[CS-FSLUG] PD: Re: Christians taking action...

Timothy Butler tbutler at ofb.biz
Sun Aug 20 15:51:29 CDT 2006

> This is a simplistic view of the system.  One which most fighting  
> for a
> "living wage" espouse.

	I am not fighting for a "living wage," quite the contrary, I see  
that a "living wage" too demotivates people. However, I am trying to  
be practical: a certain, significant portion of Wal-Mart employees  
are on the state medicaid rolls. The value of the services provided  
by the state are also significant. If Wal-Mart could not pass these  
costs off to the state, they would have to raise their prices and  
hence could not as easily undercut those who provide the services to  
begin with.

	This could be seen as a call for more government regulation or less.  
I might advocate that those working for Wal-Mart must surrender  
rights to Medicaid (hence internalizing the externality to the  
individual) or that Wal-Mart employees who are on Medicaid would have  
their Medicaid exclusively funded by a tax applied to Wal-Mart  
(internalizing the externality to Wal-Mart). The latter probably  
makes the most sense. Since I don't shop at Wal-Mart more than maybe  
once or twice a year, why should I be the one footing the bill for  
the medicaid provided to Wal-Mart employees? It makes much more sense  
for Wal-Mart shoppers to pay it (which is where the cost would end up  
in either case since (many) workers would either demand more pay or  
Wal-Mart would pass the tax on to the consumer).

	Again, the only reason for advocating this is that the market's  
ecosystem has already been tainted by the existence of the socialized  
service (medicaid). Insofar as everyone equally foots the bill for  
this service, Wal-Mart faces no market force to change the situation  
to one where the government provides less services.

> But things are much more complex than that.
> What about the teenagers that want a little income, but are covered
> under the family benefit plan?  What about the retirees who are mostly
> covered by their retirement plans, but want something to do or a  
> little
> extra income?

	Sure, there's that too. But, while there are a significant amount of  
retirees and teens working at Wal-Mart, they are not the majority.

	Many places provide healthcare only if the person isn't covered  
under another plan. As such, any attempt to redirect the cost of Wal- 
Mart back to Wal-Mart and its patrons should be done on the basis of  
how much Wal-Mart is costing the system, not how much it would cost  
if every Wal-Mart employee needed health insurance.

> These people will easily work for under the "living wage"
> (which in your example is $10/hr) because they don't need the  
> benefits.

	$10 is a figure I pulled out of the air. Again, note if John goes to  
work for the supermarket instead of Wal-Mart, he may not need  
healthcare (he's already on another plan), and hence it will not be  
provided to him. The primary difference in costs for Wal-Mart versus  
the supermarket is for the employees that *do* need healthcare. In  
the case of the supermarket, they provide the coverage, and hence I,  
as the consumer, choose whether to "pay for that coverage" based on  
whether I shop at that store. In the case of Wal-Mart I have no  
choice, since I "pay for that coverage" through my taxes every year.

	Again, remember: the market already has a socialized force. I  
advocate an attempt to minimize the amount of that force rather than  
rewarding companies that drive more people into the socialized  
system. I want more free market forces, not less.

> I'm not saying that it is good, but just that things are more
> complicated than as presented.

	Right. But, in analyzing a market system we must almost always use  
Ockham's Razor. It is too hard to examine every force. If I use a  
generality, I probably do not mean it is true in every case.

	Yes, someone will work for $5/hr if need be. BUT, if one store is  
offering $9/hr. (including benefits, so maybe only really $6 in cash)  
and another is offering $7 (but no benefits), a person might take the  
job at $7 and then go on the state roles to receive healthcare  
services. See, the market is damaged. People are demotivated to take  
the job that provides the benefits because the immediate cash might  
be better otherwise. Nevertheless, the overall situation is worse,  
since the taxpayer is subsidizing the person to receive more cash. If  
those who could not afford health care simply did not get it (not  
that I am advocating that),  the person would, in most cases, take  
the job with benefits despite less "real cash."

	Point: Wal-Mart is generally not creating jobs, but replacing jobs  
that offered more complete packages in exchange for higher prices. In  
the end, consumers do not save much (if anything) but instead pay  
indirectly (through taxes) instead of directly.

>> What we know about the reality of socialism in the fallen world is
>> that it is not Biblical, it enslaves the lazy to dependency and the
>> productive to the support of the lazy.

	Precisely. And that is what Wal-Mart is benefiting from.


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