Instigator

The Minimum Wage is Beneficial to the Poor

Debating

Waiting for instigator's argument

The round will be automatically forfeited in:
00:00:00:00
Debate details
Publication date
Last update
Category
Economics
Time for argument
Three days
Voting system
Open voting
Voting period
One week
Point system
Winner selection
Rating mode
Unrated
Characters per argument
30,000
Contender
Description
Round One: Opening Arguments
Round Two: Rebuttals
Round Three: Rebuttals/Rejoinders
Round Four: Rebuttals/Rejoinders
Round Five: Closing Arguments
Stipulations:
1. Definitions:
Beneficial - producing good results or helpful effects (Merriam-Webster.)
2. Moral arguments (in addition to the Economic arguments) may be submitted since the topic solicits normative arguments.
3. The minimum wage itself, and not just juxtapositions of scale, will be included in the purview of this debate.
Round 1
Published:
Just to add a proviso, the poverty level will be defined as those who earn just about $18,000 or less per year. (This was derived from the Federal poverty level figures.)


Opening Argument:

The minimum wage is a statutory edict which designates a price floor in the labor market--i.e. a minimum amount payable to employees by employers. It should be noted that the minimum wage does not guarantee employment. It requires only that employees legally hired be paid at the minimum. Many notable and pubic proponents of the minimum wage while prone to allege its necessity to the poor neglect to mention the effects this price floor has on the labor market. One and perhaps the most prominent effect the minimum wage has is pricing out partitions of low-skilled/unskilled labor. A minimum wage of $7.25 (the federal minimum) for example makes it illegal to hire someone at $7.24 or less. From an employer's standpoint, this takes on a slightly different meaning. The minimum wage makes it illegal for an employer to hire labor whose marginal productivity generates $7.24 or less.

What do I mean by marginal productivity? It's the contribution a worker's individual output, usually described as a maximum, adds to overall production. I'll use an example that was taught to me when learning Economics: say for example that I'm a professor of a course and I need help erasing/cleaning an entire blackboard. I have just about four erasers, and I decide to enlist just two students to complete this task. Naturally, one assumes that with this assistance, the task will be completed much quicker than it would have had I done it on my own. If I were to enlist the help of four students, erasing the blackboard should be completed in no time. What if I were to enlist the help of 20 students? What is the addition to productivity the fifth to 20th student contributes? I have only four erasers, so employing the help of 20 students would add an unnecessary difficulty to the task. I suppose my students can use their shirts, but that adds to costs rather than diminish them (e.g. costs of laundry, soap, etc.) I can go out and purchase more erasers, but that adds to costs as well as subtracts time I could've spent erasing the board. And from this, we get the Law of Diminishing Marginal Productivity which delineates that the positive relationship between input and output will eventually reach its peak before it plateaus (and drops off.)

Now let's add compensation. Suppose I have $40 dollars to pay the students whom I enlist to help me with this task of erasing the blackboard. (It's a bit expensive considering the task, but I'm willing to go that high.) Now if I hire the two students I mentioned earlier, I could pay them each up to $20. But I want this done as quickly and efficiently as possible. So I've decided to hire the four students. There are four erasers; four sections of the blackboard; forty dollars; it works out quite nicely. Now the government steps in and enforces a regulation that states I must pay each of those students $13 to erase the blackboard. What does this do? It prices out the fourth student. Since I'm legally bound to pay them the minimum, I can hire only three students. While the three employed students can enjoy their bump in pay, the fourth student will enjoy no pay. Since the fourth student's marginal productivity ($10 he or she would have generated had I enlisted his or her help) is now legally unemployable, the student is legally unemployable. And the labor market itself loses $1 because I now pay $39 dollars for less efficient work.

What if I were to keep all four students. And I decide to pay the $52. That is $12 more than the work is worth so I have to find a way to redeem this loss. In order to keep the four students employed, I decide to bump up the price I charge for my course. Now depending on the price elasticity (the gauge of changes in demand with respect to changes in price) this may result in two things: the bump in price may discourage students from taking my course all together, or my students will incur an increased cost. And this too would depend on the nature of my course: elective (elastic) and requirement (inelastic.) What if Black & Decker releases an automated/robotic buffer exclusively for blackboards at the low price of $45.99. This buffer is advertised to the do the work of four men in half the time. I can forgo the employment of all four students because with the release of buffer, the opportunity costs of hiring the four students at the minimum increased.

