Posted on 04/17/2016 7:00:11 AM PDT by Kaslin
My home state, California, has edged out New York to be the first state adopting a $15 minimum wage. Our Governor, Jerry Brown, gave the policy a full-throated endorsement. He stated “I'm hoping that what happens in California will not stay in California, but spread all across the country. It's a matter of economic justice. It makes sense.” If you know anything about California, you too would be in support of this righteous increase that more than doubles the national minimum wage.
How does anyone expect one to live on a measly $7.25 an hour? After all, this is not Des Moines. Have you seen the prices for things out here? Half the people cannot afford to live and the other half are driving BMWs.
First, let’s start with the cost of gasoline. When people come to visit us and we drive them somewhere, they are shocked by the signs at our ubiquitous gas stations. They want to know why our gas costs anywhere from $.80 to $1.25 more per gallon than theirs does at home. We tell them “My God, this is California; what do you expect? We have our own gasoline blends for every season. It is to protect our environment.” Even when the country was awash in gas and prices were plummeting below $2 per gallon, we had a shortage that spiked our prices. But it is all good because we get to live in California. How is a person making what people make in Baton Rouge supposed to pay for our gas?
Then there is the cost of electric power which is 50% higher in California than the national average. But it will not be for long. Because our wise elected leaders including Governor Brown put into law a requirement that 50% of our energy comes from “renewables” by 2030. Forget that the price of natural gas and oil has plummeted and new supplies have been found that will last for generations; we have to think about global warming. We can bear the cost of doubling our electricity rates. And the good part is we will have those nifty-looking windmills everywhere. How does a person afford this excellent electricity making what people make in El Paso?
Of course, there is the cost of housing. The 12th Annual Demographia Housing International Affordability Survey for 2016 ranked four California cities (San Jose, San Francisco, Los Angeles and San Diego) in the top ten least affordable cities in the world for middle class housing. Four in the top ten for housing costs in THE World. That is fairly astounding. This obviously has nothing to do with government controls, rent control, government fees or restrictive development policies by urban planning imps or any of Governor Brown’s policies.
A friend of mine’s son rents a small studio apartment in San Francisco for $3,200. The soaring housing costs have caused the Black population to plummet in San Francisco from 14% to 6%. That is the smallest percentage of Blacks in the 14 largest U.S. cities except one: San Jose has only 3% black population. The government policies, of course had nothing to do with this development. With these housing costs how would you expect anyone to live on the same wages as Savannah, Georgia?
Other states may have a higher poverty rate, but that is before there is an adjustment for the cost of living. When the adjustment is made for the cost of living, California has the highest average poverty rate from 2010-2014. The 23.8% living below the poverty line in California exceeds every state except the District of Columbia (included in the study) at 22.7%. Mississippi has the highest poverty rate, but once you adjust for the cost of living it plummets to 16.1%. When that many people are living in poverty, either you must hand them out government money or have their employers’ increase their wages.
What we see is that all Californians will now be able to support themselves without government handouts. Between the increased tax revenues and decreased welfare costs, taxes on everyone will significantly decrease. Thus, we are sure Governor Brown will be able to call for a cut in the state tax rates. Since California has the second highest combined tax burden after New York, that will help to attract a lot of new people to the state.
The important thing is businesses can absorb these increased payroll costs. You may want to remember that all payroll will be going up. For instance, now with the new pay rate people making up to about $62,400 per year will be subject to California overtime rules which are eight hours per day and 40 hours per week. Everyone will share in the new benefits.
When business owners let their customers know that the 20-25% increase in their meal at a restaurant will be going for such a good cause (lowering the poverty rate), the selfless residents of California will heartily pony up the additional money. When people care about each other like we Californians do, this will work out.
It will be so delightful when you go to a McDonald’s and will not have to face those annoying, cheerful, young faces greeting you and asking for your order. Instead you can choose your own food from a tablet at the counter, swipe your debit card and then have Robot Rob deliver it to you. Who wants all that human interaction ordering a McMuffin?
Now that you have some perspective, you must agree that a $15 minimum wage is responsible. No one can live on these current wage levels. After all, have you seen the price of a Martini on Sunset Boulevard? It is at least $15 and that is for a well or generic label. Can you imagine how much it is with Absolut? How is a person supposed to support themselves on these wages with these prices?
The main problem is the raise is not tied to merit and hard work.
You can be a terrible worker and you still get a huge raise and it leaves a person wondering why work hard — there is no reword in it.
Isn’t socialism wonderful.
My previous reply doesn’t make too much sense on this thread/topic.
