What harm do minimum wages do? • Hacker News Board

Re: What harm do minimum wages do?

#341

Post by qeternity » Wed, Aug 19, 2020, 9:06 PM UTC

lokar wrote: post #287

The anti-min-wage / free market argument ignores a key fact: as a society we have decided we won't let people starve to death. So, if someone can't make ends meet, we will (via taxes) support them, at least to some extent. This support factors into the wage negotiation, allowing the employer to force a lower wage (absent a state imposed min). Absent state sate welfare style support many low wage (min and sub-min) job…

This gets to the heart of the problem of minimum wage. Walmart is often cast as a villain because many of their workers receive government benefits. Nobody stops to ask the very real question of: what if the average Walmart worker doesn’t add $X in value per hour. What if the value of the “Walmart Greeter” is less than that of minimum wage? Is it better for Walmart to fire this person because they’re not worth minimum wage (presumably it’s the highest paying job they could find, suggesting they’re not worth “minimum wage”) or is it better to have lower minimum wage with state benefit offsets? At least in the latter scenario Walmart helps shoulder the burden.

Tl;dr - Often corporations are accused of abusing state benefits by not paying workers more as opposed to shouldering some of the burden that states would otherwise be left with due to unemployed masses of unskilled labor.

Re: What harm do minimum wages do?

#342

Post by csours » Wed, Aug 19, 2020, 9:06 PM UTC

qeternity wrote: post #318

dayjobpork wrote: post #285

The richest person in Australia seriously floated an idea to import foreign workers and pay them $2 a day to work in her mines I've always looked at minimum wage as an employer saying "I'd pay you less if I legally could". In workplace negotiations all of the power is held by the employer, unless you have some form of collective bargaining, and having a Government mandated minimum prevents companies from totally expl…

These policies are always double edged swords. The other way to frame minimum wage is that it makes it illegal to work unless you can produce $X value per hour.

Ehhh? What are you talking about? It's not illegal to do things that don't make money. That's called a cost center. I don't make money for my company, I reduce the risk of losing money, and provide tools for people who do make money.

Re: What harm do minimum wages do?

#343

Post by Broken_Hippo » Wed, Aug 19, 2020, 9:08 PM UTC

bgorman wrote: post #243

gjulianm wrote: post #4

> Textbooks state that, in the absence of a minimum wage, a worker is paid his “marginal product of labour”, which means the value of what he produces. > Just as a monopolist can set prices higher than would be the case in a competitive market, a monopsonist can set prices artificially lower. A lot of economic arguments forget these ideas. The labor market is not a free market: companies have more power in negotiatio…

Your chain of causality is actually completely wrong. At 15 dollars an hour only a few companies can hire unskilled workers. At 1 dollar an hour many people can pay workers that amount, so there is more competition out there for wages. The idea that there is a monopolistic employer in the US labor market is laughable. Even for monopolistic industries like telecom there are multiple options. Minimum wage jobs should n…

IT doesn't matter if minimum wage shouldn't be expected to be long-term. The reality is that many folks basically work minimum wage or slightly above for large chunks of their life. And some folks are happy in these jobs.

Some of these minimum wage jobs even require degrees. Preschool teachers, for example, often pay minimum wage or just above it - but this somehow shouldn't be a career choice. Many other jobs pay just a little above this - which, realistically, is what you'd get working late at a burger place. They get paid more than preschool teachers many times.

There is a limit to the ability to relocate with these jobs as it costs money: Same for learning new skills.

Denying folks a living wage when you know that low-paying jobs is reality for a large band of people (regardless of what you think it should be) is just cruel. The world "isn't a charity" because folks look down on folks.

Re: What harm do minimum wages do?

#344

Post by Certhas » Wed, Aug 19, 2020, 9:08 PM UTC

gjulianm wrote: post #4

> Textbooks state that, in the absence of a minimum wage, a worker is paid his “marginal product of labour”, which means the value of what he produces. > Just as a monopolist can set prices higher than would be the case in a competitive market, a monopsonist can set prices artificially lower. A lot of economic arguments forget these ideas. The labor market is not a free market: companies have more power in negotiatio…

Universal Basic Income would also help with this problem.

Re: What harm do minimum wages do?

#345

Post by smileysteve » Wed, Aug 19, 2020, 9:09 PM UTC

nickff wrote: post #307

lokar wrote: post #287

The anti-min-wage / free market argument ignores a key fact: as a society we have decided we won't let people starve to death. So, if someone can't make ends meet, we will (via taxes) support them, at least to some extent. This support factors into the wage negotiation, allowing the employer to force a lower wage (absent a state imposed min). Absent state sate welfare style support many low wage (min and sub-min) job…

So they would starve, jobless, because the work wouldn't pay a subsistence wage? This seems unlikely, as many people work at jobs where they don't earn enough to support their lifestyle. I think the below-subsistence wage earner would be more likely to (though not certainly) move somewhere that their skills were more needed.

> I think the below-subsistence wage earner would be more likely to (though not certainly) move somewhere that their skills were more needed.

This introduces us to indentured servitude's abuses.

Re: What harm do minimum wages do?

#346

Post by ccffpphh » Wed, Aug 19, 2020, 9:09 PM UTC

ckocagil wrote: post #136

ccffpphh wrote: post #47

Earlier quoted context omitted.

The issue is that nobody is entitled to anything. You aren't de facto entitled to receiving money for any services you may or may not provide, regardless of whether you're skilled or not, just because you exist. A company exists because one or more people risked wealth in order to create a net positive system - their existence is not as riskless as one would believe.

