The Instigator
InsertNameHere
Con (against)
Winning
26 Points
The Contender
Anarcho
Pro (for)
Losing
7 Points

A free market economy is harmful to society

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Post Voting Period
The voting period for this debate has ended.
after 7 votes the winner is...
InsertNameHere
Voting Style: Open Point System: 7 Point
Started: 9/17/2010 Category: Politics
Updated: 6 years ago Status: Post Voting Period
Viewed: 7,557 times Debate No: 13171
Debate Rounds (3)
Comments (22)
Votes (7)

 

InsertNameHere

Con

This stems from an earlier argument with my opponent, Anarcho about whether the free market is beneficial to society or not. I'll begin by presenting several arguments from the earlier debate. Good luck to both of us!

1) Minimum wage: My opponent is in favour of it. There are several reasons to be opposed to it, however. One of the obvious is the fact that it can harm the economy. Businesses are expected to pay a certain amount, even if they can't afford it. This can affect how much goods they're able to produce thus hindering their ability to produce profit. Less profit can also result in less jobs available as they would only be able to afford to hire a limited number of workers.

On the contrary, by removing minimum wage laws there are no such barriers to employment. Businesses would be able to pay whatever they can afford while still being fair. If an employee doesn't like the wages offered by a particular business they have a choice to not work there. They could seek out a business that pays better wages. Also, most businesses would be inclined to pay fair wages anyway; if nobody wants to work at a particular place due to bad wages then that business would risk bankruptcy. Paying unfair wages wouldn't be worth the risk for an established businessperson of losing their hard-earned business.

2) Welfare/social security: It is inevitable that in every society there'll be poor people. Both the left and right have different ways of approaching this issue. I am in favour of the right-wing view of abolishing the government social services. This has a few advantages. It, of course, requires paying taxes. With lower tax rates people would have more money to spend on other things, including donations to charity. This is a completely voluntary action and doesn't involve citizens being told what to use their money on. One may question these motives and think that few people would donate and leave very little money for the disadvantaged. However, with more money available it is possible that more donations would occur than what presently occurs.

Another obvious issue is the abuse of current welfare systems. There are many people who receive funding through welfare who are either lazy and refuse to work or are addicts and want money to support their addictions. I'm sure most reasonable taxpayers wouldn't want their hard-earned money going to these people. Without government welfare programs these people are given incentive to go out and work and even if their regular wages aren't enough there is opportunity to do other things on the side to earn more money.

These are just a couple points to start off what I hope will be an interesting debate. I conclude that a free market is more efficient than a controlled economy. I'll bring up more points to be addressed as the debate progresses. Again, Good luck to both of us!
Anarcho

Pro

I accept this debate and wish luck to my worthy opponent.

1) Minimum wage: In a Capitalist society there must be a minimum wage for the workers to be able to get a somewhat fair pay. While this hurt some businesses people being able to live off of what they are paid is more important. More workers for a lesser wage for each is not really a good economic cost for the worker as it would be for the bourgeois.

What would be able to get the bourgeois to even pay fairly? From what I know of them (they are family) they tend to love money so why not keep as much as they possibly can? The employee does not even have much of a choice in who to work for, they will take what job they can. Michigan has the second worst unemployment rate in the United States at about 15% so if I am offered a job I am going to take it regardless of pay. If the big business owners wanted to attract more employees they could simply pay a little more than what a small business is which since it is a small business might not even be a lot already.

2) Welfare/social security: My opponent says that if social programs were to be cut then taxes would be lowered and more people would be willing able to give money to charity. What if they didn't though? Which is just as likely as them donating money. These people would have nothing to fall back on and cause an economic gap between them and the rest of the population. If you are born into poverty and homelessness chances are you will live and die that way. Especially if there was a depression, no one would be able to donate money for many years as they themselves have hardly enough money to survive as is.

The percentage of people who actually abuse the system and do nothing to get off of welfare and just survive off of it are a low percentage and not very many people on welfare want to stay there. And my time is up. Rest of argument will be in the comments.
Debate Round No. 1
InsertNameHere

Con

I thank my opponent for getting his response up in time!

The first points I brought up were about minimum wage. My opponent begins by countering this by declaring that those hiring people would pay less in order to keep more money for themselves. This, however, is untrue. Many people now are more likely to do that due to the fact there's minimum wage laws in place. When there's a certain amount you're expected to pay to each employee that leaves less money to keep your business going. As a result, employers would be inclined to pay less to save more money to run their business more efficiently.

Secondly, employers would be inclined to pay fair wages anyway. One advantage to a free market is that you can choose where you want to work. As a result, if you don't want the low wages you can go work at another business that offers higher wages. Businesses will continue to compete with each other to get employers by raising wages at rates that they're able to afford due to current market conditions. Minimum wage laws, on the other hand, hurt businesses in times when the economy is bad as they have less money to work with. Without such laws they can adjust accordingly.

