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Former Labor Secretary Found What Work Is Like Now (2022) (jasonstanford.substack.com)
104 points by janandonly 6 months ago | hide | past | favorite | 241 comments



I don't like the particular focus he puts on customers not tipping well. He mentioned feeling like he's being nickel and dimed to access his tips, but that's precisely the same feeling we customers have now about tipping. I can understand why customers don't leave a big tip at a movie theater too - the ticket for the movie already paid for access to the theater, and the food prices inside are also highly marked up as is. Asking for tips on top of that is exhausting and annoying for the customers.

He should have perhaps spent more time on the topic of corporate profits.


This is a theater that has waitstaff that take orders and bring food and drinks to your seat as you watch the show.

Don't want to tip, even though it's baked into the wage calculation? That's fine. The author is just pointing out that market forces means that folks aren't going to stay in those jobs.


In which case, the movie theater may have to switch their wage calculations to actually pay these people for the work they're doing. The up-front price for tickets might need to increase, but that's preferable to the weird layers of hidden fees in the current system.

Using tips as a substitute for paying a living wage needs to be eliminated everywhere, but I especially don't blame people for not realizing that a movie theater of all places is playing that game.


You say upfront pricing would be preferable but consumers show over and over they pick based on the advertised price. This is true in dining, flights, hotels etc.


I'm not saying upfront pricing would survive in a free-for-all laissez-faire economy, I'm saying that it ought to be required because it is better for consumers.

They pick based on the advertised price because hidden fees and culturally-mandated tips exploit weaknesses in our psychology, not because customers actually like to spend more than they'd planned on.


In Ontario, Canada we did away with the lower tier minimum wage. Everyone, including servers, bartenders, etc, make at least $16.55/hr. Tips, if any, add on to that. It makes it so much easier to look at the price tag and know what something costs, and not to tip when it doesn’t feel like anything exceptional happened.

But my favourite thing: it gives weight back to tips. They mean something again.


California doesn't have a tip wage, tips still expected.


Great - tips there should be optional, but that's now not part of the discussion. California's progressive laws rarely reflect the rest of the country, especially Texas.


progressive 1970's policies


Both can co-exist. Also, let's not forget that California lives in its own bubble, not reflective of the rest of Americana.


I don't know why you're bringing California into this. I don't live there, and TFA takes place in Austin, TX.


Shoud've clarified - I couldn't reply to the 3rd reply due to HN's limitations, but it was related to the "California" reply without making mention of it. This has nothing to do with Canada.

HN has posting limitations.


That's a weird take. What about life in California do you think is so different?


This seems more like an argument for mandating up-front pricing, than against up-front pricing. That way nobody can “defect” and gain business by obscuring prices.


An advertised price that is racing to the bottom by offloading more and more of the cost to tips from customers.

Meanwhile the employees blame the customers, the customers blame the corporation, and the corporation blames the employees.

The corporation is the only one that is laughing all the way to the bank.


I assume at least the top quintile of tipped personnel are also making out better than under a non tipped system.


This isn't about high-end bartending or wait staff in high-end restaurants. Most people in the service industry don't work there, and most places can't support that level of pay, so your point is moot in general application, but still accurate.

That's not what this conversation is about.


> consumers show over and over they pick based on the advertised price. This is true in dining, flights, hotels etc.

This is precisely why junk fees must die.


Well the debate aside it seems like the culture is moving away from tipping. Younger generations don't seem to do it. So it seems that legislatures are going to have to start accounting for this in their min wage requirements


Customers being oblivious to dark patterns in charging, is why regulation is needed.


Sure, but until such things transpire we have an ethical obligation to tip and tip well, right? Like, if you admit there is a problem, it seems pretty bad to just focus on the root causes without addressing immediate needs.

If you are about to run someone over in your car, you dont just say "well, the speed limit shouldn't be this high anyway.."


> but until such things transpire we have an ethical obligation to tip and tip well, right?

I don't think so, no. I don't think there is any ethical obligation to tip at all, and there never has been.

I am under no ethical obligation to be abused by companies using their employees as human shields.


I agree you’re not under an ethical obligation to be abused, but to use a company’s services where all parties expect you to tip, and then you don’t that’s unethical as well. You don’t get to have your cake and eat it too.


People can expect whatever they want, but there is no actual obligation to tip. It's not a matter of wanting my cake and eating it too, it's a matter of rejecting the premise that what should be a way of expressing appreciation is being subverted by employers to underhandedly supplement wages.

If the tipping is actually mandatory, then build it into the price to begin with. That way, perhaps tipping can go back to being an actual expression of thanks.


The only unethical thing here is pretending you are owed money without telling the other party they owe you money.


I agree, but here’s your notification: if you go to a bar or restaurant and receive service you should tip.

If you don’t like this, don’t go.


It's not that simple. If I go to a restaurant and order at the counter tipping is typically considered to be entirely optional, in spite of the fact that the PoS system would like you to think it isn't.

Then there's the whole spectrum of space in between. What about order-at-counter but the food is brought to you when it's ready, but you then clean up after yourself? What about a buffet, where you pay at a counter, serve yourself, but someone comes and cleans up your plates?

An alternative heuristic that I've heard is that if you pay in advance than tipping is optional, while if you pay at the end it's required, but that doesn't cover Doordash.

There are clear cut cases where tipping is required, and a whole fuzzy mess in between. And that fuzzy mess gets fuzzier and messier each year as companies intentionally blur the line.


I receive service everywhere I go, from the people who clean floors and bathrooms to the people who make food to the people who stock shelves, and even do engineering drawings for me.


But isn't being a patron of one these companies precisely the thing that does put you in this kind of obligation?

Isn't the whole thing about human shields that we don't want to hurt the humans in question?


No, I reject the premise that there is an actual obligation to tip. The obligation is to pay the bill.


Ok! Sorry about that, and good luck with everything.


Sure, in situations where tipping is factored into the wage, if you use a service you should tip. I get around that by mostly avoiding such services.

But the situation here isn't a clear-cut case like a sit-down restaurant where tipping is expected. If I were handed a receipt like the one in the article for my family's tickets and food, it wouldn't occur to me for a second that the barkeep in the room next door was relying on me tipping on this popcorn purchase in order to make a decent wage on this kids movie night.


It is a clear cut situation though: at Alamo drafthouse you order just like a restaurant, and a server will even greet you and get drink orders before the movie begins. It is full table service throughout the movie, where you order by writing on slips of paper. You get a bill at the end for your meal.

But, in general, this shouldn't even be the point. You should always assume that leaving a tip for someone in a position to receive it is a worthwhile gesture that means a significant amount!

I don't even know how this is so contentious to people honestly. Why make such a point about not doing something nice and relatively small? Your gonna spend $15 bucks on an IPA anyway, why not just help someone out too? Are you worried the bartender is going to get paid too much?


This is a pretty privileged take. Not everyone who can afford to buy Subway for lunch can afford to pay 15% more for it.

Tipping has become contentious lately because it's been asserting itself as an opt-out part of every Square checkout flow, even in situations where we never used to tip like fast casual order-at-the-counter. In the era of Uber we're also frequently asked to pick a tip before we even receive the service, which feels more like extortion than "something nice". Tipping is becoming more and more contentious because tipping is changing, and the version you describe is quickly becoming the minority case.


Ok! Sorry to waste your time then, good luck with all that.


This is why I advocate getting the waiter's venmo/squarecash and tipping them electronically.

This attacks the custom of tipping directly: It prevents the management from being able to use tips in their scheme to pay workers less, and absolves the customer of the requirement to hurt the worker if they want to fight against tipping culture.


> I advocate getting the waiter's venmo/squarecash

I find the assumption that everyone uses such apps interesting. For my part, I just tip with cash. No need to bring a third party into any of this.


Except tips are generally pooled and shared with the busboys and the kitchen staff.


in canada wages have grown but tips have just grown too, so there is seemingly a stronger cultural connection and its not simply fiscal. even if everyone waiting tables was paid a 100k salary, they can't just "put away" the tip jars. im not sure how the insanity stops, maybe inflation will stop it


> Using tips as a substitute for paying a living wage needs to be eliminated everywhere, but I especially don't blame people for not realizing that a movie theater of all places is playing that game.

Many bartenders and servers, especially in high end restaurants would actively be against this policy. Mostly because these folks can earn $300-500 a night, and moving to some low wage salary would never compete with this.


The argument isn't to take someone who earns $400 per night and leave them a $100 per night salary and no tips it's to take someone who earns a total of $400 per night and change that to be a $400 per night salary instead of a small salary with lots of tips. That is to say the debate isn't about how much is being paid but how it's being paid.

One of the real world problem that gets run into is, even for a large portion of people that want this, when one restaurant list $50 prices and expects $10 in tip and the other charges $60 and expects no tip people still go to the one listing $50 more often.

