Resolved: Just governments ought to require that employers pay a living wage
Neg PositionWhen examining the Neg for this topic consider standard positions for countering affirmative claims. At the most fundamental, there is no need for a living wage because there are no harms arising from the lack of a living wage. This could succeed if Neg shows any harms which exist are the result of other causes, such as lack of education, skills, opportunity or motivation on the part of laborers. Another standard negative position is acknowledge there may be harms in the status quo but the living wage will not solve them and/or living wage requirements will lead to other harms or disadvantages. For example, if businesses forced, by government mandate to pay living wages will close, or it chills incentive to hire workers, or other such bad things currently not in the status quo, then we have a reason to negate. Another standard argument for the Neg is the counterplan. While this may sound very policy-debate like to those not used to such terminology in Lincoln-Douglas, it is legitimate to propose a mutually exclusive solvency mechanism with a net benefit the Affirmative cannot attain. If such a counterplan (perhaps better to say counter-proposal) exists, the net benefit affords a good reason to negate.
Alternative CausesI suppose we could surmise several reasons why people (especially in a wealthy nation such as the U.S.) could be counted among the working poor, defined as individuals who work full time but still live below the poverty line. Affirmative can make a compelling argument the minimum wage is not a sustenance wage and can cite sources which claim a person would need to earn three times the minimum wage in order to live above the poverty line. Okay, so those kinds of jobs are out there and the people who take them commonly have too few skills or too little education to find better jobs. Nevertheless, there are other kinds of high paying jobs which pay above the poverty rate which are also low-skill, low-education positions. Much of the cause may lie in the unavailability of "better" jobs in the areas where the working poor live as well as other personal reasons individuals have limited employment options. In 1999, the US Department of Labor examined the issue and noted:
- Sixty percent of the working poor are clustered into the retail-trade or service industry.
- Nearly thirty percent of the working poor are engaged in seasonal work, rather than year-round work.
- One-third of the working poor have health constraints which prevents them from attaining better jobs.
- A whopping seventy-percent of working poor are in single-parent households with half of them headed by single-parent females.
- Two-thirds of the working poor who qualify for government assistance programs do not take advantage of them
A very interesting international treatment on the cause of so-called working poor is found in the Crettaz and Bonoli study published in 2010. They looked at numerous factors in multiple labor markets in various government jurisdictions to draw conclusions as to why working people sometimes live in poverty. Like the U.S. Department of Labor paper referenced above, the answer is often much more complicated than simply a matter of wages.
Crettaz & Bonoli (2010):
It is undisputable that working poverty is by far not merely a matter of low earnings, and that the relationship between individual earnings and household income is loose, as has been demonstrated by many authors. However, it seems to be a very important factor that should not be downplayed in social policy analysis. Other factors are also very important, notably household size and composition as well as labour market participation, as has already been demonstrated by others in terms of the composition of the working-poor population (see e.g. Andress and Lohman (2008)). Family policy broadly understood, that is, including family cash benefits, of course, but also parental leave schemes and the provision of child care services, seems to be the most important welfare state related factor – in terms of the relative weight of the three mechanisms leading to working poverty. This factor plays a decisive role in terms of the cross-sectionally measured levels of working poverty, but also in a social-investment, life-course perspective, as it allows working parents to have a lower likelihood of falling into poverty, and, hence, reduces the share of children of working parents who grow up in poverty.
Just citing works of these kind serve to illustrate the problems often associated with low wages are in reality more complicated issues which are not always solved by throwing money at it. In fact one could claim it is empirically denied financial aid helps in states which already have wide ranging welfare schemes and continue to see concerning numbers of working-poor.
Alternative DisadvantagesOur major premise for this contention is that mandating a living wage is detrimental to the economy.
