Economics is not medicine or physics. It is a lot more complicated and less understood. A reasonable man doesn't have a high chance of predicting the effect of this, and neither does a reasonable economist. Exhibit A, reasonable economists already disagree on this exact issue. Exhibit B, if $1-2 difference in minimum wage is enough to reduce the net number of restaurants, then we should see many fewer restaurants per capita in high minimum wage states than in low minimum wage states, but I know of no data showing that result.
I can certainly see how things might play out as you say: minimum wage goes up, crappy unproductive workers get paid more for being crappy and unproductive, more businesses close down than open up.
I can also see how it could play differently: minimum wage goes up, those higher wages get spent, some businesses benefit, the businesses paying minimum wage raise prices by a small percentage, it turns out that demand is inelastic, profit margins stay the same, worker turnover declines.
We really don't know.
Georgia has a very low minimum wage. Oregon had a high minimum wage. Are there more restaurants per capita in Georgia?. Do restauranteurs in Georgia make much more profit?.
We need data to form an opinion.
Old guys reniniscing about how $3.25 was a good wage 40 years ago is not data.
Seattle will give us data, in the coming years. I'm on the fence until I see that data.
Here are a couple other options. Maybe there could be a lower minimum wage for workers in their first six months in a job. If the worker is good, pay them more after that; if they are bad, fire them pronto.
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It is a pretty straightforward thing to predict. The elusive "reasonable man" would expect it. If you look at it logically, there are no surprises. When this shuts down a bunch of businesses, do you think it will be easy or hard to take the minimum wage from $15 to $10 an hour? After those businesses close, what would it take to bring them back?
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