Last week, two public policy groups, Interfaith Worker Justice and Faith in Public Life, wrote a letter to Congress stressing the moral obligation to raise the federal hourly minimum wage from $7.25 to $10.10.
According to Catholic News Service, it was “signed by about 5,000 people, including more than 30 prominent religious leaders known for their work on social issues.”
The letter described increasing wages as “indispensable to ensuring that no worker will suffer the indignity of poverty.”
But the question shouldn’t be whether or not fighting poverty is a moral obligation—our call as Christians to help the least of these is clear. Rather, the question should be whether or not raising the minimum wage will actually help the poor.
Dr. Anne Bradley is not convinced it will:
Without looking at the long-term, often unintended consequences, we won’t see the full picture.
In fact, she says in this post that it will hurt them in two different ways:
- A higher minimum wage raises the cost of employment for businesses, resulting in job losses. It becomes riskier to hire lower-skilled laborers, and studies have shown that lower-skilled laborers are actually becoming unemployed.
- Raising the costs of employing workers means that firms often have to raise their prices to cover the difference. The increased price of goods and services disproportionately harms the poor because they don’t have the excess disposable income to absorb the rising costs of buying things they need.
So the very good intentions behind minimum wage policies often harm the very people we are trying to help. Instead of closing the opportunity gap, we widen it by cutting off opportunities for the poorest among us.
Public policy definitely affects the poorest and least powerful among us. It’s just not always apparent how. In this case, it’s easy to miss the harmful unintended consequences of raising the minimum wage.
What then should we do to help the poor?
Dr. Bradley proposes a solution: empower businesses owners.
If we want to care for the poor, and enable them to use their gifts to serve others, we must empower the people who stand ready and willing to employ them and not hamper those efforts. Only then are the poor able to get on that ladder of economic progress and escape the trappings of poverty.
One way to empower business owners is to support public policy that increases their economic opportunities instead of shrinking them.
But even if the religious leaders who banded together to write this letter failed to see the unintended consequences of raising the minimum wage, their involvement in the public square is an example for all people of faith to follow. According to the article,
Faith leaders and advocates for working people are writing letters, taking part in prayer vigils at state capitols, meeting with government leaders, and writing bulletin inserts on this issue.
If we really want to help the most vulnerable, other faith leaders and advocates should follow their example, but in support of free enterprise that creates more opportunities for the poor, not less.