It’s time to rethink the national minimum wage. It’s too low at $7.25 an hour, but there’s a reason Congress hasn’t voted to raise it since 2007. Think Spokane, Wash., Midtown Manhattan and Selma, Ala.

In Spokane a 2,700-square-foot home with four bedrooms and two bathrooms is on sale for $165,000, with a $600 monthly mortgage—roughly what New Yorkers pay to rent a parking spot. In Selma, the median home is valued around $90,000, according to Niche, a company that analyzes real-estate markets. The idea that Spokane, Manhattan...