Monday, November 12, 2012

A disproportional response

In the first season of The West Wing newly-elected president Josiah Bartlet rejects strategy suggestions from his military advisers when a plane carrying Americans, including his personal physician, is blown up by Syrian operatives. They recommend a series of small air strikes as a "proportional response." Bartlet has another idea.

He asks for a disproportional response. He wants total war.

Eventually his advisers convince him that this would be too costly. He'd lose the support of his allies and many innocent people would be harmed.

This idea of a disproportional response has been leading my inner opposition to several recent boycotts, such as the ones against Target and Chick-Fil-A. In Target's case, the company gave money to someone who supports business policies that will favor Target, but he also is against gay marriage. Boycott.

In Chick-Fil-A's case, it was a small fast food chain most of my friends have never seen that was suddenly evil because the CEO is against gay marriage and gave money to anti-gay marriage groups. Massive boycott, supported by people who don't live close enough to a location to actually make a purchase. There were also some crude assumptions about everyone who works for the company. The protesters weren't necessarily wrong, just disproportionate.

Now the left's disproportional response is against Papa John's pizza chain because the founder and CEO said he will respond to a government mandate requiring him to provide health insurance to all full-time employees or pay a fine by simply turning those full-time employee into part-time employees.

So up come the stupid memes and canned slogans. Remarks insulting the company's products are tossed around and the CEO John Schnatter is criticized for being rich and having a mansion.

As a former pizza delivery guy, I can say that it was a great job. The money is really good because of the tips (which the above link conveniently left out) and it required no formal training or education. There's nothing special about the employee-employer relationship that implies my boss should have offered me health care in exchange for a reduction in wages. If you make it more expensive to hire people, they will hire fewer people. The increase in compensation would also mean that more people would want to be delivery drivers and you'd see those with the least employment options pushed out.

The assumption among lefties is that this mandate would be a smooth transfer of money from Schnatter's pocket to those of his employees. After all, he lives in a mansion.

Well, that money is the company's, not Schatter's. CNN said while the cost of meeting the mandate is unknown, the company would have to pay $28 million in fees as an alternative to buying all that expensive health insurance. Think of that as a ballpark.

In 2011, the company's revenue was $55.7 million. That is, the ballpark for the cost of this measure is half the company's profits. Schatter's own annual compensation is $2.75 million.

They think that because Schatter lives in a mansion, he should pay 10 times his salary in health insurance bills for employees at a McJob. These numbers are easy to find, but are being left out because they are inconvenient to the envy-based activists.

The company is simply responding to incentives by cutting hours to avoid providing health care, and market interventions are mad that their plans are making things worse for the employees, not better. That is the power of the law of unintended consequences.


  1. I'm SO in the mood for Papa John's Pizza now. Thanks a bunch... :-P

  2. I ended up ordering pizza Sunday night after doing some research for this piece from the non-chain location down the street. I'm not boycotting Papa John's, I just don't like their pizza.