I was on Wisconsin Public Radio yesterday debating family-friendly workplace policies, as now advocated by Barack Obama.
It was a civil discussion, but as politicians will, Sen. Jennifer Shilling (D–La Crosse) stuck to her own talking points and failed to answer any of my points about why family-friendly workplace policies are wrong when mandated by law or regulation. She didn’t even react to my suggestion that Obama brought this up to divert attention from his craptacular performance on the economy. (To wit, economic shrinkage of 2.9 percent in the first quarter.)
This shouldn’t be surprising, because Democratic ignorance on business has lasted the entire Barack Obama presidency. (Obama, of course, not only has never gotten a private-sector paycheck, but he has spent his term denigrating business, the “rich” and the successful.) Shilling’s biography on her state Senate web page lists a whole bunch of political experience, but no private-sector experience other than mentions of the La Crosse and Viroqua chambers of commerce.)
I have yet to read any acknowledgment of the cost of what Obama and Shilling espouse — paid leave and higher minimum wages — on businesses. Take, for instance, a 10-employee business, of which there are many in small towns throughout Wisconsin. If someone is taking paid leave, the business is paying that employee to not work, and meanwhile 10 percent of that business’ workforce is absent and not contributing to the business. That means the remaining workforce has to do the absent employee’s work, and usually without compensatory additional pay.
Because education must be reinforced, I’ll repeat what I’ve been writing for, well, years here and elsewhere: A business exists to serve its customers, not to employ people. Employment is the result of the business’ existence. The number one priority of a business is profit, because without profit nothing else, including paying employees, happens. Employee pay and benefits are usually the largest portion of a business’ expenses.
(And, by the way, everyone casting aspersions about Walmart and McDonalds and other publicly traded companies are beating upon 0.1 percent of the businesses in the U.S. That is a point utterly missed by a Democratic state Assembly candidate I spoke to earlier this week, who appears to me to be basing his run for office on his past and present employment discontents.)
Democrats and their apparatchiks are basing this campaign on their belief that every American workplace is a horror out of Charles Dickens, where employees are chained to their desks or infernal factory machines, paid slightly more than slave wages. As usual, Democrats fail to respect the American business owner. I don’t find particularly credible the complaints of someone (for instance, Obama) who has never signed the front of a paycheck, who has never wondered how he’d make enough money to pay his employees, who goes without paychecks so his employees do get paid, and who works nights, weekends and holidays when his employees don’t.
It is one thing for businesses to decide on their own that they need to increase employee pay or benefits to attract and retain employees. That is up to the individual business. (In the 1990s, for example, minimum-wage jobs paid more than minimum wage because that’s what it took for employers to get people to work for them. That’s what a healthy economy does, as opposed to our Recovery In Name Only.) It is not up to government to decide that businesses need to pay their employees more or provide better benefits.
It’s also not clear to me why business people would support these mandates, unless they see them as a way to make their smaller competition less competitive, if not eliminate them entirely. If a business can provide better employee benefits and yet remain profitable, why would that business want to give away its competitive advantage?
Obama used three examples of businesses that provide benefits he thinks businesses should provide their employees — Google, Cisco and JetBlue. The first two are large employers in an area of business, IT, in which there is intense competition for employees. IT is certainly not representative of American business as a whole. In most other areas, profit margins are considerably smaller.
I am highly skeptical that Shilling (who as a state senator makes almost $50,000 a year, which is considerably more than most of her constituents) has spoken to anything remotely resembling a cross-section of businesses in her Senate district on this subject, and I am skeptical that she’s gotten the opinions of a chamber or commerce or a business group on this subject either. Most small businesses would find a paid-leave mandate or higher minimum wage a significant burden on their ability to do business. On the one hand, both cause higher prices, and when prices go up, people buy less; on the other hand, when employee costs get too expensive, employees get cut. (McDonald’s restaurants in Europe are replacing their front-counter employees with kiosks. That is the U.S.’ future if the $10.10 minimum wage becomes law.)
William F. Buckley Jr. once said that he’d rather be governed by the first 2,000 names in the Boston phone book than the faculty of Harvard University. I’d rather be governed by any chamber of commerce board in this state than any elective body in this state. That certainly includes the state Legislature. Unlike the Legislature, business people have to work for a living.
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