no its not a fallacy, when they did this in seattle , restaurants let go lots of people, stores closing in LA now over this... , employers will make others do more or at the very least, go to part timers where they dont have to pay all the full time costs of insurance and other regulated fees the government mandates, etc,, , the increase costs will lead to increase prices which will mean those getting the raises will end up with a net no change in thier economic standing, that is if they get to keep thier jobs in the first place!!,, with many services and products increasing in price too the rest of us have less buying power thus less in bought in the economy, less trips out for dinner, less every thing and the downward trend continues of job cuts.