Although activists claim living wage legislation can increase wages with minimal costs, the reality is quite different. Both economic theory and the evidence suggest that living wages, like minimum wages, create distortions in the labour market that have a negative impact upon employment. When governments mandate a wage above the prevailing market rate, a typical result is that fewer jobs and hours become available and it is usually the people with the lowest skills who are most adversely affected. Indeed, there is a trade-off between the workers who benefit from a higher wage and those who endure the costs due to fewer employment opportunities.
Lamman looks at the Neumark and Wascher meta-analysis published in 2007 which concluded that minimum wage hikes indeed increase unemployment and notes empirical results observed in Canada.
One important study by University of California Professor David Neumark, a leading expert in the area, and William Wascher, comprehensively reviewed the academic literature on minimum wages and employment (Neumark and Wascher, 2007).16 After looking at more than 100 studies covering 20 countries, Professor Neumark and his co-author found that an overwhelming majority of studies reached the conclusion that minimum wage hikes have a negative impact upon employment. In Canada, more than a dozen studies have examined the impact of increases in provincial minimum wages.18 Based on those findings, a 10% increase in the minimum wage decreases employment for young workers (ages 15–24) by an average of three to six percent (Godin and Veldhuis, 2009). For young workers most affected—those earning between the current minimum wage and the proposed higher wage—the impact is more acute, with job losses of up to 20% (Campolieti et al., 2005).[page 9-10]
Regarding the effects of living wage laws on poverty reduction, it is interesting to note and observation made by Lamman. Living wages laws do not specifically target the poor since not everyone earning a substandard wage is living in poverty (Lamman 2014:19). This means some individuals will benefit from high wages even though they don't need it and the Neg debater could certainly point out the injustice of transferring benefits to the undeserving if poverty reduction is the goal.
A key negative impact of living wage laws is increased inflation which drives up the cost of goods and services.
The costs of a minimum wage hike are often passed on to consumers in what economist Daniel Aaronson calls “price pass-through.” In a study of prices in the restaurant and fast food industry—an industry that heavily employs and serves low-wage earners—Aaronson, French and MacDonald found an increase in the minimum wage also increases the prices of food items.24 Using data from the Consumer Price Index (CPI) from 1995 to 1997, the economists examined 7,500 food items (usually a complete meal) from 1,000 different establishments in 88 different geographic areas. They found the increase in menu prices affected limited service restaurants the hardest. These are restaurants where most diners pay at the counter and take their food home with them. These restaurants are also more likely to employ low-wage workers and thus more likely to have their business costs rise as a result of a minimum wage increase. The study found that in these instances, almost 100 percent of the increase in labor costs is passed on to consumers in the form of higher prices [page 5]
Some sources claim that employers will respond to mandated living wage requirements by labor substitution. This means they will move higher-skilled workers into lower-skilled positions which effectively denies employment to those, the law was intended to help.
Another channel of adjustment to minimum wage changes is labor-labor substitution within businesses.34 Research finds that some employers will replace their lowest-skilled workers with somewhat higher-skilled workers in response to increases in the minimum wage. As a result, minimum wage increases may harm the least skilled workers more than is suggested by the net disemployment effects estimated in many studies because more skilled workers are replacing some less-skilled workers.
Let me stress these are only a few sources which detail negative effects or disadvantages linked to enacting living wage mandates. There are many more and you should certainly have them in your files since you will hear plenty of counter-claims. The major idea, is there is no reason to require employers to provide a living wage if the overall impact of society is going to be worse.
Alternative SolvencyThis brings us to the LD counterplan or counter-proposal. It can be a viable rhetorical device to convince the judge there are better alternatives to mandating living wages and so no reason to Affirm. The counterplan is a negative strategy designed to compete with the Affirmative proposal which works best with resolutions which specify agents and actions. In the case, the agent is "just governments" and the action is, "require employers to pay". A proper counterplan is competitive, that means first, it is mutually exclusive with respect to the affirmative plan. Thus if both the plan and counterplan can be done at the same time, they are not mutually exclusive so there is no reason to reject the plan. Secondly, the counterplan must have a net benefit which cannot be achieved by the plan. If the plan and counterplan have the same advantages or disadvantages, there is no reason to prefer the counterplan. This is not as complex as it sounds. Simply describe other actions which can be taken to solve the problem of working-poor which avoids the problems of "requiring employers" to do it. For example, if your case shows that requiring employers to pay a living wage is a form of coercion which violates the natural rights of the employer, then propose an alternate way the government or other actor can help the working poor which does not violate employer rights. The following proposal avoids the unemployment disadvantage.
