Another politician suspends the laws of economics

When politicians interfere with free markets, the consequences can be serious. As Michigan struggles to climb out of its economic pit, State Sen. Ray Basham decides to pull out a shovel and start digging deeper. Unfortunately Jack Lessenberry joins him.

Basham’s deceptively name "Fair Share Health Care Fund" is another attempt by a politician to jump on the populist band wagon. This is a perfect opportunity for him to generate election year publicity by helping his union backers bash Wal-Mart while appearing to address health insurance concerns.

Basham’s plot to force Wal-Mart to pay for health insurance suggests he is insulated from reality. Apparently he hasn’t noticed but companies are not flocking to this state because of its unfriendly business climate and his proposal will make things worse.

In addition, Basham ignores some basic economics. Wal-Mart can only pay its low skilled workers what they are worth. If forced to increase compensation in the form of health benefits, it must reduce take-home pay. If it cannot reduce take-home pay, Wal-Mart will reduce its operations in Michigan or stop hiring low-skilled labor. Contrary to their delusions of grandeur, politicians cannot suspend the laws of economics. Of course it they understood this, Michigan’s economy would be growing like the rest of the country.

[Letter to the Editor - The Metro Times. Submitted 02/10/2006.]