My hypothetical, I trust you've acknowledged by now, is allegorical and microcosmic of the issues with the minimum wage. In essence, I've used economic reasoning in the context of a classroom setting to highlight:

The minimum-wage prices out low-skilled/unskilled labor.
The minimum wage may be offset by extending the increased costs of labor to prices.
Automated/Robotic alternatives increase the opportunity costs of employers hiring at the minimum.

And due to these effects and some yet to be elaborated, the minimum wage is not beneficial to the poor.

As this debate continues. I will further elaborate on the aforementioned points as well as supplement them with other considerations. At this point, I leave the floor to my opponent.

Published:
Opening arguments:
We live in a developed, first world nation, where 3rd world salaries simply will not cut it. Most companies do not set a value to a task and then seek to give the full valuation to whoever gets chosen to complete it, they will seek the minimal possible compensation.

With unskilled workers being a massive chunk of the workforce, especially in areas of lower educational opportunities, this creates a large supply, reducing their ability to negotiate effectively. History has shown how masses without power will accept horrendous conditions, or found alternatives by any (often violent) means. Neither of these are acceptable outcomes for the greatest nation in the world. Just because a group of people accept conditions does not mean those people had a choice, nor does it make it fair, just, or benefitial.

The second industrial revolution showed us how appauling worker conditions can get under the influence of the so called "invisible hand." Sweat shops, child labor, uncompensated workplace injuries, workplaces prone to injuries, a whole population destined to live short lives in squalor, unable to ever afford or invest in any form of advancement, much less an american dream. I think we can all agree the result of the unregulated free market setup of that time was not benefitial to those workers. Despite a lack of any investment in benefits or conditions, and despite the MASSIVE profits of the goliaths of that era, worker wages were unlivable and deplorable. A lack of regulation helped only those who had money and power, a tiny minority. 

Introduction of regulations, including minimum wage lead to a boom for the american economy and especially unskilled workers, whose assembly line monkey work (nob A into slot B all day every day), attained them a suburban house, 2 cars, and a comfortable life. Objectively a far better outcome then the lawless economic hellscape of the second industrial revolution.

In addition to the poor, a minimum wage is helpful to small local businesses, who although cannot afford to indivudally raise wages at the moment, would greatly benefit from the increased patronage they would get from an enriched public. One would be foolish to cut back on employment with a rush of customers at the door. Increased sales can balance out decreased margins, but increased demand will shoot our gdp through the roof, maintaining our greatest in the world title (that is currently increasingly contested).

Demand without supply = opportunity 
Supply without demand = nothing
Our economy replies on consumers who can afford to demand. If the invisble hand demands otherwise, we will be 3rd world within a generation.


Note: it is my opinion that this debate structure is ineffective. Next round my opponent will respond to this, but i will be responding to his statement. The next round we switch. We will be having 2 simultaneous discussions rather then focusing on one. 

As i am the one making the positive assertion, i should be making the sole assertion, with every following round being rebuttal/defense. At the least i should have been able to include some rebuttal rather then an independent opening argument. That would have unified our conversation. I suggest, but do not enforce, that my opponent drop his initial post and respond to me, leaving the BOP to me alone. This is just a suggestion that i will leave this to my opponents discretion. If he does not agree, no biggie, we will continue as layed out in the description.
Round 2
Published:
Rebuttal:

We live in a developed, first world nation, where 3rd world salaries simply will not cut it.
This is tautological.

Most companies do not set a value to a task and then seek to give the full valuation to whoever gets chosen to complete it, they will seek the minimal possible compensation.
The rational actor whether a seller or patron seeks to optimize his gain; this means that the seller will try to redeem a much higher value while the patron attempts to purchase at a much lower value. Since any transaction between the two embodies the subjective values of each party, an employer, in this case, using your words "will seek the minimal possible compensation [a prospective employee is willing to accept.]" And this distinction is important. Without the agreement of both parties, there's no labor contract. If coercion is involved, then it's a slave contract.

With unskilled workers being a massive chunk of the workforce, especially in areas of lower educational opportunities, this creates a large supply, reducing their ability to negotiate effectively.
Ambiguous reference. Large supply of what?

History has shown how masses without power will accept horrendous conditions, or found alternatives by any (often violent) means. Neither of these are acceptable outcomes for the greatest nation in the world. Just because a group of people accept conditions does not mean those people had a choice, nor does it make it fair, just, or benefitial.
This statement is riddled with contradiction and unsubstantiated assertions. If the masses were willing to accept what you allege are horrendous conditions, then it obviously would have been an "acceptable" outcome (contradiction.) And if these workers "accepted" but somehow did not have a "choice," are you alleging that these workers were placed under duress and coerced into taking/keeping their jobs?

