Should the US raise the federal minimum wage?

[Admiral Yi]

Sure, but why are you giving the restaurant $24 for a $20 meal?

Presumably because you think it's worth $24 dollars.  Just like you did before they switched from tipping to wages.

[Admiral Yi]

I think the tipping culture really works in (short term) favour of one party - the employer - as it follows the classic divide et impera principle, by setting (otherwise) fairly common interests of the server, other staff members and the customer (have a good experience) at odds with each other, thus effectively alleviating the employer's/restaurant owner's liability for delivering that to all parties involved (by paying its employees well and delivering good value for money to a customer).

How in the world does tipping set the interests of the customer against the interests of the server?

[Eddie Teach]

Sure, but why are you giving the restaurant $24 for a $20 meal?

Presumably because you think it's worth $24 dollars.  Just like you did before they switched from tipping to wages.

I feel like we've gotten into a semantic debate. Marty said tipping (by customers) subsidized restaurants. You replied that "It's only a subsidy if the restaurant receives additional money on top of what it gets from its customers." My point was that a tip, like a price increase, was beneficial to the restaurant whether they are technically subsidies or not.

[Admiral Yi]

I feel like we've gotten into a semantic debate. Marty said tipping (by customers) subsidized restaurants. You replied that "It's only a subsidy if the restaurant receives additional money on top of what it gets from its customers." My point was that a tip, like a price increase, was beneficial to the restaurant whether they are technically subsidies or not.

Please explain what you mean by beneficial to the restaurant.  I had thought you meant the owner came out ahead.

[Eddie Teach]

Whether you give the restaurant $20 and the waiter $4 or the restaurant $24, the restaurant comes out ahead of a scenario where you only give the restaurant $20.

[Admiral Yi]

Well yeah.  24 is a bigger number than 20.  Not sure what that has to do with tipping and the minimum wage.

[Eddie Teach]

Well yeah.  24 is a bigger number than 20.  Not sure what that has to do with tipping and the minimum wage.

It has nothing to do with the minimum wage. It has to do with tipping because that's how we got those numbers.

[Admiral Yi]

It has nothing to do with the minimum wage. It has to do with tipping because that's how we got those numbers.

In my scenario the total bill to the customer was the same whether there was tipping or not.

[DontSayBanana]

Is there no automatic mechanism for adjusting the minimum wage (inflation, average wage increases or similar)?

Not federal, no.  Some states (like here in NJ) are adjusting for inflation now.  Here in NJ, the minimum wage is increased by the CPI-W for the preceding year.

[dps]

Let the states raise their minimum wages.

that.

It's up to the States to do it, not the Federal.  Then people will move to States they feel better in, if it really makes a difference.

Are minimum wage earners actually mobile enough to just move to a different state in order to seek better economic opportunities?

Of course they are.  If Mexicans making way less than the US minimum wage can move to this country illegally, US citizens making $7.25/hour can certainly move to a different state (or a different part of the same state).

That said, if all you're qualified to do is a minimum wage job, you're probably better off making $7.25/hr in West Virginia or Arkansas than making $15/hr in New York or California.

[Valmy]

Are things really that expensive in eastern California or upstate New York?

[Admiral Yi]

I imagine upstate NY would get pounded if the whole state went to $15.

For that matter, I think most states have parts that would get hurt by a $15 min wage.

[Valmy]

I imagine upstate NY would get pounded if the whole state went to $15.

For that matter, I think most states have parts that would get hurt by a $15 min wage.

Ah I thought those were state minimum wages.

[Admiral Yi]

Ah I thought those were state minimum wages.

AFAIK the only jurisdiction that currently has $15 is SeaTac.

[dps]

It has nothing to do with the minimum wage. It has to do with tipping because that's how we got those numbers.

In my scenario the total bill to the customer was the same whether there was tipping or not.

Right.  In the current system, if the meal costs the customer $20 and the customer leave a $4 tip, then the restaurant gets the $20 and the server gets the $4.  Changing it so that the customer pays $24 to the restaurant and the restaurant gives $4 of that to the server doesn't really change anything, except eliminating tips means that the server gives up the opportunity to get a larger than normal tip by providing superior service.