$15 Minimum Wage: The Straw That Will Break California’s Back

| |

Top Tier Gear USA

california flag wikimedia

Strict gun laws, asinine and superfluous regulations, a second-rate education system, domineering labor unions, unpayable public debts, rotting infrastructure, and mind-boggling housing costs. Which state are you thinking of right now? Is it California? I bet it’s California.

Over the years the People’s Republic of Kalifornia has developed quite the reputation for oppressive rules, dysfunction, and unsustainability; both financially and environmentally. Financially speaking the state has been on the precipice for some time. In recent years several of their cities have declared bankruptcy, and overall the state has one of the highest debt per capita ratios in America. It’s a big effing mess with no clear solutions in sight. There really isn’t any way that California, the biggest economic powerhouse in America, can sustain its current course.

California can however, hasten its demise with crackpot left-wing policies that are sure to ruin their economy, like raising the minimum wage.

A deal to raise California’s minimum wage to $15 an hour by 2022 was reached Monday by Gov. Jerry Brown and state legislators, making the nation’s largest state the first to lift base earnings to that level and propelling a campaign to lift the pay floor nationally.

The increase will boost the wages of about 6.5 million California residents, or 43% of the state’s workforce, who earn less than $15, according to worker group Fight for $15. The proposal had been headed to a statewide referendum. It’s now expected to be approved by the state assembly.

Will it raise the wages of 43% of the workforce, or kill that workforce? I’m betting on the latter. This will be the highest statewide minimum wage in the country. Seattle raised its minimum wage to $15 recently, as did Oregon, but in those cases the wage increases were focused on urban areas. And that’s one reason why California’s minimum wage increase is going to be so disastrous for the state’s economy. It’s going to be $15 an hour everywhere.

Wealthy West Coast cities can absorb the costs of higher wages (for the most part), but California’s policy is going to disproportionately affect its poor, rural, inland counties, of which there are many. These are regions that are just like any other rural part of America. They’re dominated by small businesses and mom and pop shops. Goods and labor are cheap because they have to be. Profit margins are already thin for everyone, and will be completely wiped out by this policy.

In any case though, the cities aren’t going to fare much better. It’s just that the rural areas are going to feel the heat first. In the long run it’s going to destroy jobs and raise costs all over the state, and contribute to countless other failed policies that California is reeling from.

The question is, will this policy add so much weight to Californa’s pre-existing problems, that it will be the straw that breaks the camel’s back? Forbes seems to thinks so. They recently made a compelling comparison to what California is planning to do, and what the unfortunate Greeks have already done.

Greece’s minimum wage zoomed from slightly below 600 euros in 2000 to close to 900 euros by 2011, according to Eurostat. That’s a 50% hike, exceeding the minimum wage hikes of Greece’s closest peers, Spain and Portugal, according to the same source.

Labor unions demanded these wage hikes, protesting in the streets and on picket lines. And politicians turned them into law.

That’s how labor compensation turned into an entitlement.

Unable to pay the higher wages, some Greek corporations downsized their operations or closed their doors altogether. Others moved to neighboring Balkan countries, where the minimum wage in Bulgaria is one-fourth of those of Greece.

A third group of Greek corporations — those with pricing power– hiked prices, shifting the burden to consumers.

A fourth group of corporations became welfare agencies, maintaining their labor force by counting on direct or indirect government subsidies to stay in business.

It was a situation where the government was financially propping up both average citizens and big business, and it was just too expensive. When the debt crisis came, this entitlement system imploded. Greece’s high minimum wage indirectly helped bring that country to its knees (among other reasons of course). It’s precisely what happens to all socialist systems, and Commiefornia will be no exception. Once this law is in place, California will be on the Greek path, which there is no escape from.

Delivered by The Daily Sheeple

We encourage you to share and republish our reports, analyses, breaking news and videos (Click for details).

Contributed by Joshua Krause of The Daily Sheeple.

Joshua Krause is a reporter, writer and researcher at The Daily Sheeple. He was born and raised in the Bay Area and is a freelance writer and author. You can follow Joshua’s reports at Facebook or on his personal Twitter. Joshua’s website is Strange Danger .

Wake The Flock Up! Please Share With Sheeple Far & Wide:
  • It’s Californication!

  • Hunter

    Wealthy West Coast cities can absorb the costs of higher wages

    The “cities” aren’t paying this higher wage, it’s the individual, often small, businesses that all go to make up a city. It will be a slow death for many of them until they decide ‘the hell with it’ and close shop and there go all of those living wage jobs. Others might figure out how to automate or pare down their employees but it’s going to do a lot of damage.

  • bill lopez

    $15 by 2022 – that’s another 6 years. With the real rate of inflation and the cost of living in California $15.00 an hour in 2022 will probably be LESS than the current minimum wage.

    And who says the economy is going to make it through another 6 years anyway?

  • Asylumsix

    The bigger you are the harder you fall…

  • Mike

    Jobs will be lost, hours will be cut and prices will go up again thus nullifying any freaking raise.

    • Can’t get that through to the morons though, this is why a Republic is better than a democracy.

      • Mike

        so very true.

  • Broos

    More Koch-$ucking UP to the 1%.

  • CurlyBill

    too bad for Caliph-ornia. I dont feel bad for them… I live in Oregon and do not visit there. I try not to buy anything from there…in fact I will go out of my way to not buy anything from Caliphornia.

  • Frank

    Socialism continues to creep in and displace Capitalism and Free Market systems – which self-balance in response to natural forces of supply and demand. Instituting another artificial and arbitrary requirement will have the opposite effect that they are so desperately seeking – unless their goal is to crash the economy completely, in that case they’re on the right track.

    • They’re not stupid nor incompetent, we’re being attacked by policy.

  • Sn SM

    “too bad for Caliph-ornia. I dont feel bad for them… I live in Oregon and do not visit there….”

    The problem is…California insanity…does not STAY in the peoples republic of kalifornia. Oregon is now being filled with escaping Californians who bring their
    Socialist big government insanity with them. Higher taxes, unconstitutional gun
    laws…love of police state activities…fear of freedom….you get it all when a
    family from California moves onto your block.

  • Clementine

    All by design… they want the Mom and Pops to go under, they want people housed in cities… when everyone is without work and packed into a city they will be easier to quell.

  • Boop Gahev

    Why wait until 2022? If it is a good thing, DO IT NOW!

    If you wait until 2022, the minimum wage will have to be raised be $20 an hour in order to keep up with the ever debasing fiat.

  • Tatiana Covington

    Socialism does not work, idiots!

  • Reverend Draco

    To those who support the minimum wage: Since you have established that using guns to force an employer to give someone a raise – instead of raises being merit-based as they should be – why stop at $15/hr? Why not $25/hr? $50? Hell, let’s make it an even $100/hr – instant prosperity for everyone! By the gods – that’ll stimulate the economy!

    Can I get a “rAmen” and a “Hells yeah?”

    Fuck “Fight for 15” – “Coercion for a C-note,” baby!

    • billdeserthills

      Who said You was a Reverend? Some other POS, I bet

  • Reverend Draco

    I generally use the Big Mac as a reference. . .

    Nationwide, the average price of a Big Mac is approximately 1/2 hour of minimum wage. Has been since at least the 1980s, perhaps longer.
    Every time the MW goes up, the price of a Big Mac soon reaches that approximate 1/2 hour mark.

    Currently, the MW in Cali is $10/hr, and a Big Mac averages $3.99 (call it $4 with rounding) – roughly 1/2 hour of minimum wage.

    So. . . what can we expect with a $15/hr MW?
    A Big Mac that runs $6.00 or more.