City’s Attitude on Business Like a Pop Song

Sometimes I feel the city of Los Angeles and the business community have a dysfunctional relationship straight out of a pop song. “I love you, you’re perfect,” croons the city, “but can’t you just be a little bit more like someone else?” Driving along Victory Boulevard last week, I saw billboards on bus stops announcing that the city was going to raise people out of poverty. They are achieving this, the billboards proclaim, by raising the minimum wage to $15 an hour and requiring employers to provide a minimum of six paid sick days a year.  The business community has been vocal against the city’s minimum wage increase for over a year now, and I thought I had written my last column on the issue. But I was wrong. Those billboards were infuriating, and completely ignore the reality of our city leaders’ actions.  A minimum wage increase does not lift people out of poverty. Increasing sick days does not lift people out of poverty. Adding regulations, taxes and edicts from on high do not lift people out of poverty.  There is one way to sustainably lift people out of poverty, and that is to grow a strong economy that provides long-term, good-quality jobs.  And private enterprise is the only thing that can achieve those goals. There are many things that business is: innovative, productive, and yes, profit-driven. Profits come from creating value, and adding that value to the economy. The value benefits us all, by growing our retirement accounts, by providing us with technology that a few decades ago was science fiction, by offering us any possible configuration of coffee we could want from the comfort of our air-conditioned, electric car.  There are also many things that business is not: a charity, a social service center, an ideological experiment.  Our city leaders are proud of the fact that Los Angeles is the fourth biggest economy in the country. Who built that economy? Business leaders and innovators.  And so it feels like the city is saying to the business community: We love you, you’re wonderful, but please be just a little bit more like a charity, a social service center, an ideological experiment. The city of Los Angeles is not raising people out of poverty. It is not paying workers. It is placing an additional burden on businesses and hoping that they are innovative enough to bear it. And guess what? Businesses will adapt. They will survive. They will even thrive. They will adapt by investing in technology. You can already check out your own groceries, and order your coffee via an app. They will adapt by analyzing what jobs can be moved to a cheaper part of the country, or even whether the entire business can move out of state. They will adapt by cutting other benefits or hours or training opportunities. Privately, businesses say they are already doing these things, although no one wants to admit it out loud. None of these adaptations will help lift Angelenos out of poverty. They will reduce the number of jobs and limit opportunities for young or entry-level workers. The city of Los Angeles celebrates business and benefits from business, but then turns around and expects business to fill the gap where government has failed. American capitalism is great; the Los Angeles economy is touted as one of the strongest in the world. Our city should be proud of our business leaders. They should celebrate their success and ask, is there any way we can help?  Instead, the city has placed burden after burden on business, not stopping to consider how each has made life just a little bit harder.  We all suffered through the last recession. We don’t need our city leaders to pass rules to make business more expensive, and make the next recession even harder. For them to then claim that the city is reducing poverty – well, that’s just the final crescendo of our dysfunctional teenage love song. Stuart Waldman is president of the Valley Industry and Commerce Association, a Van Nuys-based business advocacy organization that represents L.A. County employers at the local, state and federal levels of government.