The Instigator
1Historygenius
Pro (for)
Losing
5 Points
The Contender
GreenTeas
Con (against)
Winning
12 Points

Raising Minimum Wage Damages the Economy

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Post Voting Period
The voting period for this debate has ended.
after 4 votes the winner is...
GreenTeas
Voting Style: Open Point System: 7 Point
Started: 10/28/2012 Category: Economics
Updated: 4 years ago Status: Post Voting Period
Viewed: 11,007 times Debate No: 26662
Debate Rounds (4)
Comments (11)
Votes (4)

 

1Historygenius

Pro

Rules: I will be debating that unemployment raising minimum wage hurts the economy rather than help it. My opponent must argue that raising it helps the economy.

No semantics or trolling.

Round 1 is just for acceptance.
GreenTeas

Con

I accept and will be arguing the CON position -- specifically, that raising the minimum wage can strengthen the economy.


Debate Round No. 1
1Historygenius

Pro

The Effects of Minimum Wage on Unemployment

Employers hire people to generate profit. Thus, they pay the workers how much they are worth. If you are a worker and you are worth at least $7 and hour to the worker, then you will be paid $7 an hour. You will likely never get a raise or promotion unless you work harder and prove your worth to the employer. A rise in the minimum wage hurts workers its trying to help.

Before 2007, minimum wage was $5 an hour. This was more reasonable and teenage unemployment was decreasing. Then during 2007, the minimum wage was raised to $6. The results were negative and teenage unemployment increased rather than decrease. This is because the workers were costing more than what profit they were making for the employer. When the 2008 economic crisis hit, minimum wage was raise to $7 an hour. Teenage unemployment skyrockted to over 25%. This has been proven by many acamdemic studies. It also took a major toll on employment for minorities. It has effect all other employment sectors negatively. [1,2,3,4,5,6]

Here is a graph:

This shows the effect of raising the minimum wage with teenage unemployment. As you can see, it has negative effects.

The Effects of Minimum Wage on Prices

Prices rise. You have less of a product so you must do that to maintain profit. [7]

Sources

1. http://web.archive.org...
2. http://epionline.org...
3. http://www.mackinac.org...
4. http://online.wsj.com...
5. Adie, Douglas K. 2008 T "Did the Increase in Minimum Wage Cause Our Unemployment Rate to Rise?" . BALL STATE UNIVERSITY
6. http://web.archive.org...
7. http://blog.nj.com...

GreenTeas

Con

My task, as the CON position, is to show that raising the minimum wage can have a net positive effect on the economy. I will begin by addressing my opponent’s arguments and follow by offering my own arguments.

<<< REBUTTAL AGAINST PRO >>>

1. Rebuttal to :: Raising the Minimum Wage Will Increase Unemployment

My opponent’s primary argument is that raising the minimum wage is harmful to the economy because it will increase unemployment. In support of this argument, he states that increases to the minimum wage during 2007 and 2008 were followed by an increase in unemployment for teenage workers in subsequent years.

My opponent, however, fails to demonstrate why this increase in unemployment should be attributable to the increase in minimum wage, particularly when the economic collapse occurred at the exact same time. In addition to the economic collapse, several other factors are known to have increased the unemployment of teenagers during this time – including competition with older men and women who have increased their attachment to the labor market, single mothers, and young adults unable to find employment.[1]

Moreover, numerous economic studies over the last two decades have found that raising minimum wages does not result in job loss.[2][3][4][5][6] While simplistic models of supply and demand could lead one to predict that an increased minimum wage would lead to job loss, the empirical data from these studies demonstrates that moderate increases to the minimum wage do not result in increased unemployment.

The reasons for why increased wages do not lead to increased unemployment may be attributable to the reduced expenses of the employer. When the wage is increased, employees are less likely to leave their employer, thus leading to reduced costs associated with recruitment, re-training, and re-staffing. [See study in CON ARGUMENT below] Additionally, employees that remain with their employer longer are likely to be more productive due to their greater experience.

<<< CON ARGUMENT >>>

I present the following arguments in support of my position that increasing the minimum wage can have a net benefit to the economy.

