My View: Minimum Wage Increase Necessary

MWP-3The Question is How Much and How Long a Ramp Up – The push to put a $15/ hour minimum wage ordinance on the ballot was a bold move, that generated a lot of controversy and concern. But it has also sparked, for the first time since 2006, a real discussion in this community about what a living wage is and how much it should be.

It seems unlikely that there will be a ballot measure for November, with the May 1 deadline rapidly approaching. The organizers are suggesting that 2015 is a more reasonable target date, and that gives us a change to recast the discussion.

While we agree with the overall premise of the Raise the Wage Davis folks, we believe that the discussion should focus on what a living wage needs to be, how long we should reasonably take to get there, and how we can keep the wages at a more constant level.

The raise the wage campaigners give us a starting point for discussion, proposing an increase to $15 an hour with a brief ramp up period. Naturally, business interests look at these figures and cringe. They see huge increases in costs, leading to layoffs and business closures.

From our standpoint, we need to be able to scientifically analyze what a living wage is, how much it should be, and how long we need to take to get there.

Minimum-Wage-graph

If you look at federal minimum wage in terms of constant dollars, you see pretty clearly that, while the real value is punctuated by periodic wage increases, for the most part the value of minimum wage has declined over time.

That leads to the first point, that any new minimum wage policy should create a target goal and then have a built in annual inflator. Such an inflator would actually help employees who would not see their wages decline in real terms, and it would also benefit employers who would not have to see periodic spikes in wage increases, instead seeing wages increase 1 to 3 percent annually depending on the measure of inflation that the wages are tied to.

That leads us to a second point, which is that raising the wage immediately to $15 might be problematic from the perspective of employers. So, perhaps a better approach is to more slowly ramp up the wage increases, in increments that businesses could better absorb into their expenses. What if we ramped up those wages not over a year or two, but over ten years?

Proponents argue, “It’s time to bring a $15/hr minimum wage to Davis. We can change things. Right now, the minimum wage is just $8 per hour. This translates to less than $17,000 per year. We’re trying to put an initiative on ballot for a $15 minimum wage in Davis. This ensures that nobody who works full time should have to live in poverty.”

But opponents are quick to cite data that many minimum wage earners are not the primary wage earners in their family. And that most minimum wage earners are young.

The Pew Research Center last summer found “not very many people earn minimum wage, and they make up a smaller share of the workforce than they used to.”

They cited data from the Bureau of Labor Statistics that found that “1.566 million hourly workers earned the federal minimum of $7.25 an hour; nearly two million more earned less than that because they fell under one of several exemptions (tipped employees, full-time students, certain disabled workers and others), for a total of 3.55 million hourly workers at or below the federal minimum.”

People at or below the federal minimum are:

  • Disproportionately young: 50.6% are ages 16 to 24; 24% are teenagers (ages 16 to 19).
  • Mostly (78%) white; fully half are white women.
  • Largely part-time workers (64% of the total).

MinimunWageTable

However, that analysis understates the impact of raising minimum wage to $15, because there are a lot of people, in between the current minimum wage rate in California of $8 (which goes up to $9 on July 1 of this year, and $10 on January 1, 2016) and $15, who are not now classified as earning minimum wage.

Nevertheless, legislative data suggests that 90% of minimum wage workers in California are over 20, while 2.4 million of the state’s children live in households who earn minimum wage.

The argument has been posed that we perhaps should discount the poverty level wages because most families are not living on minimum wages. But not so fast. First, about if 2.4 million of the state’s children live in minimum wage earning households, that is more than a quarter of the 9.3 million children in the state.

Second, why are we discounting students making minimum wage? Given the costs of college tuition soaring in recent years, we have an epidemic of students saddled with huge student loan debts – the ability of those students to earn more in wages should not be so easily discounted.

Another issue is whether a city should be the one making minimum wage laws.

As we have noted, Kari Fry in her letter claims to be in favor of minimum wage “increases that are already scheduled by the state of California and proposed by the president of the United States.”  But she writes, “I do not support a localized minimum wage that inevitably will put our community at an economic disadvantage.”

The Enterprise in their editorial writes, “Oh, and while we’re at it: We oppose a city-by-city approach to the minimum wage. The state is the appropriate place for this change to occur.”

While that may not be an unreasonable position, it does ignore an interesting factor, California is almost as diverse as the United States. We have a federal minimum wage which sets the overall floor for wages and states are free to go higher.

Why should the same principle not apply within the state of California? It is not like all communities in California cost the same to live in. So if someone makes a given wage in Dixon or Woodland they have better purchasing power than someone who makes the same wage in Davis. So why not allow minimum wage laws to account for local preference and conditions?

The real question is whether a minimum wage ramp up can be structured in such a way that workers get an increased bang for their buck while not creating the conditions that lead to layoffs and business closures.

It is a fine line and the best solution is to figure out where that line should be drawn. To do that, we need to get empirical researchers into the room with activists and business interests, and, hopefully then, we can create a solution that meets everyone’s needs.

—David M. Greenwald reporting

About The Author

David Greenwald is the founder, editor, and executive director of the Davis Vanguard. He founded the Vanguard in 2006. David Greenwald moved to Davis in 1996 to attend Graduate School at UC Davis in Political Science. He lives in South Davis with his wife Cecilia Escamilla Greenwald and three children.

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131 thoughts on “My View: Minimum Wage Increase Necessary”

  1. South of Davis

    David wrote:

    > nearly two million more earned less than that because they fell under
    > one of several exemptions…

    Most of the people with exceptions didn’t “earn less” they “earned MORE”. When I was an undergrad my roommate was a bartender “making minimum wage” and he came home with over $100 CASH in his pocket every night (after tipping out his bar backs).

    When talking about “minimum wage” we should not forget that quite a few people (bell hops, valets, cocktail waitress, limo drivers etc.) make a LOT more than “minimum wage” (even more since few declare more cash than they have to and get a lot of “tax free” cash).

    1. D.D.

      If your bartender buddy slipped and fell at home, not at work, and hurt himself, did he have excellent health insurance? Did he have very many vacation days and paid sick days?

  2. SODA

    “To do that, we need to get empirical researchers into the room with activists and business interests, and hopefully then, we can create a solution that meets everyone’s needs.”

    Suggest our community or the proponents approach UCD to do such a study. We have abundant talent in town and this could help answer your question, e.g., Sociology Dept, Graduate School of Business, Math, etc. Choose your flavor!

    1. Tia Will

      Alan

      I am unclear if you are serious or not. So let’s say the minimum wage is repealed. Does this mean that you support raising taxes so that they increased number or people having to supplement their income with food, and housing vouchers ? While we are discussing adverse consequences, can we not acknowledge that decreased wages will increase government dependency which is so abhorrent to some ?

    2. HVenon

      Repealing the minimum wage would send more people into the food stamp and welfare offices. Let’s say a person had a low-skilled job digging ditches or picking crops – at $3.00 an hour. How could they sustain themselves? Obviously, they’d be forced to sign up for government assistance.

      Minimum wage was made to prevent exploitation and, well, social Darwinism. It also exists to strengthen the buying power of the lower classes, so more money can circulate in the economy.

      It’s also important to consider inflation. In 1969, the minimum wage was equaivalent to $10.60 in today’s dollars. No wonder why “entitlement” spending is increasing – many employers are no longer paying people living wages!

      Hope these thoughts change your mind, Alan!

  3. D.D.

    Re: yur statistics: thank you for displaying the stats re: women.
    Re: part time stats: some employers don’t want to admit that some of their workers are full time. Workers comp benefits used to be calculated per one hundred dollars of payroll. I don’t know how it is calculated today.

  4. Frankly

    Second, why are we discounting students making minimum wage? Given the costs of college tuition soaring in recent years, we have an epidemic of students saddled with huge student loan debts – the ability of those students to earn more in wages, should not be so easily discounted.

    And here we completely understand how the machine works.

    The reason that college tuition costs are soaring is that the universities have bloated the number of employees and their pay and benefits. And in California most of these are state employees.

    Surprise surprise! More overpaid government employees causing run-away costs.

    Minimum wage hikes are just another tax on business. Another end-around to fund the massive ongoing Democrat-public sector theft of earning from the producers in this state. Drive around the campuses these days and note all the new and new luxury cars. Now check with small business owners to see what they drive. Usually a car or truck that is more than a decade old and in need of repair.

    Wake up people! These Democrat politicians and their cronies have used your ignorance of the long-term consequences for the scraps they send your way to get your vote. They are slowly but surely choking the life out of the economy. They are destroying economic opportunity for you and especially for your children. They are doing so only so they get to live an easy life where they don’t have to work as hard and can retire early and travel the world.

    You accept these scraps, and ignore the theft, at your own peril.

    And let’s be clear about the demographics of minimum wage. Add this to the tab of our out of control immigration. We have flooded this country with millions of uneducated people from south the border to provide Democrats another political tool for theft just like their public sector unions.

