The Instigator
JorgeLucas
Con (against)
Losing
5 Points
The Contender
Citrakayah
Pro (for)
Winning
7 Points

Minimum Wage

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Post Voting Period
The voting period for this debate has ended.
after 3 votes the winner is...
Citrakayah
Voting Style: Open Point System: 7 Point
Started: 10/16/2012 Category: Politics
Updated: 4 years ago Status: Post Voting Period
Viewed: 2,673 times Debate No: 26268
Debate Rounds (4)
Comments (0)
Votes (3)

 

JorgeLucas

Con

I will argue against minimum wage, my opponent will argue for minimum wage. Both sides must provide their own arguments for their respective claims as well as rebuttals. First round is acceptance.
Citrakayah

Pro

My thanks to my opponent for presenting this debate. I look forward to a fascinating dialogue.
Debate Round No. 1
JorgeLucas

Con

Thank you to Citrakayah for accepting this debate. Hopefully it is as interesting as our previous debate on science.

Contentions:

1. Minimum wage causes unemployment
Having the minimum wage set at a certain level does not mean an employer is required to pay everyone that amount. The employer is only required to pay that amount to the employees he chooses to keep. If the work of an employee is at a lower value than minimum wage, keeping the employee will end up ultimately causing the employer a loss. Thus, he will remove the employee. Since this will happen to many, unemployment will rise.

2. Large companies use minimum wage to stop competition
While one may logically think that regulations such as minimum wage put a check on the most powerful corporations, this is not the case. Walmart, for example, discovered that it could use minimum wage to its advantage, and lobbied for its increase in 2005 (1). Since then, minimum wage has gone up from 5.15 to 7.25 (2). Walmart's executives did not do this because they wanted to help their employees. If that were the case, they would have just given raises. But by lobbying for an increased minimum wage, they force regulations on their competitors. They can pay it because they are rich enough, but their competitors don't have that ability, and suffer the consequences. While I don't know if there was a correlation, it is interesting that the raises in minimum wage took place during the time of the recent recession.

I await my opponent's contentions and rebuttal.

Sources:
1. http://www.heritage.org...
2. http://www.infoplease.com...
Citrakayah

Pro

I’ve labeled my opponent’s examples C1, C2, et cetera, and my own P1, P2, P3, et cetera, for ease of reading.

C1. Well, yes, it’s true that there is some research that suggests minimum wage causes unemployment. There’s also some research that suggests it makes no statistically significant difference, or actually makes a positive difference (ie reduces unemployment). Studies that support the minimum wage (in terms of unemployment) include:

- David Card and Alan B. Krueger, "Minimum Wages and Employment: A Case Study of the Fast-Food Industry in New Jersey and Pennsylvania," American Economic Review, Volume 84, no. 4 (September 1994), pp. 774–775. This found that employment rose after an increase in minimum wage.

- Thomas C. Leonard, "The Very Idea of Applying Economics: The Modern Minimum-Wage Controversy and its Antecedents," History of Political Economy 32 (1), p. 139 (2000). This found that studies concluding that studies concluding unemployment rose after the implementation of a minimum wage had methological flaws had not be responded to by those who had written aforementioned studies. PDF: http://www.princeton.edu...

- Hristos Doucouliagos and T.D. Stanley, "Publication Bias in Minimum-Wage Research? A Meta-Regression Analysis," British Journal of Industrial Relations, 2008. Another study found that after publication bias was corrected for, there was no relationship between minimum wage and unemployment.

While the minimum wage was believed to cause increases in unemployment in the 1990s, that view is no longer the consensus among economists[1]. Currently there isn’t really much of one. Further peer-reviewed research is probably warranted.

C2. It’s true that Wal-Mart may be doing this to discourage competition (emphasis on may; I am not a member of the heads of Wal-Mart so I cannot say for sure—it is possible that they are doing so for other reasons still not related to alturism). But in a similar light, some people can’t afford to comply with OSHA regulations. Is competition an end in and of itself, or is it to serve a greater purpose? If it is to serve a greater purpose, then surely there could be specific instances in which competition could not be good. For instance, I would not desire competition between a company that manufactured peanut butter with rat feces in it and one that did not; someone (including myself) might be careless or ignorant and purchase the former rather than the latter.

Now, that’s an extreme example, to be sure. Which leaves it up to me to prove that having a minimum wage is, overall, a good thing, even if it decreases competition and (possibly) causes a slight increase in unemployment. There are many paths available for me to do this with; I’ll use several of them.

P1. Adoption of a living wage (which is basically a form of a minimum wage that automatically rises) is predicted to decrease premature death.[2] An increase in minimum wage would, of course, lead many to experience raises; currently a family of three with one minimum wage earner earns about 2/3 of the federal poverty level.[3]

1. "A Blunt Instrument; The Minimum Wage," The Economist, October 28, 2006.

