[AnthonyMouse]

Here's a thought experiment for you. Think of college as a job. You go there, you do work, you get paid. The amount you get paid is negative because your productivity to the school is near zero and their cost of "employing" you requires them to have a lot of buildings and faculty etc. Yet people take on a lot of debt to be able to work as a student at a college, so they obviously perceive some value in it.

Should we prohibit colleges as "simply not viable moral businesses"?

Now suppose we have something which is halfway in between. The benefit to the institution is positive but small. You're doing productive work but it's only worth $4/hour. On the other hand, you're learning stuff and that's very valuable to you -- much more valuable than an $8/hour job where you're not learning anything. Should we prohibit this and not the school? Why?

[adjkant]

The argument you're making requires that you are making a significant personal investment in yourself at that $4 an hour job, which I have yet to find such an example of. I'd be happy to hear about some.

Internships for lucrative fields where knowledge experience/investment pay off have no issues existing in economies with minimum wages as very clearly demonstrated by the fields of software engineering, businesses, and many other fields. Not to mention that most minimum wage laws make exceptions or reductions for internships, and people do unpaid internships often for things like PolySci students for political campaigns.

So, yes, we should continue to support internships that invest in people and we already regularly make such considerations in minimum wage laws. $4 an hour jobs in a place where $8 an hour is the minimum wage is not an example of an internship where you are going to learn something valuable, though I am open to hearing about these jobs. The cost of an intern is often far less the pay and much more the hours of those senior to them who would be teaching. Minimum wage is not standing in the way there.

Even if these jobs exist, what percentage of $4 jobs will those be? In reality this will be exploited by large corporations every time, pricing as low as the market will let them, irregardless of livability.

[AnthonyMouse]

How would you expect to you hear of some when they're prohibited by law?

Try it like this. Federal minimum wage comes out to around $15,000/year. This is in the same ballpark as college tuition -- which is generally regarded as costing a lot of money. If you go to an institution where you're a novice and it takes half your hours to learn the trade and the other half is productive but effectively unskilled work for the employer, you would expect these two to net to approximately zero, right? So why is it at all unexpected that it would frequently net to a number which is slightly positive but less than minimum wage?

> Even if these jobs exist, what percentage of $4 job will be those?

Probably the large majority of them, because otherwise why would anybody take those jobs? They wouldn't be paying enough to attract employees unless they were offering something else of value that existing jobs with higher compensation don't have.

Corporations can't just offer to pay $0.25/hour and get a line of workers lining up at the door. They have to outbid other companies for labor. That's why most companies already pay more than minimum wage for most jobs. And it's why most of the jobs that would pay less than minimum wage are ones that offer the workers something else in its place -- education, more flexible hours, a shorter commute etc. Taking those options away makes peoples lives worse, not better.

[adjkant]

> Try it like this. Federal minimum wage comes out to around $15,000/year. This is in the same ballpark as college tuition -- which is generally regarded as costing a lot of money. If you go to an institution where you're a novice and it takes half your hours to learn the trade and the other half is productive work for the employer, you would expect these two to net to approximately zero, right? So why is it at all unexpected that it would frequently net to a number which is slightly positive but less than minimum wage?

Again, you are missing the point. Either that job is an internship (non-permanent and I already addressed it) or you will quickly become a fully productive worker (this is literally just training/ramp up and is not a significant cost to employers). These are not the jobs/pay structures minimum wage laws are affecting nor are people discussing, this is just a straw man.

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> How would you expect to you hear of some when they're prohibited by law?

Legality does not define what concepts exist in the world, so let's hear them! You have yet to even mention a single example.

Companies can and do regularly lobby for laws. They don't appear to be using this line of reasoning because if large minimum wage employers like McDonalds or Walmart tried this they would be laughed at even in political spheres.

> Probably the large majority of them

I suspect we're gonna have to agree to disagree here on what's going to happen without a minimum wage.

> because otherwise why would anybody take those jobs?

People take badly paying jobs because if you're faced with bad and really bad, you'll take bad. Companies are free to exploit this without minimum wage laws in place. This type of exploitation only works in a buyers (if we put employees here as "buyers" of jobs) market, and immediately pushes wages significantly lower in a sellers market, which we have seen for quite a good deal of the past few decades. We can't have economics that are only moral when things are going well.

