Minimum Wage Hike

"The proposed wage hike is a way for business and labor interests in blue states to raise labor costs in the red states with which they compete," said NCPA Distinguished Fellow Robert McTeer. "What business wouldn't relish the thought of raising the costs of its competitors?"

McTeer says that the higher minimum wage will have a negligible effect on most blue state cities on the coasts. "Yet in the interior of the country, there will be predictable bad effects: higher unemployment and higher costs of business."

Comparing a $7.25 wage with the cost-of-living in 50 major metropolitan areas (See Full Chart Online Here), the NCPA found that due to differences in the cost of food, housing, gasoline and other goods the purchasing power of the federal minimum can vary widely depending on where a worker lives.

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I found the argument that states use federal wage laws to hurt their domestic competitors to be very original and interesting. It's also very intuitive. As some of you may know, I ruffled some feathers last year when I posted my opinions about federal minimum wage laws on the John Edwards blog. With the growing possibility that John Edwards will be chosen as the 2008 Democratic presidential nominee, it is worth revisiting those arguments. They can be found here.