What happened to California’s quest to be friendlier to business?

I’m just a newcomer to this state, but I recall that California grew edgy a few years back because businesses were fleeing to avoid high taxes and heavy regulation. So the state vowed to be more welcoming to businesses. At least, that was the view from the outside.

However, some headlines in recent weeks gave this newcomer the opposite impression. Not only did voters snub pro-business initiatives in November, for example, but the governor’s caved in to the movement to boost the state’s minimum wage. (Of course, everyone favors higher standards of living for workers, but business operators often argue that a high minimum wage is not the way to do it because it kills jobs and hurts business.)

But the most startling example came last month when the Los Angeles City Council voted to require any buyer of a big grocery store to keep workers on the payroll for at least 90 days after the purchase.

In other words, the city thinks it should make staffing decisions for at least some business owners.

Of course, some could argue that the effect of the ordinance is piddly. After all, it was aimed at a very small group: Only incoming grocers. And, they could argue, the ordinance had a good heart since it gives employees of the sold grocer up to 90 days to find other work.

That’s true, but those arguments miss the point. It’s the business owner who has the right to decide whether to staff up or staff down, stay open or close, expand or shrink. After all, it is the owner’s money at risk.

And while the ordinance may seem to have a minor effect, it could, in fact, have a big effect.

Once the city has decided to take away a little right, what’s to stop it from taking a bigger right? What happens if it passes the same kind of ordinance for, say, drug stores or automobile dealerships or manufacturers? And why stop at 90 days? Why not 120 days? Why not a year?

Beyond that, the ordinance could have bad human effects. Imagine you are a grocery owner nearing retirement. You’ve labored long nights and many weekends building up a small chain of stores, and now you’re ready to sell out and enjoy the fruits of your labor. Well, good luck. Thanks to the city, you’ve probably just seen the value of your stores drop and your dreams diminished.

The city came to a fork in the road. It could have chosen to be welcoming to business, but it chose the other path, the path of heavier regulation, the path that’s decidedly unfriendly to business.

That’s the significance of this decision, for it shows the true colors of the City Council. Indeed, since the city apparently has decided to become a nanny, poking its public nose into private business matters of grocery owners, business owners in the city now have pause to wonder if they’re next. And the decision gave this newcomer pause to wonder what happened to the quest to be business friendly.

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As noted, I’m a newcomer. At my last stop, I was business news editor of the daily newspaper in New Orleans, a city that unfortunately knows a thing or two about losing businesses.

I’m honored to take over from the former editor, Mark Lacter, under whose stewardship for most of a nine-year span the Los Angeles Business Journal won numerous awards, the admiration of the community of business journalists and, we hope, the respect of its readers. Mark will continue to do some work for the journal, and we’ll continue to follow his good example.

*Charles Crumpley is editor of the Business Journal. He can be reached at

[email protected]

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