California enacted a relatively modest “enterprise zone” law 30 years ago, and maintains a $700 million program, which manages a few geographic areas where businesses can receive tax breaks for hiring disadvantaged workers in locations where high-unemployment is persistent. Enterprise zones are a good idea to give incentive to businesses and build new investments and value in communities that would not otherwise receive attention. Emboldened by more recent Democratic electoral gains in the Legislature, and a Governor who says he wants to “reform” the meager enterprise zone program, the California Labor Federation, which despises the program, now argues that 61 percent of the program’s credits go to very large corporations, and therefore it should be “reformed”. A new bill they are behind, Senate Bill 434, would require employers to pay $16 per hour in the zones, which is twice the minimum wage of $8, and more-or-less kills off the incentive for companies investing in blighted communities – which is inherent in the idea behind enterprise zones in the first place! Craig Johnson, president of the California Association of Enterprise Zones, claims the zones have created 124,000 jobs in the state. But the California Labor Federation apparently doesn’t like those types of jobs, so they are more than happy to sponsor job-killing legislation, regardless of unemployment statistics showing that among black teenagers, the unemployment rate is growing, is up to 43.1 percent nationally, and is even worse in California. The California Labor Federation’s attitude on enterprise zones is one that would not be lost on economist Walter E. Williams, who has observed, “(l)abor unions have a long history of discrimination against blacks,” and “(t)o the detriment of their constituents, black politicians give support to labor laws pushed by unions and white liberal organizations.”
