Dan Price, the young CEO of Gravity Payments in Seattle, generated a boatload of publicity and controversy last month when he committed to pay every one of his 120 employees an annual salary of at least $70,000. Price said he was concerned that lower-paid employees were struggling to make ends meet.

In light of our country’s growing economic inequality, the 30-year-old Christian saw his own $1 million salary as part of the problem. To fund the raises for more than half the company’s workers, he cut his salary to $70,000, and decided the company could afford to reduce profits by as much as half.

In the week after the story first broke Price got emails from nearly 100 CEOs lauding his decision. But not everyone was so enthusiastic.

The New York Times ran a follow-up piece detailing some of the criticism directed toward the company. Naysayers from the business world say the move to “overpay” workers rather than trusting the market rate could do more harm than good. They suggest the new salaries could spur resentment from once higher-paid workers and hurt long-term productivity. Some critics lambasted the decision as socialism.

These criticisms from purported defenders of free-market capitalism—from business professors and economists to talk show host Rush Limbaugh— evidence egregiously flawed thinking about both capitalism and free markets. They’re also at odds with the wisdom of Scripture.

Despite the concerns over the pay shift as socialism, Gravity Payments has every intention of continuing to operate as a business selling a service and making a profit. In fact, as a result of the recent publicity, several new clients have signed on. Dan Price and his company are practicing ...

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