The Instigator
NoCoolNameNate
Con (against)
Winning
7 Points
The Contender
Bob13
Pro (for)
Losing
0 Points

DDO Olympics: Abolish The Minimum Wage

Do you like this debate?NoYes+1
Add this debate to Google Add this debate to Delicious Add this debate to FaceBook Add this debate to Digg  
Post Voting Period
The voting period for this debate has ended.
after 1 vote the winner is...
NoCoolNameNate
Voting Style: Open Point System: Select Winner
Started: 8/17/2016 Category: Economics
Updated: 8 months ago Status: Post Voting Period
Viewed: 790 times Debate No: 94807
Debate Rounds (4)
Comments (12)
Votes (1)

 

NoCoolNameNate

Con

Preface

This is a debate for the DDO Olympics, individual tournament bracket B.

Full Topic

Resolved: The US ought to abolish both federal and state minimum wages

Rules

1. No forfeits
2. Citations should be provided in the text of the debate
3. No new arguments in the final round
4. Be civil
5. No trolling
6.
7. Do not question rule 6
8. For all undefined terms, individuals should use commonplace understandings that fit within the logical context of the resolution and this debate
9. The BOP is evenly shared; both debaters should affirm the desirability of their respective approaches
10. Obey the structure

Structure

R1. Acceptance
R2. Cases/rebuttals
R3. Rebuttals
R4. Conclusions, new arguments

Thanks.
Bob13

Pro

I accept.
Debate Round No. 1
NoCoolNameNate

Con

Thanks for accepting! I'm honestly a bit surprised that my opponent accepted this topic as it's very clear to me that the minimum wage is necessary and morally correct in our economy. To be clear, the resolution states that *ALL* minimum wages, including those that the state sets, should be abolished. Throughout the course of the debate I'll be defending the position that state's should set their minimum wage according to the living wage in that area and adjust it constantly according to inflation. Sorry that this is a little sloppy, I ran out of time:

First of all, any program to increase the minimum wage needs to be flexible to support small businesses:

The Star Tribune, July 27 2015 "Minnesota's minimum wage rises to $9 per hour Saturday"

"Minnesota will vault past Illinois, Michigan and South Dakota this week to gain the highest minimum wage in the Midwestern region at $9 an hour, which also will rank among the most-generous state wage floors in the country.
Small Minnesota employers " those with annual gross revenue below $500,000 " still will be permitted to pay workers less, with their minimum wage matching the federal minimum.
Businesses can also pay trainees at the lower rate for 90 days, and teens can be paid less, too."

The minimum wage bill passed by the Minnesota state legislature this year included stipulations that aimed at reducing the burden placed on small businesses through delayed wage hikes, I'm in favor of doing the exact same in other cities and states in the US.

A minimum wage floor that addresses varying regional costs of living will be able to provide a living wage to all who need it:

The Pew Research Center, Aug. 3 2015 "The real value of a $15 minimum wage depends on where you live"
"Honolulu is the most expensive metro area in the U.S. " a $15 national minimum wage would have a real purchasing power of $12.24 there. Beckley, West Virginia, has the lowest RPP (regional price parity) of any metro area in the nation, so a $15 minimum would have the purchasing power of $19.23 there. (Allentown, Pennsylvania, incidentally, has an RPP of exactly 100, making it the only metro area where $15 really would mean $15.

If the goal were to guarantee low-paid workers everywhere in the country the same real purchasing power, that would require hundreds of different minimum wages, scaled to each locality"s cost of living. For example, giving everyone the same purchasing power that $15 has in New York City would cost $13.07 in Chicago; $12 in Fresno, California; $11.10 in Cincinnati; and just $10.43 in Anniston, Alabama."

So I agree that federal minimum wages are terrible. However, state minimum wages are necessary as they subsidize low wage workers.

We also see huge benefits from the minimum wage in the economy, reducing the costs associated with it:

Increased Consumption

"Poor people are what economists call 'borrowing constrained.' They tend to have more needs than are being met, so when money arrives, they spend it." http://www.bloomberg.com...

Money that minimum wage workers receive is spent right away and basically just sent right back to businesses, stimulating the economy.

