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Comment by patrickaljord | Hacker News Reader

> That should be expensive for the middle-class.

So you're saying only rich people should get taxi rides? I thought Sweden supported the poor more.

Also, you're aware that when the minimum wage is too high, it just means there will be more unemployment, not that everyone gets a raise.

Now the debate is: are people happier with a job with a low wage or are they happier at home doing nothing? Studies show that people are more depressed at home when unemployed and have more chance to improve their condition and salary by starting at lower paid jobs doing something. But many of the supporters of high minimum wage would rather people stay at home than improve themselves starting with lower paid jobs not because it helps the poor but because it helps the high minimum wage supporters sleep better at night knowing that although more people have no jobs, at least no one is being underpaid... well... except for those not being paid at all.

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I accept your comment about 'supporting the poor' was probably flippant but still, I find the idea that the best way to support the poor is to make taxis cheaper, rather than increasing the/enforcing a minimum wage absolutely bizarre.

I also wonder whether having these artificially low prices for things like Uber, reduces the incentive to improve more efficient modes of transportation like trains/buses.

> I find the idea that the best way to support the poor is to make taxis cheaper, rather than increasing the/enforcing a minimum wage absolutely bizarre.

I explained this part in my comment. Enforcing a higher minimum wage just put people out of jobs, it doesn't give everyone a raise. So you're not raising people's wage, you're actually taking away from them their whole wage bringing it down to zero.

>Enforcing a higher minimum wage just put people out of jobs...

Maybe increasing the amount taxi drivers are paid would drive up the cost of taxis and thus drive down demand for taxis. This seems reasonable to me. We're defining a minimum amount somebody's time is worth, which means the cost of things that use peoples time go up.

The root "problem" taxi drivers solve still exists - people still need to get around, but taxis aren't the only way to solve that problem. Train and bus services could be expanded or improved.

The other thing to consider is that the extra money the taxi drivers earn will most likely provide other economic opportunities.

> We're defining

Who's We? Shouldn't taxi drivers be free to define how much they want to sell their time? Why should you decide for them? Isn't that paternalistic and anti-freedom? Why do you know better than they do what's best for them? Why not let them be?

I mean we as a society.

> Shouldn't taxi drivers be free to define how much they want to sell their time?

The problem with this is that, in my (perhaps naive) mind, the logical conclusion is a race to the bottom fuelled by greed (of the business) and desperation (of the employee) which helps nobody. In my view there should be a regulation to prevent how far this can go.

By the way, I don't think we'll agree on any of these points, but it's refreshing to have a discussion that doesn't descend into name-calling and personal criticism :)

> the logical conclusion is a race to the bottom fuelled by greed (of the business)

If that were true, we would all be paid minimum wage, which is not true. As you gain experience, you bring more value and therefor employers are forced to pay you more, which is demonstrated by reality as I said, we're not all paid minimum wage for exactly that reason. Race to the bottom happens when the minimum wage gets so high that even qualified people get minimum wage and the rest are just unemployed and don't get anything at all.

About greed, are you're aware what greed is? Here's Milton's 3 minutes video on it https://www.youtube.com/watch?v=RWsx1X8PV_A&t=13s

> So you're saying only rich people should get taxi rides?

I do agree with that, best if middle class people use public transport (or worse, their own car).

> I thought Sweden supported the poor more.

It has nothing to do with support of the poor. In India, taxis are incredibly cheap, and there is no shortage of poor people. Poor people can drive buses and trams, too, you know.

> Also, you're aware that when the minimum wage is too high, it just means there will be more unemployment

No, it doesn't. It was never empirically proven that there is a connection between minimum wage and unemployment. (You are simplifying the whole economy to the labor market, but there is also demand side.)

That's amazing, you're basically saying better services should be for the rich only while the poor should use lower public services while saying at the same time that you support the poor. Incredible. That's what socialism always does, pretends to help the poor but in the end only the elite benefits from it.

> No, it doesn't. It was never empirically proven that there is a connection between minimum wage and unemployment.

When it comes to low skill jobs, yes, increasing the minimum wage does create more unemployment as the middle class is not able to pay for them anymore, only the super rich. That's a well no fact, you can look it up.

That's not a fact. It's nonsense you believe to be a fact. Luxembourg, Sweden, Norway, Germany all have low unemployment rates (and higher total employment rates than the US) and have higher minimum wages. Economies adapt to higher minimum wages, they may lose jobs in the short term, then adapt and total employment can return to former levels if the correct policies are in place.

Btw, when you say socialism pretends to help the poor, but helps the elite, that doesn't help your case. By all objective measures, the poor are better off in western european social democratic countries than in a free-for-all capitalist society, like the US. There are other models, like Singapore that also work well, FYI.

> Luxembourg, Sweden, Norway, Germany all have low unemployment rates (and higher total employment rates than the US) and have higher minimum wages.

France, Belgium and Ireland all have a higher minimum wage and higher unemployment rates than the US. Clearly the unemployment rate is affected by multiple factors. The issue is whether a higher minimum wage increases unemployment, not whether you can counteract it with other policies -- applying the other policies without raising the minimum wage could result in even less unemployment.

> Btw, when you say socialism pretends to help the poor, but helps the elite, that doesn't help your case.