1. Raising the Minimum Wage Acts as an Economic Stimulus and Creates Job Growth

Increasing the minimum wage provides a direct economic stimulus by placing money into the hands of low-wage workers – the class of people who are most likely to immediately spend that money in their communities. Increased spending power for low-wage workers will result in increased demand and stimulate economic growth. One dollar in increased minimum wage results in $2,800 in new consumer spending per person over the year, and would inject as much at $60 billion into the economy.[7][8]

Studies demonstrate that an increased minimum wage will stimulate the economy. The decade following the federal minimum wage increase in 1996-1997 experienced one of the largest periods of job growths, and individual states that raised their minimum wages above the level of the federal minimum wage experienced job growth that was larger than those states that kept theirs at the lower federal level. [9] These beneficial economic effects hold true even during periods of high unemployment and recession. [10]

2. Raising the Minimum Wage Increases Productivity and Reduces Costly Employee Turnover

Economic researchers have found that wage increases result in decreased employee turnover and increased productivity. Reduced employee turnover leads to savings by the employer because it spends less on recruitment, re-training, and re-staffing.[11] As a result of lower turnover, these employees will be more experienced, and consequently more productive. Improved worker wages, stability, and productivity, as well as decreased employer expenses all provide a benefit to the economy as a whole – and, to workers, employers, and consumers individually.

3. Conclusion

Raising the minimum wage does not result in job loss, as shown by numerous studies. Instead, empirical evidence supports that raising the minimum wage will actually result in stimulation to the economy, job growth, increased worker productivity, and decreased employer expenses.

SOURCES

[1] http://usmayors.org...

[2] http://www.irle.berkeley.edu...

[3] http://www.irle.berkeley.edu...

[4] http://www.cepr.net...

[5] http://www.cepr.net...

[6] http://nelp.3cdn.net...

[7] http://www.chicagofed.org...

[8] http://www.epi.org...

[9] http://www.fiscalpolicy.org...

[10] http://www.epi.org...

[11] http://www.irle.berkeley.edu...

Debate Round No. 2
1Historygenius

Pro

The Effects of Minimum Wage Increase Unemployment

"My opponent, however, fails to demonstrate why this increase in unemployment should be attributable to the increase in minimum wage, particularly when the economic collapse occurred at the exact same time."

The response to this comment is simple. Here is a quote from a good source responding to my opponent's statement:"In truth, there is only one way to regard a minimum wage law: it is compulsory unemployment, period. The law says: it is illegal, and therefore criminal, for anyone to hire anyone else below the level of X dollars an hour. This means, plainly and simply, that a large number of free and voluntary wage contracts are now outlawed and hence that there will be a large amount of unemployment. Remember that the minimum wage law provides no jobs; it only outlaws them; and outlawed jobs are the inevitable result." [1]

This clearly shows that raising the minium wage is a negative, not a positive. My opponent then cites his own numerous studies which conclude that raising the minimum wage does not hurt the economy. A meta analysis is needed (a look at a large amount of studies). The meta analysis will show that a there is a large consensus in favor of either me or my opponent's arguments.

The Joint Economic Committee has done over 50 years of research on this subject and has found that a consensus favors my arguments:

"Historically, defenders of the minimum wage have not disputed the disemployment effects of the minimum wage....
[studies finding minimum wages having no effect] were exhaustively surveyed by the Minimum Wage Study Commission, which concluded that a 10% increase in the minimum wage reduced teenage employment by 1% to 3%."

Years of research find minimum wages reduce employment. Some studies include Currie and Fallick (1993), Gallasch (1975), Gardner (1981), Peterson (1957), Peterson and Stewart (1969). Interestingly, minimum wages are supposed to increase wages and help the poor, however studies fail to demonstrate this. Rather, they find minimum wages hurt the poor [see: Brozen (1962), Cox and Oaxaca (1986), Gordon (1981).] Further, small businesses are vital to an economy. They literally drive our economy. But the high minimum wages hurt them [see: Kaun (1965).]

