Anti-Wal-Mart Law Passes in Maryland

The anti-Wal-Mart bill passed yesterday by the Maryland legislature shows once again that government is the organization by which one group exploits others, as Franz Oppenheimer long ago noted. (This is true regardless of the fact that at different times the same group can be the exploiter and the exploited. See this.) The law, which was pushed by a union wishing to organize Wal-Mart's employees and its largest supermarket competitor, Giant Foods (which is unionized), compels companies with more than 10,000 employees to spend at least 8 percent of their payrolls on health benefits or to give the money to a state welfare program. Wal-Mart is the only firm that crosses that threshold and does not spend that amount. (Why 10,000? Why not 9,000?)

Defenders of the law say it's necessary to protect Medicaid. They claim that Wal-Mart doesn't have to provide health benefits because its employees can go on the state-federal medical welfare program. But the percentage of Wal-Mart employees in Maryland who use Medicaid is not unlike that of other big retailers nationally. That, however, is not the main argument against this claim. Wal-Mart didn't set up Medicaid. It's slightly absurd for politicians to create a welfare program and then complain when people use it. If they don't want taxpayers paying for other people's medical care, let them shut down Medicaid. (Hey, great idea!) The hypocrisy here is amazing. For decades state politicians have made medical care more expensive than it would be by piling regulations and mandates on insurers and imposing licensing requirements that suppress competition. Then they object when employers try to cope with artificially inflated costs.

The way to make medical affordable is to strip away the regulations, allow a truly competitive market, and end the pernicious rules that encourage workers to tether themselves to their bosses through health insurance. The way not to make it affordable is to impose idiotic laws such as Maryland has just done. Forcing Wal-Mart to spend more may well cause people to lose their jobs; then I guess it'll be okay if they go on Medicaid. Some favor.

A final word about the union effort here. I have no problem with a union trying to interest Wal-Mart's employees in organizing. If employees want to organize, they should do so. But employees who'd rather not be in a union shouldn't be forced to pay dues or have representation they do not want. If Wal-Mart's management wishes not to recognize the union, that is its right. It should be voluntarism all around. (Workers should be free to bring public pressure to bear on the company consistent with everyone's rights--that is, peacefully.) I acknowledge that in a truly competitive marketplace (that means no regulations and taxes, which hamper small and potential competitors and self-employers), workers would have more choices and higher pay than they have now. But the way to address this is to get rid of the regulations and taxes, not to pile new regulations on old.