The Instigator
jimtimmy
Con (against)
Winning
23 Points
The Contender
Stephen_Hawkins
Pro (for)
Losing
16 Points

Minimum Wage

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Voting Style: Open Point System: 7 Point
Started: 10/18/2011 Category: Politics
Updated: 5 years ago Status: Voting Period
Viewed: 2,486 times Debate No: 18865
Debate Rounds (4)
Comments (3)
Votes (9)

 

jimtimmy

Con

I am arguing against the Minimum Wage. Opponent, Pro, will argue for Minimum Wage.


RD1: Con sets Terms and Conditions. Pro Makes Argument for Minimum Wage.

RD2: Con Responds/Makes Arguments. Pro does the Same.

RD3: Ditto RD2.

RD4: Ditto RD3 (except Pro can only respond to Con, no brand new arguments.).



Arguments can be Moral, Utilitarian, Economical, or, hopefully, all of the above...





Stephen_Hawkins

Pro

Alright, I am glad I get to do this debate. I shall make my arguments here, as requested:

Firstly, I would like to point out Maslow's Heirarchy. This is a simple explanation on how people are motivated[1].

We each have a hierarchy of needs that ranges from "lower" to "higher." As lower needs are fulfilled there is a tendency for other, higher needs to emerge.[2] . The first one is Physiological. This encompasses Taylorism's idea that we can motivate people through pay[3]. If my opponent wishes to put forth a different form of motivating people, although I doubt it, as this is commonly accepted, please make your case for this as well.

Also, as I am retaining the status quo, my opponent must give arguments to change it, but also the minimum wage is to affirm something, therefore I feel the burden of proof should be shared.

Low wages are inadequate compensation for potential workers who are discouraged from entering the labour market. By making labour more attractive, more human resources will be used, thus raising national productivity. With a system where we give social welfare to those who are not working, we need to motivate people in order to get them to work and have a system which is productive. Now, some people will say that this is because of an inefficient market caused by minimum wage. I will refer them to the fact that 8% of people are currently unemployed living off of benefits[4], and yet 13% are in poverty. In America, the situation is the same.

Governments have a duty to reduce poverty and so to raise the standard of living of all households. There is an absolute minimum quality of life, below which families should not fall. A minimum wage that had no effect on employment would be unnecessary, especially as the wage rate is not necessarily the main consideration of employers when hiring workers. People who employ others will use other methods, usually non-monetary methods in order to motivate others.

State benefits would cost less - less need for benefit "top-ups" such as income support and council tax benefit- because those in work who are directly affected will see their gross weekly earnings rise. On top of this, the government would make more money, as earnings will rise, therefore people pay more in income tax and national insurance contributions.

Finally, I will refer to an October 1999 report from the Confederation of British Industry (CBI) who gave qualified support to the National Minimum Wage. Key points from their study included that "Not much evidence of a significant impact on employment or unemployment" and "No noticeable blip upwards in average earnings". The impact on inflation "unlikely to be significant". (No noticeable blip upwards in average earnings connotes that there was no massive turmoil or bother in the industries, as the minimum wage simply makes it unlawful to use near-slave labour to create products or services).

Also, they state that in October 2011: (regarding the minimum pay rise)

"This moderate increase strikes the right balance during a period of economic uncertainty. It means that workers on the minimum wage will not fall behind the rest of the workforce in terms of pay rises. A larger rise would have hit businesses hard and could have put many lower paid jobs on the line."

In their 2002 survey, their primary conclusion is that:
 The national minimum wage (nmw), has made a real difference to the income of 1.2
million employees. In addition, a great many other employees have benefited in
companies whose strategy is to pay a percentage above the rate. Our survey suggests
that, in addition to those paying at the nmw level, a further 9% of companies follow a
strategy of paying a percentage above the main rate.

This should be conclusive. We have many many reasons to keep minimum wage, and it should not even be questionable that we should keep it.
Thank you, and I look forwards to my opponent's arguments. For future reference, I will next be addressing the issue of minimum wage issues abroad.


http://hale-business.wikispaces.com...;
Daniels, V. (2004, March) from http://www.sonoma.edu...
http://tutor2u.net...;
http://www.ons.gov.uk...;(for reference, the inactivity rate is those neither classed as unemployed nor employed, or unemployed but not claiming benefits. If not mentioned, assume that statistics are on the UK.
http://www.socialsituation.eu..., created Oct 2011)
https://www.cia.gov...;(page created Sept 2007, it can be assumed that it is now higher)
http://www.bbc.co.uk...;
(I have left out the direct link to the October 1999 CBI study, as well as others, as they can be found on www.cbi.org.uk with other sources. However, I will give some key citations:
http://www.cbi.org.uk...
http://www.cbi.org.uk...;)
Debate Round No. 1
jimtimmy

Con

I thank my opponent for responding and look forward to this debate.