The same is true for stores listing prices including taxes. It simply won't be the most common method in the US unless it's a regulated requirement for every store to do. There is no way every store is just going to opt into it all at once when they know not opting into it will get them more customers than the ones that do. This doesn't mean people prefer needing to calculate tax every time they look at a price it just means it's not a naturally correcting set of incentives.


bollocks. most bartenders or servers would not be opposed.

top 10% of restaurants are making TONS of cash and the servers are raking it in, sure, but even working in Loudoun Co. VA -- the overall richest county in America, btw -- my salary was easily less than half of what I pulled as a network engineer.

the single mother of 2 working in Applebee's in shit-tier Indiana is struggling because of tips -- they need to go. restaurants in Europe, or Asia, or the Middle East didn't stop existing without tips.


>>the single mother of 2 working in Applebee's in shit-tier Indiana is struggling because of tips -- they need to go.

That's reality in large swaths of the US. One less work opportunity available now...


Paying tips to a bar tender or waiter isn’t some sort of social anomaly. It’s customary. Whether that custom is wrong or not can be debated, but while it’s customary, it’s reasonable for people to expect customers to follow the custom. Going to a restaurant and tipping $2 is the sort of stuff that gets your food spit in and is reserved only for the absolute worst service - it’s worse than tipping nothing. That’s the custom, wrong or not. Trying to change a societal custom by screwing over the worker is wrong, it’s just punishing the person who can least afford your social stand against how the business pays its workers.


"Customary" works both ways. If it's "customary", then we should probably also accept that the custom doesn't involve tipping as much as the article author thinks bartenders deserve if people generally don't tip as much as the article author thinks bartenders deserve.

And a former state labor official of all people should be blaming the employers for not paying a proper wage (and proposing regulation to solve that) rather than the customers for not making uncustomarily large tips to make up for them.

(Also, in most of the world it isn't customary to tip bartenders)


Ok, but sit back and ask yourself (if you’re in the US, which is the context being discussed and what they do in another society isn’t particularly relevant), do you tip at restaurants and bars? Almost everyone would agree they do.

The situation here is it’s a restaurant and bar that shows movies.

I wouldn’t expect to tip on the ticket prices, but it is surprising to expect to not tip full service waiters and bartenders.

I will be willing to wager $2 that the same people at a bar would tip their bartender as is customary in the US. The context mixture of theatre with bar is likely the cause of the anomalous behavior. And the authors point is: if you don’t want to tip your bartender at the theatre, then expect there won’t be a bartender at your theatre as they will work at a bar, where you would tip them.

That seems pretty fair?


> And the authors point is: if you don’t want to tip your bartender at the theatre, then expect there won’t be a bartender at your theatre as they will work at a bar, where you would tip them.

Or maybe, just maybe, the venue selling the drinks at substantial markup could pay them properly rather than trying to extend the custom of staff wages being dependent upon the charity of customers to a venue where customers generally don't feel like tipping. You'd think a government official in a labor department of all people would get the idea that employers paying living wages should be the rule rather than the exception.

Tipping customs often vary according to venue, range of products served and how they're served (sometimes in nuanced ways that are baffling to outsiders). Honestly, I have no idea whether it's considered customary to tip at that sort of bar at that sort of venue in that state, but a complaint about making less than a dollar per hour at a supposedly busy event is a data point against.


I would note in a labor market labor has the option to work for the employer who maximizes the employees benefit. As you note the author is in a labor department and they meticulously detail all the reasons no one would want to work for this theatre. They use this as an explanation for why companies are complaining they can’t hire - because they aren’t competitive and make a hostile work environment. Instead, employees are exercising their at will employment rights and going to employers that offer reasonable work environments.

Which I think you’re agreeing with their point. The employer could fix the situation but instead just barrel ahead oblivious to the reasons their people are quitting. It wasn’t the managers, it wasn’t even the customers even though the customers weren’t awesome. It was the owners.


And who created the odd mix? The movie theater company.

So instead of losing all of their staff, they should simply pay to retain them and post a "no tipping" policy upon entry.

It really is easy, but too people on HN will contort themselves into knots to avoid having any company have any accountability at all in any decision making.


Well, that is actually the entire thesis of the original link.


Does the same logic apply regarding which products are purchased or boycotted for a societal improvement?

As a consumer, I make specific choices. If I am marketed a price, that should be inclusive. The change starts with my choices, since managers clearly are against setting high enough wages.


You can certainly not tip your servers at bars and restaurants, no one forces you to. You can be a one person protest. But you won’t change anything other than how little the server takes home. The business won’t even observe your principled stand, and they’re the one whose behavior you have to change. The only observer will be the worker who just doesn’t get paid for their labor.


This is a depressing way to blame all the victims here and have no hope of making anything better.

It's like hospital owners openly saying they know nurses won't strike even if they don't get treated fairly because their patients will die and the nurses, as caregivers, won't let that happen.

The apathy toward a system that not just supports that kind of thing but very actively encourages and rewards it is brutal to watch.


Some restaurants have started applying mandatory tips. I think the right way out is to reward such places with your business. It makes sense for everyone. The servers get paid proportional to the volume of business, which they can impact positively through excellent service and upselling/cross selling, without having to grovel for the money. The patrons aren’t put in the position of deciding the tip amount, and if they are unhappy about service they can take it up with management and/or not return.


Sure. That’s called “paying a living wage”, it was always an option.

Just advertise the prices with the fees included.

That’s the rub, restaurant owners want to advertise one price and then actually charge a bunch more once they know people are committed. And that’s something that the US is really bad about in general - sales tax is handled similarly poorly.


If food is spit on, I hope it can be proven and then restaurant can be permanently closed. Both the owner losing for not paying enough and the workers losing job for not doing properly.

This is where state should enforce capitalism by killing those badly behaving businesses.


> workers losing job

Spitting in food or adulterating it in any manner is a criminal offence. Losing your job should be the least of your worries.


> Going to a restaurant and tipping $2 is the sort of stuff that gets your food spit in and is reserved only for the absolute worst service

How does that work? For table service you usually tip at the end after you’ve already eaten your food.


Right - as long as you never return or go to a restaurant where you’re known by one of the staff as “that person.” Customers reputations often precede them more than they realize.


> Going to a restaurant and tipping $2 is the sort of stuff that gets your food spit in and is reserved only for the absolute worst service

Huh, I wonder how this works in restaurants attended by lots of foreigners. I knew America had a "tipping culture" and that 10-20% was customary, but I didn't know how bad not tipping was until this comment. Many clueless tourists probably know even less than I did.


Yeah the folks I know in the hospitality industry don’t like serving people from Asia and Europe for this reason. Right or wrong they view it as not worth the time and effort as the tipping rates are often considerably lower than Americans.

Likewise I’ve noticed when I travel internationally Americans get a great deal of service and attention because unlike the local population because it’s likely they will tip.


I've always tipped the customary amount but using the logic "it screws over the worker so it's wrong" feels like a bad litmus test for whether trying to change a societal custom is actually right or wrong. By this logic there would be no right way to try to end things like the custom of folks pumping your gas by pumping it yourself instead (funnily enough, still several states this is actually illegal) because it would screw over the gas pump employee. That doesn't mean it's right to not tip at a food joint in the US, it just means there's more to something being right or wrong than whether a worker is the main one affected.

To me, I don't think there is any way to change the custom beyond regulation. The incentives just feel too misaligned. The crowd of customers leans towards going to the place with the lower list prices, intentional or not. The restaurants will never collectively decide on their own accord to go against that flow themselves. The servers are never going to collectively force the restaurants to make that decision. Each option requires "everyone just decide to forever on operate this new way which forces no-tipping alignment all together" and that's just never going to realistically happen. Customers aren't going to form a long lasting collective which convinces the servers to press the business nor are they going to form a long lasting collective to boycott businesses directly. Businesses aren't going to care about anything but never optionally baking in higher prices on the menu since it's giving customers away to competition. What each group actually wants as a majority is irrelevant for something as minor as this. The only way it happens is if the majority are for it being regulated as such, which can happen with representatives deciding how the collective of restaurants need to behave.

tl;dr: I tip because not tipping isn't going to result in change, not because the only way to enact change is to make sure a worker is in no way ever affected during the change.


Yeah, personally I think the tipping culture is wrong and I don’t like people to feel they have to grovel for my pittance. It feels gross to wield that power over people. If they give bad service they should simply be fired, rather than having to earn that on each and every exchange. Some restaurants have started including tips without optionality. This feels right - it scales with the business volume. By making the business more successful, cross selling upselling and creating loyal customers, the wait staff wins. Probably the way to change things is to seek these restaurants out and make their business model successful rather than screwing over folks who are just trying to get by.


The concrete example (with photo) that he gave of a bad tip was this:

> On Christmas Day a family bought over $100 worth of tickets and food two days after Christmas.

I don't know how this family received their food, but it almost certainly wasn't at the bar from the bartender. Maybe it was delivered to them inside the theater as another commenter suggests, but it's just as possible that they got the food at the counter.