The second industrial revolution showed us how appauling worker conditions can get under the influence of the so called "invisible hand." Sweat shops, child labor, uncompensated workplace injuries, workplaces prone to injuries, a whole population destined to live short lives in squalor, unable to ever afford or invest in any form of advancement, much less an american dream.
Please submit to this debate's purview references of worker conditions before, during, and after the industrial revolution.

I think we can all agree the result of the unregulated free market setup of that time was not benefitial to those workers.
Don't assume we agree. If you're going to allege that the free-market setup was not beneficial, substantiate your point through thorough reasoning or verifiable empirical data.

Despite a lack of any investment in benefits or conditions, and despite the MASSIVE profits of the goliaths of that era, worker wages were unlivable and deplorable.
Reference?

A lack of regulation helped only those who had money and power, a tiny minority. 
Please elaborate on the relevance of their being a tiny minority; furthermore, provide reasons or empircal data to the effect of only those who had money and power being helped.

Introduction of regulations, including minimum wage lead to a boom for the american economy and especially unskilled workers, whose assembly line monkey work (nob A into slot B all day every day), attained them a suburban house, 2 cars, and a comfortable life. Objectively a far better outcome then the lawless economic hellscape of the second industrial revolution.
Reference and citation please.

In addition to the poor, a minimum wage is helpful to small local businesses, who although cannot afford to indivudally raise wages at the moment, would greatly benefit from the increased patronage they would get from an enriched public. One would be foolish to cut back on employment with a rush of customers at the door. Increased sales can balance out decreased margins, but increased demand will shoot our gdp through the roof, maintaining our greatest in the world title (that is currently increasingly contested).
Assuming that the "increased demand" borne from the income effect isn't offset by the decreased demand from price inflation (Law of Demand.) And if a minimum wage can enrich a public to an extent where GDP would shoot though the roof, then why hasn't it done so already, since the U.S. has a minimum wage?

Demand without supply = opportunity 
Supply without demand = nothing
Our economy replies on consumers who can afford to demand. If the invisble hand demands otherwise, we will be 3rd world within a generation.
I don't understand your meaning in this statement. Can you elaborate?



Forfeited
Round 3
Published:
My opponent has forfeited round two. I sustain all arguments.
Published:
Defense:
 
“This is tautological.”
 
I’m glad we agree. I am not debating welfare here. A living min wage assumes full time employment, not a one time round of erase the board. These are people reporting to work every day, trying to support a family… in the richest nation in the world. That considers itself the greatest.
 
“The rational actor whether a seller or patron seeks to optimize his gain; this means that the seller will try to redeem a much higher value while the patron attempts to purchase at a much lower value. Since any transaction between the two embodies the subjective values of each party, an employer, in this case, using your words "will seek the minimal possible compensation [a prospective employee is willing to accept.]" And this distinction is important. Without the agreement of both parties, there's no labor contract. If coercion is involved, then it's a slave contract.”
 
Indeed, and as history has shown, those without power have been “willing to accept” some appalling things when given no choice. It is not called wage slave for no reason, and during those “free” market times, it wasn’t an exaggeration.
 
With unskilled workers being a massive chunk of the workforce, especially in areas of lower educational opportunities, this creates a large supply, reducing their ability to negotiate effectively.

 “Ambiguous reference. Large supply of what?”

The either subject nouns in that sentence work: unskilled workers, workforce.
 
History has shown how masses without power will accept horrendous conditions, or found alternatives by any (often violent) means. Neither of these are acceptable outcomes for the greatest nation in the world. Just because a group of people accept conditions does not mean those people had a choice, nor does it make it fair, just, or benefitial.

“This statement is riddled with contradiction and unsubstantiated assertions. If the masses were willing to accept what you allege are horrendous conditions, then it obviously would have been an "acceptable" outcome (contradiction.) And if these workers "accepted" but somehow did not have a "choice," are you alleging that these workers were placed under duress and coerced into taking/keeping their jobs?” 
What is acceptable to those without choice, may not always be acceptable to a society. Made clear by me saying “neither of these are acceptable outcomes for the greatest nation in the world.” They were not under duress, but they also had no path to escape. Workers couldn’t even organize as employers didn’t take them seriously and fired them all until the government stepped in to equalize the power that even collectively workers did not have. “individual responsibility” in this situation is a lie meant to enslave people. You can’t be an individual vs an institution.
 
https://rooseveltinstitute.org/wagner-act/
 

Please submit to this debate's purview references of worker conditions before, during, and after the industrial revolution.
 
