James D. Miller column at Tech Central Station is a handy, concise answer to attacks on Wal Mart's business model.

Paying higher wages would also cause Wal-Mart to substitute greater for lesser skilled employees. For example, at $8 an hour you might be happy to hire a neighborhood teenager to cut your grass, but if you were coerced into paying $20 an hour for lawn care you would probably drop the teen and hire a landscaping company. Like every firm, Wal-Mart always tries to hire the best people it can for the wage it offers. If Wal-Mart paid higher salaries, it would be able to attract employees with greater skills and so would employ fewer unskilled workers.

Miller also demonstrates how minimum wage laws cause higher unemployment:

American shoppers are accustomed to having others bag their groceries. Large supermarkets in France, however, require customers to do their own bagging. France has a much higher unemployment rate than the U.S., so it seems very inefficient for the French economy not to put some of its unemployed to work bagging groceries. About one-half of U.S. retail employees earn less than France's minimum wage. So although it's profitable for U.S. stores to hire bag packers, its high minimum wage makes it unprofitable for France's supermarkets to do the same. The result for France: less pleasant and more time-consuming shopping experiences for customers, and higher unemployment for workers. Do we really want to force Wal-Mart to pay higher wages, thereby causing them to make their customers bag their own groceries?