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Editorial: Another buck for workers

Original post made on May 1, 2015

A growing movement to adopt local minimum-wage ordinances is gaining momentum on the Peninsula and elsewhere in California, and with a City Council committee's vote this week an ordinance now appears headed toward adoption in Palo Alto.

Read the full story here Web Link posted Friday, May 1, 2015, 12:00 AM

Comments (28)

Posted by Mila Z
a resident of Fairmeadow
on May 1, 2015 at 9:09 am

Raising the minimum wage is a worthwhile, immediate step to help those in our community who face the largest obstacles, make the obstacles less bleak. I agree that further study for impact on employers is key and yet I am hopeful that the housing and transportation realities that low income earners face might bring home the poignant need for all of us, at all income levels, to engage in a discussion about the kind of community we want to have and what, if anything, we are willing to do about it.

Posted by housing
a resident of Community Center
on May 1, 2015 at 9:16 am

If we really want to a make a difference in the lives of low-wage workers, then step one has to be increasing our housing supply to end the housing shortage. A dollar more an hour doesn't help a low-wage worker afford a $2000/month studio. But if communities like Palo Alto and our surrounding neighbors took on housing with as much fervor as we've taken on a minimum wage, then bringing down the cost of housing would have a huge impact on low wage workers. After all, housing is the number one outlay for low wage workers. We already have a model for doing this - we're one of a handful of cities that's carbon neutral and we've made a lot of environmentally sustainable decisions even though we alone won't solve global warming. So why aren't we doing our part with respect to the housing shortage, too?

Posted by Supply and Demand
a resident of Menlo Park
on May 1, 2015 at 9:24 am

This is probably a good step, but as the article notes, the impact is limited because $15/hour is still not enough to address the increase in costs due to the area's housing shortage.

All of us on the Peninsula need to have a real conversation about what we are willing to do to address rising housing costs. Facebook has offered to reform the area near its campus from an office park to a neighborhoods with thousands of units of housing. Google has offered the same in North Bayshore. Any of these opportunities need to provide housing at all income levels, not just the top or the bottom.

Adding more supply is the only real solution to a housing shortage.

If Stanford offered to turn the Research Park into a mixed-use neighborhood like downtown, would Palo Alto refuse the offer or champion it as Mountain View has done? What about the shopping mall or the Frye's site? Palo Alto has many commercial areas that are ripe to be redeveloped as mixed-use areas.

Posted by Elaine Uang
a resident of Downtown North
on May 1, 2015 at 9:50 am

Kuods to the Policy and Services Committee for taking this step. Increasing minimum wage is a good step for increasing the earning power of low-wage workers, but as the editorial states, it does not do much to address the regional housing shortage (for the low wage spectrum, and increasingly, the middle income spectrum). these workers (and many more higher waged earners) still can't afford to live nearby.

We've seen some stories published recently about local workers enduring punishing commutes (sacrificing time with loved ones and adding to the burden on our antiquated transportation systems), like this Stanford Dining Services worker who was pushed out of the area recently. Web Link

I hope we can collectively find the will to embrace creative solutions that provide more homes in our city, so we can welcome more of our local workforce (and others) as residents in our community. And if we think about more homes, let's use the opportunity as a catalyst to build the convenient, sustainable 21st transportation infrastructure our city (and our region) so badly needs.

Posted by Paul G
a resident of Old Palo Alto
on May 1, 2015 at 11:44 am

Actually, it is not too early to assess the impacts in San Jose. Two years after implementation, not a single calamity predicted by increase opponents has come to pass. Here's a Mercury News op-ed from March: Web Link

Posted by Resident
a resident of Another Palo Alto neighborhood
on May 1, 2015 at 12:04 pm

The logical consequence to this is that there will end up being less minimum wage jobs in Palo Alto.

Remember the days when gas was cheap and everybody had it pumped by those happy guys who also washed your windows? Gas got expensive, nobody wanted to pay for the service, and now we end up all pumping gas ourselves.

So we are going to see all grocery stores with self serve checkouts, less reasonably priced table service restaurants with order at counter and paper plates, plastic silverware and paper cups, spilt popcorn left between showings at movie theaters and who knows what other cost cutting measures!

The cost of staff is already a high cost for businesses after the cost of rent. Most places will not be able to afford the same number of employees and remain competitive. Service will suffer for all of us.

Posted by stephen levy
a resident of University South
on May 1, 2015 at 12:07 pm

stephen levy is a registered user.

