Rhetoric to Challenge California’s Statist Elites

California’s ruling elites have enacted policies that make it impossible for middle class citizens to live here. They have artificially elevated the cost of living, nearly destroyed public education, decimated public services, neglected public infrastructure, and declared war on small business. To deflect criticism, they’ve convinced a critical mass of voters that any attempts to roll back these abominable policies are being engineered by racist, sexist plutocrats, and their willing puppets in the Republican party.

Exposing this diabolical, conniving scam won’t be easy. The ruling elites are a powerful coalition, comprised of left wing oligarchs including most of Silicon Valley’s billionaires, California’s public sector unions armed with the billion dollars (or more) they collect every year in forced dues, and the environmentalist lobby and their powerful trial lawyer cohorts.

Defeating California’s ruling elite requires a new coalition, comprised of the private sector middle class, enlightened members of the public sector middle class, and members of disadvantaged communities that aspire to the middle class. Attracting members of these communities, especially California’s Latinos, Asians, and African Americans, requires convincing them that current policies actually harm their interests.

To do this, there are two moral arguments the elites make that have to be debunked, because they underlie all of the intrusive, statist policies that are destroying California’s middle class. The first is the argument that capitalism is inherently evil and must be strictly curbed if not completely replaced by socialism. The second is the argument that unprecedented sacrifices must be made in order to save the planet from an environmental catastrophe.

Corrupt Capitalism vs Competitive Capitalism

Here are examples of two very different ways to critique wealth. In each example, the first phrase is employed by the ruling elites. It feeds on resentment and ignorance. The second phrase is offered as a counter argument. It appeals to the aspiring middle class family, or the small businessperson. It is designed to extol the positive virtues of capitalism and expose the opportunistic cynicism of the statist elites.

(1) “Tax the corporations” vs “make corporations compete.”

(2) “Capitalism is inherently evil” vs “no economic system in history has delivered more individual freedom and prosperity.”

(3) “Wealth is usually the result of privilege” vs “Wealth is usually the result of hard work in a free society.”

(4) “Government needs to regulate corporations” vs “corrupt corporations use regulations to destroy their smaller competitors.”

(5) “We have to redistribute wealth so people can afford to live” vs “we have to nurture capitalist competition to lower the cost of living.”

These arguments shine a spotlight on the great con job promulgated by the elites: The ruling class does not care about you, but we do. Because like you, we have to try to make payments on a half-million or even a million dollar mortgage, just to own a small house. Like you, we have to pay more for gasoline and electricity than any other citizens in any other state in America. Like you, we have to send our children to failing K-12 schools, then sink further into debt to pay tuition for them to attend colleges and universities where they don’t get a good education.

Extreme Environmentalism vs Practical Environmentalism

Apart from the distraction of race and gender, environmentalism provides the moral argument used as cover for policies that have imposed a punitive cost of living on Californians. It is important to make the distinction between attacks that discredit environmentalism in its entirety, and environmentalist reform that exposes the hidden agendas and inherent futility of California’s extremist environmental policies. Here are examples of two very different ways to apply environmentalist values.

(1) “Stop urban sprawl” vs “California has 163,000 square miles of land and is nearly empty, adding 10 million more people on quarter acre lots (even including new roads and new commercial/industrial centers) would consume less than 2,000 square miles!”

(2) “People need to live in multi-family dwellings” vs “detached single family homes are cheaper per unit to build than multi-family dwellings, and are more popular among buyers.”

(3) “There isn’t enough water for people to have detached homes and yards” vs “for less than $20 billion, we could build enough desalination capacity to provide water to every home and business in Los Angeles County; farming consumes 80% of all water diversions in California, we are exporting water intensive crops like alfalfa, grown using massively subsidized water, in the Imperial Valley (desert)!”

(4) “The government needs to discourage further development of fossil fuels such as clean natural gas” vs “Californians are paying as much as ten times what energy consumers pay for electricity in low cost states, and that California’s CO2 emissions are a minute fraction of those from other nations such as China and India.”

(5) “We have to get people out of their cars and build passenger rail” vs “cars, trucks and buses offer far more convenience and versatility, and are on the verge of becoming 100% clean and sustainable modes of transportation.”

(6) “No new mines and quarries should be allowed within California, and existing ones should be phased out” vs “developing in-state natural resources creates in-state jobs and costs less than importing materials from elsewhere in the U.S. and Canada.”