Initial Case

First, we must review what a wage is. Quite simply, a wage is the price at which a worker agrees to sell his or her labor to a firm. Now, in our modern monetary economy, firms typically use money (units of currency) to buy the labor of these workers.

So, for all relevant purposes in this debate, a wage is the monetary amount at which a worker agrees to sell his or her labor to a firm.

The question then is: where does the minimum wage fit into this equation?

Well, quite simply, the minimum wage is the state setting a monetary value below which a worker is not allowed to sell his or her labor. So, if I wanted to work at a gas station for $5 an Hour, but the minimum wage was $7 an Hour, I would not be able to do this.

And, like all state laws, the minimum wage is violently enforced. This means that if I were to disobey the law and work for under the $7 an Hour, I would be thrown in jail, using the classic definition of the minimum wage. My opponent cannot dispute that the minimum wage is violently enforced. By definition, the minimum wage must be violently enforced to be a minimum wage.

So, to be quite clear, the minimum wage is the state violently forcing workers to sell their labor above a certain monetary amound.

Now, we can get into the practical problems with the minimum wage. First, we must remember that a wage is no different from a price. Therefore, a Minimum wage is essentially a minimum price being set on labor.

So, let me offer up a hypothetical story. Let's say that a minimum price were to be set on all goods. This price could be $7.25 (which happens to be the minimum wage in America). Now, this would not affect some goods, like computers, cars, and houses, which are priced well above $7.25. However, this would affect other goods like candy, small toys, and certain foods, that are priced well below $7.25. Now, these goods would have a substantial surplus at first, as not many people would buy things that are typically priced below $7.25 for $7.25. Eventually, these goods would almost entirely dissapear from stores, as producers would not produce goods that could not sell.

Now, think about this in the context of labor. If workers cannot sell their labor below a certain price, a lot of firms will not buy their labor at all. If a worker's labor is worth $2, then a firm will not buy their labor for $7.25. This means that there will be a major surplus on the labor market, as many low skilled workers will not be able to sell their labor at all.

This creates an decrease in employment, as this is what happens when workers cannot find work. This decrease in employment is a major drag on total utility and production in society.

The minimum wage is an immoral, illogical, and impractical thing. It forces workers to sell their labor above a certain monetary amount. This is wrong and it leads to less employment.


Responding to My Opponents Arguments


My opponent claims that the minimum wage motivates people to enter the workforce. He seems to ignore that a wage is, in and of itself, an agreement between a firm and a worker. If a worker did not want to enter the workforce because their wages were too low, they would not enter with or without the minimum wage. A minimum only keeps low skilled workers that would be willing to enter the labor force out of the labor force because they are not allowed to sell their labor below a certain price. Therefore, a minimum wage only keeps people out of the labor force, as it keeps low skilled workers from getting work in the first place.

My opponent then claims that government has an obligation to maintain a minimum standard of living. I do not agree with this premise and ask for further explanation in Round 2.

My opponent says that state benefits would cost with a minimum wage. The opposite is true, as the minimum wage increases unemployment and unemployment increases the cost of state benefits.


Conclusion

I look forward to my opponent's response. All of my arguments have been logical so far, so no sources are necessary as of yet.

Stephen_Hawkins

Pro

Stephen_Hawkins forfeited this round.
Debate Round No. 2
jimtimmy

Con

Extend all arguments
Stephen_Hawkins

Pro

I shall address my opponent's arguments before extending my own:

Eventually, these goods would almost entirely dissapear from stores, as producers would not produce goods that could not sell. Meaning many low skilled workers will not be able to sell their labor at all.

This creates an decrease in employment, as this is what happens when workers cannot find work. This decrease in employment is a major drag on total utility and production in society.