Further, the photo doesn't give any indication of how much money was spent on tickets vs food, which would be entirely expected to impact the tip calculation. If they bought $95 in tickets and one kid got some popcorn, a $2 tip is downright generous!


Yes, fair enough. However taken at face value, their point is if you don’t tip full service workers like waiters and bar tenders when they’re working at the theatre, expect they will quit to work at the restaurant or bar where you will tip them. Maybe they’re fluffing their article for clicks, but assuming they’re not, this is a pretty reasonable take. If they are, and it was as you posit it might be, well, shame on them.

My point was if you imagine yourself ordering $100 in food at a full service restaurant with reasonable service, do you imagine yourself not tipping? I think most Americans can’t imagine that. It’s customary.


No, I agree with your last point. I think the system sucks, but it's not fair to hurt the victims even more.

That said, I still think this movie theater is particularly shady on the tipping spectrum. The article calls out a family's food purchase and a kids' movie night as examples of bad tipping and implicitly criticizes the non-tippers, but it seems likely to me that the people involved had no clue that there was someone in the building relying on their tips that day.

The theater is guilty for blurring the line between tipping- and non-tipping locations, the patrons are just reacting as expected to the lack of clarity.


Absolutely I agree with you. And ultimately the article was about why everyone quit working at the theatre. It is entirely the theatres fault, and one way they caused their own situation was by not making the custom clear to the customer. If for instance tickets and food etc are billed together, it is tricky to know that you’re supposed to tip for the food but not the tickets and everything gets blurred. One solution is to make sure waiters and bar tenders bill their services independently.

Overall, I think the business model they have doesn’t work for labor, and they suffer the consequences by being unable to hire. To their point, it’s not about workers being lazy, it’s about the business owner making a work environment that’s untenable but expecting people to be grateful for the opportunity. The tipping was only one issue, amongst a lot of others, but it’s also the one that would have cost the owners nothing to resolve by simply clearing the ambiguity.


To put it simply: the wage calculation is between the company and the employee, not the customer and the employee.

The company socialising their wages out to their customers via tips is fucking absurd.


I agree but as long as the government makes it easy to do, it will continue.


Since tipping is expected even in the states with no separate tipped minimum wages, the only way this would happen is if the government prohibited people from giving money to other people.

There is no government involvement in tipping, it is a social custom. And I don’t think the government can or should do anything about it.


> There is no government involvement in tipping

As long as there are separate laws for tipped vs non tipped employees, the government is involved in tipping.

https://www.dol.gov/agencies/whd/state/minimum-wage/tipped


Federal law requires the same minimum wage, regardless of tipped or not tipped. So if you don’t tip, the employer has to make up the difference.

Also, note

> Since tipping is expected even in the states with no separate tipped minimum wages,


> Federal law requires the same minimum wage, regardless of tipped or not tipped.

And if you believe that actually happens I’ve got a bridge in London to sell you.

Every person I’ve ever met who has ever lived on tips has been hosed on this. Employers will just adjust your hours to make the math work out rather than paying you more money. There’s a reason wage theft is a $50 billion dollar a year grift (though that’s not limited to just tipped employees).


Meh I hate tipping culture as much as the next person but you really can’t run, for instance a dive bar, and pay the bartender $15 an hour. The foot traffic doesn’t bring in nearly enough most of the time. The end result would just be far fewer food and drink places which I wouldn’t like.


That's the whole point though. If the types of restaurants that you like can't make enough money to offer jobs that workers would accept then those restaurants shouldn't exist. They can be replaced with more profitable businesses that more people will enjoy.


I’d like a lot of restaurants to exist though, I don’t want being able to find workers to be the limiting factor and have 4 choices for food instead of 40. Plus it lets a lot of business owners start up their own businesses and support a lot of workers.


Sure, I want a lot of restaurants, but I don't want them to exist due to them exploiting or underpaying their workers. A business is not entitled to workers, so if they cannot afford to pay enough to find workers, the business has failed. C'est la vie.

I for one, do not see paying someone close to minimum wage in return for 40hr/wk of their time as 'supporting' workers. You want to really support workers? Pay them appropriately and provide them a good workplace.


That begs the question about what to do when the workers will accept lower wage, and there is not a more profitable business waiting to replace it.

I dont know so many people make those assumptions. If there is a more profitable buisness, why isnt it there already?


If they are offered more than enough money to be willing to stay and there's not a more profitable business waiting to replace it, then what exactly is the problem?


in the context of the minimum wage discussion, the problem is when the labor is willing but not allowed to work, ends up unemployed instead, and the store sits vacant.


And how is that related to businesses that cannot afford to pay their staff enough to keep them?

We're not discussing minimum wage here. If we were I'd point out that minimum wage should at a minimum be the amount where letting the store remain vacant is equally preferable. However to ensure alignment I consider it better to put it higher to the point where people earning minimum wage aren't a burden on society (I mean a store with as much value to society as a vacant one doesn't really deserve to exist, you're just shifting the problem there, don't ever let industry do that for you).


>And how is that related to businesses that cannot afford to pay their staff enough to keep them?

It was more of an addendum on the types of business that shouldnt exist, and business turnover in general. I agree that if a business cant make enough to attract talent, it makes sense that that it should fail (all other factors neglected).


I dont think that logic really follows. The cost to the consumer foot traffic is the same if it is tip or wage.

If customers are willing to pay the price + tip to have a equivalent $15/hr salary, they should be willing to do so with just the price, e.g. $5 beers vs $4 beers +$1 tip.

Im sure there are some cultural issues around changing the norm in the US, but it works out mathematically, and there is evidence from all around the world where tipping is not the norm.


Well the restaurant doesn’t guarantee the worker $15. If you don’t have enough tips, the worker just makes less.


This isn’t true in the US: if the minimum wage is $15 and the worker only makes $8 in tips, the employer is required by law to cover the difference.

Note: this doesn’t change the fact that minimum wage is a pittance.


Bar workers in my country get about 13$ per hour. And get to keep whatever tips.

We also have no shortage of bars, tipping is entirely optional and often viewed as an unwelcome American import.


If they can't bring in enough foot-traffic that they can pay a bartender $15 an hour, then how is tipping going to make up the difference? There's also not enough foot traffic to make that work


I'm not following. If the bartender is making enough not to quit, the money is there.

The accounting sleight of hand where they seem to pay less for the food and drink but actually don't because they must add a tip doesn't change how much income is going into the establishment.


The “enough not to quit” could be much lower than $15, like $7/hour. You can’t advertise $7 and get workers but you can dangle potential tips in front of them. The whole thing is weird game theory.


Dive bars are like carnivals, then, and can only exist if they extract consumer surplus.

I reckon there is a reason carnivals no longer thrive with the advent of public parks. Perhaps similar capitalistic creative destruction would occur for dive bars if the incentives were changed.


There is a relatively simple solution to this problem in many cases: higher prices and buybacks.


> The author is just pointing out that market forces means that folks aren't going to stay in those jobs.

Fun fact: that's the *business'* problem. As a customer, if you don't pay your staff, which means your business has shitty service, I'm just not going to come back.

Pay your staff a living fucking wage.


> even though it's baked into the wage calculation?

Then it should be next to the price on the menu:

$x + minimum $y tip.


Shouldn’t they have to pay taxes if they printed it like that?


You can't avoid taxes by not printing something.


I don't believe retail sales tax applies to tips in most (any?) states.


Why not? Why shouldn't sales tax or whatever tax also be fully paid for each received tip? It is not like other business gets to avoid taxes.


In principle: the money goes completely to the employee(s) being tipped, so it doesn’t make sense to tax the business for money it doesn’t receive.


Why should that matter? Let's say you run software consulting. And most of the price goes to labour. Would that not mean that sales tax should only be applied to part going to business itself?


Because sales tax is a tax on a sale, not on your employees' wages. Payroll and income tax (among others) apply to wages.

Whether payroll tax applies to tips depends on the municipality, but income tax always does.


> The author is just pointing out that market forces means that folks aren't going to stay in those jobs.

Not tipping is effectively using those same market forces to fix the disaster that tipping has become. If folks aren't going to stay in jobs because they don't make enough money from tips, then that will pressure employers to pay people better.


> then that will pressure employers to pay people better

When taken to the logical end, this is true… but who ends up getting hurt the most during the transition? The workers you ultimately want to help. I can’t see that as a good alternative.


Then that's the sad reality. We've used tips as a bandaid for low wages for too long, and now ripping the bandaid off is going to hurt. But the alternative is that the wound festers and potentially gets even worse because it's buried deep under a bandaid.


The alternative is to maintain the status quo, and the status quo should not be maintained.


And that's okay! The wages should be increased, and tipping should be put out to pasture.


Don’t deign to even remotely justify this tipping nonsense. People should know upfront how much they need to pay with no guilt tripping funny business. It also irks me to no end how entitled someone bringing your food out to you can be. Everyone works, no one else begs and shames people for extra money.


