If you care to do some reading[1] there are a lot of studies that contradict your point. For example this study [2] finds that price pass through is not very sticky, and ends to last only through the fiscal quarter in which the new wage comes into effect. Remember, price increases can lower demand, and products and services that already charge the maximum that the market will bear. In reality wage increases usually just lower profits, they are in effect redistributive, and in a very direct way that doesn't involve the overhead of government handling the money.

[1]https://scholar.google.ca/scholar?hl=en&q=minimum+wage+incre... [2] http://www.mitpressjournals.org/doi/abs/10.1162/003465301750...