    Here is the agreement:

    You vote for me and I, the Democrat politician looter, will take from the producers and give to you.

    What they don’t tell you is that you will be forever locked into dependency with this arrangement. Democrats create a moocher class… people that have lost the connection with self-determination and economic progression to greater prosperity. People that no longer ask for a hand-up because there is nothing to left to aspire to.

    More and more people with a hand-out. Fewer and fewer people that are independently economically self-sufficient.

    The destruction of the fundamental principles of economic advancement that have been a principle of our country’s great success.

    If you support minimum wage hikes, you are either brainwashed by the political-media-education industrial complex so that you no longer understand right from wrong relative to your own long-term economic well-being… or you gain financially from it as a member of the looter class.

    1. South of Davis

      Frankly wrote:

      > the Democrat politician looter, will take from the producers and give to you.

      True, but so will the “Republican politician looter” (only they might take a little less in taxes now and just borrow he difference for our kids to deal with paying back):

      http://d7.freedomworks.org.s3.amazonaws.com/Administration_chart_0.png

      The guys with the R after their names have not done any better than the guys with the D after their names for most taxpayers and are just trying to get as much money from “regular people” (aka people that don’t give them money) and give the money to their “friends” (aka people that give them money)…

      1. Frankly

        The guys with the D after their names are the ones dominating this state and this city… and then have been for some time.

        And they have also had the reigns of control for the nation for the last eight years.

        I don’t disagree with your point, but don’t you think at some point we stop looking backwards in blame and start focusing on the here and now?

        There are few people that could have imagined the extent of the collapse of the housing and financial markets in 2008. Even few people with the education and training to understand these things ever sounded warning bells. So politicians spent too much thinking the gravy train would continue.

        But now we KNOW it won’t continue, but Democrats have taken charge and have actually INCREASED the rate of spending anyway.

    2. Tia Will

      Frankly

      “What they don’t tell you is that you will be forever locked into dependency with this arrangement. ”

      I didn’t get “forever locked into dependency” from my government looted handouts. Do you deny that I exist ?

      1. D.D.

        I wish I could tell you the W.I.C. success stories I witnessed. But those women deserve their privacy. Maybe some of them would like to write something here. I will tell you there is very successful M.D. (not Tia, another woman I know) who received W.I.C. while she was supporting her child and going to school and waitressing part time. Many others were also given temporary assistance and are now contributing greatly to California, in many different professions.
        Another way W.I.C. actually saves taxpayers money: the infant mortality rate (huge hospital bills, not to mention the heartache) is lower for woman on W.I.C.

    3. tribeUSA

      Frankly–most of the high-priced cars in the UC lots are not those of staff; but students!
      There is a huge range of wealth in the student population; reflecting the continuing increase of polarity of wealth in the greater population. Many students are taking out loans and working 20-30 hours a week busting their butts to get thru college; many other students (those children of the more virtuous job-creators) drive $50,0000 vehicles; usually Mom & Dad’s 2-year old Mercedes or Escalade or Lexus (too old for Mom & Dad after that; must update), or maybe the new BMW they got for high schooll graduation (of course none of these students are being groomed for the fast-track in Dad’s or his associates business; that doesn’t happen in the USA).

      That said; I do agree that there are too many admins on staff; it’s gotton bloated and I don’t think the professors always have the autonomy they used to have; often the admins call the shots

      1. D.D.

        Tribe- yes, the student population is getting wealthier and they act more entitled to their wealth. In the 70’s and 80’s, there were so many bicycles everywhere! Most students had crappy, used cars, or no car at all!
        The students on our street all drove brand new cars. Once, they threw a party on a Thursday night; they all left the party house & stood out in the street, trying to decide who was sober enough to drive home…shudder….We opened our window & yelled, “shut up!”. A young woman stumbled down the street, stood under my bedroom window and yelled, “hey, why don’t YOU shut up?” Then they climbed in the back of a brand new pick up truck, and drove away.
        There is a service called the tipsy taxi, I think? They don’t need to drive after partying.
        There is a good bus service in Davis. Students don’t really need cars. They can also walk, or use bicycles.

  5. Don Shor

    It would be very helpful if someone better able than me would come in now and explain the elasticity of labor demand and supply and how it is affected by (1) a $1 increase in the minimum wage, vs. (2) a $7 increase in the minimum wage.
    Davis has a very large supply of willing part-time workers, probably far in excess of what neighboring communities have. People need to understand what will happen to (1) the number of available jobs, and (2) the number of job-seekers if you increase the minimum wage by 67%.
    I’ll just post this quote from a study, to show what needs to be understood:

    there
    exists a critical value of elasticity of labor demand so that increases in the minimum wage
    rate make low-pay workers better off for higher elasticities, but worse off for lower elasticities.
    This critical value decreases with unemployment benefits and increases with workers’ risk

    So you need to understand how an 11% increase in minimum wage ($10 from $9) differs in impact from a 67% increase ($15 from $9).
    In effect, proponents are arguing that there is no impact on elasticity from a 67% increase, because revenues from granting this wage increase will vastly increase spending locally, businesses will see significant revenue increases, and those increases will more than cover the increased cost of payroll. I consider that voodoo economics. Since it’s never been done anywhere, it’s a big experiment. Unfortunately, the adverse impacts are likeliest to fall on those who proponents are ostensibly trying to help.

    1. Frankly

      Here is the average primary expense and earnings for a restaurant:

      – Cost of Goods Sold: 26% to 36% (fast food has lower COGS than does fine dining)
      – Payroll & Benefits: 30% to 40% (fast food has higher labor costs than does fine dining)
      – Operating/Controllable expenses: 7% to 12%
      – Occupancy expenses: 5% to 10%
      – General and administrative expenses: 1% to 5%
      – Earnings Before Interest, Taxes Depreciation & Amortization: 0% to 19% (fast food has lower earnings than does successful fine dining)

      Assuming a California Taco Bell franchise with a start-up investment of about $2.25 million. The minimal franchisee eligibility requirement is $1.5 million in net worth and $750k in liquidity (cash). But the $2.25 million only covers the first three months of operation. A restaurant that is not initially profitable will cause a burn rate of more capital. Consider also that 57.2% of new fast food franchises close within their first three years of operation.

      The point here is that there are not a lot of people that can afford to start and run a Taco Bell (or other food franchise) and their investment is subject to significant risk. The offset to that risk is the expected returns.

      Actual sales and expense figures are difficult to pin down because very few franchises openly publish them. However, the National Restaurant Association provides some information.

      The average annual sales for a California Taco Bell franchise is $1.3 million per year. The average annual after tax profit is $200,000. This means the average annual expense is $1.1 million, and assuming 35% of this is labor costs we get to $385,000. If we assume 70% of the total labor costs support the minimum wage employees we get $288,750. Now we increase that amount by 50% to cover the jump from $10 to $15 per hour and we get another $144,375 in expenses.

      And net profit is reduced from $200,000 to $55,625.

      Now explain to someone putting $2.25 million or more of their capital and many hours of their time at risk for $55,625 per year in returns that this is still a good idea. This is the point lost on so many that demand constant increases in the minimum wage. It absolutely reduces the number of jobs available because fewer people start or expand businesses that employee people… because with the decrease in returns they will do other things with their capital and time.

      Wonder why the stock market keeps bubbling higher and job creation is so anemic?

      Thank you Democrat politicians and liberal voters that gorged on social justice college classes instead of accounting, finance and economics.

      1. Frankly

        And by the way, there is about zero % price elasticity in fast food. It is competitive and the average customer is in lower economic circumstances. If a restaurant raises its price, customers will either go elsewhere, or buy less or not buy at all. So don’t make the point that Taco Bell can just increase the price of their tacos.

        1. Tia Will

          Frankly

          There would also be an upside if more customers chose not to buy fast food at all.
          Their overall health would be much improved thus also lessening their health care costs.

          1. Frankly

            I expected this response from someone. My dad paid my kids and nephews $20 per month to not eat fast food except In-and-Out and later Subway was approved. They stuck to it until late high school, but remain picky about what fast food they will eat or not. Of course their dad is a cook (thought I might go to culinary school at one point) and trained them to like healthy, but well prepared food.

            Interesting now how many healthy choices exist at most fast-food restaurants. I don’t think abolishing them solves the problem. The solution is food education. I am not generally a big fan of many aspects of French culture, but their food culture is something we should model.

      2. Alan Miller

        I ran a business for a couple of years. It was a great idea, but not a great business idea. I learned in hindsight the errors in my business plan assumptions. I had less than no personal time during this period, slept very little, and had memory lapses of weeks at a time from the stress. I later calculated that after all was said and done I made about $3/hour.