Reed Garfeild, a Senior economist for the Joint Economic Committee Report, notes that 200 years of research demonstrates that a minimum wage destroys job creation. Many reports in the 1990s created an economic "revelation" because they argued an increase in the minimum wage had no effect. However, attempts to replicate these findings failed miserably. Not only is it nearly a fact minimum wages increase unemployment, but also evidence shows that minimum wages increase the amount of time a family spends on welfare and the amount of high schoolers that drop out of high school. [2]

Another graph. The 1990s, considered a time of great economic growth, also had the same troubles with teenage employment and the minimum wage:

This shows the minimum wage and teenage unemployment during the 1990s. As you can see, this is similar to the 2000s. Lower minimum wage is equal to lower teenage unemployment. Higher minimum wage increases teenage unemployment.

My Opponent's Arguments

My refutations to my opponent's refutations on my original argument has refuted my opponent's two new arguments. The Joint Economic Committee has found that no job growth has been created.

"One dollar in increased minimum wage results in $2,800 in new consumer spending per person over the year, and would inject as much at $60 billion into the economy."

What if minimum wage increases to $1 million dollars? Will that stimulate the economy and increase growth? I don't think it will increase productivity (referring to my opponent's second argument) if its that high.

Further, for my opponent's theory to work, we must assume wages are higher so they have more money to spend. However evidence simply does not add up. Amongst younger employees, income drops due to increases of the minimum wage [(Meyer and Wise (1983b)]. And, due to the fact the minimum wage hurts young, unskilled, workers, this leads to them not gaining experience. This causes them to have worse skills (and be more effected by the minimum wage--less likely to get a job) and make them earn less in the future. And even if they get a job, they will be less likely to make large profits as the minimum wage prevented them from getting basic experience (Brozen (1969), Feldstein (1973).). [2]

Reed Garfeild puts it like this:"To put this gain in perspective, each minimum wage worker who earns $4.25 an hour brings home $3.92 for each hour worked once payroll taxes are deducted. The employer costs of a minimum wage worker is $4.58 an hour when the employers share of the payroll tax is included. If workers could take home the amount of money it costs the employaer to hire workers, they could have 62 cents more per hour. Clearly, the California parent would be better off if the tax wedge were reduced, rather than increasing the minimum wage."ConclusionI have proved that minimum wage hurts employment for everyone, specifically teenagers. If minimum wage goes up then teenage unemployment will skyrocket higher. I have refuted my opponent's arguments that minimum wage creates job growth, economic growth, and productivity. Raising the minimum wage at this time, or any other time,would hurt the economy. [3]

Sources

1. http://www.lewrockwell.com...
2. http://web.archive.org...
3. http://web.archive.org...
GreenTeas

Con

In this round, I would like to point out that my opponent has made a very misleading claim regarding his studies. I do not know if it was intentionally misleading or due to a failure to actually check his sources – I suspect it was not intentional but instead was the result of citing a partisan Republican statement. In any case, I believe this inaccurate claim should reflect negatively on my opponent and cast doubt onto the validity his other claims.

<<< REBUTTAL AGAINST PRO >>>

1. Rebuttal to :: Raising the minimum wage increases unemployment

My opponent admits there are conflicting studies regarding the effects of minimum wage on employment, and suggests that a meta-analysis is required to discover the truth. He states that “[studies finding minimum wages having no effect] were exhaustively surveyed by the Minimum Wage Study Commission, which concluded that a 10% increase in the minimum wage reduced teenage employment by 1% to 3%.” This quote is wholly misleading and inaccurate. The quote, which comes from the Joint Economic Committee Republicans in 1995,[1] is referring to a study performed in 1981 by Brown, et al.[2] The Brown study could not have “exhaustively surveyed” the recent studies that have found the minimum wage has no effect on employment, simply because the Brown study was published in 1981, and the studies finding no effects on unemployment were published in 1990-2012.

Despite my opponent’s inaccurate and misleading argument, I will not deny that – in addition to the recent studies I have cited showing that the minimum wage has no effect on employment – there are also older studies which appear to suggest that raising minimum wage slightly increases unemployment.

There is good reason to believe that the recent studies demonstrating that minimum wage has no effect on employment are more compelling than the older studies.

