Minimum wage laws are inherently self-defeating and should be eliminated immediately

"This is my first debate as well. Thank you for joining in!" No problem; thanks for the quick reply! "This issue is, in fact, absolutely essential and it must be resolved in order to reach a definitive conclusion regarding the effects of minimum wage laws, which, I argue, are inherently self-defeating because they disturb natural market processes." Because my disagreement with the notion that profit = social benefit is unrelated to our minimum wage discussion, I'm going to agree to your terms for this particular debate. "I don't want this debate to be about the economic tenability of alternative energy, but your example does not support your position." Neither do I, so we can skip this. "What is true in theory is true in practice, assuming that the theory (a) has a valid initial premise, and (b) is logically and internally consistent. There is no divide between logic, on the one hand, and the real world on the other. Logical consistency is universally valid, which is why science and mathematics works. Next, there is no "surplus of labor." Labor, like all economic goods, is scarce. The demand for economic goods is infinite, and because labor is required to produce commodities (it is one of three co-dependent factors of production), then the demand for labor (in general) is, ipso facto, infinite. This is not to say, though, that the demand for computer engineers is infinite." Economics is not a hard science, so theories derived from this field are often not observed in practice. There is a logical divide between the theory and practice that you had acknowledged yourself. In theory, a minimum wage is predicted to spur unemployment, which just doesn't happen in the real world. You noted this in your own posts, so I'm not sure how you reconcile these two contradictory statements... "If your logic were valid, then minimum wage rates at $100/hour, or $1000/hour would have absolutely no effect on employment rates—clearly, this is absurd.Z" I agree - a $100 price floor is absurd, and it will certainly affect employment rates. For one, the logic of my narrative demonstrated that "moderate" increases in the minimum wage will not have any substantial effect on employment levels, which is backed up by empirical data; something we agree on. Secondly, the logical "point" of my narrative was intended to demonstrate how and why removing the price floor will not necessarily increase employment rates due to the diminishing marginal utility of labor. I wasn't implying that any wild or excessive increase in the minimum wage rate will have no effect on the employment rate. "It is true that the productivity of labor is directly a function of (a) capital per worker and (b) the total supply of labor (labor force), and it is also true that continuous firm expansion is impossible, but for reasons you have not mentioned (namely transaction costs, managerial diseconomies of scale, et al). But from this, one cannot logically deduce that the demand for labor is inherently and entirely inelastic, or insensitive to changes in wages. Managers hire labor based on the expected surplus they will earn from that laborer. If the surplus is greater than the costs, then that laborer will yield supernormal profits for that employer (above the interest rate or return to capital). The employer will offer any wage that is not above the surplus that laborer yields, since some profit is better than no profit." I never stated that the demand for labor is totally inelastic. The demand for labor certainly is not totally elastic either, which is mainly due to sticky wages and a diminishing marginal utility of labor. Because of this, removing the minimum wage will do more harm than good, which in itself, demonstrates that the minimum wage isn't inherently self-defeating. "Essentially, wages are not determined by decree, that is, employers don't really "choose" what they pay their laborers. Competition bids up the price of labor towards the marginal product. Assume, for the sake of simplicity, that the marginal product of labor is $10/hour, and that the national wage rate is at $1/hour for whatever reason. This means that simply hiring a laborer will earn you an economic rent (specifically $9/hour). But since labor is scarce, that is, it is absolutely required for production, and because some profit is better than no profit, employers will begin bidding up wage rates. That is, one employer, who has capital but requires labor, will offer $2/hour, since $8/hour is better than the $0/hour he would earn if he was unable to find laborers. This process continues until the national wage rate = the marginal product of labor (all of this can be expressed quite easily with mathematics)." No math required; you expressed it perfectly. Even so, this still neglects to mention whether the market wage rate has the sufficient purchasing power to get by with. When the market is left to determine wages, the given wages we're discussing will very likely fall below the current price floor, which has a purchasing power that is already below the federal poverty level. One would have to work approximately 63 hours a week at the current minimum wage rate just to meet the FPL - not including tax deductions. In a consumer driven economy, this is only going to drag down aggregate demand, with GDP following suit because of a reduced disposable income for these individuals. The employers' excesses in disposable income are often hoarded or placed in a bank account instead of being spent at various firms, which doesn't motivate increases in production. Also, due to diminishing marginal utility of labor, the unemployment rate will not substantially decrease. Instead, the overall economy, and especially its most impoverished members, will endure a decline. The point is that a market wage may not be as beneficial as the minimum wage. The macroeconomic outlook has to be taken into account as well. "Now, it is true that each additional laborer lowers the marginal product of labor, but if the price of labor falls faster, or at the same pace, then employment rates remain the same. If the marginal product of labor falls faster than the national wage rate (because of a minimum wage law, for example), then labor becomes a liability and yields economic losses for the employer." Yes, but the economic loss isn't very substantial because employers would account for those losses by laying off employees, which hasn't been observed in the real world. "In fact, many blame FDR's policies for the unprecedented unemployment rates during the 30s, which lead to extended economic stagnation. It's better to have 97% of the labor force employed at $7/hour then have 60% of the labor force employed at $10/hour." True, but this isn't a trade-off that is often dealt with; 40% unemployment is a bit unrealistic. If these circumstances were common, I would agree with your take on price floors. Plus, the minimum wage under FDR (enacted twice) did not show any substantial effects on unemployment during the Great Depression. Instead, like almost every observed scenario in history, unemployment rates were most sensitive to the cyclical state of the economy - not the minimum wage. "In other words, the current existence of t" I assume you accidentally submitted your argument prematurely. If so, you can continue it in the next round if you like.