2. http://www.ncbi.nlm.nih.gov...

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

Debate Round No. 2
JorgeLucas

Con

Defense:

C1: To show that minimum wage does have a correlation with unemployment, I have included a graph (1). But this aside, my opponent has failed to address my claim on principle or logic. I have shown that it is logical that minimum wage causes unemployment. It is up to my opponent to logically prove the opposite.

C2: My opponent's example of the peanut butter with rat feces proves why competition is in fact a good thing. In a system based on competition, the peanut butter without rat feces would quickly put the one with rat feces off the market. My opponent believes that without competition, somehow only peanut butter without rat feces would be made, but it is just as likely that the situation would be reversed. And with no competition, nobody would be able to buy good quality peanut butter.

Rebuttal:

P1: My opponent's first source does not say that minimum wage is predicted to decrease premature death. Rather, it says it is predicted to decrease premature death for those working full-time. This completely ignores the unemployed, and the consequences they will face. As for my opponent's second source, he claims that it is current. It is not. It was written in 2006, when the minimum wage was still $5.15. In the years since, minimum wage has gone up to $7.25 and the economy has collapsed. Also, the notion of a living wage ignores the fact that different people require different levels of income to survive. Somebody who works 8 hours at $4 an hour will live at the same level as somebody working 4 hours at $8 an hour. My opponent will likely want to point out that one has a higher quality of life because he works fewer hours, but this is irrelevant. That four hour difference has no bearing on the purchase of clothing, shelter, food, etc...

Sources:
1. http://politicalderby.com...
Citrakayah

Pro

C1: Given the choice between two options, one rooted in logic and the other rooted in what actually happens, we would be well advised to choose the latter. Human behavior doesn’t always follow logic or be what we would expect. While logic and principle can be useful, when it contradicts objective reality we should pay more attention to objective reality than logic and principle. To be sure, when this happens we look for factors that might explain why the result did not agree with our expectations, but we still pay more attention to what actually happened.

As for my opponent’s graph, I must note that during that much of the spike took place during or immediately preceding the Great Recession. It seems reasonable unemployment would go up regardless of minimum wage during a recession, especially one as great as the Great Recession.

C2: And yet, during the Gilded Age, companies that cut corners such as allowing rats to run around in sausage and get ground into it did quite well for a long period of time [1]. My point is that not all competition is good; we would be ill-advised to dispense with food and safety guidelines, OSHA requirements, et cetera. But those things limit competition. The key here is what is more important. Is competition good in and of itself, or is it supposed to serve the people? If it is supposed to serve the people, and is not an end in and of itself, then why can’t there be circumstances where competition would not be desirable? If it is an end in and of itself, why?

I do indeed believe that if the government were to regularly inspect the places where peanut butter was made and shut down any that failed inspections, there would be less peanut butter with rat feces inside of it than otherwise. I think this a fairly reasonable assertion.

P1: If my opponent has a more recent survey of economists, I would invite him to show it. I would also say that I am unaware of any serious economist who says that the collapse of the economy was due to an increase in the minimum wage.

My opponent’s rebuttal of my own point in favor of the minimum wage assumes that the minimum wage, and/or increases in the minimum wage, cause unemployment. I have shown that the academic literature shows little to no support in favor of this hypothesis, that the most recent survey of economists that deals directly with the question shows that there is no consensus that the minimum wage causes unemployment, and that there is some evidence to suggest that the minimum wage actually increases unemployment. My opponent has failed to rebut these studies.

Furthermore, the study I cited does not show that the unemployed would have it any worse if the minium wage increased.


1. the Jungle
Debate Round No. 3
JorgeLucas

Con

C1: I would say a logical argument is better than an historical argument because of all the factors not taken into account by the historical argument. And, yes, this may be the case about my graph just as it may be the case about my opponent's sources. As for my opponent's critique of my graph, he seems to understand what it says, but yet tries to make it seem as though the correlation is not there, or is at least irrelevant. While the correlation may or may not be direct, it is undeniably there.

C2: My opponent uses an either/or fallacy in describing competition. Competition is not an end in and of itself, but it also wasn't created to serve the people. Competition is a natural phenomenon, and trying to mitigate it will prevent innovation, economic growth, employment, etc... My opponent has also not shown why competition causes companies to put rat feces in peanut butter, and yet insists there is a correlation.
The kind of regulation my opponent describes will have unforeseen consequences. In our world of increasing economic regulation, children regularly have their lemonade stands shut down (1). My opponent and others will probably claim there is a difference, and while there is, where would the line be drawn? What factors would be taken into account? And then there will of course be loopholes, which would be 'fixed' by more regulation, creating more loopholes, and so on. It is a slippery slope, and definitely undesirable.