        A wise business person later told me that if you don’t expect to make at leeast a quarter million per year in profits, the risk is not worth opening one’s own business. I say this to put Frank Lee’s numbers in perspective for those of you who have not run a business. $55,00 may seem like a lot to a college student or one starting their career if on a career path. It is an OK wage if you are working for the man and have full benefits. It is piddle if you are running your own business and must pay your own bennies and those of your family out of it, and no sane person would open a business for such a risky low profit. $250,000 maybe, $50,000 not a chance in hell.

        You can be as idealistic as you wish, it doesn’t change the realities of economics.

  6. D.D.

    Re: state workers pensions & “bloated” workforces:
    Often, California sets an example for the private sector. In the case of prisons, it is doing a horrible job. In the case of cash for convictions, it is doing a horrible job. In matters of sexual harrassment policies, it does a good job. Civil rights in the work[lace- I’d give it a C plus. Pensions? As I mentioned in another post, I would have never saved as much on my own vs. electing to have my employer, the state of CA, take a big chunk out of my paycheck and hold it for me until I turned 55. Smartest money decision I ever made was getting in tier one.
    When people are jealous of state workers pensions, they rarely understand how much money the worker elected to be withheld from their paycheck. Their own wages were withheld, similar to your tax refund being your wages.
    Overtime is another area where the state does a good job. When I worked more than forty hours a week away from my children, I was compensated very well.
    Travel – when I used my own car, I was compensated very well. Private companies could look at travel and overtime and do better. They could also enforce very strong policies against sexual harrassment. I talked to a few high school students in Davis who were being harrassed by their male bosses but were too shy to say anything, because they really needed their job.

    1. South of Davis

      D.D. wrote:

      > When people are jealous of state workers pensions, they rarely understand how
      > much money the worker elected to be withheld from their paycheck.

      I know EXACTLY how much was withheld from my retired firefighter friends for 30 years and after I explain to them (most who took their last math class at 16) the return they are getting on the money that was withheld is WAY WAY better than the return of 99.99% of other people that “invested” the same amount of money they say “wow I really got lucky”… The retired cops and firefighters I know ALL make more per year than anyone I know with an investment portfolio worth less than $5 MILLION (even more when you consider the tax free advantages of “chief’s disease”):

      http://www.utsandiego.com/uniontrib/20040911/news_1n11chp.html

      1. D.D.

        So, maybe people want to make more money, like their friends who are cops and firefighters. Maybe you want to make their salary, too? Why be upset that they have a good salary? Why not demand a better salary for yourself? Maybe when you work overttime and you are dog tired, you wish someone would fairly compensate you for all your time away from home? A fair compensation for getting your work/life balance out of whack, not to mention your sleep hygiene?
        Maybe, wh
        en you use your own vehicle, you wish someone would fairly compensate you for the gas and wear and tear on your car? So demand better benefts from your boss.

      1. D.D.

        State workers used to be offered two retirement plans: simply put, tier one meant California holds on to more of your paycheck, (my own wages), but I receive that money back when I retire. That’s what I chose in 1987.
        Tier two meant you keep more of your own money, invest it where you want, and you get way less when you retire.
        Currently, I’m not sure anyone still gets offered tier one when they are a new hire.

    2. Frankly

      Not jealous. Just angry that it is done on the backs of people having to work harder, and because they are being taxed to the max to fund this giant government employee over-compensation mess, will not be able to retire themselves with enough for even a comfortable life.

      For a fat-cat government employee starting is career at 22 and making $100,000 when he retired at age 57 and getting 80% of that and all his healthcare covered for the rest of his life, assuming he lives until 92, assuming a 5% rate of return, it would take $1,700,000 in cash at the time of retirement.

      Now how much would you have to have taken out of your check and invested each month to have saved $1.7 million over 35 years?

      1. hpierce

        Just curious… if your “example employee” has genetic issues that means they probably [50% level] won’t live to be 70, would you want them to work until the day they died, have all their retirement “benefit” plowed back into the “pool”, with no survivor(s)’s benefit, no medical for the survivor, because that would save a whole lot of money? And if so, why do people and employers pay so much into SS and medicare? Perhaps we should end ALL forms of retirement benefits. Perhaps we should all work until we “drop”? Would all save taxpayers a lot of money.

        Makes sense to me.

      2. D.D.

        Um, my friends who invested their tier two earnings were pretty much screwed, financially, a few years ago. hey are now continuuing to work past the time they wanted to work.

      3. D.D.

        I do not feel overcompensated for the years I served California families. (It was a privliege.) I made about the same amount of money that a friend of mine made, who was doing very similar work in the private sector. She made higher wages, but when we factored in my health insurance, and tier one retirement, we both made very close to the same.

  7. Davis Progressive

    question to the naysayers – so we know that minimum wage will go up to $10 an hour by the end of next year. it’s not going to get done away with. so would you be willing to put an automatic inflator on it?

    1. TrueBlueDevil

      Yes, at the rate of inflation. But national Democrats aren’t for that. It came up when Bill Clinton was President, I think Hillary agreed to not put an inflation adjustment in because it allows the Dems to play the equity / unfairness card every election, and keeps our leaders away from real serious issues.

  8. TrueBlueDevil

    I skimmed Davis’s article. Did he mention that less than 5% of people earn minimum wage?

    It is a defacto “training wage”, earned mainly by very young first-time workers, often in school. When you raise the price of anything, you lower the demand. Unemployment will rise, employers will learn how to do without the PT workers, they will economize, or pass on the costs to the consumer.

    Just as when Obama passed the ACA, employers cut back on full-time workers to avoid the ACA requirements. So since the implementation, Obama can show that we generate 100,000 jobs per month, approximately, but the average American work week has dropped by 20 minutes a week. Thank you, ACA. The numbers thus further hide the fact that we aren’t crating jobs.

    1. Davis Progressive

      he wrote: “They cited data from the Bureau of Labor Statistics that found that “1.566 million hourly workers earned the federal minimum of $7.25 an hour; nearly two million more earned less than that because they fell under one of several exemptions (tipped employees, full-time students, certain disabled workers and others), for a total of 3.55 million hourly workers at or below the federal minimum.””

      but that understates minimum wage because that’s the federal minimum wage and most states have higher minimum wages.

      he then wrote: “2.4 million of the state’s children live in minimum wage earning households, that is more than a quarter of the 9.3 million children in the state.”

      1. South of Davis

        DP wrote:

        > 2.4 million of the state’s children live in minimum wage
        > earning households, that is more than a quarter of the
        > 9.3 million children in the state.

        This is “technically” correct, but it is important to remember that the younger siblings of the 16 year old daughter of two UCD professors who works as a hostess at Appleby’s are some of the “2.4 million of the state’s children live in minimum wage earning households”…

      1. Don Shor

        Here are the national figures from the Bureau of Labor Statistics:
        “In 2011, 73.9 million American workers age 16 and over were paid at hourly rates, representing 59.1 percent of all wage and salary workers. Among those paid by the hour, 1.7 million earned exactly the prevailing Federal minimum wage of $7.25 per hour. About 2.2 million had wages below the minimum. Together, these 3.8 million workers with wages at or below the Federal minimum made up 5.2 percent of all hourly-paid workers.”
        http://www.bls.gov/cps/minwage2011.htm

  9. Topcat

    It is a very bad idea for Davis to institute a local minimum wage that is significantly higher than the California State minimum that is set to go to $10/hour in 2016.

    If the local rate in Davis went to $15, employers that hire low skilled workers will take a close look at their budgets and make adjustments. These could include cutting back the number of workers they employ, cutting back on employee hours, raising prices, moving out of town, or going out of business. It is a fallacy to think that employers can just raise prices and wages with no other affects.

    For those who are having a hard time understanding how economics works, let’s try an example using your personal household budget. Let’s say you are renting a house or apartment, or paying an adjustable rate mortgage. Now imagine that your landlord or mortgage company raises your rent or payment by 50%, for example, from $1,500 to $2,250 per month. Except for those who are independently wealthy, you will need to make adjustments which could include, cutting back other expenses (vacations, eating out, clothing, gifts, etc.), working more hours (if you are an hourly employee and your boss will let you), or sending your spouse or other family members to work. You could also consider moving to a less expensive place to live, perhaps outside of Davis.

    These are the same types of decisions employers have to make when faced with cost increases. I have seen no awareness from the proponents of the $15 wage that these affects even exist. These people remind me of the climate change deniers that I occasionally see on TV.

    As I have said in other threads, a local $15 minimum wage in Davis will hurt the lowest skilled and most vulnerable people in society. The loss of employment opportunities will be bad for our community and bad for our city.