According to a paper released by the Federal Reserve Bank of Chicago, "an increase of $1.75 in the hourly federal minimum wage raises aggregate household spending by roughly $48 billion in the year following the minimum wage hike" https://www.chicagofed.org...

The evidence clearly demonstrates that minimum wage increases help the economy due to the fact that poor people are able to meet their economic potential and spend more in our economy.

Higher Productivity

Workers who have greater income security also experience less poverty-related stress, which further boosts their productivity. A report from the Industrial and Labor Relations Review found that "high-wage firms can sometimes offset more than half of their higher wage costs through improved productivity and lower hiring and turnover costs". http://www.jstor.org...

Corporate Tax Cuts

Because the minimum wage would ensure that way more minimum wage workers receive a living wage, the government would need less money to spend on welfare. As a result, we could implement a corporate tax cut which further lessens the burden on companies.

In closure, the minimum wage *I* propose would: ensure that those who are willing to work receive a living wage, would be based off of regional costs, and ultimately not even hurt the economy at a considerable rate. It's morally correct for the government to look after it's people and try to reduce suffering as much as possible. For these reasons, I affirm.
Bob13

Pro

Contention #1: Minimum wage increases unemployment.

If employers could spend less money on paying each worker in a minimum wage job, they would hire more workers, reducing unemployment.

"In essence, minimum wage increases make it more likely that firms won’t hire new people than that they will fire current employees. For example, movie theaters have stopped employing ushers almost entirely." [1]

In addition, a study done by AEIdeas shows a direct correlation between minimum wage and teenage unemployment [2] as shown in this graph:



Every time the minimum wage is raised, teenage unemployment rises with it. Abolishing minimum wage would allow employers to
employ more people in minimum wage jobs.

Contention #2: The vast majority of minimum wage workers are teenagers and other people who don't need to make a living wage.

According to the U.S. Bureau of Labor Statistics, 15% of employed teens earn minimum wage or less, compared to 3% of those aged 25 or older. [3] This is because teenagers don't have to support a family, or even themselves; thus, they can live on a small amount of money. Adults will find higher paying full time jobs if they have to support themselves and a family, which will happen with or without minimum wage standards.

Conclusion

Minimum wage standards don't serve their purpose of ensuring that people earn a living wage, and they decrease job availability, which in turn increases unemployment and hurts the economy.

[1] https://mises.org...
[2] http://www.aei.org...
[3] http://www.bls.gov...
Debate Round No. 2
NoCoolNameNate

Con

My opponent is either misreading statistics or intentionally misleading people here but either way I'll now explain why these points aren't sufficient to demonstrate the truth of his claims.

1. So in his first contention he claims that businesses would have more money to employ people without a minimum wage. However, this fails for several reasons:

A: Many companies simply pocket the money and increase the salary of CEO's rather than employing more workers

B: It doesn't really matter if more people get employed if the jobs are not sufficient to support them anyway and require welfare form the government (see my earlier contentions which have still not been refuted)

C: There isn't evidence given to demonstrate that this out weighs my previous contentions even if you agreed with him and ignored my refutations.

And in regards to his graph, correlation does not imply causation and that does not account for multiple economic factors such as the housing crash.

2. My opponent brings up statistics regarding the demographics for what type of people receive minimum wage, however this is not an accurate representation. I'm a bit short on time again so I'll quote an article that refutes this pretty well and is more articulate than I'd currently be:

"When describing who would see a raise if the minimum wage were increased, it is important to look at everyone who earns between the current minimum wage and the proposed new one, as well as workers earning just above the new minimum wage (who would likely also see a small pay increase as employers move to preserve internal wage ladders). The typical worker who would be affected by an increase in the minimum wage to $10.10 per hour by 2015 looks nothing like the part-time, teen stereotype: She is in her early thirties, works full-time, and may have a family to support. Our analysis of workers who would benefit from an increase in the minimum wage shows:

The average age of affected workers is 35 years old;
88 percent of all affected workers are at least 20 years old;
35.5 percent are at least 40 years old;
56 percent are women;
28 percent have children;
55 percent work full-time (35 hours per week or more);
44 percent have at least some college experience.
Claims that mostly teenagers would see a raise if the minimum wage were increased are sometimes based erroneously upon the official Bureau of Labor Statistics data on workers who are earning the federal minimum wage or below"i.e. workers earning exactly $7.25 per hour or less. These data do not provide an accurate picture of who would see a raise if the minimum wage were increased because they exclude all workers from the 19 states with higher state minimum wages, along with all workers making slightly above the current federal minimum wage but below the proposed minimum, all of whom would see a raise if the minimum wage were increased. Also, see a comprehensive analysis of the impact of raising the minimum wage in Raising the federal minimum wage to $10.10 would give working families, and the overall economy, a much-needed boost."

http://www.epi.org...

