Government meddling
in business is nothing new. We are all
aware of recent news, mandating that employers provide healthcare coverage to
employees that meet specific criteria. Let’s
take a look back at how the government has meddled in business in the past.
In 1916 the
National Child Labor Committee successfully worked with Congress to pass the
Keating-Owen Child Labor Act, also known as Wick’s Bill. This statute prohibited the sale in interstate
commerce of goods produced by factories that employed children under fourteen,
mines that employed children under sixteen, and any facility where children
under sixteen worked at night or more than eight hours daily.
The outcry
was immediate, and in 1918 the US Supreme Court ruled the Act unconstitutional
in Hammer v. Dagenhart.
And then all
was well in the world of commerce and capitalism.
Until 1933.
Under
Franklin D. Roosevelt’s New Deal, Congress passed the National Industrial
Recovery Act. One of the provisions of
this act established a national minimum wage of $0.25 per hour, a 40 hour
workweek, and enacted regulations for working conditions.
Big business
did not take this lying down though, and in 1935 the Supreme Court declared the
act unconstitutional in Schechter Poultry
Corp v. United States.
Once again,
the invisible hand was allowed to regulate things, and government was told No! when it comes to deciding what is
right and good for capitalism.
But FDR wasn’t
finished. In 1938 the Fair Labor
Standards Act was passed, which brought back a national minimum wage of $0.25
per hour ($3.77 in 2007 dollars), a 40 hour work week, allowance for overtime
paid at 1.5 times the normal rate of pay, and prohibited children under 16 from
working.
But business
did not consider the matter to be settled.
In 1946 the case of Anderson v. Mt. Clemens Pottery Co. reached the
Supreme Court. Employees were not being
paid for their time preparing their workplaces (walking to their station,
turning on equipment, donning special clothing, and so on). The Supreme Court upheld the Act, forcing
employers to pay their employees “portal to portal”.
And now here
we are in 2012. Once again, government
is dictating how employers treat their employees. And some employers are doing the only thing
they can do: reducing employee hours to dodge the requirement, or simply
passing the increased cost on to their customers.
Some regard healthcare
coverage as a basic employee right, similar to a safe and harassment free
workplace, or to a minimum wage. Others
see healthcare more as a luxury. For a
low wage or minimum wage worker, it must be reassuring to know that if they are
injured or become ill, not only are they likely to miss out on work and pay at their
job, they could even be fired. That on
top of massive medical bills well beyond their ability to pay, on account of
their low wage job, and lack of healthcare coverage. For someone working to support a family, it
must be reassuring to know that the job creators, the people at the very top of
the capitalism food chain, are not taking a hit in their pocket book. For a CEO with a luxury mansion and a private
fleet of automobiles, suffering any loss in profits is absolutely
devastating. I mean, how would they
support their family?
