Interesting subject.
As one of the two restaurant/bar owners that I'm aware of here in this thread, we have very different takes, and politics/'extreme capitalism' is at the heart of it imo. I'll do my best to avoid getting into the politics of it, but other western democracies handle restaurant tipping far better. They just avoid it, it's not really part of the culture, they will usually build in a service fee right on the check. Not only is American tipping confusing for them, but often considered barbaric. I once made the mistake of leaving a generous tip in a British pub and the bartender chased me half way down a street to return it.
I'm old, I was raised to believe 15% was the standard waiters tip in America, but the tip wasn't to be paid on the entire cost, just the food/drink portion, not on the tax or any other added fees. Back in the day I taught my employees this and they weren't all very happy about it, but they understood that this was a base that many customers worked from.
While it's true that wait staff who underperform are often weeded out, the same should be true for the actual restaurants themselves. Serve a poor product and you're soon gone, just the same for poor customer service from a waiter. The main problem comes down to competition from other restaurants, not employee salary. If one restaurant is paying a 'living wage' and their competition is paying $2-$3.00 dollars per hour, the one with the higher labor costs is going to quickly fold as those costs are absorbed by the customer. What people fail to realize is that most of our fellow citizens earning under a minimum or livable wage are collecting government welfare of some nature, increasing your net federal/state income taxes that you pay later, essentially subsidizing any business owner or corporation who isn't paying a livable wage. I understand that weeding out some restaurants might be the result, but if you serve a better product at competitive prices, customers will find you. One of the industry jokes is that just about anybody with a recipe will open a restaurant one day, they don't get the long hours and the difficulty in maintaining an extremely high standard day in and day out in an industry which also has a high degree of employee turn-over. I've read that the mortality rate for first year restaurants was near 90%, this shouldn't be taken lightly.
For me personally, I'd rather pay a fair wage than pay higher income taxes, but that's just me ...