The government has much better options than mandating a living wage.

It can simply pay you the wage as an indirect subsidy to stimulate production.

It can employ you in the construction of infrastructure. The infrastructure of the US is dilapidated to the point of national disgrace.

It should still mandate living wages, the same way it should not allow employers to lash their employees or own them as chattel, or any number of other practices which are both immoral, and cannot find any temporary justification due to exigent circumstances (eg. literal struggle for national survival...)

I think something is missing from this equation, which is the balancing act. The value of labor is dynamic, it depends what people are willing to pay, and what is the price of other costs.

How I see it, labor cost have been cut, while rent has gone up and prices have gone down.

If you increased minimum wage, it would put pressure on prices to go up and rent to go down, both would increase the value of the labor itself.

I think this whole dynamic is way way harder to model and predict how it'll play out then everyone makes it out to be. None of people's simple projection account for it all. Even economists with fancy models backed by simulations, math, and all that can't figure out the real outcome and often disagree with one another on what would happen.

It's not as easy as saying, half the restaurants are going to shut down, and leave empty all those commercial space. What happens next? Maybe some customers start to be willing to pay even more to get back some of the great restaurants they lost, or their proximity to them. Maybe landlords have to lower their rent for something else to fill in the vacancy, etc. Maybe everyone is happy with only half of the restaurants remaining, and each of those restaurant is making twice as much now allowing them to hire more staff and pay even higher. There's a lot of balancing act that could happen.

Certainly, it's a balancing act.

But equally is it ok for people to work hard and long hours and only barely make Or not quite make ends meet?

Sorry I should note that I am not saying you are advocating for the above(could be misread).

I guess the question is what do you do when you find people who present with that situation: that they’re perfectly capable to hold down a job but only to create $10/hr of economic value by their labor.

If you set the minimum wage at $15/hr and do nothing else, you have made that person worse off than today. Everyone around them now has more money, so everything is becoming more expensive. They now can’t find or keep a job, because any employer who employs them is losing at least $200/week, $10K/year by employing them.

I don’t know what the optimal solution is, but it’s not clear to me that the above is it.

Generally the math works the other way. I worked in a Wendy's for a while; I made minimum wage and most of the people made a little bit more. We cleared $30,000 a month profit for the owner ($100K revenue, $70K for expenses including all of our wages). If a company is so inept they can't generate a bit of value from people, then to be frank, as a society we can afford to be without them. Look at the minimum wage as a filter to remove companies that are so unsuccessful, that they disappear before dragging down the citizens.

Pretty amazing! Way way better than any of my friends who have owned restaurants. Did that $30,000 profit include paying off the mortgage, various forms of insurance, legal fees, accounting fees, taxes, and so on?

30% profit for a fast food restaurant is not credible. It's too competitive. I worked for McDonalds (a long time ago, but...) the best store in the market made a little over 10% profit. Others made less, or even lost money at certain times of the year.

That’s an amazing level of transparency to share all the company financials with the minimum wage workers.

So if someone else is willing to work for those wages (they don’t really need the income or have minimal expenses) you’d tell them “tough, it’s illegal to work for that wage now”?

That question never happens in places with a minimum wage. What you can do is support your employer by showing up early and/or helping out a few extra hours after the shift. Nothing in writing or by force.

As an employer you’d be crazy to do that. Nothing would stop that employee from turning around and demanding back wages.

I've really had a lot of jobs. I would just do anything for a while just to see what it is like. In some places it is as if Hitler won the war, in others the boss or manager becomes a good friend. You don't demand back wages from a friend.

Since that is how the relatively uncontroversial minimum wage law (which has been around since 1938) works, yes, society has generally decided that we do want to tell people, "it is illegal to work for some very low wage." And, while not the parent poster, I agree that it is a useful policy.

That’s a very US centric point of view and appeal to authority. Just because it’s been the law for almost 100 years doesn’t mean it’s the ideal approach.

And several developed countries have no floor other that agreed by through collective bargaining.

https://www.investopedia.com/articles/investing/080515/5-dev...

The problem here is, most peoples' wages are defined by their leverage, not their value. For people in those situations, the benefit of minimum wage is that most people below that wage immediately get leverage in the form of legal requirement to pay them (or anyone else) min wage.

This isn't a matter of improving the situation for everyone, it's a matter of improving the situation for the majority of min-wage workers.

If someone genuinely can't provide $10/hr of value, then either 1) they need to upskill (and there are social services for that, although perhaps not in the US idk) or 2) they're like one of those literal retards who are becoming literally unemployable, and the solution is either to subsidize their employer (which is okay in this instance because you're not subsidizing a race to the bottom like you are with subsidizing normal e.g. McDonalds wages) or put them on a disability pension.

But realistically, most people are capable of upskillinng and that's what they should be doing if they're not valuable enough to an employer.

Equally the status quo is not tenable and clearly not the solution.

There are many people coming up with solutions but clearly 'free market' adjustments have failed an increasing number of workers.

But I will disagree with your economic value question, I think service workers are undervalued greatly.

There is a giant disconnect between wage and economic value, the market is terrible at connecting the two.

More specifically, the value of your labour minus the profit that the capitalist wants to make off your labour