At the risk of being simplistic I would say that the argument in favor of raising the minimum wage is that it alleviates poverty and fosters an opportunity society. The main problem with this is that it is demonstrably false.
Not only is the minimum wage evil but it’s also stupid, and neither are biblical. It is an evil means to a righteous end which is to say that it is counterproductive. Christians need to get beyond the emotions and evaluate these issues with a clear head lest we do damage in the name of helping people.
Thomas Sowell, an economist with the Hoover Institution, has spent decades illustrating the consequences of stage-one thinking. It is where you do not think about the effects of a proposed solution to a problem beyond the immediate consequences. The minimum wage issue is a perfect example of this and it is especially problematic when Christians support such a law.
One of the basic principles of economics is that people tend to buy less of something at higher prices and more of it at lower prices. For some unexplained reason we are to believe that employers, the consumers in the labor market, will hire more labor as its price increases. If we are trying to help the poor then I do not see what is compassionate about making it harder for them to find a job.
The advocates for the minimum wage forget, if they ever knew, that you can legislate higher prices for labor but you cannot legislate higher productivity. That would be analogous to proposing a law setting a minimum price of gas at $10/gallon and expecting to see higher gas mileage. Goods and services don’t become more valuable simply because the law requires higher prices.
It is tragic to see the effects of government intervention in the black community. In the immediate years after World War II the unemployment rate among black teens, around 10%, was slightly less than it was among white teenagers. Since 1970, the unemployment rate for black teens has only dropped below 30% for a couple of years. Young black men between the ages of 18-25 are prime candidates for prison, especially when they have a lot of idle time on their hands and numerous bad influences.
Most advocates seem to be unaware of the history of minimum wage. In the U.S. and other countries, including Canada, South Africa, and Australia, the law was used as a means of excluding racial minorities to protect a privilege group. It made it difficult to hire Japanese workers who were willing to work for relatively lower wages in British Columbia, or blacks in South Africa.
Christians should know that the minimum wage can be used as a weapon of discrimination and ask themselves who is being excluded today. If people in the past saw this is a means of oppressing people then we have to ask if it is having the same effects today.
Pricing labor so high that it makes finding a job difficult is not the best way to help the poor. It keeps people out of the labor force at precisely the time they need to develop experience so that they can find better paying jobs later in life. No one ever got rich on a minimum wage job. It is condescending and cruel to tell people that they should expect to do no better. We can be more compassionate than that.