Does Raising The Minimum Wage To $15 Help?
Debate Rounds (5)
Many people are working at or below the minimum wage. According to the Bureau of Labor Statistics, 1.3 million people were working at the minimum wage while about 1.7 million people were working below it in 2014. Raising the minimum wage to support these people sounds like a great idea, but if you really think about, there are other things that come into play, such as inflation. According to the usinflationcalculator.com, the latest inflation rate as of May 2016 is 1.0%, and an updated inflation rate is coming on July 15, 2016. QUICK QUESTION: ARE WE TALKING ABOUT THE CALIFORNIA MINIMUM WAGE? If so, then I say that the current minimum wage right now is $10. The goal for California is to get the minimum wage to $15 by the year 2020. Assuming that the minimum wage keeps going up at one percent a year, it might not make a significant impact. But if you think about how long the minimum wage will stay at $15, then the yearly inflation can really start to have a big impact on the $15 some people earn hourly. Think about pay raises too. If someone gets a one percent pay raise, but the inflation rate is also one percent, there really is no inflation rate at all.
1."Nationwide" Is The Key Word - A $15 minimum wage could be appropriate in areas where the cost of living is high (i.e. NYC, San Francisco, etc.) But if we apply it to the entire nation, we're applying it to the suburban and rural areas that consumers use for low prices and businesses use for lower costs. They are also home to 79.1% of low-wage jobs . Businesses in these areas simply cannot afford their wage costs doubling without raising prices, cutting jobs, or going out of business. Businesses in these areas do not enjoy the revenue streams from high populations and prices found in cities and considering they are the areas that would be vastly more affected by the raise to $15, it's just too large a spike for them to bear.
2. There Are Repercussions - There are consequences to raising the minimum wage at all and an increase as dramatic as the proposed $15 would exacerbate them further. For example, the Congressional Budget Office predicts 500,000 jobs would be lost as a result of a wage increase to just $10.10 , the even greater increase proposed would undoubtedly increase these numbers. The $15 wage could also have disastrous effects for manufacturing in the U.S. The manufacturing industry has been outsourcing and replacing jobs with technology for years and the wage increase would worsen these problems and threaten the 5.3 million manufacturing jobs that currently make less than $15/hour . Furthermore, small businesses are often able to attract and retain workers in the face of big business competition by offering wages higher than the minimum, by making the baseline so high, we take this advantage away from them.
3. It's Not The Most Effective Option - We should be striving to help lift workers and families out of poverty and reduce income inequality but the minimum wage is an effective way to do this. The Federal Reserve Bank of San Francisco found that with families, only 18% of the increased wages would go to families at or below the poverty line, whereas more than double that amount, 38% of the incomes would go to families 3 times or more above the poverty line. Clearly dispelling the notion that an increased wage would help equalize wealth distribution. They also concluded "evidence simply does not provide a strong case for using minimum wages to reduce poverty" and that the Earned Income Tax Credit (tax reductions for qualifying low income families) "is a much more effective policy to combat poverty." It is also one that does not come at the cost of potentially massive job loss. Furthermore, 62% of people in poverty 18-64 don't work so the wage would have no impact on them other than making less jobs available .
4. Little Information Exists - Many studies have been done regarding the lower proposals of $10.10 or $12, but Politifact reports "that academic studies of the impact of a $15 minimum wage -- both its benefits and its drawbacks -- are all but nonexistent." Clearly we shouldn't implement it if we have no knowledge of its effects on a national scale.
The U.S. is such an economically diverse country that states, counties, and cities need to decide what minimum wage best suits their specific economic conditions, a $15 wage is going to affect a city with a high cost of living and millions in population differently than it would a small town of a couple thousand. We cannot afford to put these suburban/rural economies and small businesses at risk.
"If someone gets a one percent pay raise, but the inflation rate is also one percent, there really is no inflation rate at all."
There's also no increase in wage value at all then. $15 will be equivalent to what $10 is currently so if my opponent is arguing $10 is too low a wage, this proposal does nothing to change that. Inflation cancels out the raise. So here we're not actually talking about a raise in pay, but a wage that adjusts to inflation, an idea that I don't really oppose. Inflation is also expected to increase to 2.34% by 2020 which would actually decrease the value of the wage .
I argue for a minimum wage that increases and adjusts with inflation rates and thus someday a $15 minimum wage would be when inflation demands it. With this proposal, no extra costs would be incurred for businesses from a $15 wage because, at that time, it will be equivalent to paying the $7.25 wage installed in 2009. Inflation naturally increases business revenues and prices thus cancelling out any increased costs, like the California plan brought up by my opponent.
By not increasing our wage with inflation since we raised it to $7.25 since 2009, we have done a disservice to the 3 million working at or below it. By leaving our wage stagnant since then, the wage has lost %12 or $0.87 of its value . If we apply that to the countless hours worked by the millions of minimum-wage workers, the value of lost wages for these workers is immense. Lost wages that would've gone into the American economy and lifted millions of American workers at no extra cost to businesses.
The highest minimum wage (inflation-adjusted) in American history was $1.60 in 1968. This is currently equivalent to an $11.05. Even at this high price, the economy flourished with a growth rate of 4% and unemployment at 3.3%. Over the course of the decade, the wage increased 4 times and we saw "the average Americans real income had increased 50 percent" and "median family income rose from $8,540 in 1963 to $10,770 by 1969."  Hardly numbers to suggest economic disaster resulting from wage increases. And keep in mind I do not even argue we need to raise the wage to that high a value. I argue we keep it at its true value of $7.25 through inflation adjustment and that when that number one day reaches $15, companies will not be incurring extra costs and those 3 million workers will receive the same pay.
There is no reason why millions of Americans doing the same hard work they were doing in 2009 have lost %12 of their deserved pay. It's unacceptable and unjustifiable. We need to adjust our federal minimum wage to inflation and when that wage reaches $15, so be it. Companies will still essentially be paying and the employees receiving $7.25 and we have no reason to believe keeping the wage at that true value of $7.25 is harming or will harm our economy. In fact, American businesses have endured wages of even greater value (i.e. 1968) and still enjoyed economic success.
Millions of workers each year lose true value of their hard work to inflation. I suggest we implement an inflation-adjustable minimum wage and when that wage one day reaches $15, I have shown it will cause no harm to the businesses paying.
Thank you again to my opponent for this debate.
1 votes has been placed for this debate.
Vote Placed by PervRat 5 months ago
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Reasons for voting decision: For the rounds to be considered as per notes given in argument, Pro gave much more thorough of an answer and Con even acknowledged raising the minimum wage was a good idea.
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