> Taking those options away makes peoples lives worse, not better.

The flaw here is that you're looking at only one side of the equation. You are improving the lives of every job that has a raised salary as a result. Now the calculus on how many jobs that removes vs raises, what kind, and where is a valid debate, but again, this tradeoff is a moral one. Economists are doing studies to get numbers so that then we as a society can make the moral decision on the tradeoff. That moral question however is not one that economists can answer. They can only study and communicate the effects.

> And it's why most of the jobs that would pay less than minimum wage are ones that offer the workers something else in its place -- education, more flexible hours, a shorter commute etc. Taking those options away makes peoples lives worse, not better.

Big citation needed here.

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I'm not looking to get into the weeds here frankly, that is not the point of my original comment. There are many studies on both sides of the minimum wage debate, and that's just going to turn into a linking war between people who are not economists and are also not likely to change their minds on the internet. I have my beliefs based on the data I have seen but again, this doesn't seem fruitful to go down this route.

The point I am making here which none of your points address is that minimum wage legislation is very much tied to moral considerations, and economics aids in giving numbers for those. At the end of the day, the viability rests on morality as interpreted based on data produced by economics.

[AnthonyMouse]

> Either that job is an internship (non-permanent and I already addressed it) or you will quickly become a fully productive worker (this is literally just training/ramp up and is not a significant cost to employers).

You're asking for examples and then pigeonholing any possibilities into one box or the other.

Some occupations take a long time to learn. Years. Particularly if it's effectively half training and half working, because then it takes twice as long to finish the training. If it's the equivalent of four years of undergrad and three years of grad school then it would take fourteen years -- hardly "temporary" but at the end you would be qualified for a six figure job and have no student loans. Is that a sufficient example?

> Companies can and do regularly lobby for laws. They don't appear to be using this line of reasoning because if large minimum wage employers like McDonalds or Walmart tried this they would be laughed at even in political spheres.

The institutions that would lobby for this legitimately don't exist because their structure is prohibited by existing law, so it's chicken and egg.

Existing large minimum wage employers generally don't want to eliminate the minimum wage because it would make it harder for them to retain talent because their prospective employees would have more options.

Suppose you work at McDonalds and have a 30 mile commute. That costs you thousands of dollars a year -- you have to buy, maintain, insure and fuel a vehicle -- and about eight hours a week of sitting in traffic. A job that paid $2/hour less but was close enough for you to walk to work would leave you healthier with more money in your pocket and more free time. McDonalds would have to pay you more in order to get you to not quit and take the other job. Why would they want that?

> People take badly paying jobs because if you're faced with bad and really bad, you'll take bad. Companies are free to exploit this without minimum wage laws in place. This type of exploitation only works in a buyers (if we put employees here as "buyers" of jobs) market, and immediately pushes wages significantly lower in a sellers market, which we have seen for quite a good deal of the past few decades. We can't have economics that are only moral when things are going well.

But that's the whole problem, isn't it? When things are going well it's a seller's market and you don't need a minimum wage. When things are going poorly, the option isn't minimum wage job vs. less than minimum wage job, it's less than minimum wage job vs. unemployment. So then you're prohibiting bad and leaving them with really bad.

> You are improving the lives of every job that has a raised salary as a result.

You're also worsening the lives of every customer who has to pay more for goods and services as a result, and for that matter everyone who makes less on their retirement account. That part of it is a zero sum game. The part that isn't is the part where where the minimum wage prohibits Pareto-optimal alternatives that generate actual surplus.

> Big citation needed here.

If there exist two complex options and you take one away based on a simple factor, there will be some number of people for which the option you took away was the better one. Can you not imagine that some jobs might pay less money but be more flexible or closer to home or less emotionally taxing and thereby preferable despite the lower pay?

> There are many studies on both sides of the minimum wage debate, and that's just going to turn into a linking war between people who are not economists and are also not likely to change their minds on the internet.