There are a huge number of nominally socialist policies in the US that really exist at the behest of large corporations. Mortgage interest tax deduction -- "help people own a home", really makes home ownership more expensive and transfers tax dollars to mortgage banks. Ditto student loan interest subsidies. Affordable housing subsidies -- placate political demand for lower housing costs without actually lowering market rate housing costs for low-middle income working people, transfers tax dollars to landlords, encourages low income people to rent rather than own. Social security -- no progressive rate structure, tax cutoff for millionaires, benefits based on lifespan and historical income which both disadvantage lower income people. Tax deductions for employer-provided health insurance -- implicit subsidy to large insurance companies. Affordable Care Act -- huge tax dollar subsidy to large insurance companies, effectively prohibits people from saving money with high deductible insurance plans that are less profitable to same insurance companies, and discourage overconsumption and overpayment to medical companies.

Skepticism is warranted.

US is not free for all capitalism, it has one of the biggest welfare and government job program on the whole planet (the industrial-military complex), so not sure what you're talking about here. Western European countries are still pretty much capitalist countries with a pretty free market. And they are still doing not as good as freer countries such as Switzerland or Luxembourg and as you mention Hong Kong and Singapore.

The only countries that are going socialists are Venezuela, Cuba, North Korea and friends and we know how they're doing.

> you're basically saying better services should be for the rich only while the poor should use lower public services while saying at the same time that you support the poor

No, what I am saying that taxi driver's job should be paid well enough. If you want a personal driver, it will cost you. The interpretation that taxi is better than public transport is yours only.. Many people in Europe don't need taxis, because we have excellent public transport, which, by the way, also employs people.

I am not sure how you can twist the logic to think that my position supports the elites more than poor. :-)

> No, what I am saying that taxi driver's job should be paid well enough.

How about letting taxis decide how much they want to charge, crazy thought, huh? Turns out many of them are happy to drive for Uber. How about we let them be? Or do you know better than they do what's good for them?

> Many people in Europe don't need taxis, because we have excellent public transport

No we don't. Public transport are still dependent on where you live, unless you live close to a station, it's not that great cause you still need to drive to the station. Not to mention the strikes (I live in France), the delays etc. Having a personal private driver on demand is a way better experience than riding a public bus (gosh do I hate this every single time I have to use it).

> I am not sure how you can twist the logic to think that my position supports the elites more than poor. :-)

Well simply put, your policies make it unaffordable for the poor to get access to the best services and only the elites can. So, there you go :)

> No, it doesn't. It was never empirically proven that there is a connection between minimum wage and unemployment. (You are simplifying the whole economy to the labor market, but there is also demand side.)

Nobody can prove something like that because it depends on dynamic characteristics of the economy. If everyone who makes minimum wage worked for the government and the government did nothing but pay them more money by taking on more public debt then the current-year employment rate obviously wouldn't go down, but our current economy doesn't look like that.

Only ~1% of workers in the US make minimum wage, and they represent an even smaller percentage of total consumption than that. Increasing their wages is not going to create a large increase in local consumption, especially when some of the money goes to things that don't create new local unskilled jobs, like increasing salaries for existing CEOs, or leaving the local economy and going to workers in China or India, or creating demand for skilled jobs that the newly unemployed minimum wage workers aren't qualified for.

And the entire wage increase comes out of the employer's pocket, which for middle class employers means that much less consumption by the employer -- the "increased demand" from higher minimum wage is the broken window fallacy. Meanwhile there are existing jobs that can justify the lower wage but not the higher wage, so those people become unemployed, which reduces local demand, not only due to the lost amount to the employee but also the profit that employee had previously generated for the employer and the surplus for the employer's customers and suppliers and so on.

> Only ~1% of workers in the US make minimum wage

does this statistic limit to literal minimum wage? so if someone is hired at +5 cents, do they not count?

> does this statistic limit to literal minimum wage? so if someone is hired at +5 cents, do they not count?

Including minimum wage +5 cents is still ~1%.

+1.00? +2.00? does it include everything sub-living wage?

Finding the specific data at that granularity is apparently a pain because everybody provides data for income instead of wages which doesn't distinguish $15 for 20 hours from $7.50 for 40 hours.

FWIW the median wage is ~$16.

> does it include everything sub-living wage?

There are many people who work primarily for tips, but raising the minimum wage wouldn't change that.

it would certainly be curious if nobody made <$15/hr yet there was so much noise about it.

Minimum wage is traditional special interest politics. The benefits are concentrated (the specific people who make minimum wage and don't lose their jobs get a raise) but the costs are distributed (things cost more for everyone, higher unemployment).

Suppose you raise minimum wage by 10% and as a result 9 people get a 10% raise and one person loses their job. Well, you just got yourself 9 votes at the cost of one, even though the net result across those ten people is negative. And the net result across all people is even worse because now people have to pay higher prices for things, but those costs are too widely distributed to change anyone's vote.

So raising the minimum wage (or having one at all) will tend to have more political support than it can justify on the merits.

>Studies show that people are more depressed at home when unemployed and have more chance to improve their condition and salary by starting at lower paid jobs doing something.

1. Could you cite one of these studies? This is the first I've hearing of such a phenomenon.

2. That seems insanely counter-intuitive, and even if it's true, it probably hits a wall at some point. To use an extreme example, I for one would rather sit at home collecting an unemployment check than work at a literal sweatshop. If studies are showing people are happier without a living income than with one, then perhaps that says something about society's attitude towards work and how work is glorified as not a means to an end but an end unto itself. I would say that should be pushed back against, and that we should continue enforcing a living wage, and simply giving people money if they can't find a job that pays one.

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