March Beginners' Tournament: The USFG should significantly raise the federal minimum wage

Argument 1: Increases to unemploymentCon states that raising the minimum wage would lead to job loss, arguing that businesses will have to respond to new costs posed by higher wages with cutting jobs. A reasonable concern, and seemingly valid as well. However, it falls apart on several levels upon further examination: - To begin with, there are multiple ways in which raising the minimum wage alows for business to save money. A study on the Harvard Business Review by MIT Professor Zeynep Ton [6] found that higher wages boost productivity and decrease employee turnover rate. Another study found a reduction in employee turnover rate within nine months of a state-wide minimum wage hike [7]. - Additionally - as a National Employment Law Project analysis [5] on Census Bureau data found - most low wage employees work for large companies, which can certainly afford the costs of higher wages.Con supports his argument with a report from the Congressional Budget Office, which found that raising the minimum wage would lead to some unemployment. What he neglected to mention, was that the very same report found that a minimum wage hike would result in massive econmic benefits, which outweigh potential costs. The projected effect on employment was essentially insignificant: a mere 0.3% reduction [1].I did say "projected" for a reason; the CBO's estimates on the unemployment increase shouldn't be taken to be conclusive. Economist Michael Reich wrote an analysis at ThinkProgress[2], noting that:"The method used by the CBO to estimate job loss is never clearly explained. According to the Appendix, the figure appears to come almost entirely from its “synthesis” of the research literature — which it concludes implies an elasticity of teen employment of -0.075 percent. This estimate is a bit below the low end of estimates in papers by Neumark and Wascher or Sabia and Burkhauser, but higher than those in various papers by Dube, Reich, and others. No details are provided concerning how the CBO arrived at this number, except that it discounts some older studies slightly because of publication bias.""Some of the studies that the CBO relied on are also problematic. As is explained in detail in a 2013 paper by Allegretto et. al that the CBO cites, the Neumark and Wascher paper and other studies that find negative employment effects suffer from methodological flaws that bias their estimates." Additionally, Con claims historical wage hikes have increased unemployment. He argues that with the introduction of the minimum went several thousand jobs, which is true. However, it suffices to say, comparing the introduction of the minimum wage to an increment makes for a false analogy. Particularly when empirical data does not support his conclusions.He later attributes job losses in Puerto Rico to the minimum wage hike implimented shortly prior. However, this is a misattrubation of the cause. As an analysis demonstrated, much of Puerto Rico's job losses had absolutely nothing to do with the minimum wage increment [3].Ultimatly, Con's case falls apart at an empirical level. Multiple studies have found minimal to no negative impact on employment prospects as a result of minimum wage hikes:- A 2013 report which analyzed the past 2 decades on minimum wage research found that minimum wage increases had next to no negative effects on employment [4].- A 2011 study found that raising the minimum wage did nothing to reduce employment rates, and boosted average income levels. Additionally, it reviewed and criticized past bodies of research that attributed increases unemployment to a higher minimum wage [8]- A 2010 study compared employment levels accross neighboring counties with differing minimal wages from 1990 to 2006, and found that higher minimum wages had no negative effects on employment. [9]Argument 2: Ineffective at decreasing povertyCon argues that, since a minority of living poverty are unemployed, they will not benefit from a minimum wage hike, which is true. However, in addition to repeating the unemployment argument (which was addressed above), he states that the minimum wage will be ineffective at combating poverty.Nonetheless, multiple studies show that raising the minimum wage does, in fact, do exactly that.For just one example, the very CBO report which Con cited in his first argument found that an increment to $10.10 would directly benefit over 16 million families [11]. Additionally, these benefits would raise millions from below the poverty line. Even if we use the report's likely flawed estimate for unemployment, can it really be said that half a million recuperable jobs are more valuable than the livelihoods of several million people?Other studies and analyses have documented the counter-poverty effects of raising the minimum wage [10].ConclusionRaising the minimum wage would not result in significant job losses (if any at all), and it would be effective at decreasing poverty. Even assuming that minimum wage hikes would kill jobs, Con would have to demonstrate that the costs would offset the benefits for his case to stand.Sources:[1] https://www.cbo.gov...[2] http://thinkprogress.org...[3] http://thinkprogress.org...[4] http://cepr.net...[5] http://www.nelp.org...[6] https://hbr.org...[7] http://www.irle.berkeley.edu...[8] http://www.irle.berkeley.edu...[9] http://www.irle.berkeley.edu...[10] https://www.washingtonpost.com...[11] https://www.whitehouse.gov...