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I'm a business owner. There are hordes of hungry people clamoring for their 3rd, 4th and 5th jobs because Walmart will only pay out $3/hr and McDonald's won't h

I'm a business owner. There are hordes of hungry people clamoring for their 3rd, 4th and 5th jobs because Walmart will only pay out $3/hr and McDonald's won't hire above $2/hr. 1. I can hire these guys at ~$8/hr federal minimum wage. 2. I can hire these guys at $2/hr and make shareholders very happy. I don't think it's hard to guess which option many people would pick. No minimum wage just hurts the people at the lowest rung of the economic ladder, by accelerating the race to the bottom.

mindcrime 8y ago
Your premises are fictional. In reality, a business can't always afford to hire someone at the minimum wage. And you can't hire an infinite number of people who are a net economic drain on your company, or you're out of business. Talk about a "race to the bottom". Your "argument" is just a caricatured strawman that has no basis in reality. If your position were an accurate reflection of reality, no company would ever pay above minimum wage. And yet that happens all the time. So maybe, just maybe, the reality is that companies pay based (in part) on the economic output the workers they are hiring...
- soundwave106 8y ago
  However, governments these days provide a safety net to guard against poverty (because, based on Gilded Age history, the alternative is worse). Employees who are paid substandard wages often simultaneously qualify for the government safety net as well. Probably in part for this reason and others, it was Franklin Roosevelts's opinion that businesses that cannot survive unless they paid substandard wages, should not be allowed to exist. (https://takingnote.blogs.nytimes.com/2014/03/07/f-d-r-makes-the-case-for-the-minimum-wage/ https://takingnote.blogs.nytimes.com/2014/03/07/f-d-r-makes-...).
  - mindcrime 8y ago
    Probably in part for this reason and others, it was Franklin Roosevelts's opinion that businesses that cannot survive unless they paid substandard wages But the question isn't necessarily "survival of the business". It's whether or not the business can afford to bring more people into the fold, based on an arbitrary fixed-point in terms of how much they can pay. Maybe I'm running a company that's humming along, profitable but only marginally so, paying 100 workers some rates ranging from exactly minimum wage, up to $WHATEVER. Now I'd like to hire 5 more workers to do some fairly low value manual labor, but if I hire them at minimum wage, it pushes the company into the red. Where does that leave us? I can: 1. Hire the workers at less than "minimum wage". This creates the most jobs, but has the downside of paying people less than what some people feel that they "should* earn. 2. Hire fewer workers, but at minimum wage. That's fine for the 2.5 workers I do hire, but how does it benefit the 2.5 that I don't hire? 3. Do nothing. This benefits none of the 5 workers I might have hired. 4. Buy a machine that does the kind of work those workers would have done, don't hire anybody new, and then lay off 10 workers once the machine is up and running. 5. Reduce costs somewhere else in the business, to allow for hiring the 5 workers at minimum wage. This might or might not be viable, depending on lots of other details. 6. Hire the 5 workers at minimum wage, and raise prices, passing the increased cost on to my customers. This might work, but again, there are a lot of variables in play here. And this negatively impacts my customers. Obviously there's a lot of nuance to all this, but my point is that it's a bit Pollyanna'ish to think that jacking up the minimum wage results in a better outcome for everybody.
    - soundwave106 8y ago
      From a business point of view I'm sure they would prefer no minimum wage at all. But there are obviously more factors to consider besides business. Obviously there is such a thing as too high of a minimum wage, that will severely dampen employment for lots of businesses. Jacking up the minimum wage in itself to an arbitrary value that is too high is pretty poor policy. But in the current state, too often, those on full time minimum wage jobs are still below poverty level, and thus qualify for many government benefits. In effect, my tax money contributes to your low-wage employee. From a personal perspective, I don't really like your option 1. I'd actually ideally want that person who is only worth sub-minimum wage to linger in the safety net for a while and learn skills that will make them more valuable than below-minimum wage level. Such would be a far better value for my tax dollars than subsidizing low-skill employment. Some economists feel that up to a certain point, minimum wage actually increases employment (in non-competitive labor markets, eg monopsonies) and increases aggregate demand enough to compensate for the cost effect (because low-income workers have a higher marginal propensity to consume, which would offset the cost effect). Of course, minimum wage is not the only anti-poverty tool out there and some economists feel it is too blunt. And the "correct" minimum wage probably varies hugely by location. As you say -- there are a lot of nuances. I'm just saying, there is more to this than just the employer perspective.
- darpa_escapee 8y ago
  > In reality, a business can't always afford to hire someone at the minimum wage. The needs of business do not supercede the needs of human beings. If a business cannot operate without virtual slave labor, the business should not exist. > Your "argument" is just a caricatured strawman that has no basis in reality. As is yours. Businesses regularly have costs which they cannot turn a profit on, but the work must be done, so it gets done.
  - mindcrime 8y ago
    The needs of business do not supercede the needs of human beings. If a business cannot operate without virtual slave labor, the business should not exist. Poverty is the natural state of humanity. Trade / business allow us to rise above that. The people you are referring to as "natural slave labor" are better off working for less than the sum you find optimal, than not working at all. And unless someone has a gun to their head, they always retain the option to do the latter. As is yours. I don't find it to be so, but feel free to convince me. Businesses regularly have costs which they cannot turn a profit on, but the work must be done, so it gets done. Sure, but there's a limit to that. A business can't run in the red indefinitely. And again, we already know from actual, demonstrated, empirical evidence in the Real World that business are forced, by economic reality, to pay more, often FAR more, than "minimum wage" to workers. But again, when we are talking primarily about the workers on the bottom rung of the ladder, the question is, do you want to lock them out of participating in the economy altogether?
- s73v3r_ 8y ago
  "Your premises are fictional." And yours isn't? Seriously, everything you're complaining about their argument, can be applied double to yours.
  - mindcrime 8y ago
    And yours isn't? No. Seriously, everything you're complaining about their argument, can be applied double to yours. I don't find that to be supported, but please give do expand on that.

