Maeser Prep Debate / Jan-Feb 2015 / Jeremy Hadfield
Resolved: Just governments ought to require that employers pay a living wage.
I agree with Martin Luther King Junior that, “an edifice which produces beggars needs restructuring.” To restructure the system that produces poverty, and for many other reasons, I affirm the resolution: Just governments ought to require that employers pay a living wage.
Pollin defines the living wage. Investopedia,. ‘Living Wage Definition | Investopedia’. N. p., 2007. Web. 7 Dec. 2014.
A theoretical wage level that allows the earner to afford adequate shelter, food and the other necessities of life. The living wage should be substantial enough to ensure that no more than 30% of it needs to be spent on housing. The goal of the living wage is to allow employees to earn enough income for a satisfactory standard of living. It entails self-sufficiency.
I value justice, as implied by “just governments” in the resolution.
My value criterion is maximizing happiness, or utilitarianism.
Respect for human worth justifies utilitarianism. Cummiskey 90
Cummiskey, David. Associate professor of philosophy at the University of Chicago. “Kantian Consequentiaism.” Ethics 100 (April 1990), University of Chicago. http://www.jstor.org/stable/2381810
We must not obscure the issue by characterizing this type of case as the sacrifice of individuals for some abstract “social entity.” It is not a question of some persons having to bear the cost for some elusive “overall social good.” Instead, the question is whether some persons must bear the inescapable cost for the sake of other persons. Robert Nozick, for example, argues that “to use a person in this way does not sufficiently respect and take account of the fact that he is a separate person, that his is the only life he has.” But why is this not equally true of all those whom we do not save through our failure to act? By emphasizing solely the one who must bear the cost if we act, we fail to sufficiently respect and take account of the many other separate persons, each with only one life, who will bear the cost of our inaction. In such a situation, what would a conscientious Kantian agent, an agent motivated by the unconditional value of rational beings, choose? A morally good agent recognizes that the basis of all particular duties is the principle that “rational nature exists as an end in itself”. Rational nature as such is the supreme objective end of all conduct. If one truly believes that all rational beings have an equal value, then the rational solution to such a dilemma involves maximally promoting the lives and liberties of as many rational beings as possible. In order to avoid this conclusion, the non-consequentialist Kantian needs to justify agent-centered constraints.
Contention 1: A living wage improves the economy and reduces poverty.
Addressing the social problem of poverty is a primary responsibility the state has for its citizens.
Professors Liam Murphy and Thomas Nagel writes that
Liam Murphy (Professor of Law and Philosophy at NYU) and Thomas Nagel (Professor of Law and Philosophy at NYU). “The Myth of Ownership: Taxes and Justice.” Oxford University Press (2002)
Disagreements about the extent of public responsibility are not going to disappear; they are the essence of politics. But we would make the following point: In spite of the disagreements, there is an important area of agreement among those views that take government responsibility for the welfare of citizens seriously. Whether one is a utilitarian or a Rawlsian or a priority theorist, or a believer in a social safety net, or a defender of fair equality of opportunity, or of equal libertarianism, one will be concerned about poverty. Poverty is bad from all these points of view. The lives of the poor are hard, humiliating, and dehumanizing; poverty restricts human flourishing. However you slice it, an increase in the resources of poor people will do more good than a comparable increase in the resources of those who have more, or much more. That is the most general and straightforward basis for redistributive policies, and it holds in some degree for a wide range of views this side of libertarianism.
Thus, increases in the well-being of the least well-off outweigh increases in the well-being of the more well-off.
And a living wage reduces the problem of poverty. Seven reasons:
FIRST: States with living wages tend to have more employment
Beth Shulman 07, (Staff, Russell Sage Foundation’s Social Inequity and Future Work Project), ENDING POVERTY IN AMERICA: HOW TO RESTORE THE AMERICAN DREAM, 2007, 116.
