Learning From Others’ Mistakes

There are constant opportunities to learn from the mistakes and achievements of others. We have the ability to take information gathered on one subject and apply it to another. This helps predict outcomes in certain situations, and it allows us to avert disaster. Americans can learn a lot from what just happened at Hostess. Because the bakers’ union could not strike a deal with Hostess, over 18,000 workers will now lose their jobs as the maker of Twinkies shuts its’ doors forever. We all just witnessed the point at which a company can no longer turn a large enough profit to stay in business. The smartest financial path for Hostess and its investors, was to cease being a company.

Although it may seem unfair that Hostess was trying to cut the wages and the benefits of their workers, Hostess was not running a charity to provide jobs for bakers. The company and the bakers entered into an agreement without force: one side said we will pay you this much to bake these things, and the other side said okay. When the company changed what they wanted to pay, the workers were free to walk away from the deal, and they did. Now 18,000 people who did not want to take a cut in pay have no jobs, but that was their choice as a worker. People must be free to take economic action which they believe is in their best interest. While there may be losers and winners in this situation, it was a transaction absent of force. Hostess could not force its workers to work for less pay, and the workers could not force Hostess to provide jobs at the same wage.

If government force were introduced we may have seen money forcefully taken from taxpayers and given to Hostess in the form of a bailout in order to save these jobs, and this company. In this situation it would have been the taxpayers that ended up being the losers in the situation, and both Hostess and the workers would have benefited from the government force used against taxpayers. One job here and one job there would have been taken away all over the country through taxation, until the 18,000 Hostess workers could keep their jobs. This is what happens with any bailout, taxpayers are robbed to save failing companies and preserve jobs which do not contribute to a free economy.

When jobs are created in the private sector, it is because wealth has been created, through the discovery, growth, harvest and manipulation of resources that will become products which benefit society. When jobs are created in the public sector, or preserved through tax dollars, wealth and resources are being removed from the private sector, and placed in a non-productive activity. GM could not make cars, sell them, pay their workers, and still make money. The government stepped in and took money from people who had already created wealth in the private sector, and decided that some of that wealth would be used to pay for cars, and pay workers’ salaries. Instead of the job which does not create wealth being lost, wealth was taken by force in order to make sure that job remained.

The Hostess closing is one opportunity to learn about economics, and apply what we learn. Opportunities to learn about government run healthcare systems present themselves in a number of different countries. Canadian women in Quebec are facing increasingly long wait times for serious operations. Ovarian, cervical, and breast cancer surgery wait times are now three times longer than the government benchmark. Over an 11 month span 7,780 patients waited 6 months or more for day surgery, and 2,957 patients waited six months or more for operations which require hospitalization.

“Canada’s system comes at the cost of pain and suffering for patients who endure inhumane delays for medically necessary and in some cases life-saving care,” Nadeem Esmail, Senior Fellow at the Fraser Institute, told The Daily Caller News Foundation in an email. “Wait lists for medically necessary health care are Canada’s shame.”

Experts say that gynecological cancer cases are the worst because of how quickly the cancer spreads by the time it is detected, and patients are waiting as long as three months to have cancers removed, instead of four weeks.

One worried patient, a mother of five children who waited three months for surgery for invasive breast cancer, said she is worried about the effects of such a long wait. After surgery, she paid $800 for a bone scan in a private clinic rather than wait five months for a scan at the Jewish General Hospital. (Original Article Here).

One study concluded that wait times between being referred to a specialist and receiving elective treatment from that specialist have increased over 100% since 1993. The Wikipedia article on Canadian Healthcare claims that despite the huge increase in wait times, and other negatives of their health system, spending on healthcare went “from $39.7 billion to $137.3 billion or a more than doubling of per capita spending from $1,715 to $4089” between 1975 and 2009 (measured in 1997 dollars).

To continue reading about government run healthcare systems, click here.

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