Thirdly, my opponent pointed out that the unemployment rate in Michigan is about 15%(without sourcing it so I'm not sure how accurate that information is). I will like to point out that these high unemployment rates exist due to the minimum wage laws due to factors I've mentioned before, employers can't always afford to hire as many people if they're required to pay them a certain amount. Certain countries such as Singapore(http://en.wikipedia.org...) and South Korea(http://en.wikipedia.org...) have market based economies and some of the lowest unemployment rates in the world. Singapore has an unemployment rate of about 3%(https://www.cia.gov...) while South Korea has an unemployment rate of just under 4%(https://www.cia.gov...). These are both pretty excellent rates compared to the rates in many European countries which tend to have more socialized economies. Spain, for example, has an unemployment rate of about 18%(https://www.cia.gov...). These are just some statistics to prove that a free market is more efficient for society.

The next area I addressed was welfare/social security. My opponent claims that with less social security(which means less taxes) that less people would donate to charity. This is also untrue. It has been confirmed in the United States that among the most generous states are "Red States". http://taxprof.typepad.com... This could be a result of more liberal minded people feeling less need to donate as they probably have a mentality that the state will help them more. Another important factor, as I mentioned in the first round, could be that with less taxes people have more money to donate. With huge portions of their pay cheques being deducted for tax payment people become more concerned about finances and where they spend their money, with charity probably being on the bottom as paying their own bills would be first. With lower tax rates this isn't as big of an issue.

As for people born into poor families, they have opportunities too. While it's true that those born into wealthy families often have an easier time at making a living it's not impossible for the poor. Anybody could develop a special skill and make a living that way. For example, if somebody is really good at cooking a certain dish they could spend the few dollars they would need for supplies for that. They could then cook it up and sell it for a few dollars more in order to make a profit. Eventually these funds earned build up enabling the person to better their business. They could start by buying better cooking equipment to make the food even better. More people would buy it thus more funds would be earned. Eventually, there would be a point where said person could open a restaurant. This kind of incentive and opportunity for growth doesn't exist in a socialist society. A person would especially feel good about themselves knowing all their money was earned due to their hard work rather than just being handed to them for nothing.

Lastly, abuse in the welfare system was discussed. While this may not be a huge problem it does still exist. one thing that was suggested was drug testing. However, such actions require taxpayer's money to be able to afford. That would just result in even higher taxes. Also, most sane people wouldn't want to be using their own hard-earned money to support lazy bums who refuse to work. The system in itself isn't entirely fair. Thirdly, even with things such as drug testing it would be impossible to catch everybody. There are still those who abuse the system who aren't drug addicts.

I'll now be handing this over to my opponent.

Thank you again for responding on time and good luck in the next round! I look forward to interesting rebuttals.
Anarcho

Pro

Yes I unfortunately got wrapped up in something at the worst time so my response was delayed.

My opponent seems to be contradicting herself about minimum wage. If the business is more inclined to pay less to the employee in order to keep the business going then by default the employee will have a lesser pay. You can't get around that, if they cannot afford what the minimum wage is now then how could they be able to pay the same amount or close to that when the law is abolished? It is not even that high of pay anyways why make it even lower?

Employers would most certainly not be more inclined to pay fair wages, they know that you are in need of a job and will use that as leverage to make you settle for it. There are not a vast array of jobs out there that you can go out looking for, if there are not many jobs available and no safety net to keep you on your feet until you find a job you will go for any job regardless of pay. While it may be true that it hurts the economy in the sense that they have to pay employees higher wages that they cannot afford due to depression, the same thing could be said the other way around. How can you come out of depression when the products being made, cannot be bought due to low wages?

My apologies for not providing a source to the unemployment rates for Michigan. http://www.csmonitor.com... As you can see the rate is 13.6% but from reading the comments of presumably Michigan residents it appears that it is a made up number and it is actually higher but the state just does not want to pay for unemployment. I would like to ask my opponent from refraining using third world countries that pay their employees less than a dollar an hour as a good example of why there should be no minimum wage. That is a poor example and just shows how little buinesses will pay even in a thriving economy.

Look to comments once again and I apologize for doing it twice.
Debate Round No. 2
InsertNameHere

Con

Again, I thank my opponent for getting a timely response.

My opponent begins his argument by stating that without a minimum wage law that employers will be paid lower by default. However, this would be non-issue due to less inflation. With more goods being produced due to more money available to a company to use, their value goes down. With the price of goods dropping people wouldn't need as much money anyway. Even those with more money could buy more goods, thus putting more money back into the economy to produce more. It's a continuous cycle that is beneficial to the economy.

Secondly, my opponent is worried about employers not paying fair wages. However, as I've mentioned before, this would not occur in a free market as nobody would want to work for people paying unfair wages. The business owner would not want to risk going bankrupt and losing their business. To run a business you need employees. Another point that needs to be addressed is my opponent's concern over lack of jobs available. Again, it's because of minimum wage laws that there's less jobs as it makes it more difficult for businesses to be able to afford to hire people. My opponent also brings up a point about depressions. While this is an interesting point it's also irrelevant to the topic of focus so will not be discussed here.