In fact, a study by the Fiscal Policy Institute found that in 12 states with minimum wages higher than the federal level of $5.15 an hour, employment rose more than in states where the federal level was standard. This finding held true for small businesses as well. And why would it not? Workers’ increased buying power leads to new purchases, which boost the entire economy — and that creates more jobs. It is a virtuous circle, one that helped power the American boom in the years after minimum wages and unionization first swept the U.S. manufacturing sector.Washington state has the highest wage in the US, and also had the biggest increase in small business jobs last year.
SECOND: The academic consensus is that the minimum wage reduces poverty
According to Mike Konczal 14, a fellow at the Roosevelt Institute
Mike Konczal (fellow at the Roosevelt Institute. His work has appeared in The Nation, Slate, and The American Prospect). “7 Bipartisan Reasons to Raise the Minimum Wage.” Boston Review. March 3, 2014.
Raising the minimum wage to $10.10 would lift 4.6 million people out of poverty. It would also boost the incomes of those at the 10th percentile of the income distribution by $1,700 annually. That is a significant benefit for workers who have seen declining wages during the past forty years. In a review of the literature since the 1990s, Dube finds of fifty-four estimates of the relationship between poverty and the minimum wage, forty-eight, or 88%, show that a minimum wage reduces poverty. This reflects a remarkable consensus among economists. The effect of an increased minimum wage on poverty is real, and it would be positive.
THIRD: Living wage increases consumer spending, which is the driving force of the economy
Stephanie Luce, Professor, University of Massachusetts @ Amherst, 2004, Fighting for a Living Wage, p. 15 Joshua Crandall, 2001
A living wage, as opposed to a minimum wage, would place more money in the hands of consumers (workers), allowing for an increase in spending. The economy’s success lies in the ability of products to be purchased. If workers are paid a living wage, around $13 an hour, all would benefit, from the top to the bottom…Faith and labor can work together to pressure our government officials and businesses to put people before profit.
FOURTH: Reduces the amount of people on welfare, saving billions of dollars for taxpayers.
Unz 14. FORBES. FEB.11 2014. “Raising the Minimum Wage would Be Good for Wal-Mart and America. Ron Unz is a Silicon Valley software developer and chairman of the Higher Wages Alliance, which is sponsoring a California ballot initiative to raise the state minimum wage to $12 per hour
The American taxpayer would also be a huge beneficiary. Each year, over $250 billion in social welfare spending goes to working-poor households via government programs such as Food Stamps, EITC checks, and Medicaid. As millions of those workers become much less poor, they would automatically lose their eligibility for anti-poverty assistance, saving taxpayers many tens of billions of dollars each year. Government programs often function as very leaky buckets, with a substantial fraction of the money spent never reaching its supposed beneficiaries. But wages paid by an employer go straight to the recipient, except for the portion withheld in government taxes.
Reducing the welfare budget reduces taxes, which increases the incomes of everyone in the nation.
FIFTH: Increases productivity
Christine Niemczyk, JD Candidate, John Marshall Law School, 2007, “Boxing out Big Box Retailers,” The John Marshall Law Review, Summer, 40 J. Marshall L. Rev. 1339, p. 1355-6
Arguably, a living wage only costs companies a small percentage of profits. A recent study shows that while companies have experienced a growth of productivity of 33.4 percent over the last ten years, workers’ wages and health care benefits remain stagnant. n126 If companies apply some of the extra profits to payroll, workers will be more inclined to continue to increase productivity and growth for the company. n127 Employees who receive higher wages perform better at work and are less likely to be absent or to quit. n128 Therefore, a living wage results in an increased standard of living for employees and provides companies with a higher quality workforce.
