>The purpose of minimum wage is a floor,

It goes deeper than that. There was a documentary that leaked a new Walmart employee going through their initial first day orientation. If you were a new hire and were married and/or had children, you got extra "orientation" on all the government benefits you now qualified for (welfare, food stamps, medicaid, etc) since you were now considered below the USA poverty line.

I am fine with letting the market regulate itself, but it is not ok that a company can pay employees low because the government will pick up the other half. That is not "self regulation".

If you're earning less than $130,000 a year, you are eligible for an FSA, which the HR team will discuss during almost any company's new-hire orientation...

There are lots of government benefits that are restricted to people below a certain income. That doesn't mean that it is unconscionable to pay people at that income level or to educate employees on what they are eligible for so that they can take advantage of it.

> That doesn't mean that it is unconscionable to pay people at that income level

If that income level is the poverty line: Yes, it is.

So then your problem is with the income level, not educating people about benefits they are eligible for.

>If you're earning less than $130,000 a year, you are eligible for an FSA

Assuming you mean a flexible spending account (for healthcare out of pocket), you're certainly not capped at $130K/year in the US. Your broader point is of course true.

If you are single, the limit is 130,000/yr. After that you can have an HSA, but FSA.

It makes sense, kinda. When your public and private social programs are numerous and disconnected, getting a job can mean losing a lot of benefits while qualifying for others.

e.g. my employer had a session about their benefits package: If I was on welfare, this would be a change in how everything works. It would have been nice if they had a session on our national pension scheme since I was now obligated to start paying into that.

>>but it is not ok that a company can pay employees low because the government will pick up the other half>>

I don't think this is a situation that applies to the idea of self-regulation. In this case, a distortion of the market is first created by the government subsidy. So the natural behavior of a business would be to leverage it. Just as the natural behavior of the IRS is to go after things like your company's paying for your cell phone and calling it taxable income.

I would suggest that the idea of self-regulation is best applied where there are no market distortions from the government that have already warped the context.

That's not how economics works. Walmart is paying their employees low despite welfare, not because of it. Without welfare, people would be more desperate for work and would be willing to work for lower wages.

would you prefer they not tell those people about the available benefits?

I think the point is Walmart is able to pay at a low enough rate that it must be effectively subsidized by the government. Walmart then plays into it as a further benefit “they” provide.

The government is setting the price floor for wages. If that price floor falls below the point at which the government will offer benefits to people, then it isn't Walmart that is being subsidized.

I would prefer that nobody who works 40 hours a week (tops! I'd be happy if the number was less) earns less than the US poverty level for a family with 1 or 2 children (undecided over which). As a matter of law.

I’m sure my 16 year old son would have loved that.

And everyone arguing that a company doesn’t deserve to exist if it can’t profitably pay more, is posting on a site funding money losing companies that couldn’t exist if they actually had to make a profit.

If you want to advocate the position that there's some age where the correlation between work and income can or should be looser, be my guest.

For me, the bottom line is that spending 40 hours a week doing something that requires no skill should still entitle the employee to be able to live a basic life. Further, that it should require only one person in a family to do that work in order for the family do live a basic life. If the person wishes to earn more then they will need to acquire more skills one way or another.

I do not believe there can be any moral justification for somebody receiving 40 hours of someone's effort (even an unskilled effort) and not giving that person enough for a basic life. I don't care what the age of the person doing the work is, and yep, if the company cannot do that, it doesn't deserve to exist - it doesn't do anything valuable enough to pay its employees adequately, so it can disappear and nobody except the owners will care.

So it costs a family of four about $7000 a month to live in San Francisco

https://www.numbeo.com/cost-of-living/in/San-Francisco

Should the minimum wage there be $48/hour after taxes?

That’s $60/hour before taxes according to this gross up calculator

https://www.paycheckcity.com/calculator/grossup/california/r...

Portland Oregon is #25 on the list of the 50 largest metro areas in the US. A living wage there is about $44/hour for a family of four. Should that be the minimum wage in Portland?

https://livingwage.mit.edu/counties/41051

For the purposes of my answers, I am taking your cost-of-living values as they are. I am not convinced they are correct, but willing to assume that they are.

> Should the minimum wage there be $48/hour after taxes?

Yes.

> A living wage there is about $44/hour for a family of four. Should that be the minimum wage in Portland?

Yes.

What's your alternative? "Oh sorry, your job is requires so little skill that even though you could just spend 40 hours a week doing it, you will need to find at least another 20 hours a week doing something else to be able to afford a basic life"

I find that morally unsupportable.

So you want to raise the minimum wage of everyone in San Francisco to $131K a year? How is that going go work out for inflation?

You want to raise the minimum wage of everyone in Portland to $91K year?

Let’s say the average grocery store has 6 people working every hour for 16 hours a day and 355 days a year. Their labor cost would be $1.465 million. Grocery stores already operate on thin margins (https://www.biz2credit.com/blog/2020/05/22/grocery-store-pro...) are you prepared to pay enough for the labor cost of the entire food chain to quadruple? From the people in the field, delivery truck drivers, etc?

Let's just say that I don't subscribe to the conservative traditional view of economics and politics that you're using to point out how absurd this sounds.

Yes, I believe we should be paying much, much more for most of the things in our lives. Right now, those of us who make about 80% of median income and above are essentially riding on the backs who make less. I think this is immoral, although I recognize that changing it is a millenia long project that faces staunch opposition.

