Low wages are supposed to be entry level, meaning a person with no skills can get employed and start learning work skills to move up.
>pay off student loans
The average college grad starts at $25 an hour.
> a person with no skills can get employed and start learning work skills to move up
https://en.wikipedia.org/wiki/Dead-end_job
> The average college grad starts at $25 an hour
Should be closer to "minimum" in an ideal world, but at least it's something.
You can believe this with all your heart, soul, mind, and strength, but it will not change the inescapable law of economics that hiring someone at a wage which is higher than the value they produce is called charity. This is, of course, unsustainable for the sector from which nearly all demand for labour is derived (business) and therefore it would be an axiomatic truth that this situation will not result in net benefits for those with skills that do not justify a wage equal or higher than a legal minimum wage.
So mega-charity for boardroom vampires and Big Finance thumb-twiddlers is acceptable, but not for workers? I don't follow your reasoning as it relates to reality.
It is possible to govern a society that doesn't worship money above all else. It's okay to be charitable.
Remember; using those laws to mandate a minimum wage does not mean that everyone is entitled to that wage. It means many just legally cannot sell their labour. It's mandatory hiring discrimination.
It is in the interest of society, however, that your employees are able to feed and clothe themselves, find shelter and medical care, and participate in capital transactions with the ability to pay their debts.
Society forces you to afford your employees a modicum of dignity and value above that of livestock, furniture or raw materials, despite the fact that, in the cold calculus of supply and demand, cost and profit, they are precisely the same - purchased assets from which business value is to be extracted.
The inconvenience of having to consider the human condition in your valuation of human employees is the cost you pay for civilization and the benefits it provides (among which is a labor force to exploit) and the cost civil society pays to suffer sociopaths who would only consider ethics in their capitalism at the point of a gun.
Can we make the min wage $1000/hr? Why not? Once you understand why not, you must admit there is a tradeoff between price floors and employment. The higher the min wage, the less people can produce that value, so they're unemployed.
The CBO estimates around 1 million people will lose jobs as a result of a $15 min wage.
Those people will certainly not be better off. And, if they're priced out of the job market, they will lose the opportunity to get work experience and move to higher wages, as virtually everyone that gets a job does. Almost no one has the same wage their entire life.
If you think the value paid is unrelated to value added, then if a person could add a ton of value for the employer, more of those companies would spring up. Then as there is less people to employ, they have to compete for employees to absorb this free money you claim exists. Finally, the wages are forced to near the sustainable level for both sides.
Look at some SEC filings for company profits versus salary paid to employees. Profits do not, per employee, support your claim.
In the vast majority of cases it's the other way around: workers are producing value and being paid a fraction of it. Some of this might be somewhat justified (someone's gotta pay for equipment and property), but some of it definitely ain't (e.g. managerial rent-seeking middle-men skimming that value).
Sure. And in a society with the wealth ours has, there should be a certain baseline minimum income—as income with the freedom of choice that entails—but minimum wage may not be a sensible way to provide that. UBI funded by progressive taxes on income that include equal treatment of capital income may just plain work better. The problem with minimum wage is that it amounts to a minimum labor value at which it is worth hiring, but working at a lower value job is often the best way to get skills for a higher value job.
There's plenty of evidence that within a certain range, increasing minimum wage is a net win in the absence of an alternative income floor, but it doesn't mean that minimum wage is the best way to provide that floor (it's inherently leaky) or that it doesn't start falling apart as a mechanism if raised much higher.
I'm happy with increasing the baseline minimum wage significantly, say to $15/hr in current dollars and indexed to inflation, but also adding a UBI and reducing the actual minimum wage to the baseline minus the $1/hr for every $2000 in annualized UBI.
Sure they are in some abstract moral sense. But they're not worth paying more than the value they produce, otherwise the company goes under and no one has a job. There's no way around this.
If you think making a min wage $25/hr would help, why not make it $1000/hr? Once you understand how this fails, you'll understand why all changes of a forced price floor forces a tradeoff with a downside people want to ignore.
Forcing min wages to whatever level always results in someone at the edge being pushed below the employment level. For example, the CBO estimates that raising the federal min wage to $15/hr will push 1,000,000 people out of jobs. Those people are worse off.
Next, min wage rises also result in inflation for products at the low end, because the products made by low wage people cost more to make and low wage people now have more money. If someone is willing to work 10 hours at X/hr for to pay for an apartment costing 10X, then raising wages to Y/hr means the lanlords can raise prices to 10Y, since the same person is still willing to work 10 hours to pay rent.
A better solution is to tax (which we do), and provide assistance to those truly needing it. A high school kid living at home making $10/hr is not the same as a 30yr old making $10/hr. And neither are the same as a comfortably retired person making $10/hr just to get out of the house.
Use targeted assistance to allocate resources always results in a better use of resources than a ham-handed one-size-fits-all approach, with less unwanted side-effects.
> The average college grad starts at $25 an hour.
I think you're almost all the way there to answering your own question.