Seriously? I need to reference the common knowledge of the second industrial revolution? I’ll get the reference about the goliaths of that era by simply stating names everyone should already know. Rockafellar, Vanderbilt, JP Morgan, Ford, Carnegie. These people amassed fortunes that made them legendary. How? Well lets look at the conditions under which they made their wealth!

https://www.historycrunch.com/working-conditions-in-the-industrial-revolution.html#/

"The final aspect of the working conditions that people faced in the Industrial Revolution was the lack of rights.  As previously stated, the political ideology of the time was classical liberalism.  This was a highly individualistic ideology that was based on little or no government involvement.  As a result, this meant that the government did little to protect workers from being exploited by the wealthy entrepreneurs of the time.  For example, child labor was a common feature of life in the Industrial Revolution.  Since there were no child labor laws at the start of the Industrial Revolution, factory and mine owners were free to hire children and employ them in incredibly dangerous situations.  Furthermore, in modern society, governments are often responsible for establishing minimum wage laws in order to protect workers from being underpaid.  However, during the Industrial Revolution, no such laws existed and as a result, industrial workers barely made enough to cover their cost of living.  Another example of how workers lacked rights was in regards to how they were treated if they were injured while at work.  As discussed in the previous paragraph, the workplaces of the Industrial Revolution were incredibly dangerous and workers often suffered from horrible injuries that made it impossible for them to keep working.  Because the government practised laissez-faire capitalism, this meant that they did not have initiatives in place to force factories to protect workers or to compensate them when they became injured and could no longer work. "
 
 
Introduction of regulations, including minimum wage lead to a boom for the american economy and especially unskilled workers, whose assembly line monkey work (nob A into slot B all day every day), attained them a suburban house, 2 cars, and a comfortable life. Objectively a far better outcome then the lawless economic hellscape of the second industrial revolution.

"Reference and citation please."
"Please elaborate on the relevance of their being a tiny minority; furthermore, provide reasons or empircal data to the effect of only those who had money and power being helped." 
https://www.thebalance.com/us-gdp-by-year-3305543
 
The first link is a chart showing adjusted minimum wage by year.
The second link shows growth in gdp by year, I will be focusing on column #4 “GDP growth rate”
 
Min Wage was created in 1938, which is the start of the min wage chart.
In link 2, 1939 starts a series of years of incredible growth.
Min wage rises sharply after 1949
1950 and the next 4 years again grow exceptional compared to previous years.
1956 starts min wages rise to its adjusted peak at 1968, apparently amidst a recession (according to column #5), growth follows the rising wages yet again.
After that min wage starts a steady decline until finding a balance during the late 1980s, where they remain. The economy was a mix of a max of 5.5% growth (vs 7%/8% routinely, or even double digit growth when min wage was first started), and often in the negatives.
 
At the worst, min wage did not stifle growth, in fact it seems consistently correlated with accelerated growth.
 
Assuming that the "increased demand" borne from the income effect isn't offset by the decreased demand from price inflation (Law of Demand.) And if a minimum wage can enrich a public to an extent where GDP would shoot though the roof, then why hasn't it done so already, since the U.S. has a minimum wage?
 
Min wage, adjusted for inflation has been stagnant. Costs have been rising. Spending power of many has decreased. Thus our GDP growth becomes increasingly limited. How low the margins of a business are is irrelevant if there are no customers who can shop there. That’s an important concept for a mom and pop who rely on their local consumer base. Not so much for Walmart that can  lose shop and move easy, international if necessary.

 
Demand without supply = opportunity 
Supply without demand = nothing
Our economy replies on consumers who can afford to demand. If the invisble hand demands otherwise, we will be 3rd world within a generation.
 
I have a biscuits for sale, but nobody wants biscuits. I have nothing but wasted inventory.
This also goes with I have biscuits for sale, but nobody can afford biscuits. Giving them away for free is nice, but not exactly a business plan. Thus we have nothing.
If there is no demand, there is nothing.
If people have demand, then there is opportunity for an entrepreneur to make money.
 


Rebuttal:

“The minimum wage is a statutory edict which designates a price floor in the labor market--i.e. a minimum amount payable to employees by employers. It should be noted that the minimum wage does not guarantee employment. It requires only that employees legally hired be paid at the minimum. Many notable and pubic proponents of the minimum wage while prone to allege its necessity to the poor neglect to mention the effects this price floor has on the labor market. One and perhaps the most prominent effect the minimum wage has is pricing out partitions of low-skilled/unskilled labor. A minimum wage of $7.25 (the federal minimum) for example makes it illegal to hire someone at $7.24 or less. From an employer's standpoint, this takes on a slightly different meaning. The minimum wage makes it illegal for an employer to hire labor whose marginal productivity generates $7.24 or less.”
 