All of the studies of this question are inherently politically compromised because it's trivial to design a study to find the outcome you want. If you want to see no increase in unemployment from a minimum wage increase, find one where hardly anyone was making the minimum wage even after the increase to minimize the economic effect. If you want to see a large effect, find a large minimum wage increase in a place with many small businesses that can't absorb the higher costs and few large institutions that can.

The ability to cherry pick data doesn't prove anything. But notice this: Even when a minimum wage does exactly what you want it to, the effect is to transfer money from the large institutions that can absorb the minimum wage increase to the minimum wage workers. But you can get exactly the same desired effect simply by changing their relative tax rates (using negative rates if necessary) without incurring any of the harm caused by constraining anyone's choice of employment.

[adjkant]

> Is that a sufficient example?

You say I'm pigeonholing you but you have yet to name a single occupation - what am I pigeonholing? Also, my "pigeonholing" is not arbitrary, it is the breadth of jobs that can exist with a minimum wage enacted...

No, it is not a sufficient example because you haven't said a word about what this person is doing. You can see how this feels like pulling teeth on my end, yes? I just want an actual concrete example of a job that could exist. If there are so many of these that there is a notable economic impact from this, it really isn't unreasonable to ask someone to name one, is it? I can't imagine what the job looks like that you described.

> But that's the whole problem, isn't it? When things are going well it's a seller's market and you don't need a minimum wage. When things are going poorly, the option isn't minimum wage job vs. less than minimum wage job, it's less than minimum wage job vs. unemployment. So then you're prohibiting bad and leaving them with really bad.

My argument is exactly that you need a minimum wage in a sellers market because the market is exceedingly inefficient for workers and allows companies to exploit workers and pass that profit off to already wealthy shareholders and upper management. For non-sellers markets the minimum should be adjusted to match economic times, I'm not saying we set a $25 minimum wage during a recession here. I'd be very happy to pin minimum wage to economic times.

> Can you not imagine that some jobs might pay less money but be more flexible or closer to home or less emotionally taxing and thereby preferable despite the lower pay?

If it is between a job that pays enough to survive vs one that does not? No I can't. Between two jobs that pay enough to survive? Absolutely.

> Even when a minimum wage does exactly what you want it to, the effect is to transfer money from the large institutions that can absorb the minimum wage increase to the minimum wage workers. But you can get exactly the same desired effect simply by changing their relative tax rates (using negative rates if necessary) without incurring any of the harm caused by constraining anyone's choice of employment.

I fully agree that would be a better policy. It has proved much harder to pass through the political system. I have said it in other threads here but I am 100% not saying a higher minimum wage is an ideal economic state, it is simply better than the current point we are at and the seemingly easiest to pass at the moment. In the end, the clear way to do this is through UBI IMO. And I think that is the root of a lot of these threads that I'm not going into responses on - this isn't a one and done policy change, you need others to match it like an increased social safety net to make that "really bad" unemployed scenario not as bad.

[AnthonyMouse]

> you have yet to name a single occupation

Because it isn't in any way specific to an occupation. It's anything where the employee receives a non-monetary benefit from working somewhere that offsets a reduction in monetary compensation. It doesn't matter if what they're teaching you is to be a lawyer or an electrician or an auto worker, what happens is that you receive long-term training in exchange for less pay.

> My argument is exactly that you need a minimum wage in a sellers market because the market is exceedingly inefficient for workers and allows companies to exploit workers and pass that profit off to already wealthy shareholders and upper management.

This is not a description of a seller's market. When labor becomes more scarce or more in demand, the price goes up without need for any special rules.

> If it is between a job that pays enough to survive vs one that does not?

The point is that minimum wage is a garbage metric for this.

Suppose one job requires you to incur $4000/year more in transportation expenses for commuting and then pays $15,000/year instead of $12,000/year. The lower paying job leaves you with $1000 more in your pocket after expenses, but it's prohibited. If either of those jobs doesn't pay enough to live it's the one with the higher nominal pay.

> I fully agree that would be a better policy. It has proved much harder to pass through the political system.

I don't think they've had an easy time raising the minimum wage either (for much more legitimate reasons) and would do better to give up on the worse policy so they can concentrate on the better one.