The Instigator
wjmelements
Con (against)
Winning
25 Points
The Contender
Lexicaholic
Pro (for)
Losing
17 Points

On the compulsory minimum wage

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Post Voting Period
The voting period for this debate has ended.
after 8 votes the winner is...
wjmelements
Voting Style: Open Point System: 7 Point
Started: 7/13/2009 Category: Politics
Updated: 8 years ago Status: Post Voting Period
Viewed: 8,813 times Debate No: 8913
Debate Rounds (4)
Comments (57)
Votes (8)

 

wjmelements

Con

Minimum wages are economically stupid government policies.

The "compulsory minimum wage" is said to be "compulsory" to distinguish it from the "natural" minimum wage.

Wage is always less than the value of the hourly produce of an employee's labour. Otherwise, the employee would not be hired.

Because of the nature of wage, we can divide the effects of minimum wage into three categories:
-When the value of the minimum wage is below what would otherwise have been paid
-When the value of the minimum wage is above the real value of the produce of labour
-When the value of the minimum wage is between what would otherwise have been paid and the real value of the produce of labour

If a minimum wage is lower than a job would otherwise pay, then it has no effect.

If a minimum wage is higher than the economic value of a job, then it eliminates that job from economic feasibility.

If a minimum wage is higher than what a job would otherwise pay, but lower than the economic value of a job, then the costs of labour increase.
If the costs of labour increase, the costs of products the labour produce increase.
If the costs of the products that said labour increases, then the price of everything goes up.
This price inflation balances out the effect of the minimum wage, so that the real (as opposed to nominal) value of the minimum wage drops again below the price labour would have otherwise paid.

So, in no case can a minimum wage have a positive effect.

Further, the third said case causes politicians to again raise the minimum wage, eliminating more jobs and creating more price inflation.

I await my opponent's case (as he is PRO, he shall present first). I will present the bulk of my case next round.
Lexicaholic

Pro

I thank my opponent for this debate opportunity. As I am Pro, I will have the opportunity to outline the scope of this debate, which I shall do to clarify the resolution.

Opening Statement/Scope of Debate
--------------------------------------------
Assuming no other changes in economic policy [1], including but not limited to any changes in any tax regime or trade agreements, or labor and business policies [2], including but not limited to discrimination based on sexual orientation or religious beliefs or increased business regulation, the compulsory minimum wage (minimum wage) is essential to operating a healthy society.

1. Bargaining Power

The minimum wage [3] is, at present, a necessary method of preventing employers, who often, if not always, have the advantage of bargaining power [4] [5] over their employees, from gouging their employees so that their employees are unable to obtain a living wage. Bargaining power is defined as "the capacity of one party to dominate the other due to its influence, power, size, or status, or through a combination of different persuasion tactics." [6] An advantage in bargaining power refers to a situation where the employee has limited ability to negotiate the price for the employee's labor, due either to the dominance of the employer in the industry of the employee's training, or where the limited knowledge or mental capacity of the employee prevents the employee from being able to engage in fair negotiation, or where the financial situation of the employee would create a desperation that the employer could exploit.

In any situation where such an advantage exists, it is unrelated to the value of labor relative to the net profits of production, and does not therefore "inflate" the price of goods produced, as the labor is valued by factors unrelated to the necessary operating profit margin of the employer's trade. Money is essential to survival in a capitalist society. Where the value of an employee's labor is reduced as a primary consequence of an exercised advantage in bargaining power on the employer's behalf, that employee has his or her livelihood reduced at no expense to the employer (relative to the production cost-profit dynamic) and to the employer's gain in profits, which the employer, barring a minimum wage, need not extend to the employee. The result is that the employee may end up working for less than he needs to survive, which holds consequences, as I will express below.

2. Cost of Living

The minimum wage is increased (when an increase is deemed necessary) according to the estimated "cost of living." The cost of living is defined as "the Price of goods and services required for maintaining an average level standard of living." [7] Standard of living is defined as "Financial health of a population, as measured by per capita income and consumption of goods and services by individuals or households." [8] What happens when this financial health is threatened? Poverty. [9] Is poverty bad? Yes. Poverty leads to social unrest, [10] which, if it becomes severe enough, leads to an increase in crime. [11] [12] This should be obvious; the more poor people you have, the more likely you'll create desperate thieves. [13] [14] Why? Because the cost of disobeying the law is no longer greater than the cost of obeying, and, similarly, the value of obeying the law is no longer as great as the value in disobeying. Moreover, thriving in one's environment (which, for humans, means wealth accumulation) is a natural survival instinct. [15] [16] If you can not exercise that instinct lawfully, you will still exercise it unlawfully.

3. Civil Unrest/High Crime Rates Results in Heavy Costs

An increase in criminal activity results in high costs to the victims of criminal actions and the family members of those incarcerated for such actions, and reduces the productivity of those laborers arrested for such crimes. [17] As a consequence, assuming no other alterations, industry is actually discouraged by lowering the minimum wage.

Closing Statement/Affirmation of Resolution
-------------------------------------------------------
Therefore, barring the application of concurrent, effective progressive measures [18], the elimination of the minimum wage would result in rampant poverty, crime, decreased productivity, and civil unrest. The minimum wage therefore has a "positive effect," in contravention to my opponent's contention, in reducing or eliminating such concerns. The resolution is affirmed.

Reservation of Arguments for a Later Period
------------------------------------------------------
I reserve the right to contend the following additional concerns in a later round that is not the fourth: (1) that the accumulation of wealth without moderate disbursement of the wealth throughout society results in civil unrest, therefore showing that the accumulation of wealth alone is not a valid reason for dispensing with the minimum wage and (2) that poverty creates health risks that also reduce productivity and which can lead to civil unrest.