SIXTH: Reduces turnover
Oren M. Levin-Waldman, Public Affairs Professor – Metropolitan College of New York, 2005, The Political Economy of the Living Wage: A Study of Four Cities, p. 57-8
Similarly, in a study of the impact of the ordinances at San Francisco International Airport, Michael Reich,, Peter Hall, and Ken Jacobs found that despite a significant rise in overall labor costs, there was also a significant decrease in labor turnover. The direct cost of implementing the ordinance, which was also part of a larger quality standards program (QSP) to improve safety and security while also improving the labor market conditions at the airport, was approximately $42.7 million a year. Spillover costs to other workers and employers added another $14.9 million to employer costs. And yet, turnover fell by an average of 34 percent among all surveyed firms and 60 percent among those firms where average wages had increased by 10 percent or more. The greatest reduction in turnover, however, was among airport security screeners. During a fifteen-month period after QSP was implemented in April 2000, turnover fell by almost 80 percent, from 94.7 percent to 18.7 percent. Every time an average worker has to be replaced, employers have to pay about 4,275 dollars per worker in turnover costs. Therefore, as a function of raising wages, employers ended up savings $6.6 million each year in turnover costs. To the extent that employers experienced reduced turnover costs, they experienced productivity gains. Total observed wages increased by $56.6 million in annual wages for ground-based non-management employees. Many reported that the quality of work increased, and many workers themselves indicated that they were more inclined to put more effort into their work.
SEVENTH: COMPANIES WITH HIGHER WAGES CAN COMPETE WITH Low-WAGE FIRMS BECAUSE THEY HAVE LOWER COSTS
Robert Pollin, Professor Economics-Univ. Massachusetts, 2008, A Measure of Fairness: The Economics of Living Wages and Minimum Wages in the United States, eds. R. Pollin, M. Brenner, J. Wicks-Lim & S. Luce, p. 30
In fact, when we did this in Los Angeles we went to a firm that was competing with a minimum wage firm that was actually getting massive subsidies from the City of Los Angles — a very low-wage firm. The firm we spoke with was paying 30-40 percent above what the low-wage firm was paying its workers. We asked this high-wage firm how it could survive. The answer was “We survive through having higher morale among our workers.” In specific terms, this meant that this firm had a low turnover of workers quitting their jobs, whereas the firm paying minimum wage had a very high turnover. The high-wage firm had almost no absenteeism and therefore had very low costs for administering, hiring, and training. So, that is another thing that changes when living wages go up — the “all else equal” condition does not hold.
Contention 2: A living wage reduces income inequality.
Income inequality is growing now. Living wage reduces it. Owens 13
Richard Trumka (president of the AFL-CIO) and Christine Owens (executive director of the National Employment Law Project). “$7.25 an hour is not a living wage.” CNN Opinion. December 2nd, 2013. http://nelp.3cdn.net/1720761e12917005d2_ykm6ivauy.pdf (CNN) — For the first time since the Great Depression, the U.S. Census Bureau tells us, middle class family incomes have lost ground for more than a decade. The sad truth is that the rewards for productivity and hard work such as health care coverage, retirement security, opportunity — rewards that used to make America’s workers “middle class” — are on the rocks. All the wage increases over the past 15 years have gone to the wealthiest 10 percent according to the Economic Policy Institute. All of them. And almost all, 95%, of the income gains from 2009 to 2012, the first three years of recovery from the Great Recession, went to the very richest 1%. Something else has happened, too. The bottom has fallen out of America’s wage floor. And the erosion of the minimum wage has lowered pay and working standards for all of us. An increase in the minimum wage — which hasn’t risen since 2009 — is long overdue. If the minimum wage had just kept pace with inflation since 1968, it would be $10.77 an hour today instead of $7.25. For tipped workers, the rate’s been stuck at a scandalous $2.13 for 20 years. “It will reduce inequality. The question is how much and for whom. It’s not going to have a huge impact, but that’s because there’s no politically feasible policy that would have a big impact,” said poverty and fiscal expert Isabel Sawhill, co-director of the Center on Children and Families at the Brookings Institution.Consider the 5-figure paycheck of a janitor versus the 8-figure salary of a CEO. Raising the minimum wage to $10.10 from $7.25, as a leading proposal in Congress would do, wouldn’t narrow that chasm.There’s also a big gap between those making 6-figures and the bazillionaires at the very top. A higher minimum wage can’t touch that. Then there’s the gap between very low-wage and middle-wage workers. It’s this gap where advocates say some progress may be made if the minimum wage is raised sufficiently. At its peak in 1968, the minimum wage was equal to 54% of average hourly earnings in the private sector. Today, it comes in at 36%, according to the Congressional Research Service. “There are a lot of causes of inequality but [the erosion of the minimum wage] is one of the important ones for inequality at the bottom,” Jason Furman, chairman of President Obama’s Council of Economic Advisers, said this week. Obama, who backs the $10.10 proposal, has said raising the minimum wage would be good for the economy and good for families. A higher minimum wage could increase the pay not only for the 1.6 million workers who earn $7.25 today, but an estimated 17 million workers who make between $7.25 and $10.10. In selling the idea of a higher minimum, though, advocates also say it could result in raises for hourly workers across the board in what’s known as the “ripple” effect. To the extent that the living wage increases the incomes of the poor, it narrows the income inequality.
