The Case For the Minimum Wage

Many thanks to Con for the debate!In the final round, it is customary to refrain from presenting new arguments, since there are no opportunities to rebut them. So I will simply recap, and use this space to ensure that I have answered all of Con's claims.First, the Burden of Proof traditionally lies on the party that is making an affirmative case, or arguing against conventional wisdom or established precedent. Since some form of minimum wage laws exist in almost every industrialized nation on earth, and a floor price on the sale of labor has been firmly established as legitimate law in the US for over 70 years, Con's argument that no minimum wage should exist represents a radical concept that demands extensive justification. No such level of justification has occurred here.In this debate, even though I was never required to justify the minimum wage (only to challenge Con's justifications for its abolition), I nevertheless have tried to show why the minimum wage is useful within our economic system, and why it is both fair and needed. The minimum wage relieves pressure on an overburdened social safety net.The minimum wage promotes consumer activity among low-wage earners, who might otherwise become economic non-participants, or economic burdens. The minimum wage is affordable to businesses.The minimum wage has never been shown to increase unemployment.The minimum wage helps grow entrepreneurial activity by expanding and empowering a wider consumer base. ---------------------------------------------------------------------------------------------------------------------------------------------------------------------ChallengesOf these justifications, Con only challenged the premise that the minimum wage has never been shown to increase joblessness. All other arguments were conceded or dropped. Con supported his challenge with the following argument: "Two studies showed that the minimum wage increases unemployment.Therefore, the minimum wage increases unemployment." My rebuttal to this argument was to ask where all the unemployment is. The United States has the most powerful economy on the planet. Simultaneously, we are also home to one of the longest-running minimum wage laws in human history. In order for the claim that this law has created economic havoc, mass unemployment, and destroyed small businesses, to be believable, it seems that we would need some evidence other than the astounding economic success of the United States since 1938. ---------------------------------------------------------------------------------------------------------------------------------------------------------------------Poor Predictions For example, Con points to a 2008 paper that was written by the "Bureau of Business Research" which predicted that the effects of a proposed minimum wage hike in the state of California would result in widespread job losses.These predictions were embarrassingly wrong. The 2008 minimum wage hike was one of a series of minimum wage increases that California passed; the 2008 increase had been preceded in 2007 for a total minimum wage increase of $1.25 an hour for California workers. Despite suffering from a catastrophic meltdown in the state's construction industry, and a severe downturn in agriculture, [1] California has seen a steady decrease in unemployment since passing the new minimum wages. The unemployment figures in many California metro areas is so impressive, in fact, that many economists are puzzled by the success. [2] Further evidence that the Bureau of Business Research's predictions of mass unemployment never came true is visible when we look at specifically minimum wage employment over the time period in question. The Food Services sector is the largest single largest employer of minimum wage workers, and is a good bell-weather for the employment rate of minimum wage workers. Following some of the largest minimum wage hikes in the nation, California saw some of the largest job gains in this sector. In very hard economic times, there seemed to be no shortage of minimum wage occupations available. From a report by "California Industry Employment Projections:" "Full-Service Restaurants and Limited-Service Eating Places account for more than 62 percent of the projected job growth in this sector. As the economy recovers, it is anticipated that consumer demand for goods and services will increase" [3] -------------------------------------------------------------------------------------------------------------------------------------------------------------"Why not just make the minimum wage $1000 an hour?" This may not have been a serious question, so I won't spend too much character space on it. All wages are paid by an employer from profits that have been obtained from consumers. The minimum wage is a reasonable floor price on labor sales, and is funded like any other wage would be - from profits, increased prices for consumers, or a combination of both. It is preposterous to think that businesses can pay for a $1000 an hour minimum wage, just as it strains credibility to suggest that employers cannot afford a modest floor price for labor. To demonstrate the absurdity of this question, we should consider it's reverse: If lower wages promote prosperity, then why not eliminate all wages altogether? Then everyone would have a job and we would all be working. The fallacy is obvious. The purpose of the minimum wage is not to put employers out of business, as this question may suggest. The purpose of the minimum wage is to allow workers to become active participants in our economy through work.-----------------------------------------------------------------------------------------------------------------------------------------------------------------Final Note: Con mistakenly thought that I said that the minimum wage has no discernible "economic" effect. What I actually said was that it has little effect on "employment." He accidentally interchanged the words "economic" and "employment." The minimum wage has helped to sustain the American middle class, expanded the tax base, provided a pathway out of poverty for millions, and allowed businesses to market to entire sectors of the economy that might otherwise have never existed. It has been affordable to businesses, and has been implemented during times of great economic expansion and job creation, which proves that the fear-mongering from critics is overblown. [1] http://www.healthycal.org... [2] http://www.usnews.com... [3]http://www.calmis.ca.gov...