BUT.
That is exactly how Obamacare was being sold to the public. That the richest country on earth (ha! we are the poorest now with liabilities and deficits) can afford so-called universal healthcare for everybody.
Even though Obamacare has absolutely nothing to do with providing healthcare to people.
The underground job network goes for less than minimum wage for some jobs. I predict this will eventually be much more wide spread.
it will actually be a pay decrease:
many will lose their jobs in small and bigger business that cannot afford multiple workers at $15/hr.
the cost of everything will increase as a result making the seeming increase - non existent.
Then the cycle of whining for a minimum wage increase then starts again.
job performance is still in my view the best way to factor pay. Many with skills or “education” or years on the job even, may not put them to use so I see no need to pay some one by those criteria without largely focusing on day to day performance.
The dirty little secret is that without the ready availability of off-the-books, under-the-table illegal alien labor, there would be no garment industry in L.A. It isn't something that would ever have come into existence hiring $15.00/hour US citizens.
A lot of people who are proud of their "Made in the USA" labels would be shocked to see how those garments are actually made, and by whom. I should have taken a picture of the row full of "retired Mexican Mafia" guys I saw sitting at the sewing machines at the last factory I visited. Might have made a good campaign ad. :)
Per Gov Moonbeam, “I’m hoping that what happens in California will not stay in California, but spread all across the country.”
Well, of course, he does. That will be the only way to slow or stop the mass exodus of small and medium size businesses from his greedy as hell state government.
There was a time, before the dumbing down of America, when politicians, economists, the media and most other people understood the difference between entry level jobs, low skilled jobs versus a career.
Many in my generation, myself included, often held two, three or more jobs simultaneously as we worked our way up the economic ladder and built a career.
We didn’t expect to earn a living wage to support a family slinging hamburgers part time.
I know there are still many people who are sensible and responsible and follow that pattern.
They do what they have to do to succeed - to make something more of their life.
These are the kind of people who America should be proud of - who should be held up as examples.
But as in so many other things today, the slackers, whiners and moochers get the attention and empathy.
Who you zoomin’?
California will just put up an iron curtain.
Far more scarey are words “social justice”.
You might thank QE, but now you can thank the $15 a hour new wage, because the disparity will only go up, up, up!
Do these idiots realize that if stuff is too expensive now, forcing the company to raise wages will NOT be passed on as another cost of doing business?
Well, that’s a rhetorical question, because it is obvious that they do NOT know...
Economist Henry Hazlitt writes: “…the whole of economics can be reduced to a single lesson, and that lesson can be reduced to a single sentence. The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups.”
In a way, this is good because if the new minimum wage begins to show unintended consequences in California, it should child proof the rest of the legislatures in the country.
The level of class envy is astounding.
Excellent point. Wageflation is coming and it’s gonna be ugly. When the full $15/hr kicks in the grunts will be making as much as the 2nd-tier and some management. The resentment will fuel the need for wage assessments (read: increases) but management is already stressed because they lost so much profit to the initial $15/hr scam.
When 2nd tier and management don’t get commensurate (idiotic) increases they will either act out with sabotage/theft/insubordination or they will jump ship for greener pastures. Eventually management will respond to the true realities of the marketplace and raise wages. At that point the minimum wagers will be back at a marginalized point again.
The left will never learn that you can’t artificially twist the marketplace without consequence.
I’ll bet they are the same people who eat at a restaurant and leave either a very small tip or no tip at all for the waitress/waiter.
I just bought myself a new sewing machine. I used to make all my own clothes. I plan to rekindle that .. and maybe do a little sewing for my neighbors.
“The underground job network goes for less than minimum wage for some jobs. I predict this will eventually be much more wide spread.”
Word.
Off the books man, off the books.
If a zombie apocalypse were to start in CA, Gov Moonbeam would state,“I’m hoping that what happens in California will not stay in California, but spread all across the country.”
My son and his family recently moved from Kansas City to California. All four of them are foodies, including the 18 month old. The were shocked that they could not find local owned small restaurants and bistros that are family friends, good food, and good service. All of the restaurants were either fast food with only counter service or very high end restaurants. They live in Redwood City and spend their time there, in Meno Park, and Palo Alto. But, even venturing out from Techie Land, the same pattern prevails.
I suggested to them that no one can afford to run the small neighborhood eateries that are so popular in KC. The cost of servers and good cooks may such a place impossible in La La Land. Fast Food places get by with minimal staff, while the high end places cater to those who don’t care what the bill might be. Those are your choices.
Ignorance is bliss.
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