Minimum Wage Should be Abolished

My original arguments are paraphrased in italics to give context Your video + Unemployment (as you tied them together): Your video makes the “key observation” that minimum wage increase is a problem. However, a minimum wage increase is NOT part of the resolution. You see, having a minimum wage is vastly different from increasing an existing minimum wage; I only have to argue for keeping a minimum wage. The minimum wage I’m arguing for will be designed to prevent businesses from exploiting employees (i.e. paying employees well below the market average). Regardless, I’m arguing for a minimum wage that would be below the market average, hence making the key point (core of the argument) in this video irrelevant. (Defending my argument) Increases the standard of living for the poorest and most vulnerable class in society: “(not sure why you quote a 1998 source).” The principles of good economic practice should remain timeless. Your mathematical calculations from the source you provided appears to be accurate and the sources seem legitimate (not that I would be the perfect candidate to judge the latter). However, the fundamental flaw of your argument is showcased in your statement: “In total, the amount of people in poverty (in 2005) one would hypothetically* help from a raise in min. wage would be 379,810 people.” Again, I am not arguing for a raise in minimum wage, I am arguing to keep a minimum wage. My opponent should be arguing against having a minimum wage, not arguing against raising the minimum wage. I know that my rebuttal is sparse considering what I am responding to, but I believe the flaw I have highlighted sufficiently counters this argument. (Defending my argument) Business exploitation and the Anchoring effect: If people refuse to work … whom will (overseas if need be). … employ to do min. wage work for them. “The problem with this argument is that businesses can already outsource jobs, and do it commonly.” “In fact, the min. wage encourages outsourcing!” Finding people overseas that are not only willing to work for a below min. wage, training them and then setting-up a place for them to work where regulations are lax is evidently difficult. Are businesses willing to spend large amounts of money and time to do all these things just to pay someone less money? Certainly, small and medium businesses will have little chance pursuing this avenue – they simply don’t have multiple millions. “To combat poverty, a less-than min. wage job is better than no job at all.” Having a less than min. wage job is illegal in a country with min. wage. Basically, having a min. wage forces businesses to pay above the poverty line, which does not necessary mean that they will not generate profits (and should not be generating profits if they can’t pay above the poverty line, as these are slave labour rates). “The only difference with a min. wage is that, instead of the people making the refusal decision themselves, the government does it for them.” This is a good thing.1. This prevents businesses from driving down the minimum market wage to slave wage levels.2. Unemployment benefits can be given to those whom are actively seeking a job The result? A small amount from taxation is given to those whom are looking for jobs in order to prevent below market wage rates (which can lead to slave wage rates, rates that are well below living standard costs) as well as sustain their lives. The Anchoring effect occurs … (i.e. what is a person’s time worth if he or she is stacking boxes?)."This example assumes that there is no way to objectively gauge what a person's working time is worth... an employer could look at how much the company profits from the worker being there, and how much the company makes without the worker.” There are far too many variables that generate business revenue to simply see a difference in revenue between the worker being there and not being there. For example, other employees may not work as hard whilst the new worker is there. Other employees might be sabotaging the plant covertly. Conflict between employees that is covert may have employees gossiping about the conflict rather than fully committing themselves to work. You could estimate what an employee is generating by way of seeing what he or she is producing. However, what is an acceptable amount of produce? The only way to measure this is to compare the amount produced by one worker to the amount produced by another worker. Therefore, not an objective value is being set, but rather one based on the relative production of employees. This conclusion is consistent with the Anchoring fallacy. Arbitrary standards will be set, and will be (unfairly) set by the business ... getting payed $0.5 an hour... who is getting payed $0.3 an hour. So, logically, it would seem that I’m getting payed extra for my extra effort, right? “This standard could have been set by one company, and other companies could copy this as well... The government most likely didn't get the value correct with min. wage.” Okay, the standard can be set by the competition between the companies. Afterwards, the minimum wage can be set to below the market value (but not too far below, otherwise it is self-defeating). This ensures that the market wage rates are not lowered further, yet retains an acceptable level for businesses to generate profits. “The problem is, there is competition between businesses for the employment of these individuals.” When there is a highish unemployment rate, it is the other way around. With an unemployment rate of America’s (7.7%, Feb 2013), people will be trying to simply become employed, rather than negotiate wage rates. This is exactly the kind of scenario which businesses will take advantage to exploit the worker. How? Businesses know that jobs are hard to come by at the moment, hence businesses are the ones that dictate prices. There needs to be a floor price (min. wage) which will stop businesses from dropping their wage rates too low. “How is $7.25 an objective standard for all jobs in the country? Who is the government to ... If what you said was the case, the vast majority of unskilled jobs would be at the min. wage in order to maximize profits.” Minimum wage can be set lower than the market average. $7.25 does not have to be the rate, and should not be the rate if it is higher than market average. In fact, the minimum wage could be lower than currently the lowest pay. It is designed to stop businesses from setting significantly lower than market wage rates, or to slowly lower the average market rates towards slave labour rates. ... “the earnings of a full-time min. wage worker with a family of three would earn $10,712 a year, thus falling 35.5% below the official 2006 federal poverty level of $16,600. “This assumes that the only one parent is working. In actuality, for older workers (25+) on min. wage, "They have an average family income of $33,606 per year." Also, just 23% of these workers live in poverty.(2)” Unless I’ve misread this, 33,606 (2 average working wages) divided by 2 = 16803, which is barely above the poverty line and is the average wage for a working parent. That means, close to 50% of working parents fall below the poverty line of 2006 in terms of wage income (and that’s not accounting for inflation where the poverty line should in theory increase). In summary, the problem with my opponent’s arguments thus far are that they either assume that the resolution requires Con to defend against an increase in minimum wage (perhaps even that abolishing the min. wage does not mean lowering the min. wage), or that minimum wage could not be lowered to a below market value. While the min. wage does have inherent problems (off-shore business ventures, business competition), these do not outweigh the benefit of preventing the lowering of already low wages.