This is probably why Alamo Drafthouse (that theater) now just automatically adds an 18% service fee.

The point of the article is to engender empathy for the worker's situation, not necessarily to diagnose or solve the problem. But you might as well go back to "Why do we have this stupid system in the US?" and the answer is Emancipation. https://time.com/5404475/history-tipping-american-restaurant...


This is better, but I still don't like these %-based fees, because they're still hiding the total fee. How many people are going to sit there, calculate how much the things they ordered will cost total, and then calculate what the service fee is going to be for their order? Few if any. So while this does eliminate the uncomfortable interaction of tipping the staff directly, it doesn't solve the 'hidden fee' aspect of it.

Just raise your prices 18%. If you're terribly concerned that people are going to balk at the raised prices, you can put a little explanation in your menu: "You may have noticed our higher prices since the last time you visited. We have raised our prices and eliminated our service fee. Now the price you see on the menu is the price you pay, no tips or additional fees!"


I think the tipping system is kind of a scam that the employer benefits from, then gradually feels entitled to as theirs.


Most people feel entitled to the value of their labor; tipping is merely the incidental mechanism that yields that value.

Put another way: we don't have any reason to believe that the author is abstractly "pro" tipping, only that he (shrewdly, like most people) recognizes tipping as a local optima that he has no real control over as a service worker.


The only way to reach the global optimum of no tipping and higher wages would be for customers to start to refuse to give tips.


Not really. That only punishes the worker, not the interested business.

Tipping is pernicious precisely because it doesn't have a real disincentive in a culture that's already normalized it. The only real solution is unilateral legislation, without waiting for the culture to change.


It indirectly punishes the business because it raises the minimum salary that workers will accept to work there


> Not really. That only punishes the worker, not the interested business. [...] The only real solution is unilateral legislation, without waiting for the culture to change.

The day unilateral legislation gets enacted will be the day restaurants replace most of the wait staff with ordering kiosks and automated drink dispensers.

Waiting on government to fix your problems is a fool's errand.


On the contrary: most tipped employees I know make substantially more than the untipped ones. The why is simple: price discrimination extracts excess value. If everyone's paying the same price, you lose some potential profit from people who would have been willing to pay more, and you lose some potential profit from people who aren't willing to pay the set price, but would have been willing to pay some still-profitable lesser price. By charging people based on their willingness to pay, you extract much closer to the maximum value.

Tipping is a price discrimination scheme that directly benefits the workers. That's a lot of value that can be captured, and any other system that a restaurant could use to extract that value would end up benefiting the owners far more.


Although it can benefit workers, the employer can hire better, lower the wages of the tipped employees, and make rules for the tips. Yes, I guess the customers are less reluctant to spend the money though.


IMO, California's tipping law is the ideal: None of the "offset minimum wage with tips" tomfoolery, if tipping pools exist they must only be shared with employees and be a written policy explained at time of employment.

In that context, I like tipping. I tip well, which gets me better service at places I go often.


hmmm... I looked and you are right. california requires minimum wage and tips do not count against that.

I can see why the doordash tipping fiasco was so dire.


Thanks for writing this out, finally someone has taken microecon 101.


I think it's an understandable focus: as a service worker, his most immediate recourse is to the people whose money he's handling.

(That doesn't make your point about corporate profits wrong.)


Whose money is he handling?

The 1000 people whose $20 he's handling, many of which he likely won't see again for months, or the 1 boss whose $20,000 he's handling daily and sees daily.

I think it would be easier to reason with one consistent boss than 1000 new strangers daily... but the boss punts it up to "corporate" and they say no.

Instead of pleading with the public to tip more, everyone should just leave. See how "corporate" enjoys paying rent and movie screening fees on a theatre that brings in $0 due to having no staff. Either they shut it down, which is fine, none of the workers were happy there anyway, or they start paying a decent wage, allowing breaks, allowing meal breaks, and allowing vacation like any reasonably humane job.


I don't think this guy sees his "boss." He sees a general manager who makes roughly the same amount as he does.

The point you're making is essentially correct (in terms of where the actual wealth and power is), but he still has no recourse against that power.


I get the frustration with tips for things that are low-touch. When you go to a place that doesn't have waiter service, or you get a prepared item to go and the cashier who you interacted with for 5 seconds turns around tablet that asks for a tip, I'm annoyed -- but this is a place that lets you order an customized cocktail, and have a waiter bring food to your seat. If you think the food is overpriced, don't order it.


The theatre gets no part of the ticket sales. For the first few weeks that the movie plays, all the proceeds from ticket sales goes to the movie studio. Every dollar to keep the doors open (and pay the staff) comes from sales at the concession stand.

The last movie where theatres made a profit from the ticket sales was The Full Monty.


I agree you don't tip tickets, but in the US tipping bartenders per drink is pretty standard. So is tipping if you get food brought out to you by a server... with the caveat that usually this goes along with paying after you eat, which maybe isn't the case here and might lead to no tipping.

I do agree a movie theater is an unusual place to complain about tips, and even though distributing them via prepaid card is complete scumfuckery, it's not the central problem.


> I agree you don't tip tickets, but in the US tipping bartenders per drink is pretty standard.

Actually, this kind of relates to the example in the article -- spending $100+ on tickets and food/drinks and only tipping $2. If the drinks only made up, say $20 of that, then a $2 tip is not unreasonable. That works out to 10% tip, which I think is acceptable for the amount of service provided.


Yep, agree with you.


So this is actually a reply to @huytersd post which I think had sort of an interesting potential angle on this I hadn't considered before and I want to steelman a bit more then the replies so far:

>Meh I hate tipping culture as much as the next person but you really can’t run, for instance a dive bar, and pay the bartender $15 an hour. The foot traffic doesn’t bring in nearly enough most of the time.

So I'm reading this as essentially observing that certain work roles are vastly more dynamic then others. If someone is, as the article describes, working flat out on their feet for weeks straight 8+ hours, maybe that should be $40/hour or more, many multiples of minimum wage. Conversely if it's an absolute dead period where mostly people are just sitting around (and free, and perhaps even should be encouraged, to do other enjoyable/productive stuff on their phones/tablets/computers), and the business is effectively paying for warm bodies to be there just in case, minimum wage would be fine. Tipping kind of, in a hacky way, could sort of capture this, where ideally if business is booming people get paid more (potentially lots more) and if not the wage automatically decreases. However, for all the excellent reasons everyone has pointed out in this thread and others, tipping is a pretty poor way to do it prone to abuse and failures. But a completely flat wage might not reflect the work well enough either in practice.

However I think we have a better model for this: sales commissions (be it direct, real estate or the like). There pay is also tied directly to the flow of money, but while not perfect it's much more empowering. The workers are agents. What if instead of tips the law mandated that businesses could opt into a model where yes they can pay a somewhat lower basic wage, but then 25% of all sales themselves went to the workers. Nothing for customers to think about, it's built into the price, but pay also then gets tied very closely to output and revenue. Business employment costs would naturally rise and fall with the revenue flow.

There'd still be lots of work for this, America's very broken health model ties in, other complaints as well. But I think that "certain industries would benefit from formalized protected dynamic pay while others are best with static pay" might have something to it, if more fair and empowering methods can be found. Though I'm no expert so there may be holes here!


The author has a curious background. He left his role as a cabinet secretary after a report found that his department misspent 250 million dollars. The governor issued a press release that said he was leaving but didn't say why. And then afterwards he claimed it wasn't related to the financial scandal, it was because he was getting so many miscellaneous death threats?

https://www.lcsun-news.com/story/news/local/new-mexico/2021/...

https://www.santafenewmexican.com/news/local_news/former-new...

It sounds to me like he got fired due to scandal but they agreed to make it a "no comment" sort of thing instead. It looks like he is out of politics now, which explains why he is cryptically starting over his career as a bartender. Well, anyway, I hope he finds a better job.


On the other hand, sometimes you just have to do what feels right. I quit tech to work in a cafe, and you could definitely paint my story as failing to make it in tech. But from my perspective I was just tired of burning out pouring my heart into something that doesn’t care at all about me. Some of his comments in the article re: getting stressed about policy he has no control over makes me think he was having a bad time as well.

At the very least, knowing how politicians are and how this man writes, there surely must have been a disconnect between him and many of his peers.


Are you still working at the cafe? How do you like it?


Do you think the governor should have said "He's leaving because the great citizens of this state who elected me are threatening to kill this man and his family?"

I would leave that job too.


Since it has recently come to become a major personality trait. I can't help but notice the bullshit of 20-40 minute commutes in traffic being "normal". Good public transportation, smart mixed use development, and generally reducing car dependence could be a very large factor in mitigating the pain of this employment.