When the elites demand “environmental justice” for people of color, ask them (using the San Francisco Bay Area as an example) what any of that has to do with why we can’t build homes on the eastern slopes of the Mt. Hamilton Range, or in San Jose’s Coyote Valley, or along the I-280 corridor in the Santa Cruz mountains. Ask them why they’re paying 60% of their income for rent or a mortgage, when California has 163,000 square miles of land and is nearly empty. Ask why money that is being spent on high speed rail, using imported materials, isn’t instead being used to create high paying jobs in road and infrastructure projects that will actually improve lives. Ask why thousands of people aren’t working in high paying jobs in mining and quarrying, so building materials can cost less.

For aggressive reformers, good questions are plentiful. What have California’s elites done for working families? Have they gotten you better jobs? Have they nurtured robust and competitive housing markets to lower the price of a home? Have they widened the freeways? Have they enabled competition to drive down the cost-of-living? Have they made your communities safe and prosperous and affordable? Have they done anything other than bribe your so-called leaders with campaign contributions so they’ll do what they’re told?

It comes down to this: These purported spokespersons for true environmentalist values have become personally successful by fomenting environmentalist panic, but they do not represent the best interests of ordinary Californians, and they do not articulate a realistic or practical vision of environmentalism.

California’s elite has declared war on the working class. They have used race as a distraction, and extreme environmentalism as the phony moral justification for their self-serving policies. They must be exposed.

The Moral High Ground

This fact – that the rhetoric of California’s elite does not translate into a better quality of life for the people they govern – is the core moral argument against current policies. Across virtually every issue, the policies of the elites are failing ordinary Californians. Pouring money into public schools has not helped students. Raising taxes has not improved services. Expanding college curricula that replace academic rigor with what amounts to political indoctrination has not improved employment opportunities for graduates. And creating artificial scarcity in the name of saving the planet has not helped the planet, but it has impoverished millions of California’s most economically vulnerable residents.

In claiming the moral high ground, reformers can use the same rhetoric the elites have employed for decades, and by doing so will find the elites have already done much of their work for them. The seditious goal of making California friendlier to small businesses, with more affordable housing, more affordable energy, better jobs and better schools is furthered by reminding Californians what the elites have done. They have engaged in one of the biggest cons of all time, enriching themselves at the expense of the average worker.

Once the issues of race and environmentalism are exposed as overstated issues, overemphasized in order to manipulate the electorate, then the resentment the elites have inculcated in their constituents can be turned against them.

Pro-growth policies don’t have to rely on terminology that has been tainted by the status-quo elites. “Free market,” “Libertarian,” “Conservative,” “Classical liberal,” etc. have seductive appeal for many ideologically driven reformers, but they have limited value in California politics. Reformers have to supplement their vocabulary, borrowing more from the left than from the right. The values and slogans that the ruling class has invested decades in inculcating in the minds of Californians can be used against them, because these elites have engaged in rank hypocrisy. Terms such as “social justice” and “equity” now have tremendous value to reformers, because reform policies will further those goals, whereas the policies implemented by California’s elite have condemned ordinary people to poverty.

Examples of using terms popular with the left to advance reformer causes:
Social justice – charter schools, teacher accountability
Civil Rights – the right to a quality education in a school chosen by parents
Equity – competitive land development to create affordable housing
Micro-aggression – countless taxes, hidden taxes, fees and regulations
Fairness – prices for energy and water competitive with other states
Progressive – pension benefits with lower percentage formulas for highly paid public employees
Diversity – college curricula that embrace conservative as well as liberal values
Anti-Discrimination – merit based, color blind criteria for hiring and college admissions

A pragmatic, centrist ideology that co-opts the rhetoric of the status-quo elites to attack the ruling class can resist being pigeonholed as left or right, or conservative or socialist. We are pragmatists. We are pro-growth, pro-job Californians and our policies will lead to prosperity, affordable housing, affordable utilities, affordable education, and social justice and equity for all Californians, and not just the elites.

CalPERS is shocked – just shocked – to find cities reeling under the burden of growing pension debt

LA Unified can’t top its high-performing charter schools, so it’s tormenting them to death with bureaucratic rules

Why can’t California lawmakers stop sexual harassment in the capitol?

Assemblywoman Melissa Melendez, R-Lake Elsinore, sits at the Capitol. For four years, Melendez has authored a bill to enshrine whistleblower protections into law for those legislative staff members who come forward with allegations of sexual assault and harassment, only to have the bills killed in the Senate Appropriations Committee. (AP Photo/Rich Pedroncelli, file)

You know who doesn’t look so weird anymore? Vice President Mike Pence. When Pence told the Washington Post that he doesn’t dine alone with women, and never, ever attends an event solo if alcohol will be served, many gasped. He seemed like a too-tightly wrapped antihero from Margaret Atwood’s The Handmaid’s Tale.