[1] http://www.investorwords.com...
[2] http://encyclopedia2.thefreedictionary.com... and http://wiki.answers.com...
[3] http://www.investorwords.com...
[4] http://william-king.www.drexel.edu...
[5] http://en.wikipedia.org...
[6] http://www.businessdictionary.com...
[7] http://www.businessdictionary.com...
[8] http://www.businessdictionary.com...
[9] http://www.seattlepi.com...
[10] http://hartford-hwp.com...
[11] http://mtbi.asu.edu...
[12] http://capaassociation.org...
[13] http://www.census.gov...
[14] http://www.fbi.gov...
[15] http://www.fool.com...
[16]http://books.google.com...
[17] http://www.house.leg.state.mn.us...
[18] http://www.forbes.com...
Debate Round No. 1
wjmelements

Con

I would like to thank my opponent, Lexicaholic, for accepting this debate.

First, I would like to point out that my opponent's third contention is reliant on his second.
Second, I would like to acknowledge that his debate refers to the existence of a compulsory minimum wage in general; however, I will accept his interpretation of the debate.

Now, to his case for a compulsory minimum wage:
1. Bargaining Power
My opponent asserts that in most cases, the advantage of bargaining power lies in the hands of the employers. This, however, is not true. In the same way that an employee is reliant on an employer for income, an employer is reliant on an employee for labour [1]. Because anti-trust laws exist in the United States [2], and pro-labour union laws such as the Wagner Act exist [3], bargaining power most often shifts towards the employees rather than the employer. So, my opponent's first contention is based on a false premise.

2. Cost of Living
A minimum wage is not necessary to ensure that the employee can recieve wages necessary to meet the cost of living.

a. Because the minimum wage law only outlaws jobs that drop below its standard [4], the employees are actually worse off than before. Being unemployed generally earns an individual less than being employed on any wage [5].
b. In addition to that, wages cannot drop below the "natural" minimum wage [6]. The "natural" minimum wage here refers to the natural minimum that an unregulated market will pay for labour. The natural minimum wage is equal to twice the subsistence of the labourer [7].
c. In addition, if workers do not make much more than what is required to subsist, they often unionize, shifting the bargaining power towards the employees [8].

So, in a free market, the only cause for the high poverty levels described in my opponent's third argument would be unemployment, which is caused by the minimum wage (see my first round arguments, which have not been directly refuted).

3. Civil Unrest/High Crime Rates Results in Heavy Costs
When we now apply my opponent's third contention, it favours the absense of a minimum wage, rather than a call for its existence. This is because the minimum wage outlaws jobs, causing unemployment and therefore poverty.

THE CON CASE
1. The Business Cycle
"Deflation" here means "a decline in general price levels" [9]. "Aggregate demand" of a product here means "the sum of all personal consumption expenditures, business expenditures, and government expenditures in a particular time period" [10]. Deflation occurs naturally due to market changes in supply and demand, whether because of market changes or because of monetary activity [11]. Regardless of the specific cause of deflation, natural or artificial, it causes nominal prices to decrease. Because "the produce of labour constitutes the natural recompense or wages of labour" [12], the nominal value of wages drops along with the nominal value of prices. When this nominal value drops below the nominal value of the minimum wage, the job is eliminated from practicality in the private sector. This unemployment then creates a greater deflation, as this individual must now consume considerably less than before.

So, the minimum wage intensifies the business cycle by creating more deflation in times of deflation.

Had there been no minimum wage, wage levels would be able to fluctuate naturally with price levels to a much greater extent, as wages would be able to drop below a minimum wage to adapt to price levels without worsening the problem to the same extent.

2. The Minimum Wage Trilemma
If a minimum wage is lower than a job would otherwise pay, then it has no effect.
If a minimum wage is higher than the economic value of a job, then it eliminates that job from economic feasibility.
If a minimum wage is higher than what a job would pay, then inflation occurs until the wages return to a level above the minimum wage.

When a minimum wage is set, most jobs fit into the first category, many jobs fit into the second category, and the rest fit into the third.

Because of the nature of the trilemma, the minimum wage can only have a negative effect.

3. Economist Consensus
In 1978, approximately 90% of economists agreed that the minimum wage overall had negative economic effects on low-skilled workers [13].

While major economic studies have tried to frame the minimum wage as harmless or even beneficial, The Economist concludes that:
"Where most economists agree is that the higher minimum wage does not do much to relieve poverty. That is partly because many poor people would not gain (since they do not work); partly because some of the costs of higher minimum wages are shifted onto poor consumers; but mainly because many minimum-wage workers are not poor" [14].

Two economists, one the Senior Economics Professor at The University of Chicago, the other is the "Associate Director in the Division of Research and Statistics at the Federal Reserve Board", have studied the effects of the minimum wage for almost two decades and conclude in their collaberation entitled "Minimum Wages" that:
"...minimum wages do not achieve the main goals set forth by their supporters. They reduce employment opportunities for less-skilled workers and tend to reduce their earnings; they are not an effective means of reducing poverty; and they appear to have adverse longer-term effects on wages and earnings, in part by reducing the acquisition of human capital" [15].

So, a majority of economists agree that the minimum wage causes unemployment for poor workers, therefore increasing poverty. When we apply my opponent's third contention and his second potential additional contention, this concern is significant enough to VOTE CON.

4. Unemployment
"Employers will hire workers if the revenue resulting from the workers' labor exceeds the costs of hiring and employing that labor" [16] is a basic fact of economics. Assuming that the minimum wage is higher than the nominal value of a field of work, that field of work can no longer be hired.
Because the fields of work that produce the least money are most often the fields of work that require the least amount of skills [17] [18], the minimum wage eliminates mostly the jobs of poor and otherwise unskilled workers. These workers have the least chance of finding new jobs [19].

This unnecessary elimination of jobs harms the productivity of a country, and therefore, its wealth.

