A couple days ago I came across an LA Times article about Council elections in the city of Vernon, California. Vernon is only 5.2 square miles and is the least populous city in Los Angeles County with a total population of 112 and only 74 registered voters. But this small city has received a disproportionately large amount of attention from politicians, business leaders, and the media over the last 10 years. Why? Because while Vernon is home to only 112 people, it is also the home of over 1,800 businesses which makes Vernon one of the most dynamic and profitable cities in the country.
Vernon was incorporated in 1905 with the specific intent of promoting industrial development in the area. Over the years, the city has fulfilled its mission with astounding efficacy. Through its close proximity to the LA area railways and harbors, business-friendly tax structures, and a number of services which cater to the business community, Vernon has emerged as an economic powerhouse. Over 40,000 people work in Vernon and, according to some estimates, over 100,000 jobs are directly attributable to the city. In all, the businesses in Vernon account for about $4.5 billion of direct and indirect wages and salaries annually.
The Times article painted a picture of an unusually intimate city council election. As is to be expected in a city with such a tiny electorate, the campaigns have consisted of a lot of direct outreach through fliers, door-to-door canvassing, and candidates having short chats with undecided voters.
Vernon is a city of insiders. Everybody knows each other. A large percentage of the residents are city employees and most city employees live in inexpensive, city-owned or subsidized houses. Most of the residents who are not employed by the city are related to someone who is. The two men running for Council are long-time Vernon residents with strong business and city ties. One, Daniel Newmire, is a current councilman running for reelection and the other, Michael Ybarra, is the son of a former Vernon councilmember, Thomas Ybarra, who served on the Council for over 40 years.
The senior Ybarra was not the only elected official in Vernon who had held office for an extended amount of time. Several other members of Vernon’s City Council had served since the 70’s until a corruption scandal in 2006 forced the city to establish term limits.
Vernon has created an ultra business-friendly environment which makes it one of the cheapest cities for businesses to operate in within the United States. So the businesses want to go to Vernon because it’s cheap for them to operate there. As a result, Vernon has attracted a lot of businesses. So while the city does not make as much money off of one business as a normal city would, the fact that there are so many businesses operating in Vernon means that the city makes a lot of money off of the business sector as a whole. It’s the Wal-Mart model. People go there because the products are incredibly cheap. Wal-Mart makes a profit by doing a lot of business and attracting a lot of customers. Their profit margins are slimmer than their competitors but since they do so much business they are still hugely profitable. So the businesses in Vernon make money because it’s cheap to operate there. But since so many businesses are based in Vernon, the city coffers are extremely robust which has allowed Vernon to pay its city administrators extraordinarily well.
Until the corruption scandal of 2006, City Council members made $70,000 per year and a number of city administrators made over $700,000 annually. At one point, Eric T. Fresch served as both the City Administrator and the Deputy City Attorney, netting him a yearly compensation of over $1.6 million.
On top of its tax structure, what is unique about Vernon is that there are no “people” to speak of. The residents are either corporate or government elites. Both are profiting from the set up so there are no moves to change it. There are no real competing interests allowed in Vernon so there is no real political competition. The council elections are real but the competition is tepid at most. Newmire even said that he wished that both he and Ybarra could serve.
The lack of political rivalry in Vernon is a particularly blatant example of the lack of real competition in our political system as a whole. Political debates focus on a small number of specific issues (abortion, gay marriage, building a wall along the US-Mexico border…) because politicians tend to agree on everything else. And as Vernon illustrates, one issue on which they agree is the importance of catering to businesses’ profit needs and being well compensated in the process. “The people” lose out in this equation; as money that could go to fund schools, clinics, and services goes to the pockets of a small group of individuals instead.