IMPACT: Income inequality is the most important cause of economic decline and also causes political instability. Harkinson 11 Josh Harkinson (staff reporter). “Study: Income Inequality Kills Economic Growth.” Mother Jones. October 4th,2011.http://www.motherjones.com/mojo/2011/10/study-income-inequality-kills-economic-growthCorporate chieftains often … the hard way.”
Corporate chieftains often claim that fixing the US economy requires signing new free trade deals, lowering government debt, and attracting lots of foreign investment. But a major new study has found that those things matter less than an economic driver that CEOs hate talking about: equality. “Countries where income is more equally distributed tended to have longer growth spells,” says economist Andrew Berg, whose study appears in the current issue of Finance & Development, the quarterly magazine of the International Monetary Fund. Comparing six major economic variables across the world’s economies, Berg found that equality of incomes was the most important factor in preventing a major downturn. (See top chart.) For example, the bailouts and stimulus pulled the US economy out of recession but haven’t been enough to fuel a steady recovery. Berg’s research suggests that sky-high income inequality in the United States could be partly to blame. So how important is equality? According to the study, making an economy’s income distribution 10 percent more equitable prolongs its typical growth spells by 50 percent. In one case study, Berg looked at Latin America, which is historically much more economically stratified than emerging Asia and also has shorter periods of growth. He found that closing half of the inequality gap between Latin America and Asia would more than double the expected length of Latin America’s growth spells. Increasing income inequality has the opposite effect: “We find that more inequality lowers growth,” Berg says. (See bottom chart.). A population where many lack access to health care, education, and bank loans can’t contribute as much to the economy. And, of course, income inequality goes hand-in-hand with crippling political instability, as we’ve seen during the Arab Spring in Tunisia, Egypt, and Libya. History shows that “sustainable reforms are only possible when the benefits are widely shared,” Berg says. “We hope that we don’t have to relearn that the hard way.”
Contention 3: A living wage increases democracy.
Low wages reduce democracy. John Heck (John, Minnesota 4-H Foundation Fellow at the National 4-H Center, worked for the late Congressman Bruce F. Vento and presently serves on the Saint Paul Charter Commission, publisher) “Minnesota 2020 Journal: Increasing Minimum Wage Increases Democracy” Minnesota 2020 Journal 2014 AT
On Tuesday, inside the State Capitol, Minnesotans rallied for a minimum wage hike. It was a rollicking good time with great speeches, music, call-and-response exhortation and lots and lots of signage. Participants made the case for a minimum wage increase’s positive economic impact on workers’, families’ and communities’ lives. Notably absent from the rally? A lot more minimum wage-earning workers. Why? Because they can’t afford to take the time off from work to advocate for democratic change. This raises an interesting, troubling question. If low and modest wage workers are too financially stressed to cast a ballot, attend a community meeting or advocate for policy change, [is the democracy truly representative]? resulting elections, meeting outcomes and policy proposals truly representative? Democracy requires citizen participation. We don’t enjoy pure democracy, where everyone gets together and decides everything. In a nation of 300-plus million and a state of 5.3 million, the pure Athenian democracy is functionally unworkable. Voting participation positively correlates with wealth, home ownership, education and age. Young people don’t vote to the same degree that older people vote. If you’re over 30, own a home, hold a college degree and earn at least the median income, you vote…at minimum wage, is $30. That might not seem like much to folks earning Minnesota’s $57,000 median family income but $30 is ten percent of $300 of weekly gross earnings. Structurally, minimum and low wage hourly pay reduces the likelihood of participating in voting, advocacy, opposition and the exercise of democracy’s promise. It further concentrates the impact of higher income interests through disproportionately representative concentration. Our democracy becomes, as a result, less democratic.