I did appreciate the author mentioning how tired they are after moving for 6.5 hours straight. I worked 3 years in the service industry as a food runner, I still remember my busiest shift being a 5 hour lunch on Memorial Day when we had 3/5 runners not show up. Easily the most chaotic (and profitable) shift I've ever worked. I did ~35k steps in the 6 hours I was working, while carrying comically large food trays around half the time. But, I almost made more money/hr than I currently do as a senior software engineer in the Bay Area, lol.


> Labor is supposed to have value. A good days’ work deserves a good days’ pay.

Society by and large does not believe this. If you dig into it a little bit, asking why fast-food workers and the people that serve them their starbucks shouldn't make more money, the answer always boils down to "I need people that serve me to be socioeconomically inferior to me"


I don't think either of these positions is correct.

The reason fast food workers don't earn more money is because there is a pool of workers who are willing to accept the current wages, because they don't have a better alternative. It has nothing to do with "deserve", in either direction.


No, it's because welfare programs enable employers to offer wages that aren't livable.

The absolute floor for wages should at least meet a person's non-discretionary expenses plus a bit of discretionary spending if they're working close to full time. If it doesn't meet that minimum level, then the employee is unable to work that job. They simply can't.

By moving some of their non-discretionary spending to welfare, that means the employer can offer a lower wage.

We are effectively subsidizing all the businesses that utilize entry-level/"unskilled" labor. Walmart employs people whose sole job is to help walmart workers apply for welfare benefits, and as a result, can pay those people less.

Realize that state and federal agencies spend time developing pamphlets advising welfare recipients how to make the absolute most out of the maximum of roughly eight dollars a day SNAP provides in benefits per person. It's crazy that we're telling welfare recipients how to make the most of eight dollars a day for food, while giving tax writeoffs for business jets.


> The absolute floor for wages should at least meet a person's non-discretionary expenses plus a bit of discretionary spending if they're working close to full time. If it doesn't meet that minimum level, then the employee is unable to work that job. They simply can't.

You are over-simplifying. That isn’t how it plays out in reality. People will accept a non-livable wage under many circumstances.

Here’s a few:

* working extra hours at two different minimum wage jobs

* living costs subsidized in some way, e.g. living with friends or family

* college student or high-school student who doesn’t yet have to pay for all of their expenses

* homeless or partially homeless

* relying on savings to cover the gap

* retired person who doesn’t need to earn enough to cover all of their expenses

And so on…


Let us rephrase then: If a person cannot cover all of their non-discretionary expenses, plus a little left over, working 40 hours at a given wage, that wage is too low. Period.

If the cheapest housing in your area requires you to work more than 40 hours a week at a given wage to cover rent, cheapest-possible food, least-possible utilities, and whatever the lowest cost option to commute to/from work is, the wage is too low. Period.

It doesn't matter that people manage to not die making less than whatever the livable wage is, because the point is that paying someone less than that wage is unethical. If someone punches me in the face, the things I do to mitigate the damage don't somehow also mitigate the wrongness of punching me in the first place.


You bring up good points!

For what it's worth, I wasn't arguing against livable wages. I simply wanted to point out the error in the parent comment's argument.


I call BS on this, that society "by and large" must be served by socioecnomic inferiors. We simply have too many societies where socioeconomic class is a main divider that don't have a tipping culture.

People not in the luxury class respond to prices, full stop. This is a policy (tipping allowed to be performed) that has gained pseudomoral status.


I think this is an absurdly cynical take. I have never met someone who thinks that.

I think most people actually believe in supply and demand, and that it has nothing to do with effort.

Most people intuitively understand that if someone is not easily replaceable, they have more leverage. If there is a line of replacements out the door, they have little leverage.


> Most people intuitively understand that if someone is not easily replaceable, they have more leverage. If there is a line of replacements out the door, they have little leverage.

There often is not a line of replacements out the door, yet, despite this, wages are still too low. Entire industries have started to die because of this - like for instance certain north eastern crab fisheries relied on cheap migrant labor that dried up, couldn't find anyone to do it, even though technically "anyone" could do the job. Why haven't workers capitalized on this "leverage" you speak of to get higher wages? Are they just too dumb/lazy?


There has to be enough excess profit in an industry in order for a worker shortage to force the wages up.

North eastern crab fisheries are likely not profitable enough (due to market rate for their products, or whatever it is), so they will likely fold/go out of business instead (unless automation can save/increase the productivity per worker, and then they can stay in business but with fewer workers - who will be better remunerated).


You precisely nailed it. some of these industries and companies shouldnt survive as they are but we insist they should.


I don't see that as contradicting what I said at all. Sometimes industries can't compete on wages and go out of business.

Thats an example of workers having leverage. The workers did get a higher wage, just not on a crab boat.

If you want to stereotype workers, they are smart and lazy. nobody wants to work longer and harder to make less, when they could work less and make more.

To counter your question, why do you think the boat owners went out of business? Were the owners just to stupid or stubborn to pay more? That they would rather lose their investment, and often their own livelihood, rather than pay workers more?


In this specific example they tried to pay more but couldn’t find anyone for a lot of different reasons. They had an industry that was propped up by artificially cheap labor (migrants with no other options). There are other artificially cheap labor markets that big companies prey on - like labor markets where the workers dont make enough to actually eat so the companies employ people to tell the workers how to use state welfare more effectively.

It’s a complete farce at best for people to assume this is pure capitalism working as intended for these labor markets to exist at all. it’s either backed by the state or by really nasty external forces that give segments of people very few other options. You can employ people and pay them enough to survive and still make a profit, yet there are weird segments of the internet that insist some types of work must be done on the backs of essentially slave labor. if that’s truly the case it should change.


I agree that society doesn't believe this. But I disagree on your explanation as to why. The biggest reason why people don't believe this is because they have no idea as to the amount of work that's being done. If you hear a cashier is being paid $16.00 an hour when the only time you witness them is when you're buying a bag of Doritos and a bottle of Pepsi where they scan your card and bag your groceries you might think that they're being overpaid. You're witnessing ten percent of their duties, where the other ninety percent have them doing the stocking work around the register, doing cleaning, keeping track of inventory, sorting and organizing checks to be cashed, verifying and indexing wire transfers, and keeping appropriate change in the register.

Most low paying jobs have the highest amount of effort. Currently, working in fast food is a much more demanding job that requires more effort than being a mechanical engineer, surveyor, or project manager. And yet those three will make four times what the fast food worker makes because their jobs are perceived as having more value to society, their education much more complex and thus more costly, and the positions they fill being very few and far between. People of all economic ranks think that those three perform more effort in their positions than the fast food worker and thus they are more worthy of the increased wages, when in reality they did more preparation beforehand (college, apprenticeships, working shit jobs like fast food) so that their positions require less effort now. Note that this has nothing to do with the real or perceived impact of their actual jobs. In contrast the fast food worker cannot frontload the effort in preparation of a better position later, because the demanding but menial work is the better position compared to being homeless or on social welfare programs. This is one of the reasons why rates of burnout, depression, and anxiety are so high in those that work services and retail compared to other industries.


> "I need people that serve me to be socioeconomically inferior to me"

Do you actually think people think this way? I’ve never met anyone who thinks like that.


Go ahead, ask someone to explain why a guy at starbucks "deserves" to be making less than a living wage, it boils down to this. There's no real argument for it.

If you ask them why they shouldn't make more, they'll typically say something like "it's not meant to be a career" or some nonsense about inflation. Yet, society still needs people to pour coffee or serve fast food, so by arguing against a living wage in this manner you are actually arguing that people with menial service jobs should be poor by merit of the type of work they do. Granted that isn't a perfect 1:1 with what I said, but the attitude is definitely there. Why else would someone be so vehemently against a person making a living wage?


The question as "why does the guy at Starbucks deserve to be making less than minimum wage" assumes the counter-party agrees that the guy at Starbucks deserves this.

In reality, (I assume that) the people who disagree with you don't have malice for poor people, but are seeing different levels of the economic stack. I would bet (I'll put money down) that they'd argue a mix of labor supply/demand and regulatory arguments, and that they're NOT just hoping to put down those who are economically less well-off.

It's important to actually understand your counterparties if you actually want to improve things.

EDIT give this a go https://depolarizinggpt.org/


I think anyone who thinks a lot of people don’t think like this should spend some time in the last 20 years of minimum wage debates. I was heavily involved in the fight for a $15 min wage in california (and other states) which hilariously and ironically is already too low by the time it finally happened. I am well aware of the arguments people present against it, and very vocally. I understand the counterparties well and the levers of power they like to press to convince people a walmart worker doing 50 hour weeks shouldnt earn enough to survive. People expressed doubt in this thread people actually think like this - they do. Seriously go look at any argument about it online.


It is a hang-up based on the Protestant Work Ethic.

