DC is one of the most expensive cities in the country to live in. I should know, I live one block from one of the Wal-Mart stores under construction.

$8.25 an hour (DC minimum wage) will get you $17k a year with no vacations. This is below 30% Average Median Income for one person in the DC area, which is the local poverty limit. It will entitle you to some government handouts, rent assistance, etc. So taxes are subsidizing low wages for the poor.

But on the other hand, those taxes are paid by people who can afford them, and as a result retailers can keep their prices lower, which mostly benefits the poor. I suspect that forcing Wal-Mart to raise their workers’ pay will result in them having to raise their prices as well. But probably not quite as much, and in any event a little inflation in a depressed area is a good thing if it triggers growth.