In 2010, Berkeley researchers found that previous approaches used to study the minimum wage were likely flawed, stating that “traditional approaches that do not account for local economic conditions tend to produce spurious negative effects due to spatial heterogeneities in employment trends that are unrelated to minimum wage policies.”[3] Moreover, a meta-analysis of 64 U.S. minimum wage studies found that “minimum wage effects literature is contaminated by publication selection bias… Once this publication selection is corrected, little or no evidence of a negative association between minimum wages and employment remains.”[4] A second meta-analysis, conducted by Princeton researchers, found that previous data sets were too small to accurately demonstrate the effects of the minimum wage, and that as the data sets used grow larger, the effect of the minimum wage on unemployment diminishes.[5]

Thus, when errors in experimental methodology and publication bias are taken into account, the older studies cited by my opponent are not compelling. Recent studies, which do not employ these traditional errors in methodology, find that there is no link between raising the minimum wage and unemployment and therefore provide a stronger argument for positive effects of minimum wage.

2. Rebuttal to :: Raising the minimum wage will increase welfare

My opponent argues that raising the minimum wage will hurt the poor and increase welfare. He again cites the statement by the Joint Economic Committee Republicans to support his contention that the minimum wage increases welfare – the statement itself cites two studies, Leffler (1978) and Brandon (1995). Neither of these studies, however, control for individual characteristics – such as work experience and educational attainment, nor do they account for local market conditions – that could skew the effect of minimum wages on welfare participation.

In 1999, John Hopkins University researchers controlled for the confounding factors that were not addressed in my opponent’s studies, and found that higher minimum wages actually reduce welfare participation.[6] The results found that a 50 cent raise to the minimum wage would lower welfare participation by 1.3%.

<<< CON ARGUMENTS >>>

1. Raising the minimum wage acts as an economic stimulus and creates job growth

By directly placing money into the hands of individuals that are most likely to immediately use that money, moderate increases to the minimum wage provide an instant economic stimulus that drives growth. [See previous round for my full argument and studies].

My opponent asks “[w]hat if minimum wage increases to $1 million dollars?” Absurd. Under a reasonable interpretation of this debate, I am only required to rebut the assertion that raising the minimum wage will damage the economy. I could, for example, support my argument by showing that moderate raises to the minimum wage are beneficial, i.e. do not harm the economy – which I believe I have been doing.

My opponent reiterates his argument that raising the minimum wage increases unemployment and cites a 1983 study by Meyer and Wise. This study falls victim to the methodological problems that I pointed out earlier. Numerous studies, including a study my opponent cites earlier, Brown et. al, criticize the methodological assumptions of the Meyer study.[2][7]

2. Raising the minimum wage increases productivity and reduces costly employee turnover

[Due to space, see argument from previous round].

3. Raising the minimum wage reduces reliance on welfare

There is a strong logical foundation and empirical evidence supporting that raising the minimum wage reduces reliance on welfare – i.e., the availability of higher wages will draw more people off of welfare. [See rebuttal argument from this round].

4. Raising the minimum wage will increase living standards

The real value of the federal minimum wage has fallen 30% since 1968. The United States currently has 47 million working poor – individuals whose income falls below the poverty line. As many as 23 million workers would benefit from a moderate increase in the minimum wage.[9] Increasing the minimum wage will put money into the hands of the individuals who need it most, thereby improving their buying power and living standards.

<<< CONCLUSION >>>

My opponent's primary argument is that raising the minimum wage will increase unemployment, but he has cited only older studies that have been shown to have methodological errors and were subject to publication bias. Moreover, he falsely asserted that meta-analysis supported his claim by citing a study that was published decades before the studies he claimed it was analyzing.

I have provided contemporary studies and meta-analysis that show moderate raises to the minimum wage: (1) do not increase unemployment; (2) stimulate the economy and create job growth; (3) reduce reliance on welfare systems; (4) and improve buying power and therefore living standards of the working poor.

SOURCES

[1] http://www.jec.senate.gov...