[1] The Wealth of Nations, Book I, Chapter VIII http://econlib.org...
[2] http://www.consortiuminfo.org...
[3] http://en.wikipedia.org...
[4] http://www.investorwords.com...
[5] Assuming that X is positive, X>0. http://dictionary.reference.com... [Definition 23]
[6] http://econlib.org... [paragraph 15], top of paragraph
[7] http://econlib.org... [paragraph 15], middle of paragraph
[8] http://www.wisegeek.com...
[9] http://investorwords.com...
[10] http://www.investorwords.com...
[11] http://www.inflationdata.com...
[12] http://www.adamsmith.org... [first sentence]
[13] http://ideas.repec.org... (The article must be downloaded to view)
[14] http://www.nd.edu...
[15] http://mitpress.mit.edu...
[16] http://www.cato.org...
[17] The Wealth of Nations, Book I, Chapter X, http://econlib.org... [paragraphs 8-10, 12]
[18] http://www.capmag.com...
[19] http://www.heritage.org...
Lexicaholic

Pro

1. Response to my opponent's observations.

"First, I would like to point out that my opponent's third contention is reliant on his second." Actually, my third contention is merely that poverty reduces productivity. The *causal relationship* between the elimination of the minimum wage and poverty is reliant on my second contention, however.

"Second, I would like to acknowledge that his debate refers to the existence of a compulsory minimum wage in general; however, I will accept his interpretation of the debate." While it is true that my opponent opened the scope of the debate with a general statement regarding the minimum wage, that statement concluded "in no case can a minimum wage have a positive effect." Therefore, I need only to present a case where the minimum wage has a positive effect to prove my opponent incorrect. My clarification of the resolution is a statement of a case where a minimum wage does have a positive effect.

2. Response to my opponent's counter-argument.

(a) Bargaining Power
My opponent has argued that the collective bargaining power of unions represents a balance against employer bargaining power that nullifies the need for the minimum wage's protective effect. My opponent is incorrect. In the United States, only 20% of all jobs are protected by a union, [1] and practically none of them are minimum wage paying jobs. [2] It is clear that any consideration of the effectiveness of the protection provided by minimum wage must be made in relation to the jobs the wages of which are affected only by minimum wage laws alone. Unions ordinarily do not exist in the lowest paying segments of the job market because forming a union would lead to an employee's termination, [3] and employees working minimum wage paying jobs rarely have a savings to rely upon to buoy themselves between jobs. [4] Therefore, unions have no deterrent effect against employers' use of bargaining power in relation to such employment. Because an employee who would need a union to mitigate the collective bargaining power of his employer could not survive the attempt (at least, not without welfare), [5] unions are insufficient to mitigate employer bargaining power.

Anti-trust laws are also insufficient to distribute wealth amongst enough able competitors to ensure competitive job markets for labor, as I believe my opponent contends. Very few industries are affected by anti-trust, [6] and most low paying industries do not act competitively in the acquisition of labor. [7] Employers can afford to do this as the job market pool of laborers will always exceed the demand for employees at the lowest income level, for those qualified only for such jobs are in competition with those with greater levels of competition across a wider demographic spread. [8] Additionally, income is more important for most such industries, as they produce goods or provide services to the general public that make volume of sales more than sufficient to make the cost of the minimum wage rate of labor an irrelevancy. [9] Therefore, a strong economy matters more than a minimum wage.

(b) Cost of Living

My opponent suggests that "if workers do not make much more than what is required to subsist, they often unionize." This is not so. [10] Additionally, this process is equivalent to civil unrest, so it creates the very situation I praise the minimum wage for avoiding. [11] Moreover, even if workers are paid below subsistence, they may continue working because, in their minds, some money is better than none. [12] There is no bar to an employer taking advantage of such desperation. [13]

Additionally, my opponent argues that the natural minimum wage is equal to twice the subsistence of the employee. My opponent has provided no justification, not even Smith's, for why this must be so. [14] My opponent feels that no person would work for less. I have shown that this is a false assumption, supra.

(c) Civil Unrest

The argument that the minimum wage creates civil unrest has not been made. My opponent's argument is that were there no minimum wage, there would be more jobs. Yes, there would, but those jobs would be below the minimum wage. There will always be a steady amount of replacement worker/consumers to replace those who could not subsist on such wages, [15] so there is no cause to concern oneself for the health of one's workers. [16] Without such a cause, there is no need to deflate the price of goods. [17] Even if your customer dies, there is always another desperate customer. [18]

Additionally, employers may pay social undesirables and the mentally infirm less not because they are incompetent but because of their social distinction. [19] This makes them less able to find employment, which reduces the competition employers would otherwise face in hiring such individuals. [20] While laws do exist to fight discrimination based on sex, gender, age and religion,[21] they do not exist to protect individuals based on sexual orientation, criminal record, social or political unpopularity, political ideology, or speech. [22] Individuals who would be discriminated against for such factors could be easily taken advantage of without a minimum wage, and there are enough such individuals [23] as to merit concern for the effects of their poverty on ultimate productivity. Additionally, poverty results in health problems, [24] which further would burden our health care system. [25]

3. Response to my opponent's argument.

(a) The Business Cycle
The fact that no population of laborers is static prevents employers from ever really having to provide lowest income laborers with their "natural recompense." [26] Therefore, my opponent's contention that deflation must occur is false. Admittedly, it is common sense for employers to pay their employees an amount above that necessary to subsist upon, as this reduces civil unrest, increases productivity, and ensures the employer the best market the employer could ever realistically expect to operate within an otherwise stable society. Unfortunately, very few employers act with common sense. [27] Note that this would not reduce our nation's wealth, as certainly a few individuals would be very wealthy. It would, however, reduce our nation's security, as the costs spent fighting the resultant upsurge in crime would deplete funds set aside for other measures, such as national defense. [28]

