Another View: Irvine May Repeal Price-Fixing Scheme


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Irvine’s city council may vote today to a repeal price-fixing law affectionately known as the “Living Wage” ordinance.

The median minimum wage worker

Earlier this year, the Irvine finance commission was having problems letting a contract.  The contractors claimed the problem was the Irvine “Living Wage” ordinance — but not for the reason you think.  The contractors didn’t mind paying the higher wage — they were spending Irvine’s money, after all — they balked at the requirement that they pay that higher wage to any employee they had in Orange County.

One of the finance commissioners suggested that the additional requirement be scrapped. At today’s special city council meeting, the Irvine City Council appears set to go a step further and repeal the entire measure  (pdf).

Economists know how to help the working poor:  The Earned Income Tax Credit.  Even Warren Buffet supports the EITC.

But who does a “Living Wage” help? Here’s a test. Conjure in your mind’s eye a worker you think worthy of help.  Did you envision a white teenager working part time in food service?  Because “white teenager working part time” describes the typical minimum wage worker.

The fiscal impact for Irvine, either way, is actually pretty small. Irvine can easily afford this, which is another hint that the “Living Wage” isn’t helping much.  Less than a tenth of the city budget is even affected (fifteen city contracts with a total annual value of $18.6 million – less than Irvine paid Forde and Mollrich.)   Also, cynics might note that the odd construction of Irvine’s “Living Wage” law makes it harder for non-Irvine based firms to bid on City of Irvine contracts. Not that any Irvine politician would ever stoop to steering a contract to a local “friend.”

Repealing Irvine’s counter-productive price fixing rule is a good start.  However, it’s not enough.  Increasing the EITC is obviously a good idea. Improving access to health care would relieve the greatest single stress faced by most working families.  Effective transit quickly and cheaply improve the possibilities for those trying to work their way out of poverty.

If Irvine is serious about helping the working poor, the City Council should stop trying to repeal the laws of economics and instead take the millions being wasted annually on empty  I-shuttles and spend that on mobility solutions for Irvine’s most vulnerable workers.


About Tyler in Irvine

Twenty Year Irvine Resident. Native Texan and proud Longhorn. Pro-Choice Ron Paul supporter. "Do I contradict myself? ... then I contradict myself, I am large, I contain multitudes." - Walt Whitman