Libertarian Ron Unz’s Effort to Raise California Minimum Wage Derailed by Lack of Funds

A California ballot measure campaign to raise the state’s minimum wage to $12 an hour is not going forward in 2014 because its primary proponent, Republican Silicon Valley businessman Ron Unz, could not raise the funds for a multi-million dollar campaign.

“After various ups and downs, it now seems unlikely that my $12 Minimum Wage initiative will reach the November ballot in California,” Unz said in an e-mail.  “This will surely come as a surprise to many people, including myself.”

Unz explained that he could not raise the estimated $1.5 million needed to hire petition circulators to qualify the state ballot measure, which he said was ahead in polling by about 30 percent. He said that he had approached several unions as well as a wealthy Republican donor, but they declined—which surprised and disappointed him.

“During 2012, California’s major unions had spent well over $100 million on various initiative campaigns,” he said. “By contrast, just one percent of those same dollars would probably have been sufficient to achieve a $12 state minimum wage, thereby boosting worker paychecks by well over $10 billion per year, with union members annually receiving more than a billion of those dollars.”

Steve Smith, California Labor Federation communications director, Tuesday said that the cost of a successful minimum wage ballot measure campaign would have been in the tens of millions of dollars, which Unz underestimated, because of likely corporate opposition. Smith said that Unz launched his campaign as a solo effort, without building the needed coalitions to sustain it, and that factor gave the unions pause about joining it.

“You need a lot of funding sources, not just labor—he didn’t do that,” Smith said. “On the merits, we agreed with a lot of what he was saying about minimum wage… He was wading into the big leagues of California ballot measure politics. I’m not sure that he crossed all the t’s and dotted all the i’s.” 

Smith said that California Gov. Jerry Brown signed a bill last year raising the state’s minimum wage to $10/hour by 2016, which was the highest state minimum wage.

Untraditional Campaigner

Unz is a physicist and technology entrepreneur who ran as a Republican for governor in the mid-1990s and lost in a primary against Pete Wilson, who was elected governor. Late last fall, he began talking to the media about putting a $12/hour minimum wage measure on the 2014 ballot. Unz gathered a lot of media attention because he came to the issue as a libertarian and not a liberal, saying a higher base wage would mean greater economic independence, smaller state welfare subsidies and a more reliable workforce. He convinced some right-wing media personalities that this view had merits.

Where Unz’s campaign ran into hurdles was the next round of funding—to hire petition circulators, or the teams who stand in shopping malls gathering signatures.

“The media had often provided a wildly exaggerated impression of my personal wealth, sometimes even absutdly describing me as a ‘billionaire,’ Unz said Monday. “Since this was incorrect, much of my effort over the last couple of months had been quietly focused on raising the funds necessary to qualify the measure for the ballot.”

Unz said that he made “considerable headway” contacting California unions, as well as “a very wealthy individual” on the conservative side of the aisle who pondered a million-dollar donation “but that possibility also disaapeared by the end of last week.”

That prospect—that the drive for the country’s highest minimum wage would be lead by Republicans and conservatives—raised eyebrows and prompted talk in Democratic Party circles. On background, Democrats said that they did not know if they could trust Unz because he previously had taken right-wing positions on immigration issues. Similarly, the fact that his initiative did not come from Democrats also was a factor.

“We’re always looking for ways to improve wages for low-wage workers,” Smith said. “It was questionable to us if this was the right route to take… The next route for us is indexing the minimum wage for inflation. The Unz initiative did not do that.”

The prospect of a state minimum increase in California in 2014 is not completely dead, however. Democratic State Sen. Mark Leno has introduced a bill, co-sponsored by the Senate President, to raise the wage to $13/hour by 2018, in a series of annual increases. That proposal is supported by the California Labor Federation, the Women’s Foundation of California, and Western Center on Law and Poverty. The first legislative hearing on that bill, SB 935, will be held next week.    


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