The other drawback with using the minimum wage to reduce poverty — a drawback discussed extensively in this newspaper and others — is that some less-skilled or less-experienced employees will lose job opportunities. Instead of being pulled out of poverty, they'll be pushed further into it. Fortunately, there's a better alternative for poverty reduction in the form of the EITC — a tax credit that boost wages through the tax code instead of an unworkable mandate on employers. It's already doing a tremendous amount of good in Illinois. Currently, a single parent working part-time for the state minimum wage receives approximately $3,300 in EITC income from the federal government, and then Illinois' state credit kicks in an additional $330. That makes their effective minimum wage roughly $10.60 an hour -- even higher than the $10 figure voters will consider in the fall.
The Negative PhilosophyA key question for the Negative is what are the limits which constrain a just government? Most sources will agree that the employers and employees establish a private contractual agreement of labor in exchange for wages. The agreement is entered voluntarily and if the employee is not satisfied, she may certainly look elsewhere. For the government to interfere with such contracts is an unjust act of coercion; an over-reaching by government into a private relationship.
Seizing the results from someone’s labor is equivalent to seizing hours from him and directing him to carry on various activities. If people force you to do certain work, or unrewarded work, for a certain period of time, they decide what you are to do and what purposes your work is to serve apart from your decisions. This process whereby they take this decision from you makes them a part-owner of you; it gives them a property right in you. Just as having such partial control and power of decision, by right, over an animal or inanimate object would be to have a property right in it (1974, 172).
It is commonly held in this situation, by mandating living wages, the government essentially seizes the profits or income of the business (or sole proprietor) and forces those resources to be distributed to others.
The ValuesConsidering the potential intrusiveness of mandating living wages, I would expect to see any number of values which focus on Aristotle's conception of justice based upon protection of natural rights or in particular property rights. Preservation of property, freedom from unnecessary government interference, and protecting the autonomy of the workers (who enter private contracts with employers) are possible values and criterion.
Good luck debaters. This is a pretty good topic and I hope you enjoy debating it.
ALEC (2014); Raising the Minimum Wage: The Effects on Employment, Businesses and Consumers; American Legislative Exchange Council; march 2014; accessed 12/18/2014.
Crettaz, E., Bonoli, G.; (2010) Why Are Some Workers Poor? The Mechanisms that Produce Working Poverty in a Comparative Perspective; REC-WP 12/2010; Working Papers on the Reconciliation of Work and Welfare in Europe; accessed 12/18/2014.
Kim, M. (1999); Problems Facing the Working Poor; Department of Labor Studies and Employment Relations; 1999; accessed 12/18/2014.
Hildago, JS; (2013); Do Employers Have Obligations to Pay Their Workers a Living Wage?; University of Richmond, Jepson School of Leadership Studies articles; 2013; accessed 12/18/2014.
Lamman, C, (2014); The Economic Effects of Living Wage Laws; Frazier Institue; 2014; accessed 12/18/2014.
Nozick, Robert. Anarchy, State and Utopia. New York: Basic Books, 1974.
(Note: versions of the complete work in PDF format can be found online).
Saltsman, M. (2014); A better solution to the minimum-wage debate; Crain's Chicago Business; September 1, 2014; accessed 12/19/2014.
Wilson, M. (2012); The Negative Effects of Minimum Wage Laws; Policy Analysis, No 701, June 21, 2012; accessed 12/18/2014.