> Calvin taught that all men must work, even the rich, because to work was the will of God. It was the duty of men to serve as God's instruments here on earth, to reshape the world in the fashion of the Kingdom of God, and to become a part of the continuing process of His creation (Braude, 1975). Men were not to lust after wealth, possessions, or easy living, but were to reinvest the profits of their labor into financing further ventures. Earnings were thus to be reinvested over and over again, ad infinitum, or to the end of time (Lipset, 1990). Using profits to help others rise from a lessor level of subsistence violated God's will since persons could only demonstrate that they were among the Elect through their own labor (Lipset, 1990).

> Selection of an occupation and pursuing it to achieve the greatest profit possible was considered by Calvinists to be a religious duty. Not only condoning, but encouraging the pursuit of unlimited profit was a radical departure from the Christian beliefs of the middle ages. In addition, unlike Luther, Calvin considered it appropriate to seek an occupation which would provide the greatest earnings possible. If that meant abandoning the family trade or profession, the change was not only allowed, but it was considered to be one's religious duty (Tilgher, 1930).

http://workethic.coe.uga.edu/hpro.html

https://rationalwiki.org/wiki/Protestant_work_ethic


> the answer always boils down to "I need people that serve me to be socioeconomically inferior to me"

By generalizing the counter-argument and making a mockery of it, you have made a disservice to your own argument, because now I can reply with another generalized absurdity like "Oh, you just believe everyone should be paid the same, regardless of how intellectually or physically challenging the job is".

Thus, no progress is made to resolve the actual problem.

Don't do this if you are arguing in good faith.


What is this referring to in the article?

> The benefit situation is no better. Workers get to see free movies when theaters aren’t busy, and get half off of meals purchased while at work. But that doesn’t help when you need to see a doctor or get a prescription (Thank you Obama for your Care).

Wasn't the cornerstone of the Obama plan a mandated health insurance by employers, but it was gutted by the next opposition congress?


If I recall correctly, the ACA only ever required employers with 50 or more full time employees to offer coverage to their full time employees. As I understand it, this mandate was delayed a couple times but it eventually stuck. But that is moot considering a huge portion of workers in the food service industry don't meet that criteria (either not full time or the employer has fewer than 50 employees) so they don't get any employer coverage. I'm not sure what the author meant by the "Thank you Obama" comment - is he criticizing the ACA for not going further with the mandatory coverage, or is this just a reference to the "thanks Obama" meme?


I assumed he was referring to the ability now for people to buy individual healthcare plans that are subsidized by the government, whereas they couldn't before. But I admit it isn't very clear.


The ACA employer mandate is still in place (it's the individual mandate that has been zeroed out). Maybe this guy isn't a full-time worker?


Most service industry people I know aren’t full time for this very reason.


That's the trick – keep the employees below avg 30 hr/wk and 130 hr/mo to keep them classified as part-time instead of full-time.


Yeah I came to ask a similar question, I'm confused what this had to do with Obamacare.


Previous discussion with 444 comments https://news.ycombinator.com/item?id=30023074


> The combination of working this front-line service industry job and my last gig running a state labor department has led to some interesting observations.

It's always funny when I'm acutely reminded how disconnected well-to-do people can be.


What is funny about it? He's reflecting on the low wages v. amount of work involved to make those wages worth his time. Every one has their limits, but well-to-do people working low paying jobs (in his case, personal and external factors) are a good indicator how much discrepancy exists in terms of work effort v. minimally accomodating income comes their way in return. Thus the worker shortage and BS argument that people don't want to work.

Blue collar work deserves a living wage. Austin, at least in the area he works in, has an average of 110,000 USD/y, yet the workers can barely survive living with roommates 40 minutes away. That's 80 minutes of your life just driving in addition to menial income - average that out and it's even worse.

Texas is embarrassingly low in its minimum wage laws. Why is it acceptable for a base wage of 2.13 USD/h for waiters when considering the cost of living has increased across the board in every way? Where does the disconnect lie here? Why is it acceptable that minimum wage is stil 7.35 USD/h, which decides how much the "higher" paying blue collar jobs pay in comparison?

You are exhibiting what I would consider an elitist mentality.


> What's funny about it? He's reflecting on the low wages v. amount of work involved to make those wages worth his time.

What's funny is he is reflecting on this _after_ his prior gig was running a state labor department.

This is the kind of thing that you should have _already reflected on_ if you are running a state labor department.

The fact that you can _run a state labor department_, and not yet reflected on the low wages v. amount of worked involved to make those wages shows exactly "how disconnected well-to-do people can be".

It's good that he learned the lesson, but it's a damn shame that he learned it after he was in a position to actually do something useful with that knowledge.


Running the labor department has nothing to do with setting minimum wages. That's a legislative honor that neither side of this republic has the political will to touch, so as a result, neither would employers care.


While a labor department obviously doesn't set minimum wage, they do often handle all kinds of labor/employer disputes (such as wage theft, denial of breaks, mandatory overtime complaints, retaliation complaints, handling worker's comp claims, etc) that would strongly benefit from someone who already has this understanding (or at least has spent time thinking about it).

Maybe a $300 wage theft complaint doesn't sound like that big a deal to a labor secretary making $196,000. But it could be an absolutely ruinous for some workers, and represent a huge amount of work to make up.


He's no longer secretary of labor. He's a former secretary of labor discussing something he had to first-hand experience, as opposed to seeing it from the disconnected pulpit. Similar to how the pope, pardon the analogy, claims the greatness of Christiandom while never mentioning the dissonance between criminality of switching the pedophiles in te church to other geographical areas to save them (and the Church's reputation) from due criminal prosecution.


>Why is it acceptable that minimum wage is stil 7.35 USD/h, which decides how much the "higher" paying blue collar jobs pay in comparison?

It has been a long time since the minimum wage decided anything, even in Texas. And in states that have not updated their minimum wage, it is because the voters are not voting for leaders that will raise the minimum wage. And those same voters are sending Senators and Representatives to the federal Congress, where again, they do not raise the minimum wage.


The minimum wage is a factor in relative wage offering, even if it doesn't decide everything. The employers' argument ends up being "well, we're paying double minimum wage, so those who don't like it are lazy, entitled people." The problem here lies in a living wage that's decided by living costs in any geographical area, not the absolute wage itself.

You are eggregiously conflating thw two.


Supply and demand curves for labor have moved well past the federal minimum wage, that is why it is not a factor.

Employers’ or employees’ arguments are irrelevant, the only thing that matters is how many buyers there are relative to sellers (or a higher minimum wage).


Clearly not, given there's worker demand for blue collar jobs that offer 12/13 USD/h in an area where that doesn't even meet rent, let alone savings, buying or repairing a car, let alone the prospect of having children, buying a house or investing into one's 401k (pensions be damned, amirite?)


We’re conversing about two different things.

I claimed that the federal minimum wage is too low to have an effect on wages, since the supply and demand curves for labor require employers to pay more than minimum wage to find anyone.


And I'm simply disagreeing with you. You are way off - if the cost of living is too high for offerings for low-skill/blue-collar work is too low to make a living sustainable enough to affect the "demand curves", that means that something is off and the only enforcement mechanism, if we want to have a functional society that doesn't depend on welfare, is through government intervention. That comes directly from the federal minimum wage.


Even left-wing economists are not a fan of the minimum wage, which is mostly political theatre.

If the market judges a particular level of software engineering to be worth say, $300/hour, and flipping a burger to be worth $20/hour, then that ratio will persist no matter what you do to the minimum wage.

You could pay the burger flipper $1m/hour, and then inflation will kick in mightily, and the engineer ends up at $15m/hour, and the burger flipper is back to feeling poor again.

The best thing is real economic growth - fiddling with the numbers does nothing


I think the more defensible statement would be that in the long run, the engineer would end up at $15m/hr. Even that is not a guarantee, since burger flippers and engineers are not interchangeable.

This analysis is missing huge path dependence and varying time lags (i.e. the Cantillon effect). If the minimum wage doubles over night, sure engineer salaries will rise, but with a large lag, since wages tend to be sticky. So the ratio would fall from 15:1 to 7.5:1 overnight, and then slowly recover (over the course of years, likely).

And that's assuming that the previous [lower] wage was not artificially suppressed via monopoly / monopsony power or something (which is definitely possible within a single industry)


In the meantime, people still need a roof over their head, need a car to get to places (at least in large swaths of concrete jungles, like in TX, as the RTFA explained), which means jack to those who aren't in that position. In other words, you are explaining away huge wage inequality via elitism.


You're right.

What I'm trying to get at though is that minimum wages won't help poor people - it only helps them feel supported. The only real help is to improve their power in the market.


In the long run we are all dead, and if the period until wages catches up is sufficiently long, you can just do it again in 10-20 years. Or peg it to inflation.

“Wages will catch up eventually” isn’t a good argument that it doesn’t help people in the meantime.


Individuals die but humanity is hopefully forever. Poor people as a category need real solutions, not a further kicking of cans down the road.

The best things that have happened to poor people throughout history have been things that increased their power in the market, and the general improvements brought on by technology.


