California is poised to become the first state with a $15 an hour minimum wage. Gov. Jerry Brown has announced a deal with labor unions, over the objections of business groups.
Brown hasn’t been the biggest fan of minimum wage increases. When he signed the most recent one into law a few years back, he insisted on a slower phase-in period and blocked an automatic cost-of-living increase.
Earlier this year, he raised concerns over the high cost to the state budget. But in announcing this latest deal Monday at the state capitol, Brown called it a "special occasion."
"It’s a matter of economic justice, it makes sense and will help our entire state do much better for its citizens," Brown says.
Republicans and business groups have quickly criticized the deal. Assembly GOP Leader Chad Mayes has made fighting California’s high poverty rate a top priority. He says $15 an hour might make sense in San Francisco, but would hurt businesses and employees in less prosperous parts of the state.
"The reason people are even talking about increasing the minimum wage is because things cost too dang much here in California," Mayes says. "Until we fix the root cause – which is the policies that we’ve put in place here in this building – we’re not going to solve the problem."
California’s minimum wage is currently $10 an hour. The agreement would gradually raise it to 15 by 2022 – with an extra year for smaller businesses. There would be automatic increases with inflation. Democratic state Senate leader Kevin de León calls the deal ambitious but smart.
"The reason why I say 'smart' is because we have exit off-ramps in the event that the economy slows down dramatically, unemployment shoots up high," León says. "We have some very prudent mechanisms to slow it down so we don’t hurt businesses."
Unions pushing for a November ballot measure with faster increases and no off-ramps say they’ll stand down if this deal is approved. That’s why the governor suggested business groups would be "cutting their own throat" if they lobby against it.
Even though he’s a Democrat, Brown has often sided with business groups in recent years against what Republican political consultant Beth Miller calls a "very liberal" California Legislature.
"Now having said that, he has tried to move the needle on some things that the business community was not supportive of," she says. "But it’s a different Legislature right now given that there’s a lot of moderate Democrats."
Many of those moderate Democrats were elected with support from business groups.
California may become the first the first state to pass a $15 minimum wage. But it might not be the first state to pay one. New York Gov. Andrew Cuomo has called for a $15 minimum wage to take effect in 2019 – three years before California.