mindcrime 8y ago

Your premises are fictional. In reality, a business can't always afford to hire someone at the minimum wage. And you can't hire an infinite number of people who are a net economic drain on your company, or you're out of business. Talk about a "race to the bottom". Your "argument" is just a caricatured strawman that has no basis in reality. If your position were an accurate reflection of reality, no company would ever pay above minimum wage. And yet that happens all the time. So maybe, just maybe, the reality is that companies pay based (in part) on the economic output the workers they are hiring...

soundwave106 8y ago
However, governments these days provide a safety net to guard against poverty (because, based on Gilded Age history, the alternative is worse). Employees who are paid substandard wages often simultaneously qualify for the government safety net as well. Probably in part for this reason and others, it was Franklin Roosevelts's opinion that businesses that cannot survive unless they paid substandard wages, should not be allowed to exist. (https://takingnote.blogs.nytimes.com/2014/03/07/f-d-r-makes-the-case-for-the-minimum-wage/ https://takingnote.blogs.nytimes.com/2014/03/07/f-d-r-makes-...).
- mindcrime 8y ago
  Probably in part for this reason and others, it was Franklin Roosevelts's opinion that businesses that cannot survive unless they paid substandard wages But the question isn't necessarily "survival of the business". It's whether or not the business can afford to bring more people into the fold, based on an arbitrary fixed-point in terms of how much they can pay. Maybe I'm running a company that's humming along, profitable but only marginally so, paying 100 workers some rates ranging from exactly minimum wage, up to $WHATEVER. Now I'd like to hire 5 more workers to do some fairly low value manual labor, but if I hire them at minimum wage, it pushes the company into the red. Where does that leave us? I can: 1. Hire the workers at less than "minimum wage". This creates the most jobs, but has the downside of paying people less than what some people feel that they "should* earn. 2. Hire fewer workers, but at minimum wage. That's fine for the 2.5 workers I do hire, but how does it benefit the 2.5 that I don't hire? 3. Do nothing. This benefits none of the 5 workers I might have hired. 4. Buy a machine that does the kind of work those workers would have done, don't hire anybody new, and then lay off 10 workers once the machine is up and running. 5. Reduce costs somewhere else in the business, to allow for hiring the 5 workers at minimum wage. This might or might not be viable, depending on lots of other details. 6. Hire the 5 workers at minimum wage, and raise prices, passing the increased cost on to my customers. This might work, but again, there are a lot of variables in play here. And this negatively impacts my customers. Obviously there's a lot of nuance to all this, but my point is that it's a bit Pollyanna'ish to think that jacking up the minimum wage results in a better outcome for everybody.
  - soundwave106 8y ago
    From a business point of view I'm sure they would prefer no minimum wage at all. But there are obviously more factors to consider besides business. Obviously there is such a thing as too high of a minimum wage, that will severely dampen employment for lots of businesses. Jacking up the minimum wage in itself to an arbitrary value that is too high is pretty poor policy. But in the current state, too often, those on full time minimum wage jobs are still below poverty level, and thus qualify for many government benefits. In effect, my tax money contributes to your low-wage employee. From a personal perspective, I don't really like your option 1. I'd actually ideally want that person who is only worth sub-minimum wage to linger in the safety net for a while and learn skills that will make them more valuable than below-minimum wage level. Such would be a far better value for my tax dollars than subsidizing low-skill employment. Some economists feel that up to a certain point, minimum wage actually increases employment (in non-competitive labor markets, eg monopsonies) and increases aggregate demand enough to compensate for the cost effect (because low-income workers have a higher marginal propensity to consume, which would offset the cost effect). Of course, minimum wage is not the only anti-poverty tool out there and some economists feel it is too blunt. And the "correct" minimum wage probably varies hugely by location. As you say -- there are a lot of nuances. I'm just saying, there is more to this than just the employer perspective.
darpa_escapee 8y ago
> In reality, a business can't always afford to hire someone at the minimum wage. The needs of business do not supercede the needs of human beings. If a business cannot operate without virtual slave labor, the business should not exist. > Your "argument" is just a caricatured strawman that has no basis in reality. As is yours. Businesses regularly have costs which they cannot turn a profit on, but the work must be done, so it gets done.
- mindcrime 8y ago
  The needs of business do not supercede the needs of human beings. If a business cannot operate without virtual slave labor, the business should not exist. Poverty is the natural state of humanity. Trade / business allow us to rise above that. The people you are referring to as "natural slave labor" are better off working for less than the sum you find optimal, than not working at all. And unless someone has a gun to their head, they always retain the option to do the latter. As is yours. I don't find it to be so, but feel free to convince me. Businesses regularly have costs which they cannot turn a profit on, but the work must be done, so it gets done. Sure, but there's a limit to that. A business can't run in the red indefinitely. And again, we already know from actual, demonstrated, empirical evidence in the Real World that business are forced, by economic reality, to pay more, often FAR more, than "minimum wage" to workers. But again, when we are talking primarily about the workers on the bottom rung of the ladder, the question is, do you want to lock them out of participating in the economy altogether?
s73v3r_ 8y ago
"Your premises are fictional." And yours isn't? Seriously, everything you're complaining about their argument, can be applied double to yours.
- mindcrime 8y ago
  And yours isn't? No. Seriously, everything you're complaining about their argument, can be applied double to yours. I don't find that to be supported, but please give do expand on that.