Friday, January 13, 2006

Maryland Is Now A Province Of Red China

I cannot believe the short-sighted legislation that Maryland just passed. The bill forces any employer that has more than 10,000 employees in Maryland to spend 8% of their payroll expense on health-care for their employees. It just so happens that Wal-Mart is the only employer in MD that has over 10,000 employees. What a coincidence!

Here are some choice quotes from the liberal brain trust:
"Don't dump your employees that you refuse to insure into our Medicaid system," said the bill's sponsor, Sen. Gloria Lawlah.

In the House, Delegate Anne Healey compared Wal-Mart to a schoolyard bully. "We're here to tell this bully to change his behavior," she said.


And the minority voice of reason:
House Republican Leader George Edwards called the measure an unwarranted intrusion into private enterprise. "If you don't want to work for Wal-Mart, no one's twisting your arms. Go somewhere else and work," Edwards said.


Wait... you mean Wal-Mart employees aren't indentured servants!?! I didn't know they had a choice of where to work!

If I was Wal-Mart, I would immediately close enough facilities to get under 10,000 employees in MD (they currently have 17,000). Then I would open distribution centers & technology centers just on the other side of the MD state line in each of the neighboring states.

An alternate strategy would be to contribute the money to health care expenses that directly help Wal-Mart's bottom line... smoking secession programs, weight loss programs, etc.

If Maryland is really committed to employers providing health-care, they should pass a law that requires every employer to provide health-care. This won't happen, however, because it would create more unemployment and, therefore, more folks on the Medicare rolls. That being said, I never underestimate the lack of economic literacy of politicians. Time will tell if idiot-legislators from other states will try to crater their economies with similar bills.

Update: Go read Don Luskin's column over at The Conspiracy.

13 Comments:

At 10:57 AM, Anonymous Anonymous said...

Wish you had commented regarding the Wal-Mart issue when it was discussed over at ChaliceChick's blog especially when a commentor (The CSO) specifically referenced this legislation as a good idea.

 
At 12:38 PM, Blogger Jamie Goodwin said...

While i understand and even agree with the a lot of free market ideaology, supportting Walmart to me makes no sense.

Walmart does all the things that make people say.. See that is what happens in a free market society. If I where a conervative Walmart would make me just as angry as it does the liberals.

 
At 1:00 PM, Blogger Early Riser said...

Jamie,

If a company violates overtime and illegal immigration laws, they should be prosecuted. However, just because you don't want to work or shop there doesn't give you the moral or legal right to hinder others from doing business w/ Walmart.

These types of governmental nannie laws will simply cause Wal-mart to increase prices for the very group of people that liberals claim to want to help.

Most free market folks just want a level playing ground for all companies... singling-out Wal-mart versus other employers is selective prosecution and should be frowned upon even if you don't like wal-mart.

 
At 1:25 PM, Anonymous Bruce Kroeze said...

"The Democratic Staff of the Committee on Education and the Workforce estimates that one 200-person Wal-Mart store may result in a cost to federal taxpayers of $420,750 per year - about $2,103 per employee."
link

You complain about "nanny laws", but don't seem to mind forcing me to pay for their policies whether or not I choose to shop at Walmart. I don't appreciate being forced to subsidize Walmart shoppers' access to cheap underwear.

The simple truth is that Walmart is a parasite on the US economy, and I applaud legislators beginning to take measures to stop the drain.

 
At 1:51 PM, Blogger Early Riser said...

Bruce,

Neither I nor Wal-mart are forcing you to do or pay for anything. Your tax dollars are being spent on entitlement because liberal politicians think they can sure all of the world's social ills through more spending.

You don't want Wal-mart's employees to get public assistance? Fine, change the welfare rules.... just don't go after a single company.

Did that same company measure the 'cost' of other employers' employees? Of course not... that would be too intellectually honest.

 
At 1:54 PM, Blogger Early Riser said...

Bruce... by the way, I added a link to your blog on my site.

 
At 3:49 PM, Blogger franky said...

I think what Bruce is talking about is the fact that many of Walmarts employees are already on Medicare which negates your point in the post. I'm not sure, but that would be my guest

 
At 5:15 PM, Anonymous Bruce said...

In response to "Did that same company measure the 'cost' of other employers' employees? Of course not... that would be too intellectually honest."

Actually, that has been done repeatedly. Walmart has been convincingly shown (in my opinion, and that of many others) to shift a disproportionately larger percentage of its employees into the medicaid rolls when compared to other companies in its demographic.

It wouldn't matter and things would even out just fine in the long run, except for the scale of the money involved. It truly is hard to bear for many states, not to mention local economies.

Please don't bring in the noise words "liberal" or "conservative". They add nothing to the discussion. Dismissing the legitimate concerns some have about the social costs of Walmart as something only so-called Liberals talk about is to be factually incorrect, and to side-step the whole issue.

(thanks for linking my blog, btw.)

 
At 9:29 PM, Blogger Early Riser said...

Bruce,

First, I truly appreciate the discussion and thanks for coming to my blog. Also, I agree on the labels and I'll omit them.

Help me with the 'social costs' argument. Wal-mart is providing jobs to low-skilled folks. They have also driven huge inefficiencies out of the supply chain which means lower prices for everyone.

If you don't like it, find some investors, open your own supercenters, match your competition's prices, pay your employees more than the going market rate and see how it goes.

Just remember: Wal-mart has to compete for employees with all other employers in a given area. The total comp package (wages, benefits, etc.) must be competitive to attract applicants. If the state forces one section of the comp package to grow (benefits), another part (wages!) may suffer... it's the economic reality of all government interference in markets.

 
At 10:39 PM, Anonymous Anonymous said...

You said " Wal-mart is providing jobs to low-skilled folks."

low cost workers still need basic living, healthcare. Do take a minute so see if you can feed a family on $10/hour or have kids who need medication.

If i am guessing right, you neither have kids nor have poor parents. Thus you will not understand .

 
At 11:20 PM, Blogger Early Riser said...

Wow... someone's making a few assumptions.

First, I have 2 kids. My wife and I waited until we were 30 to have kids (we met when we were 19) so that we could afford to take care of them - pretty novel approach, huh? Oh... sorry... personal responsibility is a politically incorrect idea.

My parents were not poor (my bad!) and I'm not trying to minimize the challenge of trying to raise a family on $10 per hour.

Why is it Walmart's (and not any other company's) responsibility to pay for healthcare? If Walmart is the only evil non-healthcare-providing company, why do people still line-up to work there?

 
At 7:03 AM, Blogger jpe said...

Maryland is forcing walmart to internalize its costs. Good for them.

If the state forces one section of the comp package to grow (benefits), another part (wages!) may suffer..

That's why we have minimum wage laws.

If you don't like it, find some investors, open your own supercenters

Actually, I think I'd rather just pass legislation mandating health care spending. Thanks for the suggestion, though.

 
At 7:48 AM, Blogger Early Riser said...

JPE,

Wal-mart already pays above the minimum wage.

You need to do a bit of research about the dire consequences of government price controls. There are always unintended consequences of government meddling - the MD legislature may have just doomed several thousand low-skilled workers to unemployment.

 

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