Governments have a duty to reduce poverty and so to raise the standard of living of all households. There is an absolute minimum quality of life, below which families should not fall. A minimum wage that had no effect on employment would be unnecessary, especially as the wage rate is not necessarily the main consideration of employers when hiring workers. I shall say this again, "I will refer to an October 1999 report from the Confederation of British Industry (CBI) who gave qualified support to the National Minimum Wage. Key points from their study included that "Not much evidence of a significant impact on employment or unemployment" and "No noticeable blip upwards in average earnings"."[1]

With regards to the problem of price changes of cheap goods, this is false. These price changes are so small they are negligible. With the incredibly cheap products, most of the things made are created by automatons. Let me give an example: LEGO. LEGO is done ENTIRELY by automatons in the manufacture process.[2] The price rise of cheap objects is negligible. On top of that, I will now address the moral issue of lack of minimum wage:


"All this means that in the vast majority of cases, the Nike presence is the very foundation of the community's well-being. That means that if we close the Sweatshop™, the community's economy, and any other benefits provided by our services, will be destroyed. So again, the people have no choice but to work at Nike for the wages that we determine!"

Or, to paraphrase, people, once large businesses are set up in areas without adequate governmental protection, people are paid terribly and treated inhumanely. We have to recognise that people live outside the 1st world countries, and in places like India, many are exploited for cheap labour, and is still done. Areas without minimum wage are crippled by big business, and an essential to any liberal community, one that is promoting the freedom of individuals, should back a minimum wage.

rebuttals to rebuttals:

"A minimmum wage only keeps low skilled workers that would be willing to enter the labour force out of the labour force, as it keeps low skilled workers from getting work in the first place". I do not understand this point, can I have some clarity on it? Are you saying that minimum wage keeps people from getting paid less? Or that it stops people who would work below the minimum wage getting a job because there is no market? If the latter, I would definitely like an elaboration on this.

The government has an obligation to maintain a minimum standard of living
I can see how this could be a conflict of ethos, but I think we can make this argument into a syllogism (I am British):

(P1) The government wishes to maintain a high standard of living
(P2) The government has put this in their manifesto.
(L1) Therefore, the government has an obligation to fulfil this mandate.
(P3) National Minimum Wage has been established as a way of doing this.
(C1) The Government has an obligation to enact a national minimum wage.

(Now, I will argue this ignoring Section 19 point 6 of the coaliton manifesto[3])

Part 19 on Jobs specifically states:
" The Government believes that we need to
encourageresponsibilityandfairnessinthe 
welfaresystem.Thatmeansprovidinghelpfor
thosewhocannotwork,trainingandtargeted
supportforthoselookingforwork,but
sanctionsforthosewhoturndownreasonable
ofersofworkortraining." [4]
Also, the conservative manifesto states:

"To fight social injustice and help the most
disadvantaged by building a strong society. The test 
of a strong and just society is how it looks after the
least advantaged – but this duty is not reserved for
the state alone. It is a shared responsibility: we are
all in this together. " [5]
This means, very clearly, Premise 1 and 2 is true. Now, a government also clearly has an obligation to do what it says it will do. To not do so is lying, and when a government does not do this, huge backlashes go against them[6]

Now, does National Minimum wage raise unemployment?[7][8][9][10][11][12] (and yes, I am quote mining slightly, purely to illustrate my point)

"To sum up, the evidence for the UK presented in this paper indicates that the effect of
the introduction of the minimum wage on the probability of employment is
insignificantly different from zero for all four demographic groups and in all three
datasets used." - Source 12, conclusion. (University of Warwick, Mark B Stewart).

It is undeniable that minimum wage does not lower unemployment; Source 9 expresses why it raises employment, talking specifically amount monopsony (Why Does an Increase in the Minimum Wage not Cause Unemployment? is the title of the essay. http://econ.economicshelp.org...)

Therefore, it is clear that we should raise minimum wage.

My opponent says that state benefits would cost with a minimum wage. The opposite is true, as the minimum wage increases unemployment and unemployment increases the cost of state benefits.
This is the major point of my opponent's argument, and it is wrong, unfortantely. Classical theory assumes labour markets are competitive, but, in practice workers often face employers with buying power. This means firms are able to pay workers less than the market wage. Therefore, when a government artificially raises wages, firms can actually afford to pay them. It is argued minimum wage legislation is similar to anti trust regulation.

I hope my opponent has learnt something from this. I await a response. I also want my opponent specifically to reconcile how the minimum wage increases unemployment, especially regarding the econ.economicshelp essay.


Myself, first argument. So what, I am a narcissist?
to around 6:50 (these are rough figures)
http://www.toolness.com...;(It is a Horatian Satire website to provoke thought on low wages and sweatshops specifically to show how companies make themselves essential to a community without legislation.
http://www.direct.gov.uk...;
Ibid, Section 19
http://www.conservatives.com...
http://www.guardian.co.uk..., right at number 1, Nick Clegg. He abandoned his voters in 2010 as he sold his party to be in the coalition; he raised the tuition fees.

