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> if your business is only profitable by the taxpayer subsidizing a relatively large number of employees wages with welfare benefits Welfare does not subsidize

> if your business is only profitable by the taxpayer subsidizing a relatively large number of employees wages with welfare benefits Welfare does not subsidize employers, it is a subsidy /against/ employers. Giving employees welfare increases their wages because it increases their negotiating power.

atoav 2y ago
Or phrased differently: If people don't starve when they won't let others exploit themselves they won't be likely to let others exploit themselves. If we apply market logic to that this would just mean that employers have to offer better deals.
- bumby 2y ago
  >If we apply market logic to that this would just mean that employers have to offer better deals. I'm not sure this follows. By this logic, do you think UBI would cause employers to increase wages? I think (given sufficient UBI), you would see some industries increase wages but many businesses fold because they are only viable by suppressing wages (which are then subsidized by taxpayers). So, yes, on one hand the remaining employers would be paying more but the overall employer base would be smaller. Another way to think about it is that as forms of welfare go up like disability, those workers tend to fall out of the labor market. They are using that as a tool for negotiating higher wages. (granted, there many complications in this point)
bumby 2y ago
If it wasn't clear, my point was that it allows employers to arbitrarily lower their wage rate where the business is viable. Example: -Employee needs $15/hour to 'afford life'. -Business is only profit-positive if it pays $12/hour or less -Assuming the employee will only accept a job if it allows them to 'afford life', as long as the government subsidizes the equivalent of $3/hour, business is able to turn a profit. Anything less than that, the employee does not accept the position and the business is not viable. This was laughably on display a few years back when McDonald's received blowback by publishing their training that teach their employees how to apply for government assistance while they were posting outsized profits.
- astrange 2y ago
  > my point was that it allows employers to arbitrarily lower their wage rate where the business is viable. But it doesn't do that, in fact it requires the employers to raise their wages. Your model has a single employer (a monopsony) who doesn't need to negotiate. That's a case where minimum wages cause both wages and employment to rise. > This was laughably on display a few years back when McDonald's received blowback by publishing their training that teach their employees how to apply for government assistance while they were posting outsized profits. McDonald's (mainly) doesn't have employees, it has franchisers and those have employees. Different companies. More importantly, if you're on the left then you should think welfare is good. It's good that they're telling people that! We should require it in fact! If you're saying that telling someone to get welfare is bad, you're making an argument that welfare is bad. In your model signing up for welfare makes employees poorer. That doesn't make sense.
  - bumby 2y ago
    >But it doesn't do that, in fact it requires the employers to raise their wages. Is there evidence to this claim? Even the most recent UBI studies seem to run contrary to this point. This otherwise borders on a bad-faith post. Yes, McDonalds corporation is different than a franchise, but the profits of the former are obviously tightly coupled to the operations of the latter. And it’s not a left/right political argument on whether welfare is “bad”. That’s an overly simplistic perspective. It’s about how a particular system is structured and whether that leads to desirable outcomes for society as a whole.

atoav 2y ago

Or phrased differently: If people don't starve when they won't let others exploit themselves they won't be likely to let others exploit themselves. If we apply market logic to that this would just mean that employers have to offer better deals.

bumby 2y ago
>If we apply market logic to that this would just mean that employers have to offer better deals. I'm not sure this follows. By this logic, do you think UBI would cause employers to increase wages? I think (given sufficient UBI), you would see some industries increase wages but many businesses fold because they are only viable by suppressing wages (which are then subsidized by taxpayers). So, yes, on one hand the remaining employers would be paying more but the overall employer base would be smaller. Another way to think about it is that as forms of welfare go up like disability, those workers tend to fall out of the labor market. They are using that as a tool for negotiating higher wages. (granted, there many complications in this point)

bumby 2y ago

If it wasn't clear, my point was that it allows employers to arbitrarily lower their wage rate where the business is viable. Example: -Employee needs $15/hour to 'afford life'. -Business is only profit-positive if it pays $12/hour or less -Assuming the employee will only accept a job if it allows them to 'afford life', as long as the government subsidizes the equivalent of $3/hour, business is able to turn a profit. Anything less than that, the employee does not accept the position and the business is not viable. This was laughably on display a few years back when McDonald's received blowback by publishing their training that teach their employees how to apply for government assistance while they were posting outsized profits.

astrange 2y ago
> my point was that it allows employers to arbitrarily lower their wage rate where the business is viable. But it doesn't do that, in fact it requires the employers to raise their wages. Your model has a single employer (a monopsony) who doesn't need to negotiate. That's a case where minimum wages cause both wages and employment to rise. > This was laughably on display a few years back when McDonald's received blowback by publishing their training that teach their employees how to apply for government assistance while they were posting outsized profits. McDonald's (mainly) doesn't have employees, it has franchisers and those have employees. Different companies. More importantly, if you're on the left then you should think welfare is good. It's good that they're telling people that! We should require it in fact! If you're saying that telling someone to get welfare is bad, you're making an argument that welfare is bad. In your model signing up for welfare makes employees poorer. That doesn't make sense.
- bumby 2y ago
  >But it doesn't do that, in fact it requires the employers to raise their wages. Is there evidence to this claim? Even the most recent UBI studies seem to run contrary to this point. This otherwise borders on a bad-faith post. Yes, McDonalds corporation is different than a franchise, but the profits of the former are obviously tightly coupled to the operations of the latter. And it’s not a left/right political argument on whether welfare is “bad”. That’s an overly simplistic perspective. It’s about how a particular system is structured and whether that leads to desirable outcomes for society as a whole.