Resolved: A Minimum Wage Should Exist.

Why the Minimum Wage? The main reason is that it gets people out of poverty. This important consequence has a number of possible effects. It reduces the need for welfare, because every worker has more money in their pocket. The need for welfare in an ideal minimum wage system would only extend to the homeless. Indeed, it even has some subtle positive effects on businesses. "For businesses, it can reduce churn, increasing retention in ways that avoid the cost of hiring and training new workers. " All and all, the minimum wage is a policy that allows for a greater distribution of society to live in relative comfort. [1]Evidence for the Minimum Wage Evidence tends to go back and forth between the two sides in the debate. However, when the data is analyzed, the correct conclusion is the pro-minimum wage side. The anti-minimum wage side relies on a misinterpretation of the data presented by studies. There are many data measures that could be used, but the three I will use are consumption, income inequality, and unemployment. Consumption - The evidence here comes down solely on the pro side. "A pay hike of $1.75 an hour, smaller than currently proposed, would augment purchases by at least $48 billion in the first year, according to a 2013 paper by the Federal Reserve Bank of Chicago economists. " The more money given to workers does take away money from the business owners, but they are much more likely to spend that money than the business owners are. "Low-income workers have a higher propensity to consume than the wealthy, because the latter are not nearly as income-constrained. " Overall, the minimum wage allows a greater amount of consumption in the economy, which raises the GDP more, allowing for everyone to have more money. [2]Income Inequality - This one should be rather obvious as well. The minimum wage takes money from the wealthy business owners and gives it to the poorer workers. The US has one of the largest levels on income inequality in the developed world, and the US has one of the lowest values for the minium wage in the developed world. [3]Unemployment - This is probably the biggest point of contention in this debate - does the minimum wage positively or negatively impact unemployment? There have been many studies on both sides, and I will address any of the studies my opponent brings up on his side when the time comes, but I want to address my side. One of the most famous studies, the Card-Kreuger study, concluded that, "Again, these results point toward a relative increase in employment of low-wage work-ers in New Jersey. We also find no evidence that minimum-wage increases negatively affect the number of McDonald's outlets opened in a state. " In other words, it found no negative correlation between the minimum wage and unemployment, and even hinted at a positive one. [4]Why Is This Important? This is probably a pressing question. As I mentioned earlier, the minimum wage cuases there to be less spending on welfare, which is obviously a positve for taxpayers. However, due to the increased consumption and income inequality, crime (particularly theft) decreases in frequency due to the fact that people have more money overall. In addition, income inequality causes social cohesion to erode, due to the increased feeling of separate classes that one cannot get out of, and of the shadow economy, which exists to fill the needs of those who don't have the money to operate in the normal economy. Because the minimum wage reduces income inequality, these effects are lessened, and society is better off in general. But it is even positive for businesses. As I've already explained, the minimum wage increases consumption and the average time people spend at a single job, which both increase GDP, and gives the wealthier business owners more money due to the stronger economy. It may even fully recoup, if not make a net positive out of their losses due to the minimum wage. The increased consumption also allows for greater increases in GDP, which would reduce the effects of recessions, which is obviously good for businesses. I will consider my opponent's arguments against the minimum wage in the next round. Sources[1]: . http://www.whitehouse.gov...[2]: . http://www.bloomberg.com...[3]: . http://www.epi.org...[4]: . http://davidcard.berkeley.edu...