Written by Nicholas Vetrisek
With the new year has come many new bills officially being implemented by the California government. While some bills such as SB 188, a bill that combats workplace discrimination, are fairly innocuous, other bills now going into effect will have a major impact on the state and could be major detriments to state businesses.
Without a doubt, the most important bill now in effect is AB 5, which limits the ability of companies to hire contractors. Corporations are only allowed to hire contractors if they do work that is outside of what the company typically does—per part B of the “ABC test.” In other words, companies like Uber and Lyft would not be able to hire independent contractors to drive cars and software companies cannot hire programming contractors. This will effectively destroy the California gig economy and take out a major contributor to the state’s economy, all in a thinly veiled attempt to force people to unionize if Democrats are to be believed.
The next important bill is AB 1482, a bill enforcing statewide rent control. This is similar to what has been tried in San Francisco and New York City: the two cities with the most rent control in the country. Unsurprisingly, they also have the most expensive real estate markets in the nation as well. Rent control sounds nice until you realize that the people that get rent-controlled buildings aren’t the poor and middle class, but well-connected celebrities and politicians.
Politicians in California are continuing the age-old folly of ignoring the only thing that can work—allowing people to build more houses by decreasing regulation thus increasing the supply—and instead choosing the cosmetic solution of just suppressing market prices. This will put the final nail in the coffin for the already struggling California real estate market.
The last few major bills passed are not necessarily as damaging as the above two, they are just symbolic of how hostile California is towards business. The minimum wage has been increased from $12 to $13 per hour. This doesn’t seem like a large difference and for megacorporations like Amazon and McDonalds, but it just makes it that much harder for small businesses that have to pay out more money than before simply because the government believes that “it’s what’s right.”
The final bill in this general category is SB 1443, which requires every workplace with at least five employees to provide two hours of sexual harassment training to new employees within the first six months of hiring. Sexual harassment is a common talking point on the left and any opportunity to preach is good in their book. It won’t work and anyone who wants to know what it will be like should ask someone in the Army what they think about SHARP training.
The new bills coming into effect this year are mostly just new ways for the government to either fix problems that aren’t broken or problems that they created in the first place. If you are a small business owner or independent contractor, hopefully this is enough to convince you that you should leave. But for everybody else, it’s just more hassle from Democrats in Sacramento.