The Third Way policy institute deigns to tell us that we can make the minimum wage less damaging – something which is most certainly true. We should and could do this by having regional minimum wages, tied to the costs of living in various places. This would indeed be less bad than one federal minimum wage, but it’s also selling the pass on the very idea itself. For if we agree, which I most certainly do, that wages should vary, that there should be no rigid national minimum, then there’s no argument in favor of the federal minimum wage at all, is there? We’ve all just agreed that there shouldn’t be one, so let’s not have one.

The institute has a New York Times op-ed about their report. They note, entirely correctly, that the cost of living varies around the country. It costs $120 (roughly) in Hawaii to get the standard of living that $80 buys you in Beckley, W.V. The calculations for this are done by the Bureau of Economic Analysis and are called “Regional price parities.” It’s the same idea and the same method used internationally to measure purchasing power parities between countries.