, take the next step up the ladder, next thing you know they could be a manager making $80,000, but they don't want to lose the free stuff from the government.
The term “Welfare Cliff” was popularized by Pennsylvania's Republican-appointed Secretary of Public Welfare in a July 2012 report, which claimed a “single mom” could nearly double her net income by taking full advantage of nine distinct anti-poverty programs, but the concept of a trade-off between welfare and work dates back to a flawed Cato Institute study from 1995. One thing all such studies have in common is the base calculation of benefits available to a hypothetical “single mom” with multiple dependent children. Most American workers aren't single moms, most recipients of government benefits don't enroll in every single available program, and the value of federal benefit programs like welfare is less now than it was in years past -- facts that are never acknowledged in right-wing media discussions of anti-poverty programs.
By Puzder's own admission, the company he runs does not pay anywhere near the amount he and Doocy claim is attainable if workers were willing to work their way off of welfare. According to a March 2014 op-ed by Puzder in The Wall Street Journal, employees at CKE-run restaurants can earn “a management-level salary starting around $36,000 and going as high as $65,000,” with an average of “around $45,000” per year.
According to the most-recently available data from the Bureau of Labor Statistics (BLS), the average food service employee nationwide makes just $19,110 annually, or roughly $9.19 per hour. According to a 2013 study from the National Employment Law Project (NELP), the overwhelming majority of fast food employees (89.1 percent) make less than $9 per hour and face significant “barriers to upward mobility” in the profession.