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Simply calculating wage by intersecting supply and demand curves without regulations such as minimum wage regularly creates conditions where minimally skilled w

Simply calculating wage by intersecting supply and demand curves without regulations such as minimum wage regularly creates conditions where minimally skilled workers end up being supported by individual tax payers (instead of businesses) My assertion that in any capitalism driven society (no matter the quality of education) you will have a non-trival size of the population not capable of fulfilling job demand and achieving minimum viable salary for survival. At the end of the day we have 3 options for these people: 1) Do nothing. This creates tax burden to combat crime as people get desperate to satisfy basic needs like food and shelter. It also is pretty crappy thing to do to our fellow man. 2) Subsidize them through programs like welfare. Helps but hurts middle class workers disproportionately and doesn't produce labor. 3) Create and enforce a livable minimum wage. Helps in the short-term (until goods/services prices are inflated adjust to this minimum) and produces labor that arguably has some value. Not perfect because it further decentivizes job creation and increases R&D for automation. Also, it is just a quick fix and needs to be constantly raised. Minimum wage is clearly not a perfect solution but I'm not sure we have a better one yet within the framework of government regulated capitalism.

todd8 12y ago
The Earned Income Tax Credit (a form of negative income tax) is an alternative to a livable minimum wage. Although a negative income tax is not without some problems (see [1]) it has been proposed as a better alternative to minimum wages by serious economists. [1] http://en.wikipedia.org/wiki/Negative_income_tax http://en.wikipedia.org/wiki/Negative_income_tax
- dragonwriter 12y ago
  > The Earned Income Tax Credit (a form of negative income tax) is an alternative to a livable minimum wage. Some form of negative income tax might arguably propose a serious alternative to a livable minimum wage, but the existing form of the EITC isn't it. (If it was, then the actual minimum wage would be a "livable minimum wage", since it exists in the context of the existing EITC.)

todd8 12y ago

The Earned Income Tax Credit (a form of negative income tax) is an alternative to a livable minimum wage. Although a negative income tax is not without some problems (see [1]) it has been proposed as a better alternative to minimum wages by serious economists. [1] http://en.wikipedia.org/wiki/Negative_income_tax http://en.wikipedia.org/wiki/Negative_income_tax

dragonwriter 12y ago
> The Earned Income Tax Credit (a form of negative income tax) is an alternative to a livable minimum wage. Some form of negative income tax might arguably propose a serious alternative to a livable minimum wage, but the existing form of the EITC isn't it. (If it was, then the actual minimum wage would be a "livable minimum wage", since it exists in the context of the existing EITC.)