California Cruises Towards $15 Hr Minimum Wage: Expect Budget Deficits, Higher Taxes, Job Losses | MishTalk
. . . so let's get this thing collapsing.
"California governor Jerry Brown has proposed a $15 minimum wage by 2022. If the legislation passes, it will wreak havoc on city budgets, state budgets, businesses, and jobs."
But, since it does not appear we will find a way out outside of the collapse, we might as well get there quickly. Time to go full socialism/progressivism, full $15 per hour minimum wage, and all the rest of the trimmings, and perks. Then be ready to sort out the disaster once the collapse happens.
Ok, so I am not quite ready to actually embrace this mindset, but I do think it will be the most likely mechanism of escape for states like New York, Rhode Island, Illinois, California, Oregon, and other fully invested blue states.
California is a strange state with massive wealth clotted a few miles from the coast around the SF bay area, LA, and San Diego. The interior of the state is quickly becoming a welfare state, filled with the destitute, and desperate. Because the blighted areas are far from the wealthy enclave, it is easy to simply overlook them. But even overlooked, they grow. But to keep this insane system afloat, the state must extract more taxes, and while the wealthy can afford these, and even wonder why anyone would complain, the middle class is squeezed, and increasingly leave. Those who remain need assistance to survive.
In Facebook’s Hometown, the First Responders Aren’t Local
Of course, they are not local, the cost of housing in the wealthy enclave is too high for the middle class who do not already have homes.
"The department’s challenge reflects a flip side of the tech boom: Facebook, Google parent Alphabet Inc. and other companies have brought thousands of high-paying jobs to Silicon Valley, but that has driven housing costs sharply higher, pushing firefighters, teachers, nurses and other middle-class workers to live far from their jobs. The trend creates difficulties, including worsening traffic and the risk that emergency workers won’t be able to get there in the case of a natural disaster."
Yes, the demand part of the housing problem is driven by tech companies bringing in new workers. But the other part is that the government will not allow any significant amount of land be utilized for new housing. If they would Free up 400,000 square acres of land, this would immediately change the cost problem.
"The public-sector workers leaving the Bay Area aren’t alone. Americans are moving away from the tech hub faster than they are arriving, according to a report published last month by the Silicon Valley Competitiveness and Innovation Project.
Other expensive regions are trying to maintain workers nearby. The Fire Department of New York awards job applicants who are residents of the city and nearby counties extra points on the firefighter exam, giving preference to them over applicants who live farther away.
The problem usually comes down to housing. South of Menlo Park, in Cupertino, where Apple Inc. is based, school-district officials in December said they plan to build more than 200 affordable apartments for teachers.
Menlo Park fire district workers will earn an average $147,000 this year, Mr. Schapelhouman said. But that money doesn’t go far in a region where the median home value is $2 million, up 18% in the past year, according to real-estate website Zillow Group Inc. Home prices have risen dramatically since Facebook moved to Menlo Park five years ago."
This shows the insanity of the problem. More people move out of the area than into the area, yet housing prices still spike. This is because the tech companies are able to pay huge salaries, and the housing supply is incredibly limited. This means that the older middle class people are being bought out of their homes by new tech employees with huge salaries, while the remaining middle class cannot afford to buy houses in the region. This means the limited apartment rentals are sky-high as well.
In the end, people live far from their work.
The existing homeowners will never let the local, or state government change this situation. The results would be average home prices falling from $2 million to well less than one half of that amount. That is a real loss of money, and the homeowners will not stand for that change.
Walther Russell Mead wrote an article a few years ago which describes this problem well.
He ends with the following:
"But there’s a serious political opportunity in America for a movement that cares deeply about ensuring that the people who need public services (whether provided directly by the state as in public schools or indirectly through vouchers and charter schools) receive good value for their money. A movement that fights to reform government and make it work, to strip away unnecessary frills and patronage posts, to disempower bureaucracies and return control to citizens and to create a regulatory and legal framework that can bring start ups and jobs into inner cities could change the balance of power in American politics.
We wouldn’t be surprised to see some of the young people who’ve gone into programs like Teach For America, or been active in movements like the effort to rebuild New Orleans begin to think outside the blue box about what kind of agenda America’s troubled cities really need. When and if that happens, the politics of the both century will finally begin to shut down, and the politics of a new and more hopeful era in American life will get under way."
I agree with this assessment completely. However, I am increasingly less persuaded by the idea that the change will somehow come from the young, the Millennials. While they as a cohort are larger than the Boomers, the Boomers have indoctrinated them with what seems to be a terminal belief that 20th century progressivism is the End of History. It is not even a good idea.
I am increasingly concerned that we will actually have to wait for the blue model to fully seize before the change will become possible. And even then, we will likely see partial implementation, and attempts to retain the very worst aspects of the 20th century blue economic model.
The educational system has been in collapse since the 1960s, yet we continue to drag it along as if it is the best thing available. The only inroads to change occurs in the deep blue states, or states where serious catastrophe's have occurred. The two which come to mind are New York City, and New Orleans. Both have majority or close to majority charter schools, and both have seen much improved educational outcomes from these school. They also both still see strong pushback against these superior schools.
The Boomers are not willing to let their childish dreams of control die so something better can replace them. Worst generation ever.
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