      1. Tia Will

        I would be happy to listen to Topcat if he/she were to present some evidence to demonstrate what actually happens when a city unilaterally raises its minimum wage instead of stating his/her opinion of what will happen,

      1. Tia Will

        Barack Palin

        Depending on how you define “wealthy” I can think of at least three to five families that fit this description, and I am not particularly well connected. I have arbitrarily chosen a family income of over $ 250,000 as wealthy since this level of income puts one in at least the top
        2-3 %.
        I imagine that there are significantly more if in “mom and pop” you include self employed professionals such as lawyers, dentists, doctors, psychiatrists… And why would you not include them since these are small businesses generally with small numbers of employees.

      2. D.D.

        I did not say “mom and pop”. I said wealthy business owner. That could be the owner of Target.
        When we sell some of our possessions, it can make us feel lighter and happier. Too many possessions can drag you down. When we share our good fortune with the less fortunate, we receive more back than we ever give away.
        Every time I have been generous, really generous, I received more back.
        The tighter one holds on to their extra money, the faster one loses it.
        More money flowed into my life when I gave my money away. Every time. It helps to do this anonymously. It feels better to be generous when we’re not trying to get credit for our generosity.

    1. South of Davis

      D.D. wrote:

      > a wealthy business owner could maybe cut back on some
      > of their possessions and pay their worker a living wage.

      I wonder if D.D. has asked a typical Davis small business owner if they have thought about selling their yachts, private planes or Ferraris to pay their workers a “living wage”?

      He will probably be disappointed to find out that most of them are driving a car so crappy it would not even pay (the current) minimum wage for more than a few months.

      P.S. Despite all the property taxes I pay I just had to write a check to the fire department (helping fund the $10K a month paid to the “retired” 50 year olds) and it looks like I am not the only one doing this:

      http://fire.cityofdavis.org/prevention/fee-schedule

    2. Alan Miller

      “Or, a wealthy business owner could maybe cut back on some of their possessions and pay their worker a living wage.”

      Reminds me of my favorite political-economic saying, “A simple lie is much easier for the public to comprehend than a complex truth.”

    3. Topcat

      A lot of lower wage employees are not employed by “wealthy business owners”. Consider that a lot of non-profits such as homeless shelters, food banks, social service agencies that serve the mentally ill, disabled and elderly also employ low wage earners. These types of organizations typically run on very tight budgets. Some rely on donations and grants.

      Also consider that some low wage earners are employed by the City of Davis as lifeguards at the pools in the Summer and playground leaders.

      It is a fallacy to believe that money will somehow magically appear out of nowhere to fund a drastic increase in the local minimum wage. I ask the proponents; where is the money going to come from to fund this?

  10. Frankly

    This is the type of thing that happens as the politicians in the state keep making it more and more expensive to do business in the state.

    Toyota Motor Corp. 7203.TO -0.38% plans a sweeping shake-up of its U.S. operations, consolidating several units in to a new headquarters in Plano, Texas, that will house 4,000 people and serve as the hub for its North American marketing, manufacturing and finance operations.

    Toyota confirmed the moves on Monday.

    Executives will start moving from the company’s U.S. marketing operations headquarters in Torrance, Calif., as soon as July to leased facilities in the Dallas suburb while a new facility is constructed. The building should be finished by the end of 2016, a person familiar with the matter said. Toyota said its financial services operations will move to Plano in 2017

    Free will is a very difficult thing for a social justice obsessed liberal to accept. That is why liberalism leads to the more extreme forms of collectivism where the state uses force to destroy free will.

    That always ends badly as North Koreans could attest (if they had enough free will to say so). But it never stops liberalism from continued attempts.

    What liberals do pretty well is to inhabit the more beautiful parts of the globe. Then they start leveraging this life-style attractiveness to push the limits on what people are willing to accept. For example, San Francisco is a beautiful place dominated by liberals. People want to live there because it is beautiful. And many are willing to pay more for the opportunity to live there. But with every increase in cost more of them will leave. And then the liberal social justice obsession kicks in to provide more transfer payments to the low income people… and again demands that those with means kick in more to help.

    But eventually the beauty of the place relative to its cost is fully leveraged. And then the demographics starts to change. It becomes a place with old wealthy folks that purchased early and stayed, and people on public assistance. Families leave and don’t come back.

    Now San Francisco is experiencing a boost in interest from foreign cash. The Chinese, primarily, are buying up real estate with abandon. But families have pretty much vacated the place do to the high cost. The only thing that tends to save San Francisco at this point has been the business sector and the inventory of commercial real estate following the crash of 2008. But even that is drying up. San Francisco is a city that is nearing the end of its beauty leverage.

    Davis is already there. It has already chased away most young families. But Davis lacks a vibrant business sector to attract and retain young professionals. Davis is growing more older affluent retirees and low income people (including the students). And now the social justice liberals are demanding more and more benefits that tax more and more remaining residents. The shift in Demographics is bad for a city that wishes to stay vibrant and attractive.

    It is a cat and mouse game. Liberal-dominated beautiful places to live trying to have their cake and eat it to. Being the cat that bats around the resident mice for the cat’s pleasure. Eventually the mice die or decide to leave.

    Those in Davis and S.F. should take note of the business fleeing their fair cities. It is a sign that they have entered a spiral downward.

      1. Frankly

        LOL. Yes, I was on a weak metaphor roll that you continued.

        Gentrification begets calls for social justice. The cycle continues. It is those communities that recognize the need and benefits of a strong economy that do well to maneuver the middle ground and prevent unwanted demographic bubbles.

        I might be more open to minimum wage hikes if Davis had anything close to adequate business and job opportunities. But with about half the number of firms, and less than half the sales per capita, as other comparable cities, this call of a minimum wage hike is beyond irritating.

        Along with gentrification, we also appear to more prone to economic stupidification.

    1. D.D.

      I’m not afraid of Chinese people. It sounds like you are using negative info to instill fear in the reader so they will be afraid that Chinese people will buy every bit of land and every business in Davis, if we raise the minimum wage to a living wage. I am not afraid.

  11. South of Davis

    Frankly wrote:

    > Davis is already there. It has already chased away most young families.

    San Francisco has seen a huge drop in the number of kids because the public schools suck and good private schools (like Town and Burke) cost over $25K per kid (for Kindergarten).

    Davis (that supports the schools with parcel taxes) has good schools and I have never seen anything showing a drop in young families (only that lots of young families are dying to move here and are excited that they are actually working on building the homes at the cannery).

    1. Frankly

      Agree that Davis is not S.F. yet, but don’t agree that Davis has not experienced a drop in families. I think you know that our ratio of school kids to residents has fallen. I also hear from my teacher friends that they deal with more troubled youth from low income families with single-mother heads of household. I guess if you want to include these in your list of families you might be closer to right. However, I am talking about more middle-class families. And there are a lot of them that would like to live here but they cannot afford it.

      The Cannery is not going to reduce the cost of housing very much if at all.

      There are no jobs here, so families also have to consider the impact and cost of commuting to where the jobs are.

      I have tried and failed to hire some good people due to the:

      1. High cost of housing.
      2. Terrible social scene for young professionals.

      Both are getting worse, not better.

      1. Davis Progressive

        i find your comment interesting… “There are no jobs here, so families also have to consider the impact and cost of commuting to where the jobs are.”

        i see it in the reverse. i get to work in sacramento, but i can live in davis. that gives me the best of both worlds.

        1. Frankly

          I just had a realtor tell me what my little 1800 sq ft house is worth in Davis.

          You might get to live in Davis and work in Sacramento, but we are part of an elite group… either lucky enough to have bought early, or lucky enough to make a large enough salary to afford the premium.

          And the cost of your commute to and from Sacramento is just another expense to consider.

          But I get your point. I selected Davis for similar reasons even though I worked in Sacramento. Now my office is in downtown Davis, so I am even luckier still.

          But it gets harder every year to justify staying here. My kids cannot afford to live here. And it gets harder and harder to attract qualified candidates to work here. The report back is that young professionals say Davis is boring, and young families cannot find a place to live they can afford. And this includes some pretty strong pay and benefits.

          1. South of Davis

            Frankly wrote:

            > You might get to live in Davis and work in Sacramento, but we
            > are part of an elite group… either lucky enough to have bought
            > early, or lucky enough to make a large enough salary to afford
            > the premium.

            Since most of my friends live in the Bay Area they all tell me how lucky I am to live in Davis where huge nice homes are so cheap… You can BUY a super nice home in Davis for less than the RENT of a crappy 2 bedroom apartment in a safe neighborhood (the median 2 be apartment rent for the entire city of SF is just under $4K/month).

            > My kids cannot afford to live here

            Do they have jobs? I know quite a few people making around $10/hour that manage to live in Davis (maybe they will be able to stay after the minimum wage goes up to $15)…

          2. Frankly

            Depending on the city, Bay Area homes are generally 25% to 300% pricier than Davis. But Bay Area professional wages are also much higher…

            Which brings up the topic of the recent CalPERS decision to align Yolo County employees to the Sacramento index instead of the Bay Area index. Why has this not been news yet? It is pretty big deal and saves our city and county government employees a bit of coin. That should make it easier for the city to negotiate them paying for more of their benefits.