(http://www2.warwick.ac.uk...
http://www.official-documents.gov.uk...
http://econ.economicshelp.org...
http://cep.lse.ac.uk...
http://eprints.ucl.ac.uk...
http://wrap.warwick.ac.uk...) - Regarding employment/minimum wage relation.

(Ibid means refer to previous source)
Debate Round No. 3
jimtimmy

Con

I thank my opponent for responding. My opponent made a number of different points. I will try to address them all here.


Does the State Have a Duty to Reduce Poverty Through the Minimum Wage?


This is a question of both morality and practicality. I believe that, in both cases, the answer is no. The state does not have a duty to try to reduce poverty. First, we must realize that the state enforces all of its rules violently.

Since we are talking about the minimum wage, let us again recognize what the minimum wage is. The minimum wage is the State saying that workers cannot agree sell their labor below a certain point, set by the state, or they and the wage payer who agrees to pay them this wage will be thrown into jail. If they resist jail, they will eventually be shot and killed.

By definition, a minimum wage is enforced violently. So, I certainly don't agree that the government has a "duty" to reduce poverty. Because, the only way the government can reduce poverty is through violence.

Now, practically speaking, the minimum wage does not reduce poverty. The reason for this is that the minimum wage has the effect of raising unemployment, which increases poverty. This is a point I will get more into in later points.


The Minimum Wage Increases Unemployment


In my last argument, I used a hypothetical story to illustrate how a minimum wage would increase unemployment, by creating a surplus in labor:

"So, let me offer up a hypothetical story. Let's say that a minimum price were to be set on all goods. This price could be $7.25 (which happens to be the minimum wage in America). Now, this would not affect some goods, like computers, cars, and houses, which are priced well above $7.25. However, this would affect other goods like candy, small toys, and certain foods, that are priced well below $7.25. Now, these goods would have a substantial surplus at first, as not many people would buy things that are typically priced below $7.25 for $7.25. Eventually, these goods would almost entirely dissapear from stores, as producers would not produce goods that could not sell.

Now, think about this in the context of labor. If workers cannot sell their labor below a certain price, a lot of firms will not buy their labor at all. If a worker's labor is worth $2, then a firm will not buy their labor for $7.25. This means that there will be a major surplus on the labor market, as many low skilled workers will not be able to sell their labor at all."

My point here was that the minimum wage is like creating a minimum price for all goods. This would create a surplus of cheap goods, as consumers don't want to buy cheap things for $7.25, which is what the American minimum wage is.

The labor market, as I explained, is just like any other market, so a minimum wage is a minimum price on labor. Therefore, it would have the same effects. That is, creating a surplus for low wage workers which would increase unemployment.

This is a pretty simple and logical matter. My opponent does not really offer a response to this. He does go off about "machines" and "labor exploitation" in the third world. He does not explain how either of these things relate to the minimum wage affect on employment.

My opponent's main response is his citing of an essay claiming that the minimum wage does not increase unemployment. This essay's main point is that the UK raised the minimum wage and unemployment did not increase. This is hardly enough evidence to base a conclusion on. The economy is affected by numerous complex factors, the minimum wage is only one of these factors.

This essay does not offer much of support for its conclusion in the first place. One point it makes is that firms could afford to pay their workers more. This is an irrelevant point. Most workers could also afford to work for less, but they don't.

The wage is what the worker agrees to sell his or her labor to the firm for. That is all. Now, if a worker is working for $7 an hour, and the minimum wage is raised to $7.25 an hour, it is likely that this work will simply see a slight pay raise. However, a worker working for $3 an hour would probably get laid off.

Furthermore, even slight increases in the minimum wage lead to less hiring by firms. Economics is all about the "margin". A 0.10$ increase in the minimum wage won't increase unemployment much in the short term, but it will lead to slightly less hirings in the long run. However, a $2 increase in the minimum wage would have a noticable short term impact and a fairly severe long term impact on employment.


Conclusion


I thank my opponent for this debate. I would also note that the fact that I have not used any sources does not give my opponent the victory in sources. I have used logic over empirics in this debate, as I feel that logic alone can show how bad a policy the minimum wage is. Therefore, no sources have been necessary.

My opponent has responded to a number of my points by simply citing studies. I ask that, in the final round, my opponent also looks at the logical arguments of this question.

I also believe that I have won this debate. I have shown that the minimum wage does not increase standard of living or reduce poverty, as it actually does the opposite by increasing unemployment. To add to that, I have also shown that the minimum wage increases unemployment.