The major flaw in my opponent's contentions is that they misuse statistics which is very misleading. For these reasons, I negate.
Bob13

Pro

Rebuttals

"If the goal were to guarantee low-paid workers everywhere in the country the same real purchasing power, that would require hundreds of different minimum wages, scaled to each locality"s cost of living."

Naturally, if the cost of living is higher in a certain area, businesses will have to offer higher wages if they want to hire anyone.

"Money that minimum wage workers receive is spent right away and basically just sent right back to businesses, stimulating the economy."

If there were no minimum wage, employment rates would rise, and the employed would send their money right back to businesses, stimulating the economy even more.

"According to a paper released by the Federal Reserve Bank of Chicago, "an increase of $1.75 in the hourly federal minimum wage raises aggregate household spending by roughly $48 billion in the year following the minimum wage hike""

Your source explains why: "Using a variety of U.S. and Canadian data, we demonstrated in Aaronson (2001) and Aaronson, French, and MacDonald (2008) that immediately after a minimum wage increase, limitedservice restaurants (i.e., fast-food restaurants) employing minimum wage workers pass close to 100% of the higher labor costs on to consumers in the form of higher prices."

In this case, increased consumer spending is a bad thing, because it occurs due to higher prices, which are harmful to lower income people such as those on minimum wage.

"Because the minimum wage would ensure that way more minimum wage workers receive a living wage, the government would need less money to spend on welfare. As a result, we could implement a corporate tax cut which further lessens the burden on companies."

Workers who really need a living wage would most likely not have a minimum wage job. Besides, welfare should be abolished, so the government doesn't need to spend that money to begin with.

Defense

"Many companies simply pocket the money and increase the salary of CEO's rather than employing more workers."

Evidence?

"It doesn't really matter if more people get employed if the jobs are not sufficient to support them anyway and require welfare form the government."

People on minimum wage jobs rarely have to support a family. The vast majority of them are just trying to make a little extra money.

"And in regards to his graph, correlation does not imply causation and that does not account for multiple economic factors such as the housing crash."

The economy started recovering from the housing crash in 2006. [1] If you look at my graph, you can see that teenage unemployment rose in 2007, and it rose every time the minimum wage rose, and only when the minimum wage rose. That's obviously causation.

As for your statistics, only 28% of those people have children. Most of those are probably people with spouses who support their family with a different job. You need more statistics than that if you're going to try to refute the fact that minimum wage workers don't need a living wage.

Conclusion

The minimum wage raises unemployment rates, and they aren't necessary to help people support a family.

[1] https://en.wikipedia.org...

Debate Round No. 3
NoCoolNameNate

Con

Jumping right in:

"Naturally, if the cost of living is higher in a certain area, businesses will have to offer higher wages if they want to hire anyone"

A lot of minimum wage workers simply receive extra money off of welfare form the government because they can't afford to live by just a minimum wage alone:
http://laborcenter.berkeley.edu...

Your idea may sound good in theory, but in reality, minimum wage workers sometimes just have no choice and are forced to live in poverty with very little to no room for anything other than bare essentials.

"If there were no minimum wage, employment rates would rise, and the employed would send their money right back to businesses, stimulating the economy even more"

No evidence is given to demonstrate that it'd be more money, and I already demonstrated how businesses would not be inclined to fire people in my opening round. My opponent just makes bare assertions again.

"In this case, increased consumer spending is a bad thing, because it occurs due to higher prices, which are harmful to lower income people such as those on minimum wage"

There's a distinction between federal and state minimum wages... In addition many businesses would not raise prices in order to stay competitive. My opponent also neglects the fact that workers can afford to buy more which in time offsets these costs.