I support the increase and also agree that its purpose is not to make housing affordable to low wage workers. As pointed out above we need other housing friendly policies to make any dent in that effort and it will always be difficult for most low wage workers to live in the heart of the region. So smart transportation investments are also necessary for all of us.

I support the increase because it maintains the original purposes of the minimum wage under the Fair Labor Standards Act--1) to reduce or eliminate poverty status for people who work and 2) to allow low wage workers to share in the general prosperity by maintaining a close relationship between the minimum wage and average wage levels.

There is a longstanding opposition to any minimum wage but the question before the council is not whether there should be a minimum wage but whether now is the time for a raise.

I also agree that the increases should be phased in as the committee proposes and done in cooperation with neighboring cities.

There is also a longstanding fear that these increases will "kill jobs". While that has some theoretical appeal, it applies more to industries that export (few minimum wage workers there) as most population serving sectors such as food services can pass the costs on to consumers.

As to our local experience in our metro area food service jobs increased by 5,500 (8%) between January 2014 and March 2015.

This will neither end poverty, solve the housing challenge nor result in economic calamity.

It is a small step, though, in the right direction for the community where I live. Thanks to the council committee.

Posted by Density wont help
a resident of Crescent Park
on May 1, 2015 at 12:15 pm

There is no way in the world that increasing the housing supply will make local housing possible for low wage workers. Highly paid tech workers and foreign money will snap it up and increase the cost. That is happening every day. Look at what they have done to the real estate market.
Very destructive forces are working on the real estate market, with a few people raking in huge dollars.
Increasing downtown density will just make a few developers and their architects rich, won't help lower paid workers at all.

Posted by Meghan Fraley
a resident of Mountain View
on May 1, 2015 at 2:12 pm

I attended the council meeting, and thought that they talked through many potential concerns regarding raising the minimum wage in an informed and considered way. In regards to research, while outreach to the business community AND the workers is important, the research has already been done.

The US Department of Labor analyzed 64 studies on minimum wage increases and found no discernible impact on loss of employment. Berkeley Labor Research Center has done extensive analysis on low wage worker and minimum wage increases across the country, and they also have found net positive impacts. How many studies need to be done before we can say it is a simple truth that hard working people deserve a fair wage?

I don't believe council acted mindlessly with compassion. Instead, it very much appeared to be a rigorous analysis by people who do have compassion and respect for all people. Too often in this country to we devalue the work of janitors that pick up after us, food workers who serve us, and all of the other jobs necessary for a functioning society.

Many in the South fought bitterly during the civil war to protect the institution of slavery, given the feared economic impact. But in retrospect, I believe we all know that this was an issue of what is right and fair. And hardworking parents deserve to be paid a wage they can live off of. Instead today, we have families sleeping in their cars and relying on government assistance for food. These people want to be self-sufficient, and many employers want to pay a living wage. Many do, but those who want to and don't should be empowered by laws that will not put them at a disadvantage with their neighboring business who would prefer to pay insufficient wages. Let's support strong business models. Let's support small businesses thriving, but not resting on the back of workers. We can do better than that.

As to the issue of teens, the vast majority of minimum wage jobs are those of adults, not teenagers. The vast majority are companies like Walmart and McDonalds who make huge profits and can afford to pay higher wages. Finally, I don't think it is such a crazy idea that teenagers are paid $15 an hour for their work. Teens are usually able to scoop ice cream as well as their adult counterparts, and they are an asset to businesses that rely on a youthful face to their company. Many of them are saving up for school and likely to soon amass huge student debt. I think teens should be paid a fair wage. And, if there is a loss of jobs for teens, and if those jobs are going to adults instead, well, then it sounds like adults in need of jobs are prioritize over teens, and I think that is sound as well.

This is not a bleeding heart issue. This is a matter of fairness, logic, and compassion. The majority of research supports the efficacy or raising the wage, and at the end of the day, a fair day's work deserves a fair day's pay. Let the businesses pay that wage. I don't want to subsidize businesses like Walmart and McDonalds through social service programs just so they can make billions of dollars in profit. Give tax breaks to small businesses if they need extra support. But let businesses do what they are supposed to do and operate ethically and be strong enough in their model to withstand the marketplace. Palo Alto businesses can't say I'm not going to pay the higher rent because it will be hard on my business. And similarly, businesses shouldn't be able to I'm not going to pay my workers enough to live on because I don't know how to create a business model to support them. In the valley of innovation, we can do better than that.

Just as the Palo Alto editorial board was disappointed in the council's level of analysis, I think there is room for further analysis and research on their part before putting out such a statement. The focus on teens is misguided, and a common way of undermining important legislation to begin to ensure a more just and fair society.

