The Grass is Always Greener...

info@iwf.org (Amy Watson) — Tue, 07 Oct 2008 14:00:00 EDT

Reports out of Canada are that all is not well for the public healthcare system in that country. More and more private clinics are popping up allowing "queue-jumpers" to pay for and receive services and tests immediately, instead of waiting for their turn in the public system. And of course, rather than recognize there are failures in a government run healthcare system that has led to the increase in private clinics, critics of the private facilities blame THEM for the often lengthy waits experienced in the public system. Click here to read this unbelievable article.

John Stossel on Entitlements

info@iwf.org (Allison Kasic) — Wed, 11 Jun 2008 09:30:00 EDT

In his column today, John Stossel points out the irony of "entitlement" programs:

That's the government's ironic term for programs that transfer money from people who earned it to people who didn't.

Entitlement? How can you be entitled to someone else's money?

Irony aside, entitlements are taking up a growing portion of the federal budget and, as Stossel points out, this comes with serious consequences:

Today's big problem with entitlements is that their growth will soon eat everything in the federal budget.
Last month, the Congressional Budget Office (CBO) analyzed the growth of government spending and deficits for Rep. Paul Ryan (R.-Wis.), ranking member of the Budget Committee. The report estimated that spending on Medicare, Medicaid and Social Security, which in 2007 represented about 8 percent of GDP, would balloon to 14.5 percent in 2030 and 25.7 percent in 2082.

There is no way that can fly.

If you add in all other spending, including interest on the debt, federal spending under the CBO's scenario would eat up an astounding 75.4 percent of GDP in 2084.

If taxes don't keep pace, the CBO says the "additional spending will eventually cause future budget deficits to become unsustainable ..."

And if taxes were to keep pace? The CBO says, "[T]ax rates would have to more than double."

More here.

High Costs

info@iwf.org (Carrie L. Lukas) — Thu, 08 May 2008 10:12:00 EDT

National Review

For the nation's capital, it's one step forward, another step back. D.C. has long been recognized as one of the nation's least friendly business climates, but in recent years, officials have attempted to lure employers into the city limits. The results can be seen around the city. The latest evidence is Columbia Heights's D.C. USA shopping complex, which features prominent retailing chains such as Target, Bed, Bath & Beyond, and Best Buy. These businesses not only bring new shopping opportunities to the neighborhood, but an estimated 1,200 new jobs, more than half of which will be filled by D.C. residents.

Yet while area residents were celebrating the opening of this new consumer paradise, the D.C. Council was busy discouraging other businesses from following D.C. USA's lead. In March, the D.C. Council passed and the Mayor signed the Accrued Sick and Safe Leave Act, legislation to force employers to provide workers paid sick leave. Businesses with twenty-four or fewer employees will have to provide three days of paid sick leave, while those with more than one hundred employees will have to offer seven days.

Most people naturally respond to this news by cheering the D.C. government: after all, who doesn't recognize the need for workers to take time off due to illness? The problem with this reaction, however, is that it focuses solely on the recipients of the new benefit without considering the other side of the ledger: those who bear the costs and suffer from the mandate's unintended consequences.

Consider what happens to a business if an employee uses paid leave. The job that person was hired to perform will go undone, another employee will have to pick up the slack, or the business will have to hire a temporary replacement worker. In any case, the employer's costs will go up or productivity will go down. Smaller businesses, which tend to be more financially vulnerable than larger ones, are particularly affected. Large employers may shift work with relative ease, but a store with a handful of employees often cannot function when one worker doesn't show up. The owner will have to hire a replacement while still paying the leave taker's salary. Those additional costs will have to be made up for somewhere: prices may rise for consumers or perhaps employees will receive lower pay.

Many advocates of these types of mandates also lament stagnating wages. Yet mandated benefits contribute to slow growth in wages since they raise the total cost of employment. As of 2006, more than 30 percent of the average worker's total compensation was paid as benefits.

Some workers may like this arrangement: they're happy to receive such a large portion of their compensation as benefits. But undoubtedly others would prefer to trade those benefits for more money. The problem is once government issues these kinds of regulations negotiation is no longer possible. Certain compensation packages are simply outlawed.

High employment costs encourage employers to hire fewer workers. Some business may combine jobs or outsource services. This is bad news for the nation's capital where the unemployment rate, at 6.2 percent, is more than a percentage point higher than the rest of the country.

It's those people - the ones who miss out on having a job because of the high cost of employment - who are overlooked by much of the media. The Washington Post, for example, highlighted a security officer who "is looking forward to getting seven days of leave," and quoted Councilman Marion Barry (D., Ward 8) who, while lamenting that the regulations didn't demand more from businesses, called the effort "humane."

But these efforts are "humane" only if you focus exclusively on those who benefit and ignore those who lose out. The Washington Post mentions the concerns of Councilman Harry Thomas Jr. (D., Ward 5) who "feared that the legislation would force small businesses to fold and prevent others from starting," but there was no real life example to illustrate this concern. The businesses that will not open and the person who would have gotten that important first job are abstract concepts, but policymakers, and the D.C. public, should not discount their loss.

The greatest loss, of course, is the basic freedom to negotiate your own employment contract. Is it really government's job to make it illegal for me to accept a job offer that doesn't include paid sick leave? Apparently, that's a question that few in the D.C. government think to ask.

Podcast Alert: SCHIP

info@iwf.org (Allison Kasic) — Wed, 19 Dec 2007 10:57:00 EST

In the latest IWF podcast, Carrie Lukas and I talk about SCHIP.

Check it out here.

Independent Women's Forum - Research Areas > Government Health Programs

The Grass is Always Greener...

John Stossel on Entitlements

High Costs

Podcast Alert: SCHIP