"Workers who really need a living wage would most likely not have a minimum wage job. Besides, welfare should be abolished, so the government doesn't need to spend that money to begin with"
This is refuted both by http://laborcenter.berkeley.edu...

And the fact that it's a bare assertion on both points raised.

""Many companies simply pocket the money and increase the salary of CEO's rather than employing more workers."

Evidence?"

The fact that some CEO's make tens of millions of dollars any ally shows they could have put a bit more effort into increasing their workers wages...

"People on minimum wage jobs rarely have to support a family. The vast majority of them are just trying to make a little extra money"

Actually 73% of US welfare expenditures go to workers with insufficient wages:
http://laborcenter.berkeley.edu...

A minimum wage increase would decrease the amount of money we would spend on welfare as a result.

"As for your statistics, only 28% of those people have children. Most of those are probably people with spouses who support their family with a different job. You need more statistics than that if you're going to try to refute the fact that minimum wage workers don't need a living wage"

Again, I already demonstrated that people are suffering from underpayment. The vast majority of those people are adults. My opponent's myths about "extra spending money" are completely refuted by these facts that he's neglected to refute this entire debate.

http://laborcenter.berkeley.edu...

Thanks. In conclusion my points were not met with much evidence and my opponent made multiple logical fallacies over the course of this debate. Thank you.
Bob13

Pro

I would first like to note that my opponent has used new arguments in his conclusion, so I will have some rebuttals in this round.

Teenage unemployment

My opponent has not responded to this argument after I proved a correlation between minimum wage and unemployment. Raising the minimum wage causes unemployment to increase.

Need to make a living wage

The majority of minimum wage workers don't need to make a living wage. My opponent provides a source that argues otherwise, but the fact remains that employed people in poverty are a very small minority, and the minimum wage actually increases the number of people on government assistance programs by increasing unemployment. In conclusion, abolishing the minimum wage would not increase the number of people on government assistance, nor would it be reduced by raising the minimum wage.

Stimulating the economy

Abolishing the minimum wage would increase employment, stimulating the economy. My opponent claims that keeping the minimum wage would stimulate the economy more, but that's not true, because fewer people would be employed.

Increased consumer spending

My opponent claims that the minimum wage increases consumer spending, but the reality is that it just raises prices, forcing people to spend more, which is not a good thing. Increasing wages is no good if prices increase with it. My opponent also assumes that businesses wouldn't raise prices in order to stay competitive, but he ignores the fact that the reason businesses raise prices is to make sure they make enough money, so their competitors would raise prices as well if they lost money from a minimum wage increase.

Conclusion

I have proven that the minimum wage causes unemployment and high prices, and that keeping the minimum wage is not beneficial in any manner. The minimum wage should be abolished to eliminate or reduce the effects of these harms.
Debate Round No. 4
12 comments have been posted on this debate. Showing 1 through 10 records.
Posted by Bob13 8 months ago
Bob13
Can you link me to one of your posts that discusses minimum wage?
Posted by bballcrook21 8 months ago
bballcrook21
Dammit Bob, this was such an easy debate to win. You gotta read my post for this stuff lol
Posted by NoCoolNameNate 8 months ago
NoCoolNameNate
Go for it
Posted by lannan13 8 months ago
lannan13
Mind if I vote here?
Posted by NoCoolNameNate 8 months ago
NoCoolNameNate
Okie. Either way you vote, thanks!
Posted by whiteflame 8 months ago
whiteflame
Alright, I've read through it and I'm working on a vote. Should be up sometime over the next couple of days.
Posted by NoCoolNameNate 8 months ago
NoCoolNameNate
Fine by me
Posted by Bob13 8 months ago
Bob13
I'm fine with that.
Posted by whiteflame 8 months ago
whiteflame
Just checking, guys: you OK with me voting on this? I'm in the tournament, though not in your bracket, so I have to confirm.
Posted by fire_wings 9 months ago
fire_wings
its DDOlympic, just to say.
1 votes has been placed for this debate.
Vote Placed by whiteflame 8 months ago
whiteflame
NoCoolNameNateBob13
Who won the debate:Vote Checkmark-
Reasons for voting decision: RFD given here: http://www.debate.org/forums/miscellaneous/topic/92613/