The minimum wage should not be raised to$9.00 as campaigned for by the President.

Let's start with a brief history of the minimum wage. The first minimum wage was established by Franklin Delano Roosevelt in 1938, and was 25 cents and hour. It was established under the Fair Labor Standards Act, as part of the New Deal. Since then it has been increased over 50 times, most recently reaching 7.25 under President Bush. (1) A good and necessary thing, the minimum wage protects workers, especially unskilled workers, from abuse and under-payment. However, there is a point at which raising the minimum wage hurts not just business and the economy, but workers and the poor and unskilled as well. THE MARGIN OF PROFIT Many people think that employees are paid solely on how the pay that corporations believe they can get away with. In reality, pay is based on two things: competition and margin of profit. I will get on to competition later. The margin of profit is how much an employer makes off a given employee. Margin of profits, especially with a minimum wage as high as ours, are at an all time low. McDonalds this year has a margin of profit at 19.71%. (2) That means off a minimum wage employee, McDonalds makes 1.44 an hour. Add this to the minimum wage, and it comes out to $8.69. So, if you raise the minimum wage to $9.00, McDonalds will average a net loss on literally every employee, as all would have to be paid that number. This would give McDonalds three options: close, causing huge layoffs, move many jobs overseas, causing huge layoffs, or raise it's prices significantly, hurting both business and the lower class who rely on it for cheap food. The margin of profit of McDonalds is higher then many, like Starbucks, with 11.17%, and Chipotle, with 10.76%. (3) Raising the minimum wage is a fiscal impossibility for most businesses, and will cause immense layoffs and higher prices, hurting unskilled workers and the poor, often the same. COMPETITION IN THE JOB MARKET While most media and popular sources constantly talk about people competing for jobs, businesses face huge competition for the most skilled and experienced workers. Every corporation will try to beat their opponent's pay in an attempt to get better employees. This works on the same principle as why prices decline. This is what protects many people from low pay, and in a competitive market what keeps pay rising. It is the reason less than 1% of the workforce is paid minimum wage (4). Raising the minimum wage would punish the 1% who get paid minimum wage, as businesses would have to rely on skilled and experienced workers, as unskilled workers would not be worth it. The people who would suffer are the same people who the minimum wage is designed to help. TRUE POVERTY While employees receiving minimum wage often struggle to pay for bills and car and home payments, the people who are truly poor are those who have no jobs, who are unemployed. These are often uneducated and inexperienced. people, and they live in abject poverty. These people need jobs, and the way to produce mass jobs is not to raise the minimum wage to a point where businesses can't afford to risk hiring them. A lower minimum wage allows for more jobs for these people who really need them. For example, a business will not pay someone $9.00 to stand on a street corner and hold a sign, but a lesser pay may be justified for the business. An unskilled job, bringing much needed income to low-income and unemployed individuals. THE DISASTROUS MODERN HISTORY OF THE MINIMUM WAGE When FDR established the first minimum wage, some jobs were killed, but it evened out and managed to be an improvement to many worker's lives. As were many later increases. The latest was a 2009 increase to 7.25 which turned out disastrously. Over the next few months, more than 300,000 low-income employees lost their jobs as a direct impact, even with a 4% growth in the economy that quarter. (5) A UGA study finds that the raising the minimum wage does not alleviate poverty. Robert Nielson of the study said ""By and large, evidence says that minimum-wage increases don"t go to the people they are intended to help. .. " (6) Less than 15% percent of wage gains from minimum wage raises go to people below the poverty level, and that is far offset by people lowered below the line and dropped further down. Raising the minimum wage is a disaster. Take a look at this chart comparing teenage, often unskilled, jobless rates to increases of the minimum wage: . http://www.google.com... This shows the effects of minimum wage raises on unskilled and inexperienced workers. (Teenagers) As the minimum wage increased, businesses were less and less willing to employ teenagers, creating an almost linear connection between the minimum wage and teenage unemployment. This is a very telling chart. It is apparent that raising the minimum wage hurts the same people as it intends to help, and ends up helping almost nobody. Perhaps inflation will justify minimum wage raises in the future, but today it is a horrible idea for the economy, for business, and for minimum wage and unemployed people. I'll leave it there for now. I look forward to my opponent's argument. Good luck! (1) . http://www.dol.gov... (2) . http://ycharts.com... (3) . http://ycharts.com... (4) (5) . http://www.thecommentator.com... (6) . http://onlineathens.com...