No one's kicking the can down the road. We're literally discussing it in this forum. There is too much abstention noticed in this discussion by those better off.

It sadly a reality that those making 2.13/h have to deal with, whether from s** pay by employers, by s** tippers, or those a**holes who defend the latter.


Raising the minimum wage is kicking the can down the road because it does nothing to address the root cause of low pay (low market power) in the long term, but instead delivers the sugar rush of immediate cash. It looks like something is being done. But the cost is twofold: 1) higher inflation (more money, same economic output), and 2) lower political momentum to help the poor, because "didn't we just raise the minimum wage?"

I desperately want every last poor person on the planet to have access to the virtuous cycle of wealth creation and increasing resources. But the only way to help the poor is to engineer a situation where their market power rises. This takes many forms - encouraging more entrepreneurship (entrepreneurs hire people), better capitalization for companies (more money for hiring), steady & reliable market regulations (hiring is less risky), finding ways to increase output per worker (worker is more valuable), and many other hard things.

More market power for poor people means when there's a shit employer, you go to the next one, or when you need a raise, you can demand one, and so on. Supply and demand always wins. Everything else is a distraction. Minimum wage is the rent control of the labor market.


I find it refreshing when someone steps downward for perspective (if perhaps also necessity), having done so myself in the past.


Am I the first one to point out that movie exhibition is a lousy business?

This place has wait service, which is kind of a desperate way to avoid the aforementioned problem. Movie theaters everywhere are closing because the economics suck; people prefer to watch movies at home, now that viewing quality is excellent and the movies all come to streaming after a couple months, and the audience ruins the experience for everyone else anyway.

A better example would be a regular sit-down restaurant, which is sometimes a decent business (although most of them fail anyway). It's also easier to analyze profit & loss.


Additionally, for the first few weeks that a movie is being shown at the theatre, 100% of the ticket sales goes to the studios. The entire source of income for movie theatres is the concession sales. I rarely watch movies in theatres because far too many are just remakes of something else. One of the 3 movies I saw in theatres this year (Landscape with Invisible Hand) was shown in one theatre in my state on Sunday morning. The tiny theatre release was just so that they could qualify for awards. I do not subscribe to any streaming services.


Thanks, yeah, in the South Bay (SF area) we've lost almost all our independent movie houses. That place where this guy worked will be gone in three years, or else trying some other gimmick.


To summarize: 1. Bad wages 2. Not enough time off 3. Rude customers

The solution to #1 is obvious but expensive. The solution to #2 is to hire more people, which is obviously difficult, but raising wages to solve #1 would probably help here too (I'm guessing they don't even want paid time off, just time off, so there's probably some additional expense involving more people but not strictly wages).

#3 seems a bit trickier. Corporate home office can't do a lot about the public being jerks. The only thing I can think of is empowering staff to kick people out for bad behavior, but that realistically that means hiring security staff or calling the cops a lot.

Of course I'm just speculating, I don't see any of this changing anytime soon. Clearly there are still plenty of customers at this theater, which is what the company cares about most. Until a staff shortage starts hurting profits nothing changes.


Also benefits like healthcare which was mentioned. The squeeze of mandating private corporations as healthcare insurance providers and being so deeply involved in a matter so private means it is a field ripe for customer/client exploitation.

The Lords of the land that are large business owners and corporations have had an economic shift, where the laborers have a tiny edge compared to the recent past in the form of less laborers and more wage competition, and they're not even organized in the US! The fact that this alone can disrupt the ecosystem of capital so drastically that a labor secretary became a bartender and the largest unionized workplaces have to give record concessions to the labor unions speaks to this systems glaring flaws.


Providing healthcare would essentially be a big increase in pay, so chalk that up to #1. Although I would much rather we have universal healthcare through the government.


> 3. Rude customers

Most people believe that the cure for this is to require every person in America to have to work a customer-facing retail position by the time they're 20.

Oprah gave us the "talk to the manager" as some sort of hack to get what you want. Instead, those customers should be fired.


Businesses need to make decisions for robustness, reliability, and longevity. Finding a model to maintain a consistent labor force (even if there is high turnover) is part of that responsibility.

I was waiting to cringe at the end when the suggestion was a minimum wage or union solution and pleasantly surprised that was not the conclusion.


We're supposed to tip at movie theaters?


Well, if the movie theater has bartenders, then yes—you tip bartenders, and other wait staff.

If it's just someone selling snacks behind a counter, then I'd say no.


Imagine that I go to a movie theater and order a soda and a beer.

The cashier pours the soda into a cup from the fountain machine.

The bartender pours the beer into a plastic pint from a tap.

Why is the bartender deserving of a tip in this scenario?


The tip is not for any particular effort. It's just an inefficient way to pay the bartender a living wage. The employer should do it, but while I vote for higher minimum wages, lower cost of living, and back the Alamo Drafthouse unionization efforts, I also tip because I recognize that's part of the true cost of the labor, and I can afford to.


The "stupid" answer is because it's customary in (much of) the US to tip a bartender, even if that bartender is just serving you a beer.

Tipping is both economic and customary in nature; you'll find that most people agree that the economics that encourage it are dumb, but that the dumbness of those economics doesn't make changing customs easy.


The scenario where you have a mix of customarily tipped and untipped food service workers in the same venue is especially weird, though.


This is a theater that also serves dinner with the show; think of it less like a movie theater, and more like a restaurant that happens to show a movie.


Nope. I paid the movie ticket. Wage is in that $20-$30 dollar ticket price.

I don't pay to enter restaurants either.


I assume this is Alamo Draft House.

You can definitely go to this movie theater and not buy any food and not tip anyone. The gimmick is that you can order from your seat and the food you want is brought to you during the movie. After the movie, you get a receipt to sign and add a tip to like at any restaurant. I find it completely normal to tip 20% in this situation. (Your ticket was bought prior to this receipt being made, so you aren't tipping on the ticket price.) As you read the menu, you add 20% to the listed prices, and just pay it. It's a weird convention that makes paying for things complicated (math to do, forms to fill out), but it's simply how paying for things at a restaurant is done in the US.

Basically, this place is no different than any other sit-down restaurant except they happen to arrange the tables in a theater and show a movie. You're expected to tip. When you don't, it's a big "fuck you" to the people making your food and drinks and carrying them to you. The author of this article is mad because many people over the course of his career told him "fuck you". I would be mad too.


Studios get 100% of that ticket price for the first 3 weeks that the movie is being shown. The way the contracts are written, a movie would have to be playing for months before theatres get to keep all of the ticket sales. The last movie where that happened was The Full Monty (in 1997).


Hard to see the forest from behind that tree.


When the author mentions that tree I can’t help but notice ;)


Nope.


"if employers continue to pay low wages, withhold health, child care, and other benefits, refuse to be flexible with scheduling, don’t give breaks, etc… workers will quit. And they will go to employers who will."

The problem is this ends up as a race to the bottom, and even the good employers end up paying poorly because 'market rates'. Good working conditions need to be enforced in law, not by market forces.


I love how almost every commonly referenced social problem goes back to high housing costs. Every city in the US needs to be turned into Manhattan.


Wait, what? Since when did we start tipping movie employees?


It completely blows my mind that some magical expected tip amount is baked in to make an already abysmal minimum wage even lower. Pure skulduggery.


Pls. explain to me how "minimal state payment per h" is:

a) not payed

b) tips are counted in ??


(2022)

Edit: @fishtacos, haha.. now I can't delete it because you replied (;


Read above.


(2022)


TX still pays 2.13/h for wait staff + tips, with a guarantee of bi-weekly guarantee of 7.35/h if tips don't make up for it. 2023 is still the same.


Texas (and other places) gets a lot of labor complaints too for stiffing this.

https://www.epi.org/publication/employers-steal-billions-fro...


I waited tables before, during and slighly after college, in TX. This was well-known, but am glad it's at least reported, even if not addressed. The entitled replies here are embarrassing.


For me, I'm antitipping culture, but realize the only way it changes is when the servers, line cooks, cashiers, and hostesses as a working class group get fed up and demand better.

Until then, it's a revolving door, and vested interests target to make customers and wait staff angry at each other.


Correct - this rests on employers, but for those dependent on employers for a job with no say but "GTFO if you don't like it" will blame whomever is stiffling their wages - in this case, crappy tippers IN ADDITION TO the minimum wage.

However, given the spurious type of work this involves, employers have the advantage, so the employees have no recourse but to blame any one they can, including bad tippers.

The tipping culture in the US is disgusting by modern standards of society, but there is no mechanism to unionize wait staff, or kitchen staff, dishwashers etc. included.


> there is no mechanism to unionize wait staff, or kitchen staff, dishwashers etc. included

There is, however, a "union" of restaurant owners who lobbies against improving minimum wage and working conditions for restaurant workers.

https://en.wikipedia.org/wiki/National_Restaurant_Associatio...


How well has that worked out?


> Staff rely on tips because wages are not at a living level

Fucking lol.

