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

This is my first debate as well. Thank you for joining in! 1) "Social benefit is not always maximized by an unfettered market because market equilibrium drives toward what is most profitable, not socially beneficial - the two are not mutually inclusive." 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. First, profit, in an unfettered economy, that is, one where businesses cannot turn to legislators in order to receive arbitrary advantages (through lobbying and regulation), is, by definition, social benefit. Profit is comprised of two different components, namely revenue and costs (revenue – costs = profit). In order to maximize revenues firms must produce goods and services that are desired by society and they must out-compete their competitors. In order to do this, they must offer the highest possible quality for the lowest possible price. Next, minimizing costs means using as little resources as possible in the production process. Doing so (minimizing costs) leaves additional resources, which are scarce, for other economic activities. Thus, profit maximization is the production of the highest quality goods, at the lowest possible prices, while utilizing the minimal amount of scarce resources as possible. "For example, fossil fuels are very arguably non-conducive to long term outcomes that can be considered socially beneficial, but because it is profitable, they are perpetually utilized by the market, which goes to show that market equilibrium isn't always best for society." I don't want this debate to be about the economic tenability of alternative energy, but your example does not support your position. It is true that fossil fuels emit carbon emissions, but the fact that its supply is relatively plentiful makes it relatively inexpensive. So much so, that it is, at this point in time, the most cost-effective way to power our economy, and sustain our current population levels. In other words, the utility that may be gained from completely switching from fossil fuels to "green energy" is greatly out-weighed by the utility that would be lost from the diminution in total economic output and productivity. 2) "This is true in theory, but not in practice." 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. 3) "….Ultimately, this means that firms will not hire more workers if the price floor is removed because it will not increase the productivity of that firm much, if at all. Instead, they will keep approximately the same amount of workers on payroll, except at much less cost. The outcome is effectively a lower wage for non-competitive workers (teens, immigrants, etc), and a relatively similar employment level….." 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. 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. For example: Let us suppose that laborer "a" has a marginal product of $10 per hour (in monetary terms for the sake of simplicity). The employer would be willing to pay that employee any wage that does not exceed $10 per hour. At $7/hour the employer makes an additional $3 surplus; at $9.99/hour, the employer makes $.01 surplus. And since $.01 surplus is better than no surplus (or an economic loss), the employer will employ that laborer. Conceivably, the employer will pay laborer "a" $10/hour since it comes at no cost to him. 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). 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. (SKIPPED 4) 5) "The price floor was implemented during the Great Depression, which suffered a period of severe unemployment that largely transcended race, age, or background. Additionally, the minimum wage increases the purchasing power among those receiving it, which arguably helps to alleviate the burden of the cost of living, albeit very slightly. However, the minimum wage is not inherently self-defeating mainly due to the consequences of removing it..." It is true that, during recessions, businesses may attempt to cut wages in order to reduce their operating costs (though some firms are hesitant to do this because they fear that the loses in productivity, due to lower worker morale, will out-weigh the costs they reduce from wage reductions—also known as endogenous wage rigidity). But if employers are not allowed to reduce (nominal) wages, that is, if the labor market is not allowed to "clear," then they are forced to layoff additional workers, which will actually lower total economic output and income by a greater extent. 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. "In other words, the current existence of t