I want to see GDP distributed more evenly. In reality, the likely end game is not that everyone in Portland makes $91k a year or more, but that there is massively more redistribution within the economy, high end incomes fall, overall highest:lowest income ratios drop, housing prices drop (because more housing is built, and housing ceases to be an investment), and lots more good stuff that

I wonder, how do you personally justify millions of people working for less than a living wage? Do you feel that there just has be a bunch of people who lose out in life, and that's just the way it is? What makes it all seem OK to you?

I am not justifying anything. I am putting numbers behind your belief that “everyone who works for 40 hours a week should be able to support a family of four”. It’s easy to talk about ideals until the cold reality of numbers, inflation, etc are brought up.

How do you propose we restructure our economy so that everyone get a wage that supports a family of four?

How many people do you think will “lose out” if inflation sky rockets where food isn’t affordable? You can look at places like Venezuela to see what happens.

Do you personally give away enough of your income to bring your compensation down to the median household wage of $65K a year?

I assure you that I’m not a conservative by any means. I’m card carrying member of the F*## the police (and have been since the 90s), BLM, keep religion out of policy, pro-choice brigade.

But I’m also a student of economics and an MBA drop out with one course remaining (CS undergrad)

> How do you propose we restructure our economy so that everyone get a wage that supports a family of four?

At its crudest, the US GDP is $23T. Divided among 350M people that's about $66k, for every living American. The working age population is about 215M, so that would be about $107k per working age American (not per household, per working age individual).

There's no need for money creation, we just need to spread the wealth around more evenly.

And note, I'm not actually advocating precisely equal income for everyone, or even every working age person. I suspect that some range of incomes is probably a good thing for society overall, but I'm fairly sure that it doesn't need to be anything like it is today. The point is that redistribution is how we get there, not injecting money into the economy.

You might care to listen to someone who knows a lot more about this stuff than me. Thomas Piketty was on the Ezra Klein Show a couple of weeks ago, and talked about several "radical" schemes to alter the levels of inequality in western societies.

https://www.nytimes.com/2022/06/07/opinion/ezra-klein-podcas...

(there's a transcript there too, so you can read rather than listen if that's your preference).

I give away 5% of my income. That's not enough to bring it down to median levels. My work is relatively charitable in some sense though: I develop libre audio software, and convince people to pay me for it anyway.

So you’re not even willing to give up more than 5% of your income and redistribute if yet you think everyone else should and you justify it by the fact that you work on open source audio software? I’m sure people struggling really appreciate that

So let’s say we redistribute the entire economy to each working age person (even though you are personally not willing to), how do we fund health care, infrastructure, education, people who need more than that from the government, etc? Who is going to invest in business? Do you suggest we tax everyone so that they have equal income? Should the fry cook make as much as the brain surgeon? Who is going to pay for the education needed for the more skilled jobs and what motivation does the doctor have to put in 8 additional years of school if they could make just as much money as the fry cook?

My children are grown, should my wife and I get the same income that someone with two special needs children get?

My parents are retired and doing pretty well for themselves with two pensions and two social security checks. Should we also tax them enough to make things more equal and tell them that they don’t deserve to keep their income after working 30 years?

That $66K might be enough for someone living in the MiddleOfNowhere Nebraska. But it won’t be enough for someone living in Seattle. Do we also redistribute people across the United States to make the cost of living equal?

What’s to stop me from just moving overseas where I can take my talents and make more money and then you have a brain drain?

Well not quite. They exist because they are profitable on average.

You think that most companies that are YC funded and seeking additional rounds of funding are profitable?

"on average" does not mean "most companies".

It could mean that, but in all likelihood it means that some YC funded companies make huge amounts of money for YC that sufficiently balances the losses that they keep doing it.

Ya know, like most investment (that works).

That’s not how VCs make money. They make money based on “exits” either via acquisition or IPO. Over the last few years, most companies had exits without ever showing profitability.

Joe Bob’s Burgers don’t have the luxury of losing money hoping they can survive long enough to find the “greater fool” either via acquisition or IPO.

> That’s not how VCs make money. They make money based on “exits” either via acquisition or IPO.

It doesn't matter. The only question for YC is whether they make money or not. They make money on some of their investments, and lose it on others. It's fairly clear that on average, that is, summed across all winners and losers, they make money overall.

I’m not questioning YCs business model. I’m calling out the hypocrisy of people who say that “companies who can’t afford to pay their employees a livable wage and stay in business don’t deserve to exist” while many people here work for companies who are only able to pay their wages even though they work at non profitable companies because they are being propped up by VC funding.

Well, in this you're seeing the result of living in a society that is responsive to the needs and desires of people with money and power. In this case, YC is an example of such people, and they've made the decision that what Overinflated Sense of Self's Startup is up to is potentially valuable enough that they'll fund it. OSSS has been judged "worthwhile" by enough money that for now at least, it can keep going.

On the other hand, Andy's Average Appetizers is of no particular interest to VC money, or any other money really, and so yep, they're going to go under because they don't anything that attracts enough money to make them viable (possibly at a higher living wage standard, possibly at current minimum wage standards).

>>The purpose of minimum wage is a floor>> There's the purpose and then there's the outcome. I have always found it useful to also keep in mind the perspective on minimum wage that recognizes that from a practical perspective, it makes it illegal for workers that create a certain level of economic value to work. Of course that's not the perspective that a proponent of minimum wage would use to pitch it because that certainly is not the purpose. But it's hard to argue that this other perspective is not to some extent, the outcome in terms of economic mechanics.