            But getting back to your point.

            I think your point is that life is all about tradeoffs.

            My attorney lives in Mill Valley and has an office in downtown SF. Her two assistants – one male and one female, are both 45 years old, on their 5th or 6th steady relationship, rent… small apartments, don’t intend to have kids… they say they are happy as clams living that SF life.

            But part of the reason that they like that life is the active social scene for young professionals.

            They won’t even come visit Davis. They say it freaks them out being in a little city filled with students and mostly white older people with not much to do and a lot of open fields around them.

            There is a working professional demographic missing in Davis and a middle-class young family demographic that is missing in both Davis and San Francisco. It would be good if we could change to at least be attracting more of one or the other. My sense is that it would be easier and probably better to attract more young professionals by developing some business parks. The young family problem is the cost of housing relative to local professional wages.

          3. Don Shor

            I can’t imagine why one would move to a small rural city, dominated by a university and surrounded by agriculture — whose whole history is grounded in agriculture — if one wanted the ambience or amenities of the Bay Area or Southern California. If you want those things, you should live in the Bay Area or Southern California. If I’d wanted to stay in a place like where I grew up, I would have gone to Cal Poly SLO; it’s got a great hort program. I was baffled by the Bay Area kids who came to UCD who would then whine about how rural, flat, and boring it was. They had perfectly good choices of universities there, just as young professionals who want the glamorous nightlife and scintillating lifestyle of San Francisco should, I’d say, live nearer to San Francisco.

          4. Frankly

            You make reasonable points. I think the challenge we are facing it to revision a larger city that maintains its agricultural roots. Davis already is too large and filled with too many urban/cosmopolitan people to be a typical rural town.

            Davis does not match any other city that I can find… and I think there is a reason for that.

            I think in some ways you project your past, profession and lifestyle onto the city without really considering what it already is. UCD has ag roots, but is has advanced significantly with a science and food strength. How do we honor that advancement?

            If we are to ignore that and those that desire more urban amenities and economic growth, the fundamental problem you and others are facing is how to make the city financially sustainable without doing so.

          5. Don Shor

            I know quite a few people making around $10/hour that manage to live in Davis

            Yes, so do I.

          6. D.D.

            Wow. Really? I guess it is fine for you to occasionally buy a pizza at Steve’s, and rent a Red Box movie, and maybe adopt an animal and buy a few bags of kitty litter. But a person making $10 an hour in Davis has a difficult time doing any of those luxuries. But, hey, all they are doing is scooping out yogurt, right? They don’t deserve a living wage, I guess. And the maid who makes the bed for your relatives when they come to town for Picnic Days, I guess she doesn’t deserve a living wage, either. Her kids can eat boxed mac n cheese from Dollar Tree every night. Okay, no more sarcasm from me.

          7. D.D.

            So, your argument is that single moms do not deserve to earn a living wage in Davis? Maybe because you are a man, you do not understand the plight of women who get pregnant and the dad, for whatever reason, cannot help support the child. So it is up to the woman to feed and clothe her child. And many single moms are close, or at, the poverty level. And no birth control, except abstinence, is 100% effective. But men have the ability to walk away from an unplanned pregnancy.

          8. Don Shor

            I have employed single fathers who were helping support children. Stop making assumptions about me. If you are a parent, your financial needs are greater than what will be provided by any entry-level job.

          9. South of Davis

            D.D. wrote:

            > But men have the
            > ability to walk away
            > from an unplanned
            > pregnancy.

            This is a bigger problem than the minimum wage. We have MILLIONS of guys goofing off and/or working for cash who don’t pay a penny to support their kids and it seems like most in government would rather raise taxes on the people (and business) already paying them than go after the deadbeats and force them to pay child support.

          10. Frankly

            I agree with this, but I have also seen and know of several cases where the father was stuck in a loveless marriage with an over-controlling, (B-word) wife (that gets amped up after the kids are born), and separates but gets stuck paying child support and possibly spouse support in excess of what he needs to live anything close to a comfortable life. And in a lot of these cases the father works all week and gets the kids on the weekend and holidays… which then ruins his chance to have any personal life. Meanwhile the mother puts the kids in school during the day and starts working even less to justify even more spousal support… and has a lot more free time… which she uses to have fun and “find herself again” because of course divorce is the most emotionally traumatizing thing she has ever experienced.

            The choice to stay married in a loveless marriage with a cold and hostile wife, or become financially destitute with zero social life… well some guys just add it up and decide to take the low road.

            Especially in California, divorce law and precedent always favors the mother. This does not excuse deadbeat dads, but we also need to maintain some perspective for root causes. I tell my sons that they better be damn sure that the woman they marry and decide to have kids with is warm, loving and kind and also works to bring in close to half of the family income. Otherwise they can be taken advantage of and have their financial and personal life destroyed.

      2. D.D.

        Cost of housing: often, the college kids do damage to homs they rent. I do understand tht.. But just as often, a person owns a crappy rental that they never fi. But they continue to raise the rent Their mortgage is often aid off! But they know they can raise the rent because 3 or four college students will rent it, and then move away. So they keep their vleaning deposit, even if the home is in as good, or better, condition as when they arrived. Gredy landlords try to charge for carpet cleaning when the carpet is over ten years old. They try to charge for normal wear and tear, etc. Usually the college kid has either moved away, or is trying so hard to find a job, tht they do not have time to go to small claims court to get their cleaning deposit back. I advise they itemize everything that is broken, etc. in their rental, and not pay their lat month’s rent. Let the greedy landlord drag them to small claims court for the last month’s rent. Landlords should keep their rentl omes in excellent condition. They are making a fortune. Many of their mortgages are paid off, yet they continue to increase the rent every yer and they do not even do the basic repairs. They take advntage of the renters. And you college students out there who trash your rental: grow up.

      3. D.D.

        Re: “troubled youth with a single mom”
        I was going to let this comment go, but it is disturbing. There are a few teachers (and other citizens) in Davis who view low income kids differently from financially wealthy kids. They personally do not believe in divorce (who does?) and they profile kids from one parent families. Maybe a tiny bit of those teachers prefer two parent families because those families have more time to volunteer in the classroom, and buy school supplies, thus, saving the teacher work? I am surprised that any good teacher would complain about her students’ financial and personal situation. Many good teachers also realize that two financially wealthy parents in a very unhappy, disrespectful marriage can do just as much, if not more, damage to a child.

      1. hpierce

        That was news [know it’s somewhat off-topic]. I and my partner also loved El Charros downtown, but it has been gone for years.

        I suspect that El Charros, and some of the Chinese/Thai/Japanese etc. restaurants in town neither pay too close attention to minimum wage nor to immigration status. Yet, they are employing people, and meeting a need/want of the community. I make no judgment.

        1. Frankly

          The son of the owners of El Charo was the best man at my wedding and rhythm guitar player in my band and still golfing and guitar playing buddy. That was a very good Mexican food restaurant.

          There was also a pretty good Chinese restaurant downtown Dixon during the same time… I think it was called Kim and Neds.

    1. Tia Will

      “Terrible social scene for young professionals.”

      That’s funny because my son is now trying to figure out ways to come back to Davis because he is burned out on the crowding, noise, and chaos of the Bay area. Guess it just illustrates that differences in preferences and values are not bound by generation.

      1. D.D.

        I agree with Tia. 3rd Street in Davis is hardly South of Market, but there is plenty to do in Davis, and it is probably a healthier community. The bike lanes in Davis are safer, that’s for sure…
        I suggest the young professionals take a gorgeous bike ride from Davis to Winters, eat at the Putah Creek Cafe, then bike home. Or go out to the Putah Creek Winery in south Davis. Davis has a social scene. And if the young professional is not satisfied with it, he or she should try their best to make it better. The Mondavi Center has some outstanding concerts that young professionals may enjoy. They can also take a short drive across the causeway and enjoy midtown Sac, too. Or drive over to Napa or Sonaoma.

        1. Tia Will

          In addition to the Putah Creek Cafe, Winter’s has available Ficelle’s for tapas on a nice patio followed by evening music at the Palms. Sometimes the groups there seem to attract mostly the older group, but on several recent visits we have seen mixed age groups including a number of folks who appeared to be in the 20-30 age range.

          1. D.D.

            I love Ficelle’s! It was sad to see the Palms move from Davis, but they continue to be a nice venue.

  12. Topcat

    David Greenwald Wrote: “So if someone makes a given wage in Dixon or Woodland they have better purchasing power than someone who makes the same wage in Davis. So why not allow minimum wage laws to account for local preference and conditions?”

    It is very easy for people to commute back and forth between Dixon, Woodland, Winters, and West Sacramento, and Davis. I know a lot of people who work in one of these communities and lives in another. I talk with a lot of the employees in the retail and service sectors in Davis and I have found that a lot of them commute into Davis. For many, it is a quick 15 minute drive.

