Author: Charles Crumpley

The unemployment rate in the city of Los Angeles is 13.7 percent. If you’re jobless in a job-scarce era, there is a classic way to escape your predicament: start your own business. Even if you sell ice cream from a cart or take in sewing, you can make it in America.

But maybe not if you’re in Los Angeles. That was the message from a study released last week from the Institute for Justice. It laid bare a city that discourages small-business startups and chokes its entrepreneurs in red tape so absurd you’d think the rules and regulations were written by Samuel Beckett.

For example, a video that accompanies the report said if you want to start a simple shop that sells used books, “You’ll need a permit from the police to operate. You’ll have to be fingerprinted. Anyone who sells you books may need to be fingerprinted, too. For every book you buy, you’ll have to stamp it with an individualized number that corresponds to the bill of sale that identifies the book and who it came from. Police get to inspect those bills of sale and – hold on – you’ll also have to hold books for at least 30 days before you sell them. Just in case the police have any questions.”

It keeps popping up. Take the article on Page 1 of the Oct. 24 issue of the Los Angeles Business Journal. It’s about how the Clean Truck Program at the ports of Los Angeles and Long Beach perversely led to the reintroduction of some of the oldest and dirtiest trucks. Oh, sure, the cadre of unclean trucks is small, but isn’t it interesting that a massively planned and very expensive program to replace old trucks with clean-burning new ones also unexpectedly created a loophole that more or less encourages use of the oldest and dirtiest ones?

In case you haven’t noticed, cities and other governments across California are in competition to see which ones can bankrupt themselves first by heaping ungodly cash on ex-bureaucrats. And it’s a pretty exciting race. https:>

Now, pension payouts never used to be a big whoop when it came to budget expenses of governments. No more. Your creative government-elected officials have sure seen to that.

Something rare happened last week. Business interests squared off against labor interests in City Hall, and business won.

I know you think it’s a joke and you’re waiting for a punch line. But it’s true. It really happened last Wednesday in downtown Los Angeles. The City Council’s transportation committee voted 5-0 in favor of a measure backed by taxicab companies. In so doing, the committee essentially snubbed the usual coalition of labor unions, environmentalists and Mayor Antonio Villaraigosa, all of whom argued against the companies.

Some
city of Los Angeles
officials recently proposed an ordinance that would give preference to local
companies when the city buys some good or service. It’s a
well-intentioned, feel-good measure that’s a bad idea.

The
ordinance would give local businesses an 8 percent advantage when they bid for
city work. So in a low-bid contract scenario, a local firm’s bid of $1
million for a city contract would be considered a bid of $920,000. And in a
request-for-proposal scenario, in which bidders are assigned points, a local
business that got 100 points would be considered to have 108 points. Obviously,
that would give local companies a leg up when they’re bidding against
nonlocal companies.

"For
too long, the city of Los Angeles has awarded contracts to private companies
without considering if any of those funds will filter back into the local
economy," City Council member Bernard Parks was quoted as saying in a
city press release.

We
just celebrated Labor Day, which means you’ve gotten a dose of boring
"state of the labor market" articles and opinions. Alas, this is
another one.

The
situation on the job front is not good. You probably know that unemployment
nationwide was 9.6 percent in August. It was much worse in California
at 12.3 percent and in Los
Angeles County
at 12.4 percent in July. A year earlier, L.A.’s
unemployment was 11.9 percent. In other words, it was bad last year and worse
this year.

But
you may not know that the unemployment rate only tells some of the story.
Another part is how many jobs are being created. Or lost.

Little
moments can say a lot.

I
experienced one such little moment a few weeks ago when John Perez, the speaker
of the California Assembly, stopped by the Business Journal to talk about the
state budget. He explained that one of the Democrats’ big proposals is to
impose a new tax on oil pumped out of the ground in California. He said it figures to be roughly
9.9 percent.

"Nine-point-nine
percent of what?" I asked.

The
calls intensified last week for Dov Charney to step aside as chief executive of
American Apparel.

That’s
nothing new. Even I opined in late 2008 that Charney should become chief
creative officer or some such, and turn over the CEO duties to an experienced
hand. What’s new is that virtually every analyst and stockholder now is
screaming it.

On
the face of it, such calls make sense. Charney’s stewardship of the
clothing company in recent years could be characterized as dismal. American
Apparel has been criticized for its provocative ads and Charney is forever
branded as a one-man generator of sexual harassment lawsuits. The
company’s financials have long been shaky.

The Beverly Hills City Council apparently doesn’t realize what it’s got.

It’s
got a city with a reputation. A huge reputation. A worldwide
reputation. The kind of reputation that other towns lust for but can
only dream of.

Beverly Hills is known as the place to get cosmetic surgery.