DRAFT "Repeal The Living Wage Act"

[CPS Inc]

The W.A,

ACCEPTS its moral duty to alleviate distress and encourage increased global equality.

Nevertheless the W.A,

QUESTIONS the setting of an arbitary and unjustified wage floor of nominal costs +25%

NOTES that such a floor could prevent nations breaking out of wage-price inflation.

Also the W.A,

RECOGNISES that Resolution 21 only applies to W.A nations

FEARS that higher labour costs within the W.A could lead to capital, jobs and businesses fleeing to rogue states.

REFUSES to directly inflict unemployment, hardship and unrest upon member states.

Finally the W.A,

NOTES that Resolution 21 urges nations to hand out welfare payments of costs + 25%

RECOGNISES that Resolution 21 destroys the motive to work by equating social security payments to entry level wages

FEARS that The Living Wage Act is a direct contributor to long term unemployment.

The W.A unreservedly condemns Resolution 21 as an arbitrary and economically damaging resolution.

The W.A. hereby repeals Resolution 21.

[Whiskey Hill]

The Grand Duke believes that a higher wage will lead more of those out of work to seek employment, that it will lead more of those who are dissatisfied with their job to stay in their job, which cuts down on transitional training costs, and so leads to less unemployment and more efficiency.

In other words, he would not support such a proposal, unless it were merely seeking to change the way the wage is set or where it is set. The Grand Duke believes that a repeal of a higher wage would lead to more unemployment, greater inequality, and greater inefficiency, and so out of concern for his good citizens, he supports higher wages and a compressed pay scale.

[CPS Inc]

Your excellency- thanks for the rapid response.

However, for the sake of public record, I must dispute your claims. By hiking the cost of labour the W.A will inevitably decrease demand for it- companies will go bust due to higher costs or outsource jobs to avoid Resolution 21.

Referring to your point about "transition efficiency"- surely Resolution 21 applies to the whole economy? Therefore it will not reduce the number of people wishing to change industries at all.

[Whiskey Hill]

The Grand Duke's Minister of Domestic Affairs informs me that he thinks you are relying on outdated economic theories which have been disproven by historical experience.

The Minister of Domestic Affairs:
As economists David Card and Alan Krueger found, raising wages does not increase unemployment. One after another, states raised their minimum wages and employment was not adversely affected.

To quote Professor James Galbraith:

Inefficiency in many countries arises from unemployment: people who are not working do not produce, and the loss of their goods and services makes everyone else poorer than they would otherwise be. Moreover, unemployment is in part an expression of discontent with one's existing station in life: people are unemployed when they are looking for a better job. The unemployment rates that we actually measure reflect, in part, the desire, and the ability, of people who would otherwise be peasants or on the dole to seek better employment at better pay.

When a society is very unequal, there are, necessarily, just a few "good" jobs and many "poor" ones. That is what being highly unequal means. And when this situation holds, it is normal for large numbers of people to go hunting for the few available good jobs. Long queues are the inevitable result. That is unemployment. Thus, other things equal, inequality produces unemployment, and unemployment produces waste: people who are not working do not contribute to the production from which ultimately everyone consumes.

Briefly, we need to look past the old ideological theories about how economies work, and look at how our economies actually work to come up with the best policies. Looking at how they actually work, having less inequality will generally produce less unemployment.

[CPS Inc]

Your excellency- naturally I concour with your call for progress within the scope of economic policy.

However, your refrence to Galbraith is quite frankly irrelevant. In it he is discussing VOLUNTARY unemployment- people choosing to leave their jobs in pursuit of higher wages. Voluntary unemployment is quite frankly a limited problem- as people won't leave a job unless they're fairly certain of finding another.

Contrastingly COMPULSORY unemployment (i.e. People>Jobs) is a significant problem- it leads to long term unemployment, poverty, desperation and deprivation. Resolution 21 actively increases this by increasing labour costs and undermining demand for labour.