    It is also very easy for Davis residents to drive to Woodland, Dixon and West Sacramento to shop. I frequently drive to Woodland to stock up at Costco and I often make other shopping stops there too. Most grocery and food items are the same price in Davis as the surrounding communities. The prices at Target are the same in Davis as everywhere else.

    Yes, I admit that real estate is a bit costlier in Davis. An equivalent house in Davis and Woodland is approximately 10 to 15% less expensive in Woodland, so the overall cost of living really isn’t that different. If a family chooses to live in Davis they can simply choose a slightly older or smaller house. Yes, I know people who have made this trade off.

    I really don’t see any justification for a drastically higher minimum wage in Davis based on the ease with which people can travel back and forth between these communities. To claim that the cost of living is drastically higher here and people have no way to compensate is simply ignoring reality.

    1. hpierce

      If taken to a vote, am pretty darn sure the proposal is DOA. Don’t think they’ll get the signatures need, and even if they do, will fail at the polls. Their only hope is the CC doing it by “fiat”, and then think it would be subject to referendum, and over-turned. Not gonna’ happen, whether t has merit or not.

    2. Frankly

      Hpierce… No need to go to so many extremes to hit parity with the rest of the working world. I would prefer 401k DC plans. Then nobody but the IRS gets to tell the employee when he can retire and what he can or cannot do with his money.

    3. D.D.

      Unbelievable. Make them waste gasoline or a long time on a bus. They don’t deserve to live in Davis. Only wealthy people and kids whose parents are funding their college deserve to live in Davis? Really?

      1. Topcat

        I have talked with many people who work in Davis in the retail and service sectors that live outside of Davis They choose to live in Woodland, Dixon, West Sacramento, and Winters for a variety of reasons. Many really like the communities they live in and they have family and cultural ties to those communities. Some have mentioned to me that they don’t like the attitudes of some people in Davis.

        The commute from neighboring communities to Davis is quick and easy in most cases. Yes, it takes a little bit of gas, but the people I have talked with find this perfectly acceptable to be able to live where they want.

        If a drastically higher minimum wage were instituted in Davis, expect to see more people from outside of Davis competing for jobs in Davis. For the lucky few that get the few remaining minimum wage jobs, the extra pay will help them pay for their commute.

      2. Topcat

        For those who have environmental concerns about the use of fossil fuels, a local Davis $15 minimum wage will increase the amount of fossil fuels used.

        In January 2016 the minimum wage rate in California will be $10 per hour. If it is $15 per hour in Davis, we know from basic Economics that many employers will need to cut back to keep their expenses under control. This will result in less employment opportunities in Davis for the least skilled workers.

        Some minimum wage jobs will still be available in Davis. Now, imagine that you are a minimum wage earner (perhaps in food service, retail or social services) in Woodland, Dixon, or West Sacramento earning $10 per hour or $400 per week. If you have any initiative at all, you will turn in job applications anywhere in Davis that will accept your application. If you are hired for the job in Davis you will have to be paid $15 per hour or $600 per week. This would give you a $200 per week raise which would make it well worth your while to commute to Davis, using fossil fuels.

        The increased employer costs will mean that there will be less of the part time and Summer jobs that entry level employees such as teenagers and college students tend to staff. These types of jobs are usually in retail, food service, lifeguards, playground monitors, and youth summer camp leaders. These teens and entry level workers that live in Davis (maybe with their parents) will have to seek employment in the cities surrounding Davis. This will result in them driving further to their jobs and thus using more fossil fuels.

        I know that it is hard to comprehend all of the adverse results from meddling with the economy, but it is clear that increased fossil fuel use is almost certainly going to result from a $15 per hour minimum wage rate in Davis.

    4. D.D.

      I chose to rent in Davis. One landlord ended my lease when my husband and I separated. “Now that you do not have a husband living here it will be too diffiult for you to keep up the house.” I moved to another rental. There was black mold in the baseboard of the bathroom that the owner promised me would be professionally removed before I moved in. It was not removed. The stove and oven did not work for two months. She brought me an old microwave with a $20 sticker still on it. She said that was all she was required to do, until she had time to fix the stove and oven. The carpet had huge loops in it and was extremely cheap. I had to ask every woman who came in my home to remove their heels, because they would get caught in the carpet loops and women would trip in my home. She added on a back room to the rentl, without the city’s final inspection. My son was living in tht room and I had no idea the final city inspection was not done on his room. She asked me to put in backyard landscaping with my son. (The backyard was dirt.( She hinted that maybe if I went to the hardware store and bought tools and gave her free labor, she might pay for some of the pavers or sod or whatever my son and I decided to do with the backyard. Of course, she would only agree to pay for it after we put out the initial cost and if she decided she liked the finished product! Thank God I did not fall for that. The list goes on and on and on. Greedy home owners take terrible advantage of renters in Davis.

      1. South of Davis

        D.D. wrote:

        > I chose to rent in Davis. One landlord ended my lease when my
        > husband and I separated.

        Did you post under the name “Jimmy’s Daughter” in the past (I seem to remember something similar happening to her)?

        > Greedy home owners take terrible advantage of renters in Davis.

        There are some bad landlords (just like there are “some” bad people doing everything). Most landlords don’t make much money (or in my case ANY money). With a typical Davis ~$500K home that rents for ~$2K/month a landlord will be lucky to keep a little more than ~$1K/month after expenses (maint./repairs/property management/water/sewer/garbage/insurance/property taxes/parcel taxes/etc.) and unless they have a mortgage payment of less they $1K/month they are coming out of pocket.

        For the few that scrimped and saved for 30 years paying off a mortgage to own a home “free and clear” they are making ~$15K a year (less than someone working full time at the CURRENT minimum wage and about HALF what someone that makes $15K/year earns)…

    5. D.D.

      Topcat, it is not an easy bus ride if you have a toddler in a stroller or a bag of groceries or an umbrella and a purse to carry. It is inconvenient. People should have an affordable apartment to come home to, if they work in Davis. Or a decent rental home. I heard that 75% of the houses in Davis are rentals.

      1. Topcat

        I know quite a few people in near minimum wage jobs who commute in to Davis by car. It is a quick and easy commute for them and they are quite happy to live in Woodland, Dixon, Winters and West Sacramento. Most of them do not want to live in Davis.

  13. tribeUSA

    To those promoting the minimum wage hike–consider changing to $11 or $12/hr at most; not $15.
    I would vote for $11/hr (and maybe $12); but not $15–I suspect there are a majority of voters who would do the same.

  14. D.D.

    Maybe I just had the worst luck in the world, but every landlord I had in Davis did not want to make repairs timely and gouged me on rent. Four rentals, four mean, greedy landlords.

    1. South of Davis

      D.D. wrote:

      > Maybe I just had the worst luck in the world, but every landlord I had
      > in Davis did not want to make repairs timely and gouged me on rent.
      > Four rentals, four mean, greedy landlords.

      Here is a tip for D.D. (or anyone else renting a place to live):

      Landlords that are on the ball (and know that an empty home or apartment does not pay rent) will advertise a home and apartment for rent as soon as the current tenants give notice.

      If everything looks good after you tour the home or apartment stop by and talk to the current residents BEFORE you sign a lease.

      You might find out about a bad landlord, but even more important is to ask about the neighbors since even with a great landlord your life will suck if the guy next door loves to play heavy metal (or show tunes) at 2:00 am.

      1. D.D.

        One of the four landlords used to rent exclusively to professors doing a sabbatical in Davis. After I moved in, I found out that the foreign professors never received their cleaning deposits. And they lived too far away to litigate. Maybe word got out at the university, so that landlord couldn’t find another professor to rent their home? One of those professors actually moved an au pair into the rental, and she cleaned it regularly and took care of the children.
        You are correct, I should have been more diligent. I thought maybe, because one was an engineer, another an M.D, and another was an attorney, that they would be fair with me. But none of them were decent landlords.

  15. Frankly

    Can somebody in support of a $15 dollar minimum wage please explain what you hope to gain for it? Meaning also what you hope others will gain from it?

    1. South of Davis

      Frankly wrote:

      > Can somebody in support of a $15 dollar minimum wage please
      > explain what you hope to gain for it? Meaning also what you hope
      > others will gain from it?

      I’m not a “supporter” but I always enjoy talking to Bernie (who is a super smart guy) and while I don’t want to put any words in the “supporters” mouth but it sounds like they “hope to gain” $5 and hour more than the new CA $10 minimum wage…

      1. Frankly

        Ok, that is simple. So why not the current $15 per hour worker gets $22 per hour. Or the $22 per hour worker gets $32 per hour?

        And why to well off liberals support it? They are not going to get another $5 per hour.

