We still have a free market economy, right? Right?

We still have a free market economy, right? Right?

Yesterday, Philadelphia Mayor Michael Nutter signed into law a requirement for companies located in the city to provide one hour of paid sick leave for every 40 hours worked. That doesn’t sound particularly draconian, sick pay sounds like a good thing, and many companies provide sick leave already.

But they do so voluntarily, as part of their compact with employees on pay, benefits, and working conditions. Being known as a good place to work has its advantages when trying to attract and retain good employees, and companies do compete on this basis (as well as on products, price, etc.).

We have laws on the books regulating workplace safety, overtime pay provisions, and a host of other things. But we now are taking one step deeper into free enterprise, and there is just something unsettling about the city government dictating to a private company what they can and cannot do in terms of employee benefits.

On the same day that Nutter was signing the Philadelphia law, President Obama was opining about the practice at Staples of distinguishing between full-time and part-time employment. Staples has had the same policy in place for ten years, but Obama indicated that it is at odds with the intent of the Affordable Care Act. His comment dug deep — that a company with large market capitalization and well-paid executives should do more to ensure good health care for all of their employees. Sounds nice, but I felt a shudder.

There is a growing desire for government to exert control of private enterprise in order to meet social goals — if your company makes a certain amount of money, and pays executives at a certain compensation level, then the government can feel empowered to force an internal redistribution of some of that money.

Believe me, I’m not saying that executive compensation isn’t out of control; it is. But I don’t want the government deciding that it is too high, I want the shareholders to make that call.

I believe in the profit motive. Let companies make as much as they can. Let them employ people who want to work there. Let them sell to people who want to purchase their goods and services. Let them pay their employees a market-driven wage and benefit package. Let them pay all of their tax obligations, according to the law.

There’s more than a whiff of government interference in the air. But it’s been going on for so long that we hardly notice anymore. The Philadelphia business community opposed the new local law on sick pay, but could not block this encroachment by a heavily Democratic city government.

Staples, though, has real firepower, and fire back they did. Good for them. Government encroachment on the free market economy will continue to be inexorable, unless we push back and debate the merits of each and every proposal, placing each one in the context of our constitutional principles.

No Comments

Sorry, the comment form is closed at this time.