P1: I have included a video in which economist Milton Friedman shows logically how minimum wage causes unemployment. It is not current, but he discusses trends throughout history up to when the video was made. For the most part, I can't rebut the studies as they are not in my possession. For one I can (Princeton), it says that to compensate for increased minimum wage, employers will have to cut benefits for employees, or cut hours. This will make the company less productive, and decrease its profit, which will likely cause layoffs in the long run.
Obviously the study cited does not come out and say that the unemployed would have it worse. First, off that claim doesn't even make sense. My argument is that unemployment would increase, not that the already unemployed people would be worse off, save for the fact that it would be harder for them to get a new job. The article says that full-time employees would be benefited. I said that this ignores the full-time employees that would become unemployed.

Sources:
1. http://www.forbes.com...
Citrakayah

Pro

C1: And logic might assume that people act logically, or things act the way we expect them to. For example, logic (when applied to economics) often presumes Homo economicus, but H. economicus is hardly accepted as a universally accurate description of human behavior in economics.[1][2]

Yes, that could be the case with my studies. But unlike my opponent’s graph, my scientific studies control for other variables; they aren’t simply a graph of the minimum wage overlaid with a graph of unemployment. I do not deny the correlation. I question the causation.

C2: I didn’t say that competition was either an end in and of itself or created to serve the people, I said that competition was either an end in and of itself or should serve the people.

If competition is not an end in and of itself, then why should we allow it to run unbridled? The question must be asked: If something does not favor the overall welfare, then why should we keep it? This question is especially urgent when it hurts the overall welfare (as ‘eh, habit’ is a valid answer to keeping something useless around). We are faced with two possibilities, it seems. Either competition is always good, or there are times when it is not. Saying anything is always good requires a great deal of evidence; my opponent has not presented such evidence. How do we know that inhibiting competition reduces economic growth, innovation, employment, et cetera? Of course it does in some cases, but how many cases? Perhaps there are instances where cooperation is superior to competition.

I assert that the only thing that is always good is good itself. Anything else will have some exceptions. In the realm of public policy, we must determine what these exceptions are, and how severe they are, then balance the exceptions against the rest. At this point we must determine how to eliminate or mitigate the exceptions while keeping the points at which the concept, process, or thing is good—if we do not determine that it must be simply thrown out as it is too flawed to be worthwhile.

That’s the point of regulations—to eliminate or mitigate the exceptions. Only a fool regulates for the sake of regulating; I am fairly confident that someones saying, “Let’s make a new regulation for the heck of it!” has almost never happened. The question is whether or not we should allow competition between peanut butter makers that have rat feces in their product and those that do not. I say we should not; that any benefits are far outweighed by the negative effects of ingesting rat feces.

My opponent asks how the line would be drawn. My answer is this: The common good. I consider regulation to be a way to protect the public good; if a regulation does not do this than it is useless and may be discarded; if a regulation hurts the public good it must be discarded.

Yes, of course there would be loopholes. But if they are genuinely loopholes, we should be able to amend our regulations, instead of simply drafting new ones. It will be somewhat like a game of Whack-A-Mole, but I think it is a necessary game of Whack-A-Mole.

P1: Again, my opponent has failed to show that the minimum wage actually does cause unemployment. Friedman was absolutely right when he said that we must examine what a law or measure produces--and I propose we do just that. Examine the real-world effects. I have done this. My opponent has not.

In the study I cited, I cannot find mention of benefits and/or compensation. I do find mention, though, of the argument, based in surveys of CEOs, that firms do not always maximize profit, and do not price wages according to productivity.


1. http://en.wikipedia.org...
2. http://www.eco-action.org...
Debate Round No. 4
No comments have been posted on this debate.
3 votes have been placed for this debate. Showing 1 through 3 records.
Vote Placed by Torvald 4 years ago
Torvald
JorgeLucasCitrakayahTied
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Total points awarded:02 
Reasons for voting decision: Both sides put up rather good defenses for their cases, which is why I have tied all the points except sources, in which Pro had two instances more than Con. Well-fought, on both sides, though.
Vote Placed by 16kadams 4 years ago
16kadams
JorgeLucasCitrakayahTied
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Total points awarded:05 
Reasons for voting decision: Pro totally won. Arguments: pros empirical arguments where stronger and he displayed studies showing there is no significant correlation between higher minumum wages and more unemoyment. It's odd con didn't respond with the 300 studies he had available. But he didn't giving pro the edge. Source: wikipedia is as accurate as encyclopedia brittanica. And he had more studies from academic journals.
Vote Placed by Like_a_Boss 4 years ago
Like_a_Boss
JorgeLucasCitrakayahTied
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Total points awarded:50 
Reasons for voting decision: Con made more convincing arguments and Pro used Wikipedia as a source.