(b) The Minimum Wage Trilemma

Briefly:
(1)Irrelevant. Ipso facto, I need not respond to this at all.
(2)Not problematic. Such jobs would likely be abusive and just as conducive to criminality. Employees are better off placated on welfare.
(3)Not problematic, for the same reason as point (2). If a job would pay less than what a laborer could survive on, the job could still be economically feasible because of the dynamic consumer market. The savings on labor need not be passed on as deflation. Employers are not compelled to concern themselves with the subsistence of their workers when making a profit. [29] Replacement costs for employees are nearly irrelevant, as lowest wage paying jobs rarely require specialized skill. [30] The actual ‘natural' minimum wage that an employer hiring such laborers would pay assuming ordinary intelligence and self-interest on the part of the employer and no minimum wage law is the lowest value of a bid to conduct such labor and such value as is reasonable to induce an employee to stay [31] less the value of terminating relative to the cost of training a new employee. That amount need not be one of subsistence.

(c) Economic Consensus/Unemployment
As per my opponent's own sources, a majority of economists do not believe that the minimum wage results in any harm. See opponent's 15. Actually, read my opponent's sources carefully, as they are supportive of my case, outdated, or founded on a logical fallacy, with few exceptions. [32]

See my comment Attachment A and any continuation for sources.
Debate Round No. 2
wjmelements

Con

I would like to thank my opponent for a well-researched response.

First, I would like to address my opponent's sourcing abuse.
My opponent has posted over 4000 characters worth of sources in the comment section. I would like to ask that he doesn't do that in future rounds.
Even disregarding this, his sources are abusive and unreliable:
My opponent's source [2] makes no reference to unions as he claims. My opponent's source [3] claims a much lesser punishment for union members than he claims it does. My opponent's source [6] does not say as he claims; rather, it only details 2 industries and how the antitrust laws affect them. My opponent's source [7a] is an entire lengthy book. He sources it, but does not tell me what paragraph, page etc., he is referring to. His source [7b] requires $36.00 to read.
Going on:
My opponent's source [9] does not say as he claims; rather, it supports my first contention. His [10] concerns the general population, not those making less than necessary to subsist, as he claims. His [11] makes no reference to the minimum wage, as he implies. [12] also does not say what he claims it does. His source [13] uses unfounded statistics and also does not claim what my opponent says it does. Source [16] is perhaps worse as a source than Answers.com. Source [17] does not address what he claims it does. Further, the "Truck System" has been illegal for over 500 years [1].
And still continued:
Source [18] doesn't work. Source [20] (or at least the free-to-view portion of it) does not say what my opponent claims it does and actually refutes his contention).
Source [26] refers to monopsony, not my opponent's claim, and even begins by stating that monopsony is "very rare". Source [27] does not refer to wages, but of improper lay-off methods. It does not address what my opponent claims that it does.

Second, my opponent introduces a new contention at the end of his 3rd argument. Further, the right to add this contention was not reserved in his opening round.

Third, I would like to point out that my opponent has dropped my 4th contention.

The PRO case:
1. Bargaining power
Most of my opponent's claims here are unwarranted, as shown above.
Besides that:
My opponent is wrong in explaining why lower-paid workers usually do not unionize. During the Industrial Revolution, low-paid workers with no skills were actually some of the FIRST to unionize [2]. My opponent's case also confuses cause and effect. It is not that unions don't protect low-wage workers; it is that unions increase the wages of workers to the point where they are no longer low-wage. Currently, unions are weaker for a large number of reasons [3]. Perhaps the greatest of these reasons is "government substitution", which means that the government is now completing the purposes of the trade union [4] [5]. With the fall of the compulsory minimum wage, the influence of labour unions will increase as there will be a greater need for them to protect the worker, whereas now there is no such need.

My opponent's source [4] is currently irrelevant as unemployment benefits and insurance are sufficient to subsist unemployed workers in the short term between jobs [6].

Antitrust laws do promote competition for labour by preventing employer-side labour monopsonies [7]. Oligopsony in the unskilled labour fields naturally evens itself out also, because the lower wages in a field become, the higher the number of willing employers [8]. Just as there is no static employee base, there is no static employer base either. In this way, oligopsony naturally eliminates itself from a free market. Along with this, the growth of the power of labour monopolies (trade unions) would naturally increase wages and benefits for unskilled workers, just as they did in the Industrial Revolution.
Again, my opponent's sources do not truly even back his claims.

2. Cost of Living
All of my opponent's sources here do not verify his claims (see above). My opponent's arguments of employee desperation are also negated because of the bargaining power contention.

Regarding the natural minimum wage, it is justified by Adam Smith, just as I had sourced. In the comments section, my opponent tried to rebut that source by claiming that the natural minimum wage is eliminated with the accumulation of stock and land. My opponent had clearly just skimmed the beginning of my source. The natural minimum wage is not dissolved with the accumulation of stock and private land [9]. The existence of the natural minimum wage makes the compulsory minimum wage unnecessary for this purpose.

3. Civil Unrest
Again, none of my opponent's claims here are truly warranted.

4. Discrimination
Because this contention is entirely new, disregard it.

5. Poverty
My opponent has not warranted how the minimum wage prevents poverty. Again, it creates unemployment (my opponent has conceded this), which causes individuals to be worse off than before.

Now, for the CON case:

1. Aggravating the Business Cycle
My opponent does not address my case. His only point against it is that an ever-changing workforce makes unemployment non-deflationary, which is false logic. The Deflationary Spiral [10] and the Phillip's Curve [11] [12] both support my case.

2. The Minimum Wage Trilemma
(1) My opponent concedes that the minimum wage has no effect in this situation.
(2) My opponent again argues that it is better to have people unemployed than employed on a low-paying job. I believe anyone can see the fallacy here. Long term unemployment is a major cause of poverty [13].
(3) My opponent does not address my point; instead, he goes off on a large tangent.