Democracy is key to a good world – loss of democracy leads to massive harms Larry Diamond, Hoover Fellow @ Stanford, Fmr. Advisor to the Coalition Provisional Authority in Iraq, 10-1995 A report to the Carnegie Commission on Preventing Deadly Conflict
This hardly exhausts the lists of threats to our security and well-being in the coming years and decades. In the former Yugoslavia nationalist aggression tears at the stability of Europe and could easily spread. The flow of illegal drugs intensifies through increasingly powerful international crime syndicates that have made common cause with authoritarian regimes and have utterly corrupted the institutions of tenuous, democratic ones. Nuclear, chemical, and biological weapons continue to proliferate. The very source of life on Earth, the global ecosystem, appears increasingly endangered. Most of these new and unconventional threats to security are associated with or aggravated by the weakness or absence of democracy, with its provisions for legality, accountability, popular sovereignty, and openness. LESSONS OF THE TWENTIETH CENTURY The experience of this century offers important lessons. Countries that govern themselves in a truly democratic fashion do not go to war with one another. They do not aggress against their neighbors to aggrandize themselves or glorify their leaders. Democratic governments [they] do not ethnically “cleanse” their own populations [because they are ruled by their populations], and they are much less likely to face ethnic insurgency. Democracies do not sponsor terrorism against one another. They do not build weapons of mass destruction to use on or to threaten one another. Democratic countries form more reliable, open, and enduring trading partnerships. In the long run they offer better and more stable climates for investment. They are more environmentally responsible because they must answer to their own citizens, who organize to protest the destruction of their environments. They are better bets to honor international treaties since they value legal obligations and because their openness makes it much more difficult to breach agreements in secret. Precisely because, within their own borders, they respect competition, civil liberties, property rights, and the rule of law, democracies are the only reliable foundation on which a new world order of international security and prosperity can be built.
As a closing note, a consensus of economic experts agree the benefits of raising the minimum wage outweigh the costs. Frydenborg no date Brian E. Frydenborg (Master of Science in peace operations from George Mason University’s School of Public Policy) “Ethical Issues of Raising the Minimum Wage” AT least 2013 because the author cites stuff from then Opposing Viewshttp://people.opposingviews.com/ethical-issues-raising-minimum-wage-6865.html
In 2013 the Initiative on Global Markets at the University of Chicago’s Booth School of Business surveyed 38 economics experts about the minimum wage. About one-third agreed that raising the minimum wage in the U.S. would “make it noticeably harder for low-skilled workers to find employment,” about one-third disagreed that it would do so, and about one-quarter said they were “uncertain.” So the jury’s out on that one. But when asked if the costs of raising the minimum wage to $9 and tying it to inflation are “sufficiently small compared with the benefits” to minimum-wage workers such that “this would be a desirable policy,” 5 percent strongly agreed, 42 percent agreed, 8 percent disagreed, 3 percent strongly disagreed, and 32 percent were uncertain. That’s a total of 47 percent agreed to some degree vs. 11 percent disagreeing to some degree, a clear margin of economists in favor that, yes, there are negatives, but that the positives of raising the minimum wage at least somewhat clearly outweigh these negatives.