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Comment by ufmace | Hacker News Reader

One thing that nobody ever seems to point out in these discussions: Should we legally mandate that every job in the world must pay enough money to support a family of 4 as a single earner of the household? What about high school/college students, retirees, spouses of high earners, and other people who want a relatively low-skill job that doesn't pay that much? Should the kind of job they want be illegal because, someday, somebody who does have a family will take that job and then complain that it doesn't pay enough to raise their family?

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It's far less economically distorting to top up a family's income with an EITC than by mandating higher wages. For one thing, it avoids giving employers incentive to cut back on labor costs.

But then you're subsidizing the labor costs of employers who pay low wages...

Employers will not cut back on labor costs if there is demand and they're still making profits. They'll cry, bitch, whine and scream at congress because their profits took a hit, but they will not cut back if they're still making profits.

Lack of demand, on the other hand...

You're missing the word "enough" before profits. Employers are like any other investor. If returns on hiring more labor are less than buying new equipment or just forgoing expanding and investing back in the market, then they won't be hiring.

You forget substitute goods. You can substitute a cashier with a self-serve machine, you can buy and use machines to clean the store faster, you can reduce opening hours, you can plan the store so that fewer employees are needed, etc.

Yes capitalism is amoral so people will certainly be willing to pay to increase salary, but they are also willing to buy machines, outsource work, make customers do more and other things that reduce the need for employees.

If Wal-Mart raised their wages to CostCo levels, it wouldn't be the current Wal-Mart employees who benefit. Wal-Mart would replace their old workers with new workers, and start competing with CostCo for those higher wage workers.

Ah so you expect the "stressed middle" like most of us to subsidize the walmarts of the world.

Where do you think the money for EITC/WTC comes from?

A tax on corporate profits?

This is just a special case of people not living within their means. If you can't afford a kid, don't have one.

The catch to this line of reasoning is that you might have a perfectly well-paying job when the kid is born, but several years later endure a drastic shift in your professional life that's out of your control.

So I don't know. "Must pay enough to support family of 4" is incredibly arbitrary, and EITCs for low-income families (as another poster mentioned) sounds icky to me, since now everyone else is just subsidizing low-wage employers. Not sure what a good solution might look like.

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