If no one is entitled to anything why did humankind abolish slavery? Child workers? Indentured servitude? Think about it. Indentured servitude is nothing but a contract between two people. By your ideology it should be of no one else's concern. Yet, it is considered slavery and is illegal. Why? Because it turns out life isn't as simple as "you're not entitled to anything". This same sentence has been uttered by peopl…

Yes, the one thing we can all agree on is the right to self. Nobody other than themselves can control their body - by that I mean that no matter what you do, nobody can tell you what to think. You can be brainwashed by force, or conditioned to react a certain way to escape force, but you can never really know what another person thinks.

Regardless, one has a right to their body. It is their property. More explicitly, any individual intelligent agent that exists takes up some physical space and that space they occupy at any point in time to continue their existence is theirs only. Property can be given up voluntarily or if nobody else has a claim to it - in this case it extends that clearly rape is wrong, but prostitution is okay, as it's voluntary on both sides. Seizing someone's house is wrong, but exploring space and building new structures in the middle of nowhere is not.

Whether laws exist regarding private property (or the lack thereof), we can define a set of natural rights that any person has regardless of any local, regional, or global laws, constructs, or ideologies. We can all agree murder is wrong, rape is wrong, stealing is wrong, slavery is wrong, and the clearest and most concise way of setting this forward is by understanding that nobody is entitled to anything other than their body and any property they have gained which was either unclaimed or voluntarily from another agent.

Certain schools of thought disagree on unclaimed property, e.g. if one settles a piece of land and the landowner doesn't notice, but after a decade or so has passed and the resident has worked the land and only then the landowner notices, who really owns it? I am not in a position to answer this but I don't think it's "arbitrary" or "man-made" to expect natural rights over your body and property. Everything else, indeed, is abstract.

Re: What harm do minimum wages do?

#347

Post by tastyfreeze » Wed, Aug 19, 2020, 9:09 PM UTC

karpierz wrote: post #242

tastyfreeze wrote: post #190

Earlier quoted context omitted.

If labor costs less products as a result cost less. How do you reconcile your view with the success of Singapore? A country with no minimum wage and a comparatively free market. There is income disparity in every time and every place. The question to ask is do the rules of the game allow anybody to succeed. Minimum wage is a rule that says some people just don't get to play.

Do you think Singapore is a free market? What do you think of their housing policy?

Thank you for pointing that out. That housing market is certainly not free. Not an aspect of Singapore I had read about before.

Other than my opinion that the needs of the people would have been better met with a free housing market. I don't have much to say on it.

Re: What harm do minimum wages do?

#348

Post by zelphirkalt » Wed, Aug 19, 2020, 9:09 PM UTC

lokar wrote: post #287

The anti-min-wage / free market argument ignores a key fact: as a society we have decided we won't let people starve to death. So, if someone can't make ends meet, we will (via taxes) support them, at least to some extent. This support factors into the wage negotiation, allowing the employer to force a lower wage (absent a state imposed min). Absent state sate welfare style support many low wage (min and sub-min) job…

In which country? I don't think it is true everywhere, that we wont let others starve.

Re: What harm do minimum wages do?

#349

Post by thethethethe » Wed, Aug 19, 2020, 9:09 PM UTC

wdn wrote: post #294

gjulianm wrote: post #4

> Textbooks state that, in the absence of a minimum wage, a worker is paid his “marginal product of labour”, which means the value of what he produces. > Just as a monopolist can set prices higher than would be the case in a competitive market, a monopsonist can set prices artificially lower. A lot of economic arguments forget these ideas. The labor market is not a free market: companies have more power in negotiatio…

The labor market is a free market. If you don't agree the employer offer is fair, you don't have to accept. When you find a better offer, you go to the better offer. As for minimum wage, it is hurting the unskilled workers, like high school students, college students who are looking for experience. If you are stuck in a minimum wage job, then this is what the market is paying for your skill set. If you think you wort…

> The labor market is a free market. If you don't agree the employer offer is fair, you don't have to accept. When you find a better offer, you go to the better offer.

Not everyone has competitive skill sets. People who work at McDonald’s don’t have much of a choice of where they work. Burger King isn’t going to pay them much better.

> If you are stuck in a minimum wage job, then this is what the market is paying for your skill set. If you think you worth more, then proof it, don't blame the system.

I think what OP was saying is that employers of low-skill workers have a asymmetric power. Because low-skill workers have no where to turn, they are forced to accept low wages and poverty over living in the street, even when their employers can very well afford to pay them more. And because the live in poverty, they cannot afford the time or materials to build skills which lift them out of poverty.

We are going to need service workers for the foreseeable future, not everyone can be a fancy software engineer with marketable skills. Covid has certainly demonstrated this. Are we just going to say “tough shit you should have worked for free when you were a teenager” and let a large portion of the population live in poverty when they don’t have to?

> I don't know if there is any unpaid internship now or if it is even legal now.

They definitely are

Re: What harm do minimum wages do?

#350

Post by aeternum » Wed, Aug 19, 2020, 9:09 PM UTC

gjulianm wrote: post #4

> Textbooks state that, in the absence of a minimum wage, a worker is paid his “marginal product of labour”, which means the value of what he produces. > Just as a monopolist can set prices higher than would be the case in a competitive market, a monopsonist can set prices artificially lower. A lot of economic arguments forget these ideas. The labor market is not a free market: companies have more power in negotiatio…

I believe you could make the labor market much more competitive with one simple and easy to implement change:

Make it a requirement that companies publish salaries.

We did this with CEO pay and it resulted in huge increases in CEO pay because it removed the information asymmetry. We make companies disclose important safety and nutrition information to the public so consumers can make good decisions about purchases, why not enable people to make good decisions about employers as well?