So the election, for all that it was worth, is essentially over. And believe me, it wasn’t worth the $6 Billion that was spent on it – in my very firm opinion. Regardless, there’s been a slew of corporations that had hinted since 2009 that if the Patient Protection and Affordable Care Act (“Obamacare”) was passed, and that, if Obama was re-elected, that they would have to cut jobs. That, apparently has become a realty.
There’s one main list that seems to be circulating among various online news sources, and I have only really been able to substantially indicate the accuracy of at least six corporations:
Dana Holding, Stryker, Boston Scientific, Medtronic, Abbot Laboratories, and Covidien.
With the exception of Dana Holding Corp., which deals with the production of automotive parts such as axels, and transmissions – the rest are medical technology and equipment manufacturer and pharmaceutical companies. There are, of course, other industries, such as Papa Johns, Murray Energy Corporation, and Darden Restaurants (Oliver Garden, Red Lobster, etc.), though, Darden and Papa Johns have only speculated, whereas Murray Energy has already began laying off people.
Many of my colleagues have already began telling me how they were right, how the PPACA was bad economic policy, that it has already started cutting jobs because of increased taxes, etc, etc. But, the PPACA doesn’t kill jobs, it requires business owners to provide health care to their employees depending on the size of their workforce. The PPACA may be one component of a broader trend, but it is the CEO’s cutting jobs, at their own discretion, and not the PPACA.
But this leads to a broader point, and one that I feel should spark an important discussion: at what point is enough profit, enough profit?
The words “morality”, “liberty”, and “freedom” get hurled quite frequently, but they do little justice to ill conceived arguments about the rituals that revolve around businesses, corporations, and profit making. And, to this point, how much money should it take to elect officials to their respective offices? Why should it take almost $2 billion to elect one president?
To put this into perspective, the six companies listed above have threatened to layoff around 7,400 people. Dana Holding cited 2,500 layoffs in order to make up for the projected $24 million in costs that they’ll have to spend. That’s $9,600 per employee. So, assuming the same is true for the rest, that’s about $70.7 million being adjusted for – just with these six companies.
These six companies had a total revenue of $89.9 billion dollars, with a total profit of $11.2 billion, or 12.5% profit margin. In total, that $70.7 million is only a decrease of 0.0063% of their profit. Of course, profit margin is important, and Dana Holding has the smallest margin of those six with 2.9% turnover. That means that the $24 million equates to 11% of their profit. Boston Scientific has a 5.8% margin, which means 3% of their profit lost. The others carry between a 12-19.4% turnover which means that they would only lose 0.001-0.008% of their actual income.
This begs the question, in my mind, at what point is enough profit enough profit? And what moral code are we speaking of? Is a corporation’s ability to make profit more important than a person’s ability to not just have a job, but to afford health insurance? Is it morally okay for a CEO’s to fire people in order to keep 0.001% of their profit?
I don’t believe it to be morally acceptable, and I don’t believe it to be consistent with the notions of liberty or freedom in the broad scheme of things. Why? To me, it boils down to basic sociology – distribution of resources. And this distribution is a fundamental concept behind the implantation for any measure of healthcare reform. As corporations hoard resources, it takes away from others to collect them. These individuals also make money differently, resulting in a conflict of interests here. But, one person’s ability to maximize their freedoms unintentionally although inevitably trumps another person’s ability to exercise theirs. It is not within the scope of freedom, or the notions of liberty that another person – for any reason – may trample the freedoms and liberties of another. Though there are just exceptions to this rule, which is why we have laws against crimes, and punishments to fit those crimes. People who cannot afford to run their own corporation, who cannot afford health care, and people who rely on a corporation for a job should not be unduly burdened on the basis that a person sitting atop a green throne may further exercise their economic powers over the weaker of the two economic classes.
For instance, with healthcare, it is against logic, that in a country based on freedoms and liberties, both economically and domestic – that a corporation should have the right to deny someone healthcare on the fundamental pretense that the corporation that offers healthcare, will lose money. But, the person who has thus been rejected, already lacks the resources (i.e., money) to effectively garner for themselves or their family health insurance. This means either paying much higher premiums because of their pre-existing conditions, or going without insurance. Should this be acceptable? If so, why?
Over the next several weeks, I will be discussing this more in depth, along with taxes and job growth.