[2] Brown, Charles; Gilroy, Curtis; and Kohen, Andrew. 1981a. Effects of the Minimum Wage on Youth Employment and Unemployment. In Minimum Wage Study Commission (1981), vol. 5, pp. 1-26.

[3] Andrajit Dube, T. William Lester, and Michael Reich. "Minimum Wage Effects Across State Borders: Estimates Using Contiguous Counties". Review of Economics and Statistics, V. 92, N. 4 (Nov. 2010): 945-964.

[4] Doucouliagos, Chris and Stanley, T. D., (2009), Publication Selection Bias in Minimum-Wage Research? A Meta-Regression Analysis, British Journal of Industrial Relations, 47, issue 2, p. 406-428.

[5] Card, David and Alan B. Krueger (1995). "Time-Series Minimum-Wage Studies: A Meta-Analysis", American Economic Review, V. 85, N. 2 (May): 238-243.

[6] http://www.ipr.northwestern.edu...

[7] http://ideas.repec.org...

[8] http://www.irle.berkeley.edu...

[9] http://epi.3cdn.net...

Debate Round No. 3
1Historygenius

Pro


The Effects of Minimum Wage Increase Unemployment

First, many newer studies still find the minimum wage harms employment. A 2006 meta-analysis finds most studies and data support the position that a minimum wage increase harms the economy. The oldest studies allowed in the analysis was from the early 1990s. Most comprehensive reviews on the "old research" was already cited. The data almost unanimously supports the position that minimum wage increases harm the economy. The study I am currently citing is the first review of the research known as the "new research". The study--dated in 2006, fairly modern--looks at the studies within the last 15 years. The first research--dated in the mid-early 1990s--finds no effect (or a positive effect) of the minimum wage increase. These studies, however, have been not replicated and poorly constructed. The majority of studies in the 1990s-2000s show a negative impact of the minimum wage on job growth. The study concluded:

"Although the wide range of estimates is striking, the oft-stated assertion that the new minimum wage research fails to support the traditional view that the minimum wage reduces the employment of low-wage workers is clearly incorrect. Indeed, in our view, the preponderance of the evidence points to disemployment effects. Of these, by our reckoning nearly two-thirds give a relatively consistent (although by no means always statistically significant) indication of negative employment effects of minimum wages, while only eight give a relatively consistent indication of positive employment effects. In addition, we have highlighted in the tables 33 studies (or entries) that we view as providing the most credible evidence; 28 (85 percent) of these point to negative employment effects."[1]

As we can see, the modern evidence still strongly supports the position that the minimum wage raises unemployment. Although some of the studies provided statistically insignificant results, the authors narrowed the data to those that did provide them (including those that showed statistically significant positive effects). Using the strongest studies, 85% of them support my position. So even if we assume my data was too old, it is still clear the newer data supports my position.

He claims there is a bias and that flaws exist in the studies. False. A 1998 study funds publication bias does not explain the minimum wage hurting the economy, in other words the studies do not suffer from this problem. [6]

My Opponent's Arguments

1. Raising Minimum Wage will NOT increase living standards

It makes little sense that the minimum wage would create better living standards (for legal citizens). For a few reasons:

I. Minimum wages hurt legal citizens and promote businessmen to hire illegal immigrants. The logic is simple. Say one job is worth 5 dollars to an employer. The employer, therefore, will only pay $4.99 so that he makes a profit. Say the minimum wage is $4. He finds someone willing to do the job, but they are not really efficient. They give little gain, but are worth that: $4. So he pays them the minimum wage. But, the government decided to make the wage $7. The job is not worth the money, nor are the workers. So, he fires the workers and now has to drop that job. BUT, an illegal immigrant comes along. He is willing to work for $4, and not tell anyone. The businessman takes the offer and runs for it. A high minimum wage, therefore, logically supports this position. Studies also confirm this idea [2].