 
Yes. May I add that in a debate regarding the effect minimum wage has on the worker, much of my opponents arguments are concerned with the employer.
 
 
“My hypothetical, I trust you've acknowledged by now, is allegorical and microcosmic of the issues with the minimum wage. In essence, I've used economic reasoning in the context of a classroom setting to highlight:”
 
It certainly is a very gross oversimplification of all the issues. We are not talking about students doing a one time task. You can hire your local teenager to mow your lawn for a few bucks, nobody is coming after you. These aren’t full time workers reporting for duty year round for an actual business, trying to make an actual living. They’ll do it for free for a bit of extra credit. This analogy falls flat.
 
“The minimum-wage prices out low-skilled/unskilled labor.”
It clearly hasn’t as we have record unemployment despite rising wages in many of the major urban hubs, while going down nowhere.
 
“The minimum wage may be offset by extending the increased costs of labor to prices.
It may, but not all prices will be effected. Real estate is not dependent on much labor, mostly inherent land value. It will not rise at all. It makes up almost 50% of the spending of most poor people. 30% is the suggest portion of your income for all people. Thats a sizeable exception to your rule.

Medicine is another major cost for people, almost none of the price of medicine comes from low wage labor.


Automated/Robotic alternatives increase the opportunity costs of employers hiring at the minimum.”
 
Automation is fractions penny’s on the dollar, its essentially free labor after a certain initial investment. Eliminating the minimum wage will not slow down the transition to tireless perfect machines by an iota. This is a red herring.
 
“And due to these effects and some yet to be elaborated, the minimum wage is not beneficial to the poor.”
 
I look forward to it.
 







Round 4
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Round 5
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Added:
--> @Athias
Again, not difficult, just less effective. I for one dont believe juggling is usually productive, but i am eager to end this side discussion. We'll let the debate decide how constructive it is :)
Contender
#4
Added:
--> @Nemiroff
The subject is the same: "The Minimum Wage Is Beneficial to the Poor." It's just that our arguments supporting our respective theses will be different. And this subject as titled requires two different theses: one which affirms the proposition, and one which negates it. Unlike the forum, formal debates require more structure (formats, stipulations, definitions, etc.)
Now that our opening arguments are out of the way, you can challenge my reasoning, and I can challenge yours. The resolution of this debate is ultimately and primarily "does the minimum wage benefit the poor?" not "can Athias find a cheaper method for cleaning his blackboard?" or "Is Nemiroff right about the second Industrial Revolution?" As long as the arguments inform the effect of the minimum wage, then there's nothing about which to worry. Not to mention, we have four more rounds, and a 30,000 character limit. So whatever needs to be addressed can be addressed.
Instigator
#3
Added:
--> @Athias
As i said, im open to going your way, and i didnt mean that it is particularly difficult, just less efficient/effective in comparison to focusing on 1 assertion at a time.
Each round we will rebutting different subjects. Seems suboptimal. But im down to see how this works out. I just wanted to make my concern known, not insist upon it.
Contender
#2
Added:
--> @Nemiroff
The burden of proof is assigned to the argument which affirms a claim. Your claim is "p" -- the minimum wage is beneficial to the poor; my claim is "q" -- the minimum wage is not beneficial to the poor. It just so happens that my argument "q" is the negation of your argument p. It's being "positive" or "negative" has no relevance. I have just as much a burden to substantiate my claim as you do yours. If we were to follow your format, and have you defend your position while I simply probe, then the resolution to this debate would be "Can Nemiroff defend the Minimum Wage?" as oppose to "The Minimum Wage Is/Isn't Beneficial to the Poor." I cannot use your failure to defend your position as information for my position less I risk arguing from ignorance, a logical fallacy; thus, your format would be in fact the less effective method. You may not be used to arguing this way, but it is a sound method.
Round One: Opening Arguments (I provide my thesis and argument; you provide your thesis and argument.)
Round Two: Rebuttals (Defend/Supplement theses and arguments; rebut opponents thesis and argument.)
Rounds Three & Four: Rebuttals/Rejoinders (Defend theses and arguments; rebut opponents thesis and argument; rebut rebuttals.)
Round Five: Closing Arguments (Reaffirm theses and arguments; summation.)
It's not difficult at all. As long as you keep focus on the resolution, the format should be easily to follow (and in my experience is quite helpful.)
Instigator
#1
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