WITH DANIEL SCHEROTTER

Photo courtesy Daniel Scherotter

Chickens and Eggs

By Daniel Scherotter

October 2, 2006

High Wages and High Poverty coexisting in the Inner Bay Area? (Fog City, 9-28) A sky high cost of living is responsible?

Then, just the other day, we read that a large number of "rich people" in California collectively gave to charity at a pitiful rate compared to the citizens of Utah and a host of Southern and Midwestern (Read Red) States. (Chronicle, 9-27).

Dare we make a connection? Dare we ask a question, the answer of which might grate against our collective social consciousness? Let's speak metaphorically… let's discuss this in chickens and eggs terms.

Where there are chickens eggs frequently follow, and from those eggs more chickens. Chickens left alone and away from predators will produce more eggs and then more chickens than chickens in a controlled environment, and definitely more than chickens in the wild. The more chickens there are, the more food they need and the more manure they produce.

Getting into the discussion of what came first, the chicken or the egg, is reserved for those involved in the one sided politics of blaming the other guy and never listening to him. I would like to think that the educated progressive community could avoid this oh-too-Bush-like behavior, and I think that it can.

We have a high cost of living here in San Francisco. It has always been high. Supply and demand have always acted predictably in our 7x7 slice of heaven. In recent years, the cost of living has gone up faster than areas around us. We also have a higher minimum (and average) wage than anywhere around us, and it has gone up far faster than anywhere around us, too. I'm sure we can all agree that these two are related, since goods and services are provided by people. I'm sure we can also realize that more expensive people with more expensive benefits (health care, sick pay) increase the cost and provide more expensive goods and services to everyone. Having higher taxes and fees than anyone around us (for thousands of miles) might also be blamed for the high cost of goods and services that we all have to pay. As labor gets more expensive, more outsourcing is occurring, the more small businesses are replaced with chains and the more storefront retail is replaced with internet competition. We all see this.

So, even though people here make more than people anywhere else, the cost of living saps that income and leaves all people with less to spend than practically anywhere else. People who in Utah would be middle class, here are working poor, and people who in Utah would be rich at $200,000/year/couple, here are cooking at home in their tiny starter condo with nothing left to give to charity. We are all paying sales tax, property tax, state income tax, payroll tax and a cornucopia of fees to government instead of to charity (which does a much better job of getting money to the intended recipient by about 3 times). In every case, those states with higher rates of charitable giving are low tax, low wage, low regulation states. Here, we seemingly prefer to give it to government.

With taxes, the theory is that in a well governed city that you get what you pay for. The theory is that if you're paid more, you can afford more. So how're those theories working for everyone? If the answer is, "not so well," maybe something's wrong with the theory, or maybe, just maybe it's with the city.

We are all paying relatively more for others' high Bay Area wages and benefits (and taxes on same) than to ourselves, too. Since we have tied the minimum wage to the CPI, we even have an accelerator that will increase the rate of increase of the CPI. We've given the Roosters Viagra and the Hens chocolate and put the eggs in an incubator.

I doubt anyone sees the cost of living dropping anytime soon, and they'd be correct. Next year the minimum wage goes up to $9.14/hour, an occasion to be celebrated by, among others, waiters everywhere, who will also get a raise on their tips from the higher prices the restaurants will have to charge. Of course restaurants can save by cutting cooks' pay or eliminating bussers.. When you add on the $1.06 or $1.60/hour for health care and the 9 paid sick days and the city payroll tax because our 'progressive' board only knows how to increase the cost of labor (and then the cost of everything labor might buy), you can see how things might get expensive in any business that required workers.

You can see the huge disincentive to become an employer of an entry level worker. You can see why private independent contractors are the single fastest growing segment of San Franciscan workers. All the progressives I know tell me to raise my prices and that people will pay the slight increase, and these are the liberals! You can see how people at any end of the spectrum might get squeezed. Businesses are no different: The fact that restaurants are far more than likely to go under in their first 5 years explains that they're in worse shape than the people they employ and serve.

So I have to ask, is this upward spiral in anyone's best interest? Small, locally owned businesses certainly lose. Citizens and residents certainly lose. I did notice that the City Government's payroll is going up by hundreds of millions of dollars, including executive pay and benefits. I noticed that city workers make more money by far than the rest of us, $6,000/year more on average before the lifetime healthcare and pension benefits are thrown in at our expense. I'm not quite sure who benefits other than the people who work for the city, most of whom don't even live here. I know that Muni, public housing, crime, public education, homelessness, poverty and quality of life are not improving, yet we're paying more for them every year. That doesn't strike me as 'progressive'. The trajectory is more banana republic than third way.

Would it not be progressive to demand the city spend our money more wisely, actually fix the problems we all see and tax and regulate us more judiciously so we can afford our own city. Shouldn't it be progressive to call for civil service reform, to modernize a 19th century city government and call for efficiency in the name of service? Would it not be smart for the progressive intelligentsia to sit down with small business leaders to help straighten out what's wrong without falling victim again and again to the laws of unintended consequences? Wouldn't it be in the peoples' best interest to advocate for a more humane cost of living?

If we want to, we can maintain the number chickens and eggs at a sustainable level where there's enough food for everyone that we can afford to feed, but currently we've got a huge amount of crap to shovel through to get anything done and a stench that's growing intolerable. We can't sit around drunk on moonshine and wonder why the barn reeks and blame it on the other guy all day long. We have to make some hard choices and decide to look at the big picture. This might require conversation. Is anyone reading this willing to talk to someone they don't completely agree with, or are we in a left wing version of Washington DC? If so - it'll be interesting to see what happens in November when the arrogant and unchallenged majority meets voters' wrath (in Washington, of course).

Daniel Scherotter is a professional chef and operates Palio d'Asti restaurant in San Francisco. Daniel is also the Vice President of the Golden Gate Restaurant Association.

Email Daniel at scherotter@aol.com.

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