II. As explained, the minimum wage does not create any jobs. It only makes it illegal for you to pay workers what they are worth (again, why pay someone money i they actually lose you money? You fire them.) As quoted last round, "In truth, there is only one way to regard a minimum wage law: it is compulsory unemployment, period. The law says: it is illegal, and therefore criminal, for anyone to hire anyone else below the level of X dollars an hour. This means, plainly and simply, that a large number of free and voluntary wage contracts are now outlawed and hence that there will be a large amount of unemployment. Remember that the minimum wage law provides no jobs; it only outlaws them; and outlawed jobs are the inevitable result."[3]

How will the minimum wage improve living if all it does is increase unemployment and causes peoples wages to be 0?

And there are a few other reasons the theory fails:

III. First, as explained, the minimum wage decreases the amount of money one makes. To reiterate the argument by Economist Reed Garfield, "To put this gain in perspective, each minimum wage worker who earns $4.25 an hour brings home $3.92 for each hour worked once payroll taxes are deducted. The employer costs of a minimum wage worker is $4.58 an hour when the employers share of the payroll tax is included. If workers could take home the amount of money it costs the employer to hire workers, they could have 62 cents more per hour. Clearly, the California parent would be better off if the tax wedge were reduced, rather than increasing the minimum wage."[4]

IV. It is unlikely the minimum wage will raise wages for those it needs to help. After calculating the data, a single mother living in California with two children will only have a salary boost of 26 cents from a 90 cent increase of the minimum wage. [4] Further, it makes no statistical sense the minimum wage increases the standard of living--it actually makes it WORSE. Studies have found the minimum wage increases the amount of time on welfare. States with higher minimum wages have people on welfare for 44% longer then states with lower minimum wages [4]. I would also like to note that the minimum wage cannot help the poor for a simple reason. Here are the facts:

"Supporters claim that raising the minimum wage is important for working families. Secretary of Labor Robert Reich often repeats the fact that forty percent of minimum wage workers are the sole source of income for their families. This is misleading because it relies on lumping single, non-family individuals with families. Only 2.8 percent of workers earning less than $5.15 are single parents." - Joint Economic Committee

35.5% of people on the minimum wage live with their parents, meaning no one will benefit from the extra money, 23% are in a married family (not necessarily meaning children). In this case, the person is usually a secondary earner which is livable without [4]. Only 8.2% are the main earner. Only 2.8% are a single parent. Only 21.8% are a single individual living alone (again, an extra 30 cents out of a 90 cent raise is nothing... and the fact they might get fired)
8.3% are a sub family member (maybe lie a roommate or grandma in the basement)[5]

So even if the minimum wage works, you are mostly helping secondary earners or people who don't need it, proving that it wont help peoples standard of living.

CONCLUSION:

Data proves that the minimum wage increases unemployment and that it has no effect (or negative effect [4]) on ones living standards. If someone is making a lower wage (or is making little benefit), it is hard to argue ones living standards rise.

1. http://www.nber.org...





6. Neumark, David, and William Wascher. "Is The Time-Series Evidence On Minimum Wage Effects Contaminated By Publication Bias?." Economic Inquiry (1998)
GreenTeas

Con

<<< REBUTTAL AGAINST PRO >>>

1. Rebuttal to :: Raising the minimum wage increases unemployment

In the previous round, I pointed out that many of the older studies on which my opponent relies have been criticized by researchers because these studies employed flawed experimental methodologies and were subject to publication bias that led to inaccurate conclusions – thus, we could not rely on these studies to determine the effects of minimum wage on employment. In addition, I provided contemporary studies – that did not use the flawed experimental approach – which showed that the minimum wage had either neutral or positive effects on employment.

In response, my opponent argues that one review of past research supports his argument. He cites a study by Neumark and Wascher (2007) that reviewed past minimum wage studies and found that “the evidence points to disemployment effects.”

This review that my opponent cites has been strongly criticized by other researchers. In 2009, a meta-analysis study examining publication bias argued that the existing data and Neumark and Wascher’s conclusions were not consistent, stating “the contrast between their subjective narrative review and the meta-analysis is quite striking.”[1] Another 2011 study by Berkeley researchers argued that Neumark and Washer did not properly interpret the studies because they did not take into account that many of these studies used flawed experimental approaches. These researchers stated that “interpretation of the evidence in the existing minimum wage literature (such as those reviewed by Neumark and Wascher) must be revised accordingly.”[2]

From the studies provided by my opponent, we cannot conclude that the minimum wage has negative effects on employment. He has provided studies that employed flawed experimental designs and he has provided reviews of those studies that failed to take into account that those studies used flawed experimental designs.