    2. Topcat

      I’m not a supporter, but the phrase I keep seeing is “This ensures that nobody who works full time should have to live in poverty.” There does not seem to be any concern for those that will not be able to find work at $15 per hour.

  16. D.D.

    Re: small business owners:
    I hope I don’t offend anyone.
    Many of my family members owned small businesses over the years: a hair salon, a milk delivery service (during the great depression), a small law firm, a blossoming baseball bat company, to name a few. Sometimes it hurts to admit that the reason your small business isn’t doing so well is the folks on your front line. Do they have exemplary people skills? Is your receptionist or cashier always projecting happiness, even if she is having a tough day? Is your product relevant to different age groups? Are you absololutely, 100% positive that no one is being sexually harrassed in your workplace? Do you have excellent policies in place that allow men and women employees to take paid paternity and maternity leave? What about bereavement leave? Do your customers really love you? Do you know all your regular, loyal customers by their first names? Are you blaming Obama or Biden or our local city council or Jerry Brown for your falling sales, when it is actually your own employees who are causing your failing revenue? Your people are your most valuable asset. Treat them with respect. Demand they treat your precious customers with the same respect. Maybe you need to start an entirely new business? Maybe your existing business was wonderful ten years ago, but it has run its course? Pay your employees top dollar. You won’t be sorry. They are extremely valuable and they will be what makes or breaks your small business.

    1. Topcat

      This is all very nice and it’s good advice for small business owners, but what does any of this have to do with the proposal that the local minimum wage in Davis should be $15 per hour?

  17. Tia Will

    Frankly

    “Meaning also what you hope others will gain from it?”

    Again, I am going to preface my comments by stating that I have not done the calculation to know if I feel that this would be the most appropriate amount. And having said so, I also would not want to put words in to the mouths of those who have “run the numbers” and so are in support of this measure, but for me, the argument for a minimum wage is as follows.

    I have no personal interest in this whatsoever. I will personally gain nothing from it.
    So the issue becomes, what do I hope others will gain from it ?
    I do not believe that anyone who is working full time should be living below the poverty level. While Don’s numbers may be correct and this is above the level needed by a single individual, well then, perhaps they have a little more money that will be spent in the local economy. He has pointed out that this will not be enough to lift a single parent out of poverty. Maybe this alone won’t achieve my stated goal, but perhaps it may make their lives more comfortable while the parent is either getting more training or working their way into a better job.
    Would we really begrudge them the extra money even if it didn’t raise them above the poverty level, or if it raised them above the poverty level if they lived somewhere other than in Davis ?

    I think that a major part of the problem here is that individual’s seem to be viewing and arguing this only from their own perspective. Businesses seem determined to present only from the small business point of view casually ignoring the fact that many large businesses could well afford to pay their employees more without any risk to their business. Those advocating for the $15.00 minimum wage seldom seem to acknowledge that this may prove to be a burden on very small businesses and that some exemptions or mitigations might be in order. We have some very bright folks on both sides of this issue. What seems to be the biggest shame to me is that there seems to be no drive from either side to sit down and talk about what could be done locally, what could be done regionally and what could be done nationally in a collaborative rather than confrontational manner.
    What a waste !

    1. Frankly

      large businesses could well afford to pay their employees more without any risk to their business.

      Tia – I’m trying to be nice here, but this is a foolish statement.

      Democrats have been referring to a few “studies” by Nobel Lauriat economists (like Paul Krugman) to make the case that minimum wage hikes have not resulted in greater unemployment. A recent CBO study that just came out says that a federal minimum wage hike to $10.10 would result in a loss of 500,000 jobs. Bottom line… economists like Paul Krugman are leftist ideologues and tools of the Democrat party. They are liars. Just like Obama is a liar.

      The primary reason that we have a much higher number of people working minimum wage jobs, and people working fewer hours than they would like, and people so discouraged about the poor job market that they have dropped out of the workforce… is that social justice liberals keep making it more expensive to do business in this country, in this state, in this city.

      Germany has no minimum wage and an unemployment rate of 5.1%.

      Norway has no minimum wage and an employment rate of 3.5%

      These are two countries that America Liberals claim the US should be more like.

      Now back to your statement. I have already posted the business math for this. But here is something that might be easier for you to understand.

      A study released on Monday by University of California, Berkeley’s Center for Labor Research and Education found that increasing wages to $12 per hour would cost Wal-Mart $3.2 billion if applied to all workers across the United States. That amounts to about 1 percent of the company’s sales of $305 billion

      Now a liberal might say “see that is only small bit of financial impact!”.
      However, Walmart’s profit margin last year this April was 5.7%. That is compared to an 8.98% profit margin for the entire Consumer Services industry.

      Walmart’s cost of sales for its US operation was about $60 billion. Labor costs in US retail average 40% of expenses according to the U.S. Census Bureau. So, Walmart’s labor costs for the US was about $24 billion.

      A jump to $12 per hour from $7.25 would be a 66% increase. That would raise Walmart labor costs by about $16 billion… and overall cost of sales to $76 billion instead of $60 billion.

      And the net impact would be a 1.2% drop in Walmart’s profit margin… down from 5.7% to 4.5%.

      Now here is what educated liberal economists like Paul Krugman ignore…

      Net profit is essentially the return on investment for any business endeavor. When the return falls investment falls. Capital flows to where it can earn the greatest returns relative to risk. If it is less profitable for Walmart to open stores, it will open fewer stores. It will open fewer stores in the depressed economic areas where profits are lower and riskier and jobs are more needed.

      Liberals need to just accept that they are absolutely wrong with their demands for minimum wage hikes. They hurt more people than they help. It is destructive altruism at its finest.

      We all want to lift more people out of poverty. How do we do that?

      We don’t do it by demanding policies that create fewer jobs, and fewer businesses, and more people stuck in low wage jobs from the existence of fewer career opportunities. What we need is a tax and regulatory overhaul, an education system overhaul and an entitlements system overhaul. These are all things that liberals prevent us from fixing. And the resulting damage to the economy is why liberals demand minimum wage hikes. It is amazing how much damage a liberal can cause just to prevent having to admit he/she is wrong.

      1. Don Shor

        And the net impact would be a 1.2% drop in Walmart’s profit margin… down from 5.7% to 4.5%.

        Assuming they don’t raise prices or take actions to cut payroll expenses. I’ll assume WalMart has already determined that their labor force is at its optimum level and can’t significantly reduce their labor hours. As a publicly-owned corporation, they aren’t likely to accept much lower profit margins because of the impact on their investors.
        So the only remaining thing they could do is increase their prices. How or whether they can do that depends on the price elasticity of their product mix. The more groceries they sell, the less they can raise prices on that portion of their product mix. Since groceries are their primary profit sector these days, they’d be kind of stuck. WalMart more than other retailers, because of their market strategy of ‘lower prices overall’. When you’re selling to the lowest-income demographic at a low margin, it’s harder to adapt to a changing environment. Walmart is already having trouble.
        Bottom line: the impact of a minimum wage hike descends irregularly across the retail sector.

      2. Don Shor

        Germany has no minimum wage and an unemployment rate of 5.1%.

        Norway has no minimum wage and an employment rate of 3.5%

        Australia has a minimum wage of $15/hour, and an unemployment rate of 5.1%.

        1. Frankly

          Yes, but I don’t think liberals want us to be like Australia. Their main industry is mining. Also industrial, chemical and steel. These are all those heavy industries that have been priced out and regulated out of existence by American liberals and their union cohorts.

          Another factor to consider about Australia… teenage unemployment is 27.6%. The US rate is 20.9%.

          Clearly when you raise a minimum wage to a level of single individual economic sustainability you do so at the expense of entry-level jobs for youth.

          Frankly… American liberals, Democrats and business that is addicted cheap imported immigrant labor have all collaborated to screw American young people.

          Too bad so many young people are brainwashed by our crappy education system to the point that they cannot see the truth.

          1. Don Shor

            I don’t think liberals want us to be like Australia.

            I don’t know who these liberals are that you are making assumptions about. I don’t know anyone who wants us to “be like” Germany, for example. Merkel is a conservative.

            Another factor to consider about Australia… teenage unemployment is 27.6%. The US rate is 20.9%.

            And I believe Australia has a different, lower minimum wage for teenagers anyway. My point is that your analogies and examples don’t hold up very well.

            Clearly when you raise a minimum wage to a level of single individual economic sustainability you do so at the expense of entry-level jobs for youth.

            Yes. Moreover, the proposal for a $15/hour wage appears to be arbitrary and has no relationship to the actual self-sustaining income needed for a single person.

          2. Frankly

            My point was that Australian unemployment is low because the people and government are friendly to the types of industry that American liberals scream and bray about and do everything they can to block.

            Just try to open a new mine in the US.

            We can’t even get the Keystone Pipeline built because of liberal blocking.