The case against Resolution 21 is concrete- assuming that your excellency accepts the "outdated economic theory" of supply and demand.

[Borinata]

Esteemed Ambassadors,

I must wholeheartedly agree with the sentiments of the Ambassador of CPS Inc. In my own nation:

-We have seen the quality of products decline across the board in an effort to 'lower' the living wage by making only inferior goods available, thus lowering the cost of the minimum wage without providing any benefit to anyone.

-We have experienced a dramatic and unsustainable increase in housing prices as people who seek to cheat the system conspire to artificially raise the average housing costs of our nation in a bid to earn more money.

-We have witnessed a sustained increase in unemployment as the number of those willing to work has increased while the supply of entities willing to hire has declined. Many cottage industries which employed thousands, if not millions, in menial labor have left our nation for non-WA nations in our region and the young, the elderly and the infirm are now less likely to find employment because they cannot sell their labor for less than a middle-aged and healthy person.

-We have had our government burdened with the task of estimating the cost of living once each year, a task which our government had never before attempted and is still ill-equipped to perform.

-Finally, we have watched the destruction of a once thriving private charity sector as many high-wage earners have seen their wages frozen or cut so that the burden of this minimum wage may be met. Annual charitable givings are at the lowest point of any non-recession period and those who are unemployed have taken the brunt of this shortfall.

I must vehemently disagree with both the setting of arbitrary wage floors and the definition of 30 hours of labor per week as full time employment. This resolution, though well intentioned, could not have been more poorly executed. The nation of Borinata prides itself on its commitment to free market ideals and feels that while a minimum wage may be the solution for many countries, it has only hurt us. The one-size-fits-all nature of this resolution places an undue burden on any government committed to a free market system. I must ask of nations which support this resolution, since your nation likely has a minimum wage law in place already, why is it necessary to force such a law on nations that do not wish it?

I fervently hope that this resolution is repealed and claim common cause with any other nation that believes a civil society can care for its own through charity and the free market better and more efficiently than any government.

Sincerely,

Geoffrey Klyman,
Ambassador of Borinata

[Gobbannium]

As the author of the original proposal, we must thank the honoured ambassador of Whiskey Hill for his calm and informative response to the rampant scaremongering in the repeal arguments. We do not think that more need be said.

[CPS Inc]

Your excellency,

I urge you to read the above postings thoroughly. The Nations of Borinata and CPS INC have completly and utterly destroyed Whiskey Hill's case. Assuming that you have genuine (not selfish) objections to my proposal I encourage you to state them at this drafting stage.

[Charlotte Ryberg]

Ms. Sarah Harper cannot support a repeal of a resolution which mandates minimum wage laws. The resolution concerned has addressed the issue and the need for free trade economies, in which employees are paid fairly for their work. In our country, we respect the right to a good and fair wage (even the members of the government are employees too).

Oh, and I support ethical trade, which is why I always been checking for the country of origin in products.

[CPS Inc]

Naturally I concour with the sentiments of your post Ms. Harper- I too believe that economies should serve people.

However, if your concern for social justice is sincere- surely you should oppose Resolution 21? It inflates the wages of those lucky enough to have a job AT THE EXPENSE of the unemployed and desperate.

[Gobbannium]

Your excellency,

I urge you to read the above postings thoroughly. The Nations of Borinata and CPS INC have completly and utterly destroyed Whiskey Hill's case. Assuming that you have genuine (not selfish) objections to my proposal I encourage you to state them at this drafting stage.

We regret to disagree. We are unconvinced by your casual dismissal of Professor James's analysis, and we do not think that the objective analysis of Borinata's economy as "All-consuming" remotely justifies the hysterical "data" they present. These would appear to be simply the conventional cries of those being required to pay for that which they receive -- in this case the labours of another.

[CPS Inc]

Clearly you are irreconcilable. I respect your viewpoint and see little point in debating further with you.

