How to Put a Waitress Out of Work

Many Christians think, for example, that, because Christians are called to care for the poor and because they think that increasing the incomes of the working poor will greatly help the poor, they advocate raising the minimum wage. Economic theory, however, demonstrates definitively that if the government imposes a minimum wage above the market wage, unemployment will occur and those who lose their jobs or are not hired to begin with will be the least productive, and hence, most poor of all. As I write in my book:

When attempting to formulate economic policy that best fosters sustained economic progress, prevents recession, or encourages recovery in the middle of a recession, policy makers must keep in mind that economic law is indeed economic law. It is not merely economic opinion or economic suggestion. Sound economic principles are sound because they are derived from the reality of human action. Just as Congress cannot repeal the law of gravity, it cannot repeal the laws of economics either. For a policy to effectively achieve its goal, it must be in full accord with sound economic analysis (Ritenour 2010, pp. 382–83).

The bottom line is that raising the minimum wage above the market wage results in unemployment. At best, some people are helped at the expense of the most economically vulnerable. Harrkin’s bill would be better titled the Keep America Out of Work Act.