However, I have provided numerous studies that conclude the minimum wage has no negative effect on employment. My opponent has provided no evidence that my studies are flawed or otherwise incorrect. Therefore, I suggest that the only rational interpretation of this data is to conclude that there is no evidence that the minimum wage harms employment.

2. Rebuttal to :: Raising the minimum wage will not benefit the poor

My opponent argues that raising the minimum wage will not benefit the poor. In supporting this contention, my opponent argues that raising the minimum wage will not create jobs, will actually decrease the amount of money one makes, and doesn’t actually put money into the hands of the poor. I will respond to each of these in kind.

First, my opponent states that raising the minimum wage will not create jobs. I have provided several studies that suggest raising the minimum wage can stimulate job creation by injecting money into the economy. [3][4] My opponent has not refuted these studies, and has only provided studies that have been shown to utilize flawed experimental designs. On this basis, the data provides a much stronger support of my position than my opponent’s.

Next, my opponent argues that the “minimum wage decreases the amount of money one makes.” He provides a quote by economist Reed Garfield that states “the California parent would be better off if the tax wedge were reduced, rather than increasing the minimum wage.” This quote does not, in any way, support what my opponent is arguing. Mr. Garfield is simply saying he believes that reducing payroll taxes would put more money into the hands of minimum wage workers than raising the minimum wage. He does not say that raising the minimum wage will not increase the amount of money one makes. This argument has no value.

Finally, he also argues that the demographics of low-wage workers do not overlap with the poor. However, the data shows that moderate raises to the minimum wage would benefit approximately 15 million individuals with families that have a total income below the national median income.[5] One-third of those families earn below $20,000 per year. Half of the workers that would benefit from an increase in the minimum wage earn about half of the total family income. And, over 21 million children in the United States have a parent who would benefit from an increase to the minimum wage. While the minimum wage will not exclusively help the working poor, it is clear from these demographics that the working poor and their families will benefit from a moderate increase.

<<< CON ARGUMENTS >>>

1. Raising the minimum wage acts as an economic stimulus and create job growth

By directly placing money into the hands of individuals that are most likely to immediately use that money, moderate increases to the minimum wage provide an instant economic stimulus that drives growth. [See previous rounds 2 and 3 for my full arguments and studies].

2. Raising the minimum wage increases productivity and reduces costly employee turnover

Economic researchers have found that wage increases result in decreased employee turnover and increased productivity. Reduced employee turnover leads to savings by the employer because it spends less on recruitment, re-training, and re-staffing.[6] As a result of lower turnover, these employees will be more experienced, and consequently more productive. Improved worker wages, stability, and productivity, as well as decreased employer expenses all provide a benefit to the economy as a whole – and, to workers, employers, and consumers individually.

3. Raising the minimum wage reduces reliance on welfare

By increasing the incentive to work through higher wages, more individuals will be compelled to leave welfare and engage in active employment. Studies have supported this argument, finding that a higher minimum wage reduces welfare participation.[7]

4. Raising the minimum wage will increase living standards by helping the poor

The real value of the federal minimum wage has fallen 30% since 1968. The United States currently has 47 million working poor – individuals whose income falls below the poverty line. As many as 23 million workers would benefit from a moderate increase in the minimum wage, the majority of which make less than the national median income.[8] Increasing the minimum wage will put money into the hands of the individuals who need it most, thereby improving their buying power and living standards.

<<< CONCLUSION >>>

I have shown that my opponent’s studies are experimentally flawed, and that when these flaws are removed, raises to the minimum wage do not negatively affect employment.

Further, I have shown that moderate raises to the minimum wage will benefit the economy by: (1) acting as an economic stimulus by injecting money into the hands of individuals most likely to spend it; (2) increasing worker productivity and reducing employee turnover; (3) reducing reliance on welfare; and (4) improving living standards increasing wages of the lower economic class.