Here is a link to a talk Ken Jacobs, the Chair of the Berkeley Labor Research Center, gave at Mountain View city council on raising the minimum wage to $15 for anyone who would like to know more about the research: Web Link

On that note, I'd be happy to email references and research to the editorial board if they are interested.

Posted by Eric Rosenblum
a resident of Downtown North
on May 1, 2015 at 2:14 pm

Eric Rosenblum is a registered user.

This is a good editorial. It points out the emotional nature of the decision, and that it is a largely symbolic gesture. I support this measure, but also realize that it won't have much real impact.

Since lower wage employees have no where to live close to Palo Alto, employers are already paying well above minimum to entice these employees to travel long distances to work here, so not only does the increase not make it so that the workers can afford to live here, but in actuality, the average wage level for salaried workers was probably already close to the "new" level.

If our elected officials really wanted to make a difference in the lives of middle and lower income people, they have to attack the root of the problem. The largest category of expenditure-- by far-- is housing: ~30% of income. The second largest is transportation: ~20% of income. Nothing else is even close (food and utilities are each around 10%). (source: NPR: Web Link Instead of symbolic gestures, we should be providing leadership to create housing near jobs, and create affordable and effcient transportation solutions.

Posted by Jessica Williams
a resident of Downtown North
on May 1, 2015 at 2:35 pm

1) A minimum wage increase is more than symbolic. Just live off minimum wage, and you will know that is true. I agree more has to be done though.

2) The vast majority of minimum wage employees are adults & the businesses largely employ over 100+ workers at a substantial profit.

"Contrary to the claims of big business lobbies, many small business owners support raising the minimum wage. Not only is it the right thing to do, it's a key step toward economic recovery. Every extra dollar in the pockets of low wage workers will get pumped right back into the economy, so everybody wins. " Web Link

Posted by Jessica Williams
a resident of Downtown North
on May 1, 2015 at 2:36 pm

Oh! And while I do think it is more than symbolic and we should move forward. I agree that more steps should be taken in regards to housing and transportation.

Posted by R Wray
a resident of Palo Verde
on May 1, 2015 at 2:44 pm

Spin all you want in a sea of altruism, but you can't escape Economics 101. Increase the price of something and the demand goes down. The price of labor is no exception. The people on the low end will suffer unemployment and reduced hours. And pay higher prices.

Posted by Alice Schaffer Smith
a resident of Green Acres
on May 1, 2015 at 2:51 pm

Frankly, I was disappointed that the discussion did not focus on what a "living" wage should be for Palo Alto workers.

Nonetheless, I applaud the Committee for its good work and the outcome of Tuesday night's hearing.

Posted by housing
a resident of Community Center
on May 1, 2015 at 3:41 pm

@ Density

Traditionally, "affordable housing" has meant old housing stock. Affluent people move into newly built homes and less affluent people move into older stock that has older appliances and fewer amenities.

We have a housing shortage of such vast proportions that even affluent people are bidding up the prices of 60+ year old apartments because there are simply not that many choices around if you want to live near work.

If we built new housing, even if all affluent people moved in (and this is not true because almost all new housing stock today also comes with affordable units and we do still have some middle class people moving in as well), that would STILL help with housing affordability because those same people wouldn't be bidding up the price of older housing stock anymore.

Housing prices and who lives where isn't just about new housing stock, you also have to look at what happens with old housing stock.

I'll also add that when we talk about hunger, no one says "let's not feed people because we might not fix 100% of the problem." So why is it that when it comes to another basic need, shelter, it suddenly becomes morally ok to say "this won't make 100% of the problem go away, so let's not do it"? We already know through decades of under-building that not building ISN'T solving the problem. The jobs aren't just moving elsewhere - what we're seeing is ever higher job growth and higher housing prices and more people being priced out. So why would we keep doing what we already know doesn't work - under-building?

Posted by HR
a resident of Leland Manor/Garland Drive
on May 1, 2015 at 4:35 pm

$15 is not even a ballpark wage. Lets look at what you could get in 1978. Minimum wage was $2.65 per hour in 1978. That was my first "government registered" job. Rolling burritos at a Taco Bell. I could purchase 26 candy bars with that 1 hour of work and have a nickel left over. I use candy bars because most people have purchased one at one time or another. Today, a candy bar costs $1.25. $15 will get you 11 without tax. If one uses the candy bar ratio, you would need to earn about $27.50 an hour to keep even with 1977 prices.