But that was in ancient America, in March of 2017. Today, in the age of what a Reason magazine reporter calls “Weinsteining,” we know more.

We have pretty good reason to believe that film producer Harvey Weinstein is a sexual predator – a kind of horny zombie in a bathrobe, a powerful creature that eats not your brain but maybe your soul. But now, writes Cathy Young, we’re obliterating distinctions, in a #MeToo movement that “tends to lump together a wide range of male wrongdoing from rape to ‘creepy’ or boorish behavior.” That broad brush “raises a basic question about human relations in the working world,” she wrote in the Los Angeles Times this week: “Can work and sexuality or romance ever mix? For many supporters of this campaign, the answer seems to be no.”

Among those who said no before it became hip was Mike Pence. But when his perspective was published in the Post, he was ridiculed as a Victorian or worse. For her part, Young concludes “sexual interaction will happen unless the workplace is regulated to a dehumanizing degree and realistically, some unwanted sexual attention will happen as well. As we grapple with these issues, we desperately need nuance.”

Remember nuance? You’ll need some right now – as you read this – to understand why our state lawmakers can’t pass a bill to protect their staff members from sexual harassment of any kind.

Since last month, more than 300 women who have worked in the state capitol have said they too were victims of some sort of sexual harassment. You’d think our state legislature – dominated as it is by a liberal super-majority – would be eager to address the epidemic.

You’d be wrong.

“For four years, Republican Assemblywoman Melissa Melendez of Lake Elsinore has introduced a bill to extend whistleblower protection to legislative employees. And for four years, the bill has been buried by the Senate appropriations committee,” CalMatters’ Laurel Rosenthal wrote in September.

“It’s ironic to me that the Legislature passes laws that are very specific to what employers can and can’t do, but doesn’t want to impose the same rules on itself,” Melendez told Rosenthal in a separate story. “What is that?”

What is that, indeed? Why would a Democratic super-majority annually kill a bill to protect victims of sexual harassment? One explanation might be Reason writer Cathy Young’s – that Democrats in the appropriations subcommittee recognize that government over-regulation of the workplace is its own kind of harassment.

But that’s not how our Democratic majority ultimately explained it. Imagine a world in which Democrats demanded less regulation. Delightful.

Another obvious explanation for the failure to pass Melendez’s measure is that government officials delight in regulating others but generally see themselves as above the law. That’s a nonpartisan, human impulse. Understanding that impulse is behind the genius of democracy – and Lord Acton’s adage that power corrupts.

But acknowledging their own corruption on this issue would be impossible for the state legislature’s super-majority. So instead they have argued – in a state Senate subcommittee – that they cannot extend whistleblower protections to their staff because their staff members are not unionized. Their staff members are hired at will, the state Senate subcommittee said. And where employees are hired at will, they may be fired at will – they cannot be protected. Democratic translation: Where there are no unions, there can be no justice.

It’s an evil response, but (admit it!) somewhat clever for people who owe their political careers to the powerful government unions that keep California corrupt – and broke. Until their staff become union members, the Democrats will offer no protection.

You and I can call that what it is: the government unions’ war on women.

Will Swaim is president of the California Policy Center.

How Can Local Officials Prepare for the Upcoming Janus vs AFSCME Ruling?

“A public employer shall provide all public employees an orientation and shall permit the exclusive representative, if applicable, to participate.”
– Excerpt from California State Assembly Bill AB 52, December 2016

In plain English, AB 52 requires every local government agency in California to bring union representatives into contact with every new hire, to “allow workers the opportunity to hear from their union about their contractual rights and benefits.” What’s this all about?

As explained by Adam Ashton, writing for the Sacramento Bee, “New California government workers will hear from union representatives almost as soon as they start their jobs under a state budget provision bolstering labor groups as they prepare for court decisions that may cut into their membership and revenue.”

Ashton is referring to the case set to be heard by the U.S. Supreme Court early next year, Janus v. American Federation of State, County, and Municipal Employees. A ruling is expected by mid-year. It is possible, if not likely, that the ruling will change the rules governing public sector union membership. In pro-union states like California, public sector workers are required to pay “agency fees,” which constitute the vast majority of union revenue, even if they laboriously opt-out of paying that portion of union dues that are used explicitly for political campaigning and lobbying.

