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An economic theory only Mayor McCheese could love

Date Posted: March 5 2004

Who knew that assembling a Whopper or a Big Mac may be just like building an automobile.

“When a fast-food restaurant sells a hamburger, for example, is it providing a ‘service’ or is it combining inputs to ‘manufacture’ a product?”

That was the question that leaped out of the newly released Economic Report of the President, a book with comments, observations and statistics about the health of the U.S. economy. Gregory Mankiw, chairman of the president’s Council of Economic Advisors, said that properly classifying burger flippers and other workers in the restaurant and hospitality sector is an “important consideration” in setting economic policy.

The New York Times pointed out that “counting jobs at McDonald’s, Burger King and other fast-food enterprises alongside those at industrial companies like General Motors and Eastman Kodak might seem like a stretch, akin to classifying ketchup in school lunches as a vegetable, as was briefly the case in a 1981 federal regulatory proposal.”

Others think that such worker reclassification is a blatant attempt by the Bush Administration to put up better numbers by reclassifying burger makers, thus making up for heavy job losses in the nation’s manufacturing sector.

Michigan Congressman John Dingell sent Mankiw a sarcasm-laced letter on Feb. 20, responding to the president’s report. The text of Dingell’s letter follows:

Dear Dr. Mankiw:

I noticed in the recently released Economic Report of the President that there was some consternation in the defining of manufacturing. It could be inferred from your report that the administration is willing to recognize drink mixing, hamburger garnishing, french fry cooking, and milk shake mixing to be vital components of our manufacturing sector.

I am sure the 163,000 factory workers who have lost their jobs in Michigan will find it heartening to know that a world of opportunity awaits them in high growth manufacturing careers like spatula operator, napkin restocking, and lunch tray removal. I do have some questions of this new policy and I hope you will help me provide answers for my constituents:

Will federal student loans and Trade Adjustment Assistance grants be applied to tuition costs at Burger College?

Will the administration commit to allowing the Manufacturing Extension Partnership (MEP) to fund cutting-edge burger research such as new nugget ingredients or keeping the hot and cold sides of burgers separate until consumption?

Will special sauce now be counted as a durable good?

Do you want fries with that?

Finally, at a speech he gave in Michigan this past September , (U.S. Commerce Secretary) Don Evans announced the creation of a new Assistant Secretary for Manufacturing. While I understand that it takes a while to find the right candidate to fill these positions, I am concerned that five months after the announcement no assistant secretary has yet been named.

I do, however, know of a public official who would be perfect for the job. He has over 30 years of administrative and media experience, has a remarkable record of working with diverse constituencies, and is extraordinarily well qualified to understand this emerging manufacturing sector: the Hon. Mayor McCheese.

With every good wish,
John D. Dingell
Member of Congress