That Conservative-Backed Campaign to Hike California’s Minimum Wage Probably Won’t Happen

Weigel
Reporting on Politics and Policy.
March 17 2014 5:57 PM

That Conservative-Backed Campaign to Hike California’s Minimum Wage Probably Won’t Happen

It was exactly two months ago, during the brief and happy summer of Republican anti-poverty initiatives, that California conservative millionaire Ron Unz told me of his plans to put a minimum wage hike on the state's November ballot. Unz went on quite a blitz, apparently (and then not apparently) winning support from Walmart, drawing attention from all manner of Thought Leaders.

Here's where Thought Leading gets you. Unz has emailed supports to admit that it's "unlikely that my $12 Minimum Wage initiative will reach the November ballot." Unions, always skeptical, never got behind it. Unz's whole memo on the fizzle is below.

After various ups and downs, it now seems unlikely that my $12 Minimum Wage initiative will reach the November ballot in California.  This will surely come as a surprise to many people, including myself.

The media had often provided a wildly exaggerated impression of my personal wealth, sometimes even absurdly describing me as a "billionaire."  Since this was incorrect, much of my effort over the last couple of months had been quietly focused on raising the funds necessary to qualify the measure for the ballot.  

Democrats and unions are the traditional supporters of minimum wage hikes and I initially had no contacts with such groups.  My undertaking was therefore a difficult one, although I eventually managed to make considerable headway.

Several weeks ago it seemed reasonably likely that one of the largest California unions might be partnering with me on the campaign, while also serving as an anchor-donor.  If this happened, I felt confident of being able to qualify my initiative for the ballot and also win a victory at the polls in November.  Unfortunately, after careful consideration the union decided that its pre-existing political commitments were too large to allow it to take on an additional one on short notice.  Other unions had roughly similar reactions.

Given my lack of previous familiarity with the internal dynamics of unions, this response surprised me.  During 2012, California's major unions had spent well over $100 million on various initiative campaigns, mostly to protect union dues and to balance the state budget with a tax increase on the wealthy.  While union support for both of these measures, especially the first, was certainly understandable, the direct benefit to most California workers was unclear.  Balancing the state budget might provide a warm sense of fiscal responsibility for low-wage workers, but little else.  By contrast, just one percent of those same dollars would probably have been sufficient to achieve a $12 state minimum wage, thereby boosting worker paychecks by well over $10 billion per year, with union members annually receiving more than a billion of those dollars.

For a time, I thought I could surmount this lack of union support.  My arguments on the conservative case for a higher minimum wage made great progress, and it suddenly looked like a very wealthy individual on that side of the ideological aisle was willing to become the crucial financial backer.  He proposed a donation large enough to ensure that the measure would reach the ballot.  But that possibility also disappeared by the end of last week.

Given these developments, it seems unlikely that my measure will be on the November ballot, which is obviously a major disappointment to me.

However, there have been several very positive consequences from the unsuccessful effort.  Partly as a result of my campaign, an enormous amount of attention and support has been generated for the idea of raising the minimum wage in California, both on a statewide basis and also for particular large cities such as Los Angeles and San Francisco.

Even more importantly, Democrats currently hold super-majorities in both houses of the California Legislature and raising the state minimum wage to $12 or any other figure merely requires a simple majority vote.  With so many prominent conservatives and Republicans having now strongly endorsed a minimum wage hike over the last couple of months, the Democrats should have a very easy time persuading their own caucus members to back such a measure.  

Obviously, raising the California minimum wage via a legislative vote avoids incurring the financial costs and political risks of attempting to pass even a highly popular measure on the November ballot.  Furthermore, this approach would ensure that full credit for the vast increase in worker wages would accrue to the California Democratic Party and its legislative leadership rather than being partly shared with a maverick conservative Republican such as myself.

I would very much like to believe that the reluctance of the major Democratic donors and the large unions to support my $12 minimum wage initiative was because they are highly confident of soon achieving a similar or better result in the overwhelmingly Democratic legislature.  And indeed, just a few weeks after my measure began generating headlines, Democratic State Sen. Mark Leno introduced a bill raising the California minimum wage to $13 per hour, a figure not at all unreasonable given California's extremely high cost of living.

So the coming months will reveal whether whether millions of low-income workers in California will indeed get the large minimum wage hike that I had so strongly advocated or whether minimum wage supporters instead lost a golden opportunity when they failed to support my $12 minimum wage initiative.

Yours Sincerely,

Ron Unz, Chairman
The Higher Wages Alliance

David Weigel is a reporter for Bloomberg Politics

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