Needless to say, this law is designed to allow union representatives to get to newly hired public employees as soon as they walk in the door, in order to convince them to join the union and pay those dues. But can anyone argue against union membership?

The short answer is no. To deter such shenanigans, SB 285, thoughtfully introduced by Senator Atkins (D-San Diego), adds the following section to the Government Code: “A public employer shall not deter or discourage public employees from becoming or remaining members of an employee organization.” Governor Brown signed this legislation on October 9th. So much for equal time.

So what can local elected officials do, those among them who actually want to do their part to attenuate the torrent of taxpayer funded dues pouring into the coffers of public employee unions in California? Can they provide the contact information for public employees to outside groups who may be able to provide equal time?

Once again, the answer is no. To deter access even to the agency emails of public employees, a new law bans public agencies from releasing the personal email addresses of government workers, creating a new exemption in the California Public Records Act. Those email addresses could be used by union reformers to provide the facts to public employees. How this all became law provides another example of just how powerful public sector unions are in Sacramento.

In order to quickly get the primary provision of AB 52 enacted, which allows union representatives into new public employee orientations, along with a provision to deny public access to public employee emails, both were added at the last minute to the California Legislature’s 2017-2018 budget trailer bill, AB 119. The union access to new employee orientations is Article 1. The denial of email access is Article 2.

So how are the unions preparing for the Janus ruling? By (1) making sure the union operatives get to new employees as soon as they begin working, (2) by preventing agency employers from saying anything to deter new employees from joining the unions, and (3) by preventing anyone else from getting the official agency emails for new employees in order to inform them of their rights to not join a union. That’s a lot.

So what can you do, if union reformers control a majority on your agency board or city council, and you in a position to try to oppose these unions?

First, examine the legal opinions surrounding the wording of SB 285, “A public employer shall not deter or discourage public employees from becoming or remaining members of an employee organization.” The words “deter” and “discourage” do not in any way preclude providing facts. Consider this preliminary opinion posted on the website of the union-controlled Public Employee Relations Board:

“One major concern I have is that the terms “deter” and “discourage” are not defined. What if an employee comes to an employer with questions about what it means to be a member of the union, and the employer provides truthful responses. For example, assume that the employer confirms that being a member will mean paying dues. What if that has the effect of deterring or discouraging the employee from joining the union?”

It is possible for employers to present facts regarding union membership without violating the new law. Find out what disclosures remain permissible, and make sure new employees get the information.

Another step that can be taken, although probably not by local elected officials, is to challenge the new law that exempts public agency emails from public information act requests. And apart from accessing their work emails, there are other ways that outside groups can communicate with public employees to make sure they are aware of their rights.

California’s public employee unions collect and spend over $1.0 billion per year. If the Janus vs AFSCME ruling takes away the ability of government unions to compel payment of agency fees, and imposes annual opt-in requirements for both agency fees and political dues, these unions will collect less money. How much less will depend on courage and innovative thinking on the part of reformers who want to rescue California from unionized government.

REFERENCES

Get a state job and meet your labor rep: How state budget protects California unions, Sacramento Bee, June 21, 2017
http://www.sacbee.com/news/politics-government/the-state-worker/article156146364.html

AB 52, Public employees: orientation and informational programs: exclusive representatives, California Legislature
https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201720180AB52

Janus v. American Federation of State, County, and Municipal Employees, Supreme Court of the United States Blog
http://www.scotusblog.com/case-files/cases/janus-v-american-federation-state-county-municipal-employees-council-31/

SB 285, Atkins. Public employers: union organizing, California Legislature
https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=201720180SB285

2017-2018 budget trailer bill, AB 119, California Legislature
https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201720180AB119

California Public Records Act, Office of the Attorney General
http://ag.ca.gov/publications/summary_public_records_act.pdf

Fact Sheet – AB 52 (Cooper) & SB 285 (Atkins), California Labor Federation
http://calaborfed.org/wp-content/uploads/2017/04/2-AB-52-Cooper-and-SB-285-Atkinsweb.pdf

Legislative Bulletin – California School Employees Association
http://www.csea.com/web/portals/0/csea_pdf/leg_rpt.pdf

SB 285: Public Employers Cannot Discourage Union Membership, Public Employee Relations Board
http://www.caperb.com/2017/04/04/sb-285-public-employers-cannot-discourage-union-membership/

Public employee unions wield hefty Atkins stick [SB 285], San Diego Reader
https://www.sandiegoreader.com/news/2017/aug/28/ticker-public-employee-unions-wield-atkins-stick/#

Marin County Discloses Debt Balances on Property Tax Bills

How would you like it if every time you received a property tax bill from your county assessor, you also received a notice that disclosed the amount of the county’s total debt, annual operating expenses, total unfunded liability for pensions, and total unfunded liability for retirement healthcare?