3. Economist Consensus
My opponent claims that my sources actually endorse his case. He does not warrant this claim. Even my 2nd Round [15] doesn't make any mention of what he says it does. For these reasons, my opponent's claims about my sources should be disregarded.

4. Unemployment
My opponent does not address my unemployment contention directly at all. Therefore, he concedes it.
My opponent concedes that the minimum wage contributes to unemployment and eliminates jobs of poor and unskilled workers, who will then have to compete with more skilled workers for higher paying jobs. These individuals are most likely to end up with long term unemployment and the result of long term unemployment is poverty. As my opponent has claimed, poverty causes health and criminal concerns. So, you must negate.

[1] http://en.wikipedia.org...
[2] http://chavez.cde.ca.gov...
[3] http://economics.about.com...
[4] http://www.springerlink.com...
[5] http://www.questia.com...
[6] http://www.nelp.org...
[7] http://legalcatch.wordpress.com...
[8] The Wealth of Nations, Book I, Chapter X
[9] The Wealth of Nations, Book I, Chapter VIII
[10] http://www.investorwords.com...
[11] http://library.thinkquest.org...
[12] http://www.econlib.org...
[13] http://www.econlib.org...
Lexicaholic

Pro

I would like to thank my opponent for his response.

1. Sourcing Abuse

I wasn't aware that data collection was abusive.

Source (2) shows that minimum wage jobs are primarily related to the service industry field. Very few service jobs in the US are unionized.

Source (3) shows how unions were busted. My opponent can not claim that union busting does not involve employee termination.

Source (6) illustrates how lightly some industries are treated. I read most of source (7a), as it is only samples from the book, and not the book in its entirety. My opponent can make time to do the same. (7b) is an authority cite to establish the expertise and recognition of (7a)'s author. It does not need to be read.

According to source (9), "On the bright side, increasing minimum wage is probably the right thing to do. ‘Until the law was passed, the minimum wage hadn't been increased in almost 10 years, so everybody was getting a real bargain,' Seiver explains. ‘It was abnormally low. Now, we're just pulling it back to the right levels.'" So the minimum wage arguably wasn't even adjusted properly. Source (10): "Among non-union workers who make less than $40,000 annually, 16% would like to belong to a union." I don't know what my opponent believes was implied, but (11) serves as an excellent example of how unionizing leads to civil unrest and is not a more desirable end than other forms of placation. Remember, civil unrest causes crime, unemployment is just one source of civil unrest. Please see paragraph four of (12). My source (13) is weak, perhaps, but no weaker than my opponent's (18) in terms of citing figures. Source (16) could be better, so I will supplement it. [n16] Source (17) illustrates the type of arrangements that develop from limitless lower wage bartering between employers and employees. If my opponent doesn't believe it, he should try working.

And still continued:
Source (18) was cut off by character limits. [n18] Presently opponent's (14) does not work. Source (20) was only cited to introduce Becker's concept. [n20]
Source (26) admittedly is less on point than an article on oligopsony would be, though the general idea remains the same: when more replacements are available than there are positions, positions need not pay what the replacements need to live. Source (27) is merely an example of employers lacking common sense.

Any argumentation made in the 3rd argument was simply an extension of the existing argument in response to my opponent's claims, not a new and unrelated concern. I do not need to reserve the right to defend against my opponent's claims in adversity to my original contentions. In fact, he was lucky I was nice enough to reserve anything at all, as there is no bar to me making new contentions otherwise.

I melded my response to my opponent's 4th contention into my third response to his argument, to save space. Re: Economic Consensus/Unemployment

The PRO case:
1. Bargaining power
I have shown that this is warranted.

Besides that:
I am not wrong in explaining why lower-paid workers do not unionize now. The Industrial Revolution is about as relevant as my opponent's homework syllabus is a reliable citation source (see opponent's last (2)). Regardless of why unions are weak, their weakness remains independent of minimum wage laws and unlikely to change because of the repeal of the minimum wage (my opponent's last source (3) makes it seem less likely). Therefore, unions will not protect low wage workers. Opponent's last (4) and (5) are excerpts of publications that do not seem related to my opponent's arguments. My opponent cites nothing to support greater support for unions occurring with the elimination of the minimum wage.

Source (4) is relevant as unemployment benefits are not paid by defunct businesses or in cases of employee termination. I would love to know how many low wage employees actually can afford insurance of any kind, though I have an idea. [n4]

My opponent assumes that more employers magically appear when labor becomes cheaper. Not so. Employer bases actually are very static, as they ordinarily use every tool in their disposal to prevent entry into the market. No one would think to do the same thing to employees, outside of a union. Additionally, my prior sources show that labor unions have been losing, not gaining, strength.

2. Cost of Living
The natural minimum wage is merely proven to exist in a state of nature under my opponent's source. It is not proven to exist as a valid alternative assuming the same economic policies we otherwise have currently. Smith was careful to limit his determinations to a consideration of the way things are in the aggregate. My opponent did not do this.

3. Civil Unrest
My claims here are directly warranted even if Con is right about unionizing. Employee unionizing is a process that directly results in civil unrest.

4. Discrimination
This contention is a natural outgrowth of my resolution clarification that we needed to consider the system as it exists without alteration of discrimination laws. There is no surprise in this contention. Where my opponent brings up a contention that will not work in the real world because of those factors I mentioned in the very first round, I must address it. My opponent may feel free to respond in the next round, now that he realizes he needs to.

5. Poverty
The jobs its elimination would create would necessarily pay below the minimum wage. The minimum wage is based on a determination of what a person needs to just skate by, and can be adjusted up or down by inflation/deflation. So my opponent has claimed that he supports the creation of jobs that would not pay enough to live off of. I'm right to say that out of work employees would be better off on welfare.