Thus, moderate increases to the minimum wage can have a net benefit to the economy!

<<< VOTE CON! >>>

SOURCES

[1] http://www.deakin.edu.au...

[2] http://escholarship.org...

[3] http://www.ibrc.indiana.edu...

[4] http://www.ibrc.indiana.edu...

[5] https://docs.google.com...

[6] http://www.irle.berkeley.edu...

[7] http://www.ipr.northwestern.edu...

[8] http://epi.3cdn.net...

Debate Round No. 4
11 comments have been posted on this debate. Showing 1 through 10 records.
Posted by zezima 3 years ago
zezima
i dont know if it would have an effect on the economy, but i do know it is unfair to the owner of the business. like in the first comment it said how if someone earns 7 dollars an hour, its because they deserve 7 dollars an houe. someone working worth 7 hours an hour and getting the minimum wage up to 9 dollars an hour may hurt the business depending on how big it is. i dont think its going to work out great to give someone 9 dollars an hour who is worth 7 dollars an hour. making the lazy richer wont help the economy...
Posted by 16kadams 4 years ago
16kadams
Still, epi is so biassed, aren't they funded by labor unions?
Posted by balltrapone 4 years ago
balltrapone
Oh I like it a lot
Posted by Freedom1Man 4 years ago
Freedom1Man
Law is semantics.
Semantics is part of a debate.
Posted by 1Historygenius 4 years ago
1Historygenius
A mistake in the links. This is 2: http://web.archive.org...
Posted by 16kadams 4 years ago
16kadams
The consensus is actually still huge, and recent meta-analysis's still support the pro (anti minimum wage) position.

We both mixed it up XD
Posted by Kinesis 4 years ago
Kinesis
"he easily wins due to the fact he has 100s of years of research"

Economists USED to overwhelmingly believe that a minimum wage would harm employment. The fact that the consensus has become far less strong recently is not a point in Pro's favour.
Posted by Kinesis 4 years ago
Kinesis
ah, 16k already pointed that out. Glad to see this debate seems to be avoiding that route though.
Posted by Kinesis 4 years ago
Kinesis
Promising start. The resolution is a little vague, though. There's obviously some threshold above which raising the minimum wage would harm employment.
Posted by 16kadams 4 years ago
16kadams
For con I meant pro
4 votes have been placed for this debate. Showing 1 through 4 records.
Vote Placed by DeFool 4 years ago
DeFool
1HistorygeniusGreenTeasTied
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Reasons for voting decision: This statement: ": it is compulsory unemployment, period. The law says: it is illegal, and therefore criminal, for anyone to hire" anyone under x wages... Alone may be seen as grounds that arguments and sourcing should go to Con. I counted several such hyperbolic statements. Additionally, con never lost a nearly laser-like focus on the relevant arguments, as they were presented. I liked the tables, and felt that both sides presented articulate, concise and easy to understand arguments. This was a well-played, respectful debate.
Vote Placed by ax123man 4 years ago
ax123man
1HistorygeniusGreenTeasTied
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Reasons for voting decision: The debate in general fell to conflicting studies, but I think Con did a better job of study-refutation and coherently forming arguments. I think Pro missed out by not delving into unintended & hidden consequences of min. wage, instead focusing on the directly measurable unemployment.
Vote Placed by Kinesis 4 years ago
Kinesis
1HistorygeniusGreenTeasTied
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Reasons for voting decision: The main thrusts of this debate were empirical studies cited by both debaters. I unfortunately don't have the time to delve into most of them, and indeed many sources are inaccessible without obtaining a hard copy. Both debaters provided plausible theoretical arguments, but Con seemed to have the edge when it came to citing more recent analyses and in at least summarising refutations of Pro sources. I'm therefore in the odd position of tying arguments, but giving sources to Con.
Vote Placed by eastcoastsamuel 4 years ago
eastcoastsamuel
1HistorygeniusGreenTeasTied
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Reasons for voting decision: Pro could not sufficiently rebut the claims that his sources were biased, and therefore not reliable. Since Con was able to do this, and since Pro's arguments were based around his sources, Pro's arguments fell.