Posted by Feel good - look good
a resident of another community
on May 2, 2015 at 6:46 am

Local minimum wage hikes may be better than nothing. But they mostly serve to make local residents FEEL GOOD and local politicians LOOK GOOD. Additional housing will not help unless it is subsidized and rent controlled. Rent control for existing apartments will not be tolerated by landlords with millions of dollars in profit at stake.

Posted by It Should be Illegal
a resident of Barron Park
on May 2, 2015 at 8:14 am

Both high-density housing, which encourage crime and sky high insurance rates, and foreign speculation, which causes housing bubbles, should be illegal.

The latter has caused housing to be out of the reach of the middle classes for the first time in American history.

The former is unhealthy for everyone.

Posted by Johnny
a resident of Midtown
on May 2, 2015 at 9:14 pm

For the love of god.
Palo Altans who support the wage hike: please listen.

Your very lifestyle demands premium service at every facet of your daily routine. And guess what supports your extravagant habits: manpower. Your laptop jobs and high quality lives rest on the foundations of blue collar workers (many of whom happen to speak Spanish... ahem... are we ignoring the elephant in the room?) working extremely hard -- driven by the need to SURVIVE. They sweat and toil in the underworld, grinding the gears of the machinery that allows Palo Altans to be so self-indulgent.

A highway divides lovely little Palo Alto with its bike lanes and shopping malls from the squalid, crime-infested, "ghetto" known as E. P. A.

...and this strange, scary, unknown place is where all the servants go at night. But let's keep pretending it doesn't exist.

Stop living in fantasy land. Such is the human ecosystem. There is a great imbalance in the capitalist fabric of our society... and that's how it is. Life is unfair. Let's just accept it... and be thankful that we're the lucky ones. Don't feign empathy for the guy mowing your lawn, the girl making your coffee, or the lady bagging your grocery when I doubt you would accept anything less than speedy, efficient service. Once that suffers, and you stand in line running late to your all-important laptop jobs, I see your empathy going out the window.

You cannot have it both ways!

Please be honest and objective. This two-faced moral licensing makes me cringe.

Posted by Joseph E. Davis
a resident of Woodside
on May 3, 2015 at 9:52 am

Raising the minimum wage is a counterproductive and unethical policy. It makes it harder for the low skilled to find work. If you want to help black teenagers, then raising the minimum wage is the worst thing you can do.

On the other hand, if you want to help Silicon Valley's higher paid robotics and software engineers, then this is a great move.

Posted by CrescentParkAnon.
a resident of Crescent Park
on May 3, 2015 at 10:26 pm

>> How many studies need to be done before we can say it is a simple truth that hard working people deserve a fair wage?

It's not the studies that are the problem. Most people do not trust these studies or know how to read them critically.

It is the obnoxious mean-spirited louts that science, reason and compassion cannot get through to. Some people are just not happy unless they know there are really really miserable people out there that are worse off than ever they are in their own heads.

And those people are the ones that quote the "studies" that raising minimum wage hurts minimum wage workers - like they care, and the only have that opinion because they are looking out for those minimum wage people! I don't know when a meme finally gets repeated and thought about enough that people push it up to their higher thinking centers to consider it, but in terms of being a civilized country the US still has an awful lot of people that can shout down or buy off intelligent discussion.

Raise it, I am for it.

Posted by Sea Seelam Reddy
a resident of College Terrace
on May 4, 2015 at 4:50 am

Good moves.

During the city council elections in 2014, I conceded and agreed that it is local government's responsibility to guide wages as private industry is too late to take the necessary action.

I calculated that $17/hour is what it takes for a person to earn these wages and try to live with companion within the 10-15 mile region of Palo Alto-Redwood City -Menlo-Mountain View neighborhoods.

We are getting there! It is a good move.

No body asks government/city hall when realtors/owners start raising house prices randomly with 'GREED' component. They fashionably call that supply and demand.

Now we use their language and call it supply and demand. There is good amount of labor shortage, so workers have the power to refuse to work for less than $15-17 dollars an hour.

This makes it CAPITALIZED system fair for every one and let people live good life that we used to live until 1990's growth and downfall and 2008 banking corrupt practices outside our city/neighborhoods by people sitting and living in tall buildings in New York, London, and Switzerland and Germany and few others. It took Obama, Geithner, Bernanke and Yellen to figure out who the crooks/corrupt in financial world are. It impacted many of our lives, jobs, families, students, professionals, retirees world wide.

Just because the 'so called economists' do not have guts/creative ideas to propose the logjam of 40% increase in real estate and 'rental' prices; let us take the initiative to demand increase in minimum wage.