The Con case:

1. Aggravating the Business Cycle
I do not claim that an ever changing workforce makes employment non-deflationary. I claim that an ever-replenishing workforce makes employment non-deflationary. I will have to go into detail on this in the next round, as work prevents me from responding in detail this week.

2. The Minimum Wage Trilemma

(2) My opponent's goal is people working. My goal is to deal with a more direct concern: people revolting. If we could augment low wages with welfare, we could eliminate the minimum wage (provided the welfare brought wages up to the cost of living). But we can't change the welfare system, as per the resolution, so we can't eliminate the minimum wage.

(3) My opponent fails to address my ‘large tangent.'

3. Economist Consensus
I believe it was opponent's 14, not 15, which I originally intended to cite. Strangely, it no longer works. There was an article from the economist that basically concluded that the minimum wage was okay. It now appears to be missing.

4. Unemployment …
I mentioned in part 3 of my counter-argument against my opponent's argument.

[n16] http://books.google.com...
[n18] http://en.wikipedia.org...
[n20] http://en.wikipedia.org...
[n4] http://www.kotatv.com...
Debate Round No. 3
wjmelements

Con

I would like to thank my opponent for this debate.

It is understood that my link (14) in Round 2 stopped working mid-debate. I believe [n14] works. It is the same article.

RE: Sourcing Abuse
I titled the section as abuse when I first clicked on a source and it asked me for $36 and when I saw that my opponent sourced an entire book, rather than a selection. The rest of it was just sourcing criticism.

While source (2) shows properties of minimum wage jobs, it shows no information regarding unions, as my opponent had claimed in both Rounds 2 and 3.
Source (3) showed a statistic of 20%, which my opponent had implied was much higher. He exaggerates it in his argument and then sources something that says something entirely different.
Source (6) still does not claim that only light industries are affected by antitrust laws, as my opponent had claimed.
Source (7a) is still entire book that my opponent sourced. He still has not pointed to the selection of the book that he was referring to.
Source (7b) does neither what my opponent claims in Round 2 nor Round 3. It makes no mention of that book and does not verify his R2 claim.
Source (9) still does not claim what my opponent said it did in R2, and still endorses the minimum wage's harmful effects on the business cycle.
Source (10) is still irrelevant to my opponent's original claim because even liberal estimates place the minimum cost of living at much less than $40,000 [1].
My only objection to source (11) was that it made no reference to the minimum wage.
Source (12) still doesn't address the psychological effect my opponent implies.
My opponent has conceded that his source (13) does not address what he claims. He also concedes that it is weak.
I would like to thank my opponent for replacing his source 16 with a valid one.
Source (17) is still irrelevant, because the Truck System is illegal (see last round).
Source (n18) is simply a saying, and has no weight.
Source (n20), Becker's concept, also refutes my opponent's discrimination case, rather than endorsing his claims.
My opponent concedes that his source (26) is not on point. Oligopsony and monopsony in labour have a significant difference in their effects (obviously), likelihood [2], and are both only temporary contributors to fluctuations in the business cycle [3].
Source (27) is still irrelevant to the point my opponent implied.

PRO:
1. Bargaining power
My opponent's case is still not warranted.
Besides that:
My opponent has not really addressed the "government substitution" argument as to why unions are declining. He only claims that I didn't cite it, which I did. See R2 (4), which directly supports my argument. Government's minimum wage policy has weakened unions and created the oligopsony my opponent thinks the minimum wage is needed to defeat. In the words of Harry Brown: "Government is good at one thing. It knows how to cripple you, hand you a crutch, and then tell you that you couldn't walk without government."
Unemployment benefits are paid by the United States government. My opponent's time-between-jobs argument is still irrelevant because of this.
My opponent's argument that cheap labour does not attract new employers is historically false. For example, labour in China is so cheap that a multitude of jobs are created there every year. The oligopsony is coming to an end, however, as evidence by the increasing costs of unskilled labour there [4], contrary to my opponent's economic fallacy. Another example would be India, where industries expand to because of the cheap labour oligopsony [5], resulting in a rise in unskilled labour costs [6].
And again, labour unions are only getting weaker because government bureaucracy is achieving their purpose.

2. Cost of living
My opponent has merely repeated himself, this time without sources. I have already refuted this point: the natural minimum wage applies in any capitalist system.

3. Civil Unrest
Again, my opponent's argument here is reliant on his first two contentions, which have no legitimate warrant and have been refuted.
Also, while Civil Unrest related to Unions can be a legitimate problem, unemployment has also been a significant problem that causes significant unrest, as it has historically [7] [8].

4. Discrimination
Though not required to respond to this contention, I will make a statement: its warrants disprove it. Becker's work, which my opponent sources, claims that those who discriminate will make less because of it [9], which is directly contrary to my opponent's claim. His case here is therefore unwarranted.

5. Poverty
My opponent has created another contention in the second-to-last round, which goes against common debate etiquette. However, I shall address it anyways.
The welfare costs of the state to supplement an unemployed worker are greater than that to supplement a low-wage worker, and the harmful effects of the former are greater than that of the latter [10].

To the CON case:

1. Aggravating the Business Cycle
My opponent here has confused employment with unemployment. At this point, there really is nothing I can do. Anyways, this argument is as good as dropped, because this is the last round, and my opponent did not refute it beforehand.

2. The Minimum Wage Trilemma
My opponent has conceded this point entirely. All that remains is to contend his two tangents (which I initially ignored to stay on topic).
-The first (2) tangent is based off of the false assumption about the current welfare system. The Welfare program INCLUDES protection of the working poor [11], as well as the unemployment benefits my opponent acknowledges.
-The second (3) tangent is an organizational mess; however, the claim that it is reliant on, that cheaper labour does not make the costs of the produce of labour cheaper is fundamentally false [12], especially if the labour cost change is market-wide.

