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Tue, Oct. 22

Cantlon: Good and bad policies, and YRMC

There are right ways and wrong ways to do social programs and other government policies intended to help people. Here is a wrong one and what could make it right, a proposal that, if enacted, would affect YRMC.

It is a proposed ballot item that is currently in the signature collection phase and, if it gets enough, could be on the Arizona ballot (click HERE for the background). It has several features regarding private hospitals but its main feature is forcing a 20% raise for staff at hospitals, everyone from janitors to nurses. It would spread out the raise over four years.

I wouldn’t be at all surprised if hospital workers aren’t getting paid what they should, and if they aren’t I’d like to see them get it, but forcing a specific raise amount, by law, and for one specific industry is the wrong way to do it; perhaps well-intentioned, but mistaken. (The minimum wage is a different case because you have to have some kind of a general floor.)

Whatever the correct wage is, that should be sorted out by the normal free-market process, negotiation.

The problem is that those who say, “Let the market decide” typically mean, “Hey, we big guns have all the leverage, we can force employees to work cheap, and we want to keep it that way so, yeah, let the ‘market’ decide.”

Except that’s not the free-market. The market works only when the two parties negotiating have roughly equal leverage. Then, yes, the market will sort out a good compromise between the employer’s interest in profit and the employee’s interest in proper pay for the value their work creates. (I’m speaking generally of for-profit hospitals or any for-profit industry. YRMC is private but nonprofit. Profit isn’t their motive, but employees still have to negotiate for proper pay.)

With for-profit employers in any industry what happens is the negotiation is nowhere near even, lots of people end up working for less than they’re worth and often less than they can live off of. Frustration drives attempts at solutions, and someone comes up with something like this proposal. Can’t blame them. They were just trying to fix a problem.

But what really needs to happen is to fix the deeper underlying problem. Through various laws and policies we could empower working people generally to be able to bargain over wages with more leverage, more like two equal parties. Should hospital workers get 20% more? Or 50% more? We can never know until a proper free-market negotiation sorts out the answer. Maybe they’d find they’re already getting what they should, or maybe they’d get that 50%.

Forcing this by law is full of flaws. We don’t know if it’s the right amount. It helps only one industry. It could be overturned next year after only one-fourth of the intended raise has been given. It’s help for working people that is fragile, dependent on political whim and mood. It doesn’t give working people the power and dignity they deserve, and quite possibly doesn’t even give them as much of a raise as they ought to receive.

The whole system of laws and policies regarding corporations and employment needs to be turned on its head so that rather than the current favoring of the top, it empowers people, to the point of fair negotiation.

Then we’d have a real free-market. Then the frustrations that drive such off-target proposals wouldn’t be there, and people would get the pay and conditions and respect they deserve.

Tom Cantlon is a local business owner and writer and can be reached at comments at tomcantlon.com.

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