    2. Don Shor

      While Don’s numbers may be correct and this is above the level needed by a single individual, well then, perhaps they have a little more money that will be spent in the local economy.

      And if you are taking that money from local business owners, they will have a little less money that would have been spent in the local economy.
      Tia: where do you think the money for a $15/hour wage is going to come from?

  18. D.D.

    Perhaps prevention is the cure. We have to deal wth people who are at poverty level because we are a wealthy country, and no one in America should go hungry. Many people below poverty level feel helpless. If I could suggest one change to our current school system, it would be this:
    Teach a class that focuses on self esteem and assertiveness. Make it a required class. Teach it in elementary school, middle school and high school.

    1. Don Shor

      We have to deal wth people who are at poverty level because we are a wealthy country, and no one in America should go hungry….If I could suggest one change to our current school system, it would be this:
      Teach a class that focuses on self esteem and assertiveness. Make it a required class.

      Having a child when you don’t have sufficient income, education, or job skills is the leading cause of poverty.

      1. Frankly

        And related to this is our immigration policy that imports so many uneducated people with a propensity to produce more needy offspring.

        I would be open to teaching self-esteem and assertiveness… absolutely. Although I would probably call it “coping skills”, because the only effective way a person gains self-esteem and assertiveness is by incrementally overcoming life’s challenges and solving the inevitable problems that never stop coming.

        I would also work hard to kill the racism, gender-ism and sex-ism templates still used to secure political power and sell media copy… and then point to the successful (American?) model of human behavior and elevate it as the platinum standard.

        Note that the successful model has nothing to do with race, gender or sexual orientation.

        1. Don Shor

          And related to this is our immigration policy that imports so many uneducated people with a propensity to produce more needy offspring.

          Lots of people with low income have children when they can’t afford it, regardless of national origin. Which is why I support keeping the safety net in place to keep children fed and prevent hunger. And which is why I support all people having ready access to family planning and all aspects of reproductive medical care.

          1. Frankly

            I don’t disagree, but you are skirting the main point. We have imported millions of poor and uneducated people and it is bankrupting us and destroying opportunity for young people.

            When I was 13-16 I worked on farms and ranches. When I was 18-20 I worked in construction. I made more money than my friends working in service jobs. Wages in those two industries have been depressed from the flood of uneducated, but hard working, immigrants.

            And let’s be honest about the demand for more minimum wage hikes. Much of the reason is that these imported uneducated people and their offspring are unable to support themselves to American liberal standards.

            Our youth are the victims.

          2. Don Shor

            We have imported millions of poor and uneducated people and it is bankrupting us and destroying opportunity for young people.

            We have millions of people who have come to this country to work in our fields and orchards and hotels and wholesale nurseries and landscape and gardening industries. What you did when you were “13 – 16” is irrelevant. Those industries would suffer from a severe labor shortage otherwise. Our “youth” wouldn’t be working in those industries. We need a reasonable immigration policy that supplies labor, and we need protections for those workers such that they don’t get abused.
            In my opinion a reasonable minimum wage is one that provides an individual with a self-sustaining income. As I have demonstrated repeatedly, that is not $15/hour.

          3. Frankly

            Don – one of great frustrations debating people with left-leaning worldviews is their consistent either inability or their constant deflection from the full circle of logic. You start at what makes you feel good and stop at what makes you feel bad.

            You are supporting some minimum wage hike for a sustainable wage because employers don’t pay it. They don’t pay it because we import so many uneducated people into the country. It is a simple supply and demand issue. In a market economy the prevailing wage is what it takes to attract and retain workers. If farming and ranching paid $12-15 per hour our capable youth would do it. If entry level construction jobs paid $15+ per hour, our capable youth would do it. If we changed the crappy over-priced system of higher learning so these kids could work half time and go to school half time… they would be much better prepared to succeed financially.

            Importing cheap labor is corporate welfare for those businesses.

            It is a supply and demand problem.

            Since you don’t want to send illegals back we should be demanding policies to expand the economy to create more jobs. That is how we solve the sustainable wage problem.

            People don’t need a sustainable minium wage… they need a career where they can earn more as their skills and value increases. Minimum wage jobs should be entry-level jobs.

          4. Don Shor

            You start at what makes you feel good and stop at what makes you feel bad.

            No. I proceed from the perspective of what we have now and what is possible. I’m not basing my positions on ‘feelings’ (one of your persistent canards) or ideology. I have no problem with a floor for wages. It should have some basis in reality: $15/hour doesn’t. It isn’t a SSI for a family, and it’s more than an SSI for a single person.
            I would be happier to see a minimum guaranteed income to replace the minimum wage, and to replace some of the social safety net that way. But that is not going to happen. So it is not unreasonable to raise the minimum wage to keep it buying the same rough amount of goods and services that it did a couple of decades ago, adjusted for inflation. That is approximately what it takes, locally, for a single person to sustain himself or herself: a self-sustaining income.

            If farming and ranching paid $12-15 per hour our capable youth would do it.

            Doubtful. Not enough of them. They don’t have the mobility or inclination toward that work of those who are presently doing it.
            I have no problem with the United States having a reciprocal relationship with Mexico and other countries that have people who want to work here. It needs to be regulated. The supply of labor from south of the border, in the absence of any minimum wage, would cause the wages paid to drop further and further. I don’t actually believe that we can constrict the supply of labor effectively without enacting draconian laws and costing billions of dollars for enforcement. Conservatives apparently believe that we can — except those who actually govern border states, like Gov. Perry, who understand that it is not feasible.

      2. D.D.

        If young people were taught self esteem and assertivenes, some of them wouldn’t feel peer pressured into a sexual relationship before they were ready. nd, menn cn walk away from an unplanned pregnancy. Women can’t.

      3. Topcat

        Don Shor Wrote: “Having a child when you don’t have sufficient income, education, or job skills is the leading cause of poverty.”

        I completely agree with this. I would also point out the increase in single mothers having children with no father around.

        I don’t know how society can convince young, uneducated women in poverty to NOT have children. I understand there is a TV show called “Teen Mom” that does present some of the difficulties that impoverished single mothers face. I have not seen the show myself, nor have I heard whether it is doing any good at convincing girls to wait until they can handle motherhood.

        1. Don Shor

          nor have I heard whether it is doing any good at convincing girls to wait until they can handle motherhood.

          Teen pregnancy rates have been declining steadily for years. So maybe it’s working.

  19. wdf1

    NY Times, 5/2/14: Seattle Mayor Details Plan for $15 Minimum Wage

    SEATTLE — Mayor Ed Murray presented on Thursday what he described as an imperfect but workable plan to increase the city’s minimum wage to $15 an hour, more than twice the federal minimum wage and one of the highest anywhere in the nation, through a series of complex and phased-in stages. Just as crucially, he said, the plan has broad political support, with a coalition of labor and business groups ready to push hard for it at the City Council, starting with the first hearings next week.

    But the plan, which in many other cities might be seen as a liberal Democratic agenda at the frontier of social and economic engineering, was immediately attacked not from the mayor’s right, but from his left.

    1. Frankly

      Attacked by the left for being “too watered down”, not because they finally learned enough about supply and demand economics and wanted Seattle to instead work on adding more high paying jobs and a better jobs-education system to fix poverty.

      Think of the US labor pool as a cone with concave sides. At the top are the highest-earners… the base is the mass of unskilled workers… and under that base is another layer of unemployed. The middle are more skilled labor and jobs. The “labor cone”.

      The most healthy form of this cone would be one with straight sides… or even convex sides… where the supply of higher-paying jobs is stronger… thereby pulling more workers up from the bottom of lower-wage jobs.

      One of the main reasons that the US has been such a successful country is that we have had the highest income mobility. Young people advance up from the bottom as they gain education and job skills. The labor cone has been more straight-sided in the past.

      Globalization and automation changed the profile of the labor cone. The sides grew more concave and the base wider due to the exodus of manufacturing to countries with cheaper labor, and because machines are much less problematic as productivity engines than are employees that grow needy and entitled and are exploited to the detriment of the company by politicians and union bosses. Then the Great Recession and the business-unfriendly policies of a Democrat Party grown much more liberal in ideology… and the size of the sub-base population has grown too.

      So, how does a boost to the minimum wage help? It increases the size of the base and the sub-base. It further slopes the sides in a greater concave. Higher taxation on higher-earners and business lowers the height of the cone, but it also increases the base and the sub-base. Bottom line… it does not help. It is destructive to the job and labor market… thereby putting more people at the bottom.

      Liberals’ economic policies keep piling on the base of low-economic prospects. And then because so many more are living in lower economic circumstances, they vote for their liberal looters to do more of the same. Thus we are in a self-perpetuating trajectory to economic decline.

      The altruism of the liberal worldview is them most destructive force that humans have derived. It seems that nothing can stop it short of revolution or constant education. But since liberals own the education establishment… guess what?

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