I have shown that the state does not have a moral obligation to reduce poverty through the minimum wage. Part of this is because the minimum wage actually increases poverty, but also because the minimum wage is enforced violently, by definition.

Saying that the state has a moral duty to reduce poverty through the minimum wage is like saying that the state has a moral duty to violently enforce a policy that actually ends up increasing poverty.

Finally, my opponent ddid forfeit a round. Unless he had a good reason for this, this should give me conduct.

The resolution has been negated, as I have shown how harmful the minimum wage is.

I thank my opponent for an excellent debate.













Stephen_Hawkins

Pro

This conclusion shall be short, because there is only one point my opponent is pushing.

Does the State Have a Duty to Reduce Poverty Through the Minimum Wage? -- Yes, the manifesto states so.

Through the Minimum Wage? -- Manifestos do not state their intention, but this is an incredibly easy way to doing so. This is true, if it raises employment.

The Minimum Wage Increases Unemployment -- No, it doesn't. Two studies I have posted, which I will repost[1][2], state that it makes little difference, and this[3] citation states that it actually increases employment, and says why. I shall post the major 6 points of the article to end:

Reasons Why Higher Minimum Wage has Led to Increased Employment1. Strong Economic Growth. In period of economic growth, firms employ more workers as there is more demand to produce goods. Economic growth in the UK has averaged 2.5% since 1999

2. Monoposony Power. Classical theory assumes labour markets are competitive, but, in practice workers often face employers with buying power. This means firms are able to pay workers less than the market wage. Therefore, when a government artificially raises wages, firms can actually afford to pay them. It is argued minimum wage legislation is similar to anti trust regulation. [see: Monopsony and Minimum wages]

3. Increased Productivity. A study by David Metcalf [3] found that firms responded to increased wages by increasing the productivity of workers, especially in the service sector. This is important because it suggests that higher wages can actually help increase productivity in the economy.

4. Lower hours. Rather than make workers redundant, firms have reduced the average hours worked. This is related to part 3, firms try to get higher productivity in a shorter time, so they can afford the minimum wage.

5. Pass on Cost increases. Because the minimum wage affects all firms, it is easier for the cost increases to be passed onto consumers. e.g. because all cleaning firms have higher wage costs, they can all increase their prices. If the wage increase just affected one firm, they would become uncompetitive. (note: the rise in prices has not led to significant inflation in the UK)

6. Avoidance of Minimum Wage. It is uncertain to ascertain the extent of this problem, but some firms have circumvented the minimum wage legislation by employing immigrant labour and paying them lower wages. It also makes it more attractive to employ young workers.

Thank you for reading, and vote for the side who has debated the best.



http://wrap.warwick.ac.uk...;
http://www2.warwick.ac.uk...;
http://econ.economicshelp.org...;
Debate Round No. 4
3 comments have been posted on this debate. Showing 1 through 3 records.
Posted by whiteflame 4 months ago
whiteflame
*******************************************************************
>Reported vote: fire_wings// Mod action: Removed<

7 points to Pro. Reasons for voting decision: c vb

[*Reason for removal*] Counter vote bombs are strictly prohibited.
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Posted by jimtimmy 5 years ago
jimtimmy
A sad debate indeed
Posted by 16kadams 5 years ago
16kadams
231 views, no comments until now...sad.
9 votes have been placed for this debate. Showing 1 through 9 records.
Vote Placed by Viper-King 4 years ago
Viper-King
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Reasons for voting decision: ff
Vote Placed by 1dustpelt 4 years ago
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Vote Placed by royalpaladin 4 years ago
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Reasons for voting decision: Viper has countered 16k, so I am removing my vote.
Vote Placed by thett3 5 years ago
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Reasons for voting decision: counter to willoweed.
Vote Placed by Willoweed 5 years ago
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Reasons for voting decision: Con is wrong
Vote Placed by imabench 5 years ago
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Reasons for voting decision: counter vote bomb
Vote Placed by bozotheclown 5 years ago
bozotheclown
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Reasons for voting decision: Jimtimmy was much better at elaborating on his points.
Vote Placed by 16kadams 5 years ago
16kadams
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Reasons for voting decision: I think con had more proof on his side, and pro couldn't recover from that. But pro had more sources. Hey con, next time use the Milton Friedman video.
Vote Placed by Lordknukle 5 years ago
Lordknukle
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Reasons for voting decision: CON on balance proved that the minimum wage reduces employment. -1 conduct for forfeit.