Thursday, January 12, 2012

The Real World: On Firings

Recently, Mitt Romney, in a larger context said, "I like being able to fire people..."  Specifically, he was talking about the ability to stop doing business with one entity, and start doing business with another.  Again, in particular, he was speaking of health insurance.

Now, I do not believe this was a particularly adroit way to make the point, but that's not the focus of this post.  Full Disclosure: I do not like Mitt Romney, I will not vote for him in the Primaries for any reason.

One of the keys of Capitalism is competition.  Whether competition among applicants for a specific job, or competition between companies to provide a specific service, competition is an unimaginably important ingredient.  A key of competition is the ability to "fire" someone.  Whether a specific employee who is not providing enough value or a company that is not providing adequate service, if I'm unable to "fire" anyone, competition does not actually exist.

We see this in regulated industry and in Government.  For decades, cable companies had no real competition.  As a result, their customer service was mediocre, at best, and their prices were high.  With the advent of affordable satellite TV, and now with Fiber-optic TV options, and Internet TV stations, cable companies are having to compete.  It is quite obvious they don't like this competition, as it has shifted the power away from themselves and to the respective stations who wish to control (that is: get paid for) their own content.  Any time you hear that TV provider X has "dropped the Y channel," you can be sure that the Y channel wanted more money per viewer, and the cable company (or satellite provider, or whoever) did not want to pay the increased rate.

Now, this is all well and good.  It is part and parcel of Capitalism.  If anyone believes otherwise they are deluded.  That does not make it pleasant.  People getting fired or companies losing business does have a real negative impact on people's lives.  To forget this is to forget the purpose of Liberty- to enable as many as possible to live as free and as well as possible.  No one should "like" to be able to fire people.  That's a negative thing.  That they should like the consequences of that ability- more competition, better service, more efficiency, and so forth- is not a negative thing, but let's be clear about what we like.

If Mitt Romney truly likes the ability to fire people for itself (I see no evidence that he does- I simply believe this was less-that-adroit way to make his point), then that is a bad thing.  It's not something we want, because it indicates he enjoys being able to inflict negative consequences on others.  If he doesn't like that negative, and was attempting to assert the positive, he chose a particularly clumsy way (in my view) to do so.

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