California leads the way in pushing for financial policies that -on their face- seem to put more money in the pockets of workers, but in reality will cut work for the young and those who need opportunity most.
Recently, the California legislature passed an unprecedented annual minimum wage increase to $15 per hour by 2023. In addition to the wage hike, state Assemblyman Kevin McCarty wants to expand the eligibility for participation in the government's new subsidized preschool program. Some families will lose their right to participate in the preschool program, McCarty says, because they will be earning too much under the new minimum wage law. (Some families will of course be much worse off as employers reduce jobs because of the new minimum wage.)
Even a two-worker household that will eventually earn over $60,000 will be eligible for the subsidized preschool. This sounds good, but there is a catch: there is no evidence that Head Start, the paradigm for preschool programs for low-income kids, has any lasting impact. Like the minimum wage hikes, which will inevitably lead to higher unemployment and automation, preschool sounds better for low-income Americans than it actually is.
California’s State Preschool Program is the largest state-funded preschool program in the nation. It provides full-day and part-day services that include meals and snacks for the little ones, health and social services referrals for families, and staff development opportunities. Currently, to be eligible for the preschool program a three- or four-year old must be from a family of 1-2 that earns a maximum yearly gross income of $39,396 all the way up to a family of 12 that pulls in up to $70,356.
The Washington Free Beacon reports on McCarty’s speech laying out his rationale:
“The other piece which I think is really critical is expanding eligibility,” McCarty said. “Some people with the minimum wage increase, they’re not rich by any means, but they [now] make a little too much to become eligible for our state preschool program, so we adjust the eligibility for the first time in many years.”
Supporters of the bill argued that the massive minimum wage increase would help alleviate the state’s multibillion-dollar budget deficit and reduce the number of people seeking government services.
“Many of these [minimum wage] workers make so little they are forced to depend on Medi-Cal, food stamps, food banks, and other taxpayer-funded safety net programs just to meet basic necessities. This continuous cycle requires taxpayers to subsidize profitable corporations paying low wages,” Raise the Wage Sacramento says on its website.
The irony is palpable. Progressives have pushed for this arbitrary $15 minimum wage as the savior for the working poor, without considering the unintended consequences. We’ve joined many others in highlighting the impact on employment of minimum wage increases. Heritage experts for example, estimate that the state-wide minimum wage increase would shed about 900,000 jobs by 2023.
And now they are moving to expand a preschool program that, while dear to President Obama's heart, has not been shown to affect the lives of low-income kids.