You might not like it, but you’d have a better understanding of what all those property taxes are paying for. And in Marin County, back in 2013, after years of effort by a local group of activists – Citizens for Sustainable Pension Plans – that’s exactly what happened.

Take a look at the copy of this “2016-2017 Property Tax Information” courtesy of Marin County, sent to one of their property owning taxpayers. Towards the bottom of the page, in the section entitled “MARIN COUNTY DEBT AND FINANCIAL DATA,” even the casual observer can quickly see that (as of 6/30/2015, the numbers are over a year behind) Marin County recognizes $549 million of debt on their balance sheet. The not so casual observer might have additional questions…

 *   *   *

QUESTIONS RAISED BY “MARIN COUNTY DEBT AND FINANCIAL DATA”

For example, why does the total “Retiree Related Debt” of $746 million exceed the “Total Liabilities per Balance Sheet” of $549 million? While the 6/30/2015 Consolidated Annual Financial Report (CAFR) for Marin County does report total liabilities of $549 million on page 9, “Condensed Statement of Net Position,” there is no schedule anywhere in the remaining document that provides the details behind that number, making reconciliation impossible. A simple keyword search on the number “549” proves this.

Elsewhere in Marin County’s 6/30/2015 CAFR, on page 61 “Note 8: Long Term Obligations,” the balance payable on pension obligation bonds is disclosed at $103 million, which matches the amount disclosed on the property tax information. Since on this same chart in Marin County’s 6/30/2015 CAFR the “Total Long Term Obligations” are reported to be $286 million, it is reasonable to assume that Marin County’s non-retirement related debt is the difference, i.e., $176 million.

So what does this all mean to the non-casual observer?

It means that Marin County’s total long-term debt as of 6/30/2015 was $922 million, and $746 million of that was for earned but currently unfunded retirement obligations to county workers. That is, 81 percent – eighty-one percent – of Marin County’s long-term debt is to fulfill promises the supervisors made to provide pensions and healthcare to their retirees, but have not paid for. At 7%, just the annual interest on this $746 million is $52 million per year. Imagine what Marin County could do with an extra $52 million per year.

There’s more. The non-casual observer will note that just the interest on Marin County’s unfunded retirement obligations, $52 million per year, equates to 11.2% of their entire reporting operating expenses in the 2014-2015 fiscal year, $464 million. But Marin County doesn’t just have to pay interest on their unfunded retirement obligations, they have to pay them off.

In the private sector, compliant with reforms for which, inexplicably, public sector agencies are exempt, pension systems have to amortize (pay off) their unfunded liabilities within seven years. At that rate, at 7%, the payment on Marin County’s unfunded retirement liabilities would be $138 million per year. That would be the financially responsible thing to do.

Wait! There’s much more. After all, Marin County doesn’t have to just pay off their unfunded retirement obligations, they have to make ongoing payments, as a percent of payroll, for the future pension benefits their active employees earn every year they’re working. How much is that?

Learning how much Marin County spends on payroll is tough, even though it should not be. Their CAFR discloses costs per department, in some cases, but finding a simple “Total Costs for Employees” appears to be impossible.

Rather than wade through Marin County’s entire 224 page CAFR for FYE 6/30/2015, payroll information can be found on Transparent California. Going to their Marin County page and downloading the Excel spreadsheet readily reveals that in 2016 they spent $275 million on pay and benefits, roughly 60% of their total expenditures. Payments for benefits – mostly retirement but also for current healthcare – totaled $71 million of that. Needless to say, that $71 million is not nearly enough to pay for (1)  current healthcare insurance plus (2) currently earned pension and (3) retirement healthcare benefits, along with (4) any sort of aggressive paydown of the debt for retirement benefits earned in prior years, but not funded at the time. Even if you add in the amount employees themselves contribute via withholding (Information on that? Somewhere. Good luck finding it).

If you’ve made it this far, braving this mind numbing arcana that obfuscates one of the greatest betrayals of the people by their government in American history, let’s break this down just a bit further.

