A minimum wage increase approved by Congress died after President Bush vetoed the spending bill to which the increase was attached.
Bush said he vetoed the spending bill because it included a timetable for the withdrawal of American troops from Iraq. While Bush has said he supports an increase to the minimum wage as long as it is packaged with tax cuts for small businesses, he has also promised to veto any legislation that includes a timetable on Iraq.
Congress approved raising the minimum wage to $7.25 per hour over a period of 26 months and linked the increase to $4.8 billion in tax breaks for businesses. The minimum wage increase was stalled in Congress until lawmakers struck a deal on the tax-cut package last week.
Democrats don't appear to have enough votes to override Bush's veto, so lawmakers who support raising the minimum wage will have to go back to the drawing board.
Meanwhile, a growing number of states are taking action on the minimum wage. Thus far, 33 states have approved minimum wages above the current federal level ($5.15 per hour). Ten of those states have linked future increases to inflation.