Lastly, my opponent goes back to the point about Michigan unemployment. He claims it's higher than what is actually recorded due to the state not wanting to pay. This could be a result of lack in funds. Government programs such as social security are expensive to maintain and are ineffective so it's natural that the numbers would be exaggerated in order to try to avoid this. Without having to worry about paying for social programs governments could focus on more important things such as fighting crime.

Also, my opponent mentions me thinking third world countries are good examples as to why we shouldn't have minimum wage laws(seems like a bit of diversion from the original topic to me). Why this was mentioned is beyond me as third world countries were never mentioned even once in this debate. My opponent also failed to address my final rebuttals in round 2 about drug testing and welfare. Please vote con!

I thank my opponent for an interesting debate. It has been a learning experience for us, both being inexperienced in the field of economics. I look forward to final rebuttals by my opponent. Good luck!
Anarcho

Pro

I would have liked to post more but by the time I wrote up the rest my opponent had already finished their rebuttal and my apologies for not doing it beforehand but school gets busy at times.

I would like to remind my opponent that there is already an overproduction of goods and oddly the prices for food is still pretty expensive. Making anymore food would be redundant and just a further screw you the billions starving when we have more than enough food.

Secondly, she says that people in a fee market would not work for unfair wages however the sweat shops in Hong Kong a very well known area for free market would detest to that being true. Nobody would WANT to work in a sweat shop and this "decide where you want to work or starve" argument is no different from Lenin's "Work or starve". The choice between working or starving is not a fair choice and anybody would naturally choose the work regardless of how much it pays. If there were no minimum wage laws yes many more people would probably be employed but why would a majority of corporations pay as much as they can to get employees interested when they could simply pay very little as a "take it or leave it" option and the more employed to produce more of the product will make the pay more and more less.

Lastly, I think public money could go to better places than paying cops and it seems like she is stereotyping Michigan as a murderous and thieving state.

I used third world countries because many of them are prime examples of free market systems that abuse the workers to make a massive profit.

And my opponet is only being nice. We both know due to my inability to address other arguments she has he upperhand and will win but still I wish her luck. ;)
Debate Round No. 3
22 comments have been posted on this debate. Showing 1 through 10 records.
Posted by InsertNameHere 6 years ago
InsertNameHere
He may have explained that actually. I don't really remember. Regardless, my knowledge of it isn't enough to include it in this debate. I just wanted to focus solely on the economic aspects rather than the historical factors.
Posted by LaissezFaire 6 years ago
LaissezFaire
You're professor is wrong. What happened, basically, was that during the 20s, the Fed printed a lot of money. That money artificially lowered the interest rate. That lower interest rate led to an artificially high amount of investment, called the "boom." But, since the prosperity was founded on printed money, rather than real savings, it couldn't last. Thus the "bust." There's a more thorough explanation in the link from my previous post. Then, once the economy crashed in 1929, the government intervened, a lot. In particular, the government kept wages artificially high through various interventions, which, like the minimum wage, kept unemployment high and kept the economy from recovering.
Posted by InsertNameHere 6 years ago
InsertNameHere
Yea, I know about the money being printed as we touched on that briefly in my US history class last semester. However, I did get the impression that previous to the 1930's there was little intervention. The way the prof described it, it was almost like the depression was caused because there was lack of intervention.
Posted by Anarcho 6 years ago
Anarcho
That...was probably some miscommunication from the rush. I still would never refer to South Korea as third world though.
Posted by LaissezFaire 6 years ago
LaissezFaire
The intervention that matters when talking about depressions is monetary intervention. (The government printing a bunch of money) And there was quite a bit of that in the 1920s, although there wasn't nearly as much fiscal intervention as there is now.
Posted by LaissezFaire 6 years ago
LaissezFaire
"I would like to ask my opponent from refraining using third world countries that pay their employees less than a dollar an hour as a good example of why there should be no minimum wage."

The countries she mentioned were Hong Kong, Singapore, and South Korea. I didn't see China or India mentioned in the debate.
Posted by InsertNameHere 6 years ago
InsertNameHere
Well, Laissez Faire, I didn't really want to dive into the points about the depression as I'm still completely unsure as to how that relates to the free market. My knowledge of it is pretty basic still although I know in the previous era, the 1920's there was little intervention.
Posted by Anarcho 6 years ago
Anarcho
Fine China is second world but India still qualifies for most of what I said and is third world. Never even said South Korea was.
Posted by LaissezFaire 6 years ago
LaissezFaire
Good debate overall.

A few minor things:

lol @ Singapore, Hong Kong, and South Korea supposedly being 3rd world countries. They were a few decades ago, but prospered thanks to their fairly free markets.

Depressions were mentioned, but not in much detail. You should have gone on the attack here, INH, since it's the lack of a free market that causes depressions. (See http://mises.org... for a very good explanation of this)
Posted by juvanya 6 years ago
juvanya
Nice source about generosity!
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