3. Economist Consensus
I have located the article from the Economist and have linked to it [n14]. The article claims that the majority of the population believes that the minimum wage is okay, but the bulk of the article says that most economists believe that the general public and even the EPI are wrong.
"Where most economists agree is that the higher minimum wage does not do much to relieve poverty." [n14]
The article also claims that the amount of economists that believe the minimum wage has a harmful effect on employment has decreased. This is from the 90% consensus back in 1978 [13], so the majority still agrees that the minimum wage has negative effects.

4. Unemployment
My opponent may have made a section about this, but he did not address unemployment in it. Therefore this point is still conceded.

Ladies and Gentlemen, the minimum wage eliminates low-paying jobs from the market and intensifies recession. Economists agree that it does not improve the conditions of poor workers, and I have shown why. Under no case is the minimum wage beneficial, so VOTE CON.

[n14] http://tinyurl.com...

[1] http://www.virginia-organizing.org...
[2] http://perso.uclouvain.be... (introduction)
[3] http://www.jstor.org...
[4] http://www.gaebler.com...
[5] http://infotech.indiatimes.com...
[6] http://www.theinquirer.net...
[7] http://www.67riots.rutgers.edu... (which incidentally occurred in a time of a high minimum wage)
[8] http://paper.sznews.com...
[9] http://www.press.uchicago.edu...
[10] http://www.columbia.edu...
[11] http://www.wisegeek.com...
[12] The Wealth of Nations, Chapter VI: Of The Component Parts of the Price of Commodities
[13] http://en.wikipedia.org...
Lexicaholic

Pro

I thank my opponent for a well fought debate and, in the interests of brevity and of bringing this debate to a conclusion, will allow the voters to determine the validity of each debater's sources.

Debate Overview and Conclusion:

-- Who we are talking about –

"Today's consensus, in so far as there is one, seems to be that raising minimum wages has minor negative effects at worst … only 5% of the workforce – some 6.6 million people – will gain directly from a rise in the minimum wage, and 30% of those are teenagers …" [1] Basic arithmetic suggests that the minimum wage is therefore important to 70% of that 5% so affected – 4.62 million people. In the same article, the jobs lost by an increase in minimum wage are those held by teenagers, the very demographic the article claims are not reliant on the minimum wage. A discussion of the effects of eliminating the minimum wage is therefore limited to the effect on these 4.62 million people relative to the gain on balance. These people clearly stand to benefit from having a minimum wage, if they would benefit from an increase thereto.

As noted in the article, there is little consensus amongst economists as to what exactly the minimum wage does. Of course, about half seem supportive. [2] Certainly for those already making the minimum wage, it has an impact.

These are the people who could be thrown into poverty and would stir civil unrest in the event of an elimination of the minimum wage. The question must then be asked whether or not, on balance, the detriment produced through this unrest would be less than the public support that would result upon the minimum wage's elimination. I am still convinced that it would not.

-- Limits of discussion –

The resolution of this debate prevents either me or my opponent from suggesting ways the system could be changed outside the minimum wage. My opponent ignores this limitation when he attacks government as the primary source of union power's diminution. Unless unions are weak because of the minimum wage, for the purposes of this debate they are weak, period. Only 20% of industries in the US are unionized, [3] and unions are hardly gaining strength. [4] My opponent can not suggest that low wage workers would be protected by unions in the present environment. [5] I fail to find anything in my opponent's source that suggests that union participation would increase as a consequence of an eliminated minimum wage.

"In that original state of things, which precedes both the appropriation of land and the accumulation of stock, the whole produce of labour belongs to the labourer.*1 He has neither landlord nor master to share with him … But this original state of things, in which the labourer enjoyed the whole produce of his own labour, could not last beyond the first introduction of the appropriation of land and the accumulation of stock."[6] Smith goes on to state that the ‘natural wage' presently is one that is subject to abuse on the part of either side in seeking to maximize profits and that employers are more likely to gain from such a situation. The reasons Smith provides for these observations are somewhat mitigated by modern regulation, but not quite where monopsony or oligopsony reduce the influence of unions to nil, [7] or if unions are found to be weak, generally.

-- Where my opponent is in error --

The increase in employment opportunities found in China and India was not due to the creation of new employers but rather the movement of old employers from one labor base to another. [8] New employers arise where there is economic opportunity and the employers have the skills and wherewithal to take advantage of that opportunity. [9] They do not arise simply because they could undertake their enterprise for less. An unoccupied economic niche needs to open for a new employer to appear and be successful.

If my opponent is suggesting that low wage laborers would be better off with a pay cut reflective of the value found in international trade that is simply ridiculous. The comparative costs of labor/production are incredibly low. Time is the most valuable commodity any person has. [10] You can not make more of it. Asking a low wage laborer to sacrifice his time when such sacrifice would gain for him no more benefit than that possessed by an unemployed individual fully supported by welfare is nonsense. Welfare does not currently compensate a low wage laborer for anymore than, at best, what that laborer would receive if fully on welfare less wages. [11] Therefore, under the current system, using welfare in place of the minimum wage results in a disincentive to work. [12] Better to be in debt with your time than without.

-- Where I was in error –

Unemployment benefits: Clearly I used the wrong word: severance pay was meant rather than unemployment benefits. [13] Unemployment benefits themselves are not much of a buoy, regardless. [14] Savings are more important now than ever.

Un-employment (rather than employment) and deflation: I used the wrong word (it was late at night, I was tired, and I had work in the morning), but the obvious intent of my refutation I will stand behind. Unemployment does not need to equal deflation because a producer will not lower prices, and therefore profit, if the employer's profit margin remains undisturbed, regardless of the unemployment/lower cost of production. Those in low wage service positions need not be the consumer base the company relies upon. Right now, that base appears to be the credit industry. [15]

-- Conclusion and Sources –

In conclusion, my opponent made a bold assertion by claiming that "in no case can a minimum wage have a positive effect." I believe that I have shown that presently, barring a more significant overhaul of our economic system, the minimum wage succeeds in placating those on the minimum wage and preventing civil unrest. As this is a positive effect, please vote Pro.