I am impressed with our Deputy Mayer Greg SCHMIDT understanding of Palo Alto and our neighborhood economics.

I beg Greg Schmidt to take the leadership to initiate moratorium on GREED and let people live their lives in our neighborhoods; whether it is owner/renter/corporation/elderly. We have had it with 'real estate' people and foreign money that dictates our lives. I do not see a Harvard/Yale/Stanford/Chicago graduates doing real estate in town. Just like we do not want these Dartmouth/UPenn/NYU graduates ruining the economy, we do not want real estate people countering and inflating real estate prices for sake of 6% commission.

We have had enough of that GREED.

We need to courage the stand up and do the right thing.

I hope we can and keep people live a happy life. As we know, whether one has money or not; we do not take it to the grave.

Remember - moratorium on GREED for now.


Posted by Johnny
a resident of Midtown
on May 4, 2015 at 10:04 am

Aaahh thanks for the clarity. It appears some human beings are immune to that evil vice known as greed. The enlightened have transcended Pandora's box. Sorry for failing to notice the halo around thine heads.

Posted by Sea Reddy
a resident of College Terrace
on May 4, 2015 at 1:10 pm

Responding to Johnny

Examples of people that are not nurturing GREED

- Bill Gates
- Warren Buffet
- Greg Schmidt (our Vice-Mayor)
- Mark Z
- Tim Cook
- Senator Warren
- John McCain
- Meg Whitman
- Governor Brown
- Secretary Rice
- Secretary Powell

As you know there are hundreds and thousands that will be on the list. America is a generous nation.

There is no shortage of it.



Posted by Johnny
a resident of Midtown
on May 4, 2015 at 6:40 pm

Look reddy, haven't you ever experienced greed in your life? We all get greedy from time to time. Its an emotion we experience because we'll always want a higher quality of life. Such is human nature. The thirst for advancement.

If you are so noble to suppress your own greed then why don't you lead by example instead of pointing fingers and begging the legislature to mold society through the rule of law. Because let's face it, government officials are clearly exemplars of generosity. City council is completely FREE of GREED and doesn't it show.

I dont get what that list is supposed to prove. Those people are irrelevant as far as I'm concerned. John McCain....? Seriously?

You think the government can actually affect a "moratorium on greed"? That is the most ridiculous thing I ever A simplistic, medieval, blunt way of thinking driven by emotion and condemnation over logic and respect.

Posted by Sea Reddy
a resident of College Terrace
on May 5, 2015 at 3:45 am

Re: Jonny comments

I respect your comments.

Greed a mindset and live good and bad values. We have gotten to a point it is destroying us. Enough is enough; how much money does one family need? it is impacting people and families.

John McCain is a good guy and served the nation well.


Posted by It's not the Realtors
a resident of Another Palo Alto neighborhood
on May 5, 2015 at 8:24 pm


Blaming the real estate agents for housing prices is nonsensical. It IS a supply and demand system and real estate agents simply broker the transactions. They recommend what the market will bear, but the seller decides how much to sell it for and which offer to accept. If you want to hang someone with a "greed" label, you'll have to hang that on the necks of every person who sells a home for the highest/best offer.

There are a few exceptions to the real estate agent angle, and that is the ones that are actively building their business by finding foreign buyers. But accusing real estate agents in general for housing prices is a gross generalization that labels the many with the misdeeds of the few.

You're better than that.

Posted by Density=Danger
a resident of Another Palo Alto neighborhood
on May 8, 2015 at 8:22 pm

In the years before coming to Palo Alto,. We lived in high density housing in three different cities. high density housing is not good for children and other residents' safety. There is increased crime, particularly: burglaries, assaults and batteries, vandalism, car theft, graffiti. Many units are purchased by investors who rent them out, then fail to do any upkeep.

On top of the mortgage payment/ rent, there are homeowners association fees, which run about half the cost of the mortgage payment. Then, because of all the risk ( crime, property damage, etc). the homeowners'/renters' insurance is more expensive than it would be for the same size home on an actual lot with a real yard.

So the fact is, lower income,,high density housing ends up being much more expensive than the purchase price would lead one to believe.

Then there are other considerations: they tend to be in higher crime neighborhoods and are unsafe for your kids. There is little or no play area for kids. There is a lot of noise, and the walls between units are paper thin. The older kids and teens, having to be kept indoors so much for their own safety, begin to act out: sneaking out after curfew, vandalizing, getting into fights, etc, etc, etc.

It just is not worth it for both social and economic reasons.

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