California Shoots Itself In The Foot...Again

If you thought the exodus from California gathering speed, it's likely to increase at an even greater pace now that the once Golden State has been pondering a change of its statewide minimum wage to $15 per hour. If Governor Brown signs the bill passed by the state legislature, the Law of Unintended Consequences will make its presence known with a vengeance.

Businesses that were already struggling under California's myriad of confiscatory taxes and business-stifling regulations are likely to see an artificial rise in labor costs to be the last straw. They will either lay off workers, move out of state, or worse, close their doors. The question is, how long will it take before the negative consequences of this minimum wage hike are felt?

Setting a minimum wage at $15 has plenty of critics.

"California may be the first state to pass a $15 minimum wage, but it will also be the first to find out why that's a bad idea," said Michael Saltsman, research director of the Employment Policies Institute, a conservative think tank opposed to minimum wage hikes. He argues that many businesses will have to cut staff or close because of the deal. "This pain from a $15 minimum wage will only be exacerbated in more troubled counties in the state."

The mistake Mr. Saltsman makes is that he believes the Powers That Be in California care one whit for the “more troubled counties in the state.” They don't. We've seen that already as countless farms were forced out of business when the state decided to send water originally slated for farms elsewhere, some of which was sent directly to the Pacific Ocean for feel-good nonsensical reasons. We've also seen it when the Coastal elite and their cronies in Sacramento do everything they can hurt large swaths of the state that aren't like them. Is it any wonder that more than a few people have suggested it may be time to break up California into a number of smaller states? Such an action would let the non-coastal portions of California decide their own fates rather than being dictated to by those in Sacramento who do not have their best interests at heart.

Another effect that California is purposely ignoring is the consequences the wage hike will have on those who will lose their jobs because they aren't worth $15 an hour, or will see their jobs automated out of existence.

Brown’s minimum wage scheme will, of course, artificially raise the cost of hiring the most at-risk workers. Though the robots are not ready to take over quite yet, an onerous wage floor only incentivizes further research into automation. This whole situation is a bizarre illustration of the layered contradictions contained in the blue coalition: anti-inequality crusaders want a radical minimum wage hike, which will likely have the effect of raising unemployment (and welfare eligibility) among economically deprived blue constituencies.

The only ones left in California will be the wealthy and the state-dependent poor. Everyone else will have either left for greener pastures or been condemned to poverty by their 'betters'. The wage hike will make the elite feel better about themselves, but will do none of the things those promoting the higher minimum wage have promised.