However, for the sake of public record, I will reitterate that (the eminent) Professor Gailbraith is discussing VOLUNTARY not COMPULSORY unemplyoment. Anyone who accepts the laws of supply and demand must accept that higher wages will lead to less demand for labour and increased COMPULSORY unemployment.

[Inane Domain]

After reading the current Resolution 21 and the proposed repeal of said resolution, I have come to a minor quandary. I believe that a minimum wage for a country must be over its Basic Poverty Line and 25% is reasonable. That is why I would support the resolution still. However, I would like to express now that I believe that a welfare system that pays out 20% over the Basic Poverty Line is far to high. Considering that is not entirely mandated by the resolution, it is the position of the Borderlands of Inane Domain to be against this proposed repeal of World Assembly Resolution 21.

Yours,

-Signed-
William Coburn
World Assembly Ambassador on Behalf of the Borderlands of Inane Domain

[Whiskey Hill]

The Grand Duke's Minister of Domestic Affairs responds thusly:

One has hardly demolished another's case when they have made an inaccurate argument. Representative of CPS Inc, with all due respect, there is little involuntary employment in the free world. In our nation we have a brief term of compulsory military service, in some others there exists forced prison labor, but generally in free states employment is voluntary, and because we are able to choose relatively freely our employment situation, it does indeed follow something akin to supply and demand.

But just as a good must be priced low enough in order to be bought (in general), a job must be well compensated enough for a person to elect freely to take on the job, or continue at it should they already have that job. If the compensation is not sufficiently high, it would make more sense to continue looking for a better job than to take the poorly compensated job, as Professor Galbraith stated. Now, this would make looking at decoupling welfare benefits from the minimum wage a reasonable thing, but it doesn't make repealing the minimum wage a reasonable thing. Quite the opposite.

[Charlotte Ryberg]

Naturally I concour with the sentiments of your post Ms. Harper- I too believe that economies should serve people.

However, if your concern for social justice is sincere- surely you should oppose Resolution 21? It inflates the wages of those lucky enough to have a job AT THE EXPENSE of the unemployed and desperate.

Honoured ambassador, I cannot see a correlation between this resolution and unemployment here. It is up to the member state to determine their levels of economic and free market freedoms, subjects to the immunities of international law.

[CPS Inc]

Your Excellency, of course resolution 21 is related to emplyoment! By hiking the cost of labour the W.A will inevitably decrease demand for it- companies will go bust due to higher costs or outsource jobs to avoid Resolution 21.

Nevertheless, your response and others have persuaded me that my proposal is doomed to failure within the W.A. As I feared, people see the title of my resolution and instinctively suppose that it's anti-worker, pro business and immoral. Only those willing to go against this instinctive reaction and deeply consider economic reality support it.

I remain convinced that higher wages lead to less demand for labour and the evil of unemployment. However, I lack the resources, will and time to persuade naturally suspicious people of the merits of my case. Therefore I intend to cease arguing for my proposal and strongly rethink my position within the WA.

Yours,

CPS INC.

[Philimbesi]

Therefore I intend to shelve my proposal and strongly rethink my position within the WA.

Dibs on their office

[CPS Inc]

Sorry to disappoint- but purely because my office is so nice I've decided to remain a member of the W.A.

I'd like to emphasise that I'm furious with the W.A (grr)- but not with it's luxurious offices

[Morlago]

Morally, I have to oppose this. However, economically, I just might put a yes vote, although my employment rate is high so I don't really care. No.

[Gobbannium]

OOC: if I was a mean-spirited sort, I'd be asking for this to be pulled on "honest mistake" grounds, since the entire last section is based on the urging (only urging, you note) of a welfare level of breadline + 25% when it's actually breadline + 20%, pretty much for the reasons outlined in the repeal. Since I'm pretty sure it isn't going to get to quorum, I'll occupy the moral high-ground instead.

Oh damn.

[Philimbesi]

::hands Gobbannium a compass and a map that depicts an arrow leading from "you are here" to an X with the words "moral high ground" above it:::