[1] My opponent's source 14/n14: http://docs.google.com...
[2] http://www.aier.org...
[3] http://william-king.www.drexel.edu...
[4]http://news.google.com... and http://www.aflcio.org...
[5] http://www.hrw.org...
[6] http://www.adamsmith.org...
[7] http://www.businessbookmall.com...
And See http://www.oligopolywatch.com... and http://www-sop.inria.fr...
[8] http://www.businessweek.com...
[9] http://www.morebusiness.com...
[10] http://www.quotes.net...
[11] Depending on the state. Welfare /= free money. You need to pay it back. Welfare has other problems as well – at present welfare doesn't supplement income the way my opponent thinks it does. This is debt, not income. Debt is not an augmentation of wages, as I see it. http://www.pacode.com...
[12] http://books.google.com... p.87
[13] http://www.boston.com...
[14] http://money.cnn.com...
[15] http://suddendebt.blogspot.com...
Debate Round No. 4
57 comments have been posted on this debate. Showing 1 through 10 records.
Posted by thereal_yeti 8 years ago
thereal_yeti
I think this issue falls into MANY other areas of life..

Let's say, a employer and employee, decided that in order to cut living expenses and to increase the employees pay, they both would simply live at the business.

THIS WOULD NOT BE ALLOWED.

The government would see this as a attack against their revenue. The employee doesn't own any property to tax, BLASPHEMY!

Or what if I wanted to live in a house with 10 other people? UNLIVABLE CONDITION, THAT MUST NOT BE ALLOWED!

How about nano-aparments? Where, the apartment is pretty much a place the tenet goes to simply sleep ? It is best that you have actual living space! YOU shouldn't decide how much space is necassary, why make that decision for yourself if you have the government to do that for you!

seems as if the government, passes legislation that increases our living expenses , than they turn around and make regulation to "Help us" and act as if they are the good guys..
Posted by Lexicaholic 8 years ago
Lexicaholic
Not if they are unskilled and doing menial physically undemanding labor, which is what most minimum wage jobs are.
Posted by wjmelements 8 years ago
wjmelements
The same applies in that replacing old employees costs money as well.
Posted by Lexicaholic 8 years ago
Lexicaholic
Only because the cost of buying new slaves was too high to afford the loss. Also, reducing laborers to the state of slaves wouldn't last for very long.
Posted by wjmelements 8 years ago
wjmelements
"if possible companies would pay nothing to employees."

Not true. Counterexample:
Even under slavery (where employers COULD avoid paying the employees), the owners had to supply the workers with the means of subsistence.
Posted by gothmog 8 years ago
gothmog
if possible companies would pay nothing to employees.
one of the main argument is that no one make mininum wage.if that was the case then whats the argument?so evidently since there is an argument ,people must make it. virtually all jobs in that pay are service jobs.which cannot be done overseas,so all other companies must pay it.its kind of hard to sell burgers from china.so all burgers places will have to pay it so no disadvantage to any single company,
if an employer cannot pay that wage and stay in business then he has other problems.there is nothing that says any company needs to exists.an example is eastern mechanics who went on strike thus causing eastern to close. why did they ?simple if they gave in they would take a pay cut.if they didnt eastern would go bankrupt and another company would move in and take over it spots and that company would need mechanics. keeping eastern alive did NOT help the mechanics. only the stock holders and frankly wether they lose or make money is not the employees concern.and gthat is the problem wiht us companies now. they are more concerned with stock holders than customers or employes.
Posted by Lexicaholic 8 years ago
Lexicaholic
"The government should help those who can't afford education to obtain it, but there is absolutely no reason the government should actually run the school system, we have food stamps but government doesn't run grocery stores. Education would be cheaper and of higher quality if we subjected it to the kind of competition that most other businesses must endure."

That's not a bad point actually. So long as regulation standards are kept up, no one is left uneducated, and vouchers cover educational costs as completely as they otherwise would in the public school system, I would have nothing against letting private competition in and using a voucher system. Just as you are used to people arguing moral rights in relation to social safety nets, I'm used to people arguing for vouchers for private schools with the public system otherwise in place. As this is not the case, I could concede to a practical purpose for a voucher system, provided it was monitored to see if the anticipated efficiency/cost improvements actually occurred (and was modified as necessary to see that such improvements did occur).
Posted by TCFreedom76 8 years ago
TCFreedom76
Most people couch welfare type arguments, health care, education as moral rights; not as public goods or what you call "social engineering". I support limited intervention to help the poor get health care and education on these grounds, because it creates a more productive society; I think we are in agreement here. I want to refute the moral arguments in favor of various transfer programs, because they lead to transfers being given to large segments of the population who aren't poor.

On vouchers, obviously they ought cover all the costs of private education; if they don't they won't work for everyone. That isn't an argument against vouchers. Also, they could be used just to send kids other existing public schools, they don't all have to go to Sidwell Friends. Right now private schools fall largely into three catagories, premium education, alternative education, and religious education. This is because the public school system has taken over the average education market because it is already paid for by people's taxes. The government should help those who can't afford education to obtain it, but there is absolutely no reason the government should actually run the school system, we have food stamps but government doesn't run grocery stores. Education would be cheaper and of higher quality if we subjected it to the kind of competition that most other businesses must endure.
Posted by wjmelements 8 years ago
wjmelements
Thanks again.
Posted by Lexicaholic 8 years ago
Lexicaholic
Nvm. Done.
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Lexicaholic
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