> Crap like this is so demoralizing

Yes, but not because people don't tip.

> because workers need the money to live

Yet the capitalist who don't want to pay a living level wage is totally not the reason workers need tips.


I think there is an element of shitty consumer behavior here.

Its axiomatic: people want to pay as little as possible. But there's a certain kind of consumer, who goes out of their way to flaunt that while they could pay more, they're not going to. And its not because the extra $10 for a reasonable tip would break them. Its not because they fundamentally disagree with the concept of tipping (although that may well be the case in addition). Its because the person "tipping" believes that no adult should be working at a movie theater, and if they wanted to make real money, they'd get a real fucking job, and no, I'm not taking resumes, why would I want to hire somebody who could only get a job pouring beers at a movie theater?!

Its really hard to overstate the antipathy that service sector employees experience on a regular basis, and how far out of their way certain customers will go to make sure that those employees know that those certain customers hold them in utter contempt.


Hm. I definitely don't want to pay as little as possible, for most things. I don't want cheap ingredients when I'm cooking. I don't want a BS car I bought for a song. I tip well, egregiously well, because those folks work hard for their living, I used to do that, and I appreciate what they're going thru.

But, as my old minister used to say, we can have all the morals we can afford. Not going to tell anybody else how to do it.


"Temporarily embarrassed millionaires" again?

You know the difference between a staff abused by customers and who are paid below the living level wage and a staff abused by customers and who are paid higher than the living level wage?

The latter can actually live on their wage and don't need tips to sustain themselves. Now tell me, do the abusive customers sets the wage or the owner of the business?


NO one is being abused by customers in any literal way. The abuse comes from coerction of losing a job by complaining to mgmt. v. directing their complaints to the ones that are supposed to supplant the 2.13/h that the STATE mandates. Thsi is not strictly an employer's fault, so hard to blame them for not giving a s**. It's a political deficiency in enforcing living wages as a baseline of income instead of 2.13/h. That's developing world wages, not US wages, or should be, if it weren't the reality.


When I worked service sector jobs, I was called stupid to my face. I was threatened with violence. People tried to get me fired for making them wait while I tried to help them. I got cussed out how over-priced printers were for how long they lasted, then I'd load their absolute-cheapest Black-Friday-doorbuster inkjet into their brand new Lexus SUV.

Certainly, the lions' share of the blame lands on the business owners who won't pay a livable wage. But some of it falls on the kind of consumer who ship at Walmart because it's cheap, but also nods in agreement when restaurants call out a "cost-of-living surcharge" to the bill.


I've faced plenty of abuse in various sectors. A "cost of living surcharge" is purely on the owners and is an absolutely insane scapegoat to trick people into paying higher than the menu price, which ought to be illegal.

It's EITHER part of the food price, or it is not. Surcharges like that are still part of the price of food/service and that has never changed. What has changed is making people feel guilty because they are a nuisance to the restaurant or whatever s**hole establishment or imbecilic manager/corporate PR idiot decided it made them look better than paying employees crap wages and making consumers feel guilty into enforced "tipping" to make up for it. It's the same for parties of 8 or more policy in many restaurants that require mandatory tipping fees. It's all terrible, all unacceptable. I'll agree that it's part of how restaurants are trying to survive, but it ought to be illegal. If I want to eat somewhere with a group of people or just myself, a cost of living surcharge is part of the meal, but not included in the menu price. That's illegal, or at least ought to be.

Not sure what point you are making besides mine.


The point is there are two possible responses to seeing the surcharge: "just raise your prices" and "I can't believe I have to pay more for this shit service! At least we know its not the owner's fault the prices have gone up, its probably those liberals forcing us to pay other people's hospital bills!" (I've also seen "employee sick-leave surcharge" appended after Oregon mandated that restaurant employees receive paid sick leave, and I've heard diners grumbling about it).

I've been cussed at for charging 5 cents for a bag when the city I worked in mandated such fees ("Well, I'm from the next town over, where bags are still free, you shouldn't charge me for that" "You're shopping here now" "That fee is bullshit, get your manager NOW" "OK")

The point is that if you work in the service sector, you rapidly realize that customers have a choice about whether or not to patronize businesses with transparently shitty policies. That those businesses stay in business tells you something about the ethics of the people who give them their business. And how those customers treat the employees tells you the rest. The point, as I've made a couple of times now, is that the customers of shitty businesses share some of the blame for their shitty, abusive business practices.


>> The point is that if you work in the service sector, you rapidly realize that customers have a choice about whether or not to patronize businesses with transparently shitty policies. That those businesses stay in business tells you something about the ethics of the people who give them their business. And how those customers treat the employees tells you the rest. The point, as I've made a couple of times now, is that the customers of shitty businesses share some of the blame for their shitty, abusive business practices.

And yet the employees' burden lands on their employers?

What a silly argument... it lands wherever it should, whether they feel it's customers not tipping well or employers not paying well. None of it is their care. The care is to put a roof over one's head. The details are irrelevant in any situation.


What's the difference? The end result is the same for the worker.


The difference is that the by allowing business to pay under minimum wage (in some states), the business get to create an adversarial relationship between the staff and the customers, and blame the customers when staff don't make as much money as they'd hoped.

This is IMO bad for everyone's happiness. Servers get upset with customers for not tipping enough and customers get to feel pressure and anxiety over tipping.

Compare that to a world where the employer has to actually pay their employees their full wage (like literally every other industry), and now you have predictable wages and less friction throughout the dining experience.


NO s**. That was my point. I apologize for the directness here, but you are out of touch with reality. If there is no political will to increase baseline wages for service staff, then the end result is exactly the same - employees will blame bad tippers because of the (what should be abnormal) tipping culture in the US, and are dependent on employers for their hours of work, so they'll lay blame wherever available.

I waited tables at semi-high-end restaurants. Worked doubles opening and closing from 10a to 12p... averaged 11/h on the busiest nights after carrying trays upon heavy trays for what felt like hours on end. I KNOW what I'm talking about from personal experience. I didn't mind the work, shift-leader, blah blah blah. I had colleagues walking away with 15 bucks TOTAL after a 5 hour shift, but it was averaged out to at least 7.35/h bi-weekly, so you can imagine the end result.

It's not sustainable. It's denigrating.


> Compare that to a world where the employer has to actually pay their employees their full wage (like literally every other industry), and now you have predictable wages and less friction throughout the dining experience.

This world has existed on the west coast of the US for a long time, and tip expectations have still marched upwards.


Cool - The West Coast of the US isn't the only part of the US.


It is an example that disproves njovin’s claim, since tipping is a social phenomenon.


Tipping on top of normal wages is normal in all of Europe, our closest Western cousins. I come from Eastern Europe, and I always tip (perhaps out of a Western custom, but also becaause I know how s** wages are there, so out of respect for acknowledging their crap wages and their service, even if I know they are paid a regular base wage).

This is not what we're talking about at all. Tipping is not simply a social phenomenon when other people's living circumstances depend on it. It becomes an economic necessity when (as the RTFA mentioned, if you'd read it) it becomes required to make a living wage.



The problem is that wealthy liberals and conservatives are in on a long-con against the American worker class. They want to pretend Inflation doesnt exist or has been conquered (e.g., https://x.com/paulkrugman/status/1712494317024026761?s=20) but refuse to reconcile that against fundamental numbers -- you cannot make ends meet with the current minimum wages.

ZIRP has been disastrous for everyone except leveraged asset owners (i.e., the wealthy). Assets inflated in price, rents rose commensurately, and we all pretended things were OK because of ZIRP and "fixed" it with further leverage to maintain affordability.


I feel like a focus on minimum wages is misplaced, it's hiding the real problem that is the value of labour has been diluted.

The minimum wage should be set based on determining the rate a sound minded well informed advocate could negotiate for the work. That is preventing exploitation. It should not be used to try to set a living wage, because as we have seen, this just leads to the COL increasing for everyone... Leading to a greater concentration of wealth as the average person now has less ability to save.


This is wonderful. "Professional politician gets real job after getting run out of town on a rail for Covid tyranny, realizes 'gee, working for a living is tough!', tries to cash in on that sweet, sweet, substack blogging-money"

We truly live in the wildest timeline.


I'll respond to the only substantive part of your comment: this looks like a guest post on someone else's blog, so he probably isn't making any money on it.


>... after getting run out of town on a rail for Covid tyranny...

This feels disingenuous. McCamley ran the department responsible for overseeing unemployment claims, and it was death threats related to those unemployment claims that prompted him to leave town. I'd be genuinely curious to see if you have something that ties this to COVID specifically.

>... tries to cash in on that sweet, sweet, substack blogging-money

Kinda hard to do that when you're essentially the guest commentator on someone else's Substack, though, no?

>We truly live in the wildest timeline.

Yeah, timelines where people flippantly throw out factually incorrect hot takes are pretty wild.


Covid tyranny?




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