Even on a 30 year repayment schedule, at 7%, Marin County’s unfunded retirement debt of $746 million would require an annual payment of $60 million. Coming out of $71 million, that leaves $11 million to work with (plus whatever employees contribute via withholding), to pay (1) current healthcare insurance AND (2) whatever new retirement healthcare benefits were earned in that year, AND (3) whatever new pension benefits were earned in that year. This amount paid to fund pension benefits earned in the current year, called the “normal contribution,” is usually expressed as a percent of payroll. According to Transparent California, Marin County’s base payroll in 2016 was $186 million. That means that if they were making just the bare minimum payments on their unfunded retirement liabilities, their total payments for currently earned benefits – normal pension contribution plus normal OPEB contribution, plus current year healthcare, plus whatever other benefits they offer – only amounted to 6% of payroll. Only six percent! There is no way that difference was made up via employee contributions.

Based on these numbers, it appears impossible that Marin County is adequately funding retirement benefits for their employees. Not even close. And it should be easy to coax these numbers from the reports available, and it should be easy for anyone with a reasonable amount of financial literacy to find these numbers and come to the same conclusion. It is not.

RECOMMENDATIONS

(1)  Make a “Debt and Financial Data” disclosure mandatory on all property tax bills, in all California counties.

(2)  Have this data include the following twelve numbers, with the expense subtotals showing the percentage of total expenses, and the debt balance subtotals showing the percentage of total debt:

  • Total county expenditures,
  • Total county expenses for payroll and benefits,
  • Amount paid towards retirement healthcare (OPEB) earned in current year,
  • Amount paid towards unfunded retirement healthcare (earned in previous years),
  • Amount paid towards retirement pensions earned in current year,
  • Amount paid towards unfunded retirement pensions (earned in previous years),
  • Amount paid on pension obligation bonds,
  • Amount paid for all other debt,
  • Total debt,
  • Total debt for healthcare,
  • Total debt for pensions (unfunded pension liability),
  • Total debt for pension obligation bonds.

(3)  Include on county CAFRs for the same year a section that contains all of the above information, with a through reconciliation to the official financial statements and schedules, so even the casual observer can verify the accuracy (or at least the consistency) of all numbers reported on the property tax schedule.

REFERENCES

Marin County Board of Supervisors, 7/30/2013 Minutes (ref. item 3, page 1)
http://marin.granicus.com/MinutesViewer.php?view_id=33&clip_id=6714&doc_id=c40ad825-4c42-1031-bc96-29b50f2ba9d1

Marin County Board of Supervisors, Meeting Archives
https://www.marincounty.org/depts/bs/meeting-archive

Marin County Citizens for Sustainable Pension Plans
http://marincountypensions.com/index.html

Marin County 2015-2016 Consolidated Annual Financial Report
https://www.calpers.ca.gov/docs/forms-publications/cafr-2016.pdf

Marin County Archive of Consolidated Annual Financial Reports
https://www.marincounty.org/depts/df/financial-reports

Transparent California, 2016 salary and benefit payments for Marin County
http://transparentcalifornia.com/salaries/2016/marin-county/

Seattle’s Minimum Wage: Bad Hygiene and Lower Wages

California’s minimum wage is set to gradually increase to $15 by 2022, following in the footsteps of minimum wage pioneer city Seattle.

Unfortunately, the unintended consequences of Seattle’s minimum wage experiment are starting to show, both in deteriorating restaurant quality and in decreasing wages for low-income workers.

According to the latest study, Seattle’s 2016 minimum wage hike approved by the Seattle City Council appears to have pushed restaurants to deal with rising labor costs by cutting corners in hygiene. Researchers at Ball State University in Indiana concluded that overall restaurant health code violations increased by 6.4% and less severe violations increased by 15.3% with each dollar increase of the minimum wage.

Bad hygiene is gross, but it isn’t the only serious consequence of Seattle’s minimum wage increases. Researchers from the University of Washington published in June their finding that Seattle’s increase from $11 to $13 coincided with a decrease in actual wages for low income workers – the exact opposite of the policy’s intended result.

According to the study, the 2016 increase to $13 led to a 9% decrease in hours worked at low-income jobs, while hourly wages rose by 3%. This means that on average people in low-wage jobs earned around $125 less per month than they earned before. Instead of helping people in low wage jobs, significantly raising the minimum wage in Seattle has actually hurt their earning ability!

My Dear Randi,

Borrowing to fund pensions could make California the next Puerto Rico

Governor Brown’s proposal to borrow money to fund CalPERS is similar to a move by Puerto Rico in 2008. That step backfired and now Puerto Rico is bankrupt.