Sunday, August 30, 2009

Why government should not compete with small business

This past Saturday, I placed an ad for a cook in the Free Press. A little one column, inch and half long ad. I debated whether I was going to spend the extra 10 bucks to put a border around the ad.

On the same page, Manitoba Lotteries Corporation places an ad for cooks and servers. Four columns wide, complete with logos, frivolous swoopy lines and plenty of dramatic white space. This is followed by a second 4 column ad for one of the restaurants at one of the government-owned casinos.

When small business and government compete, we don't compete at the same scale. I could
never spend the money on such extravagant want-ads, yet we are essentially looking for the same people. Government run operations don't have to follow the same sets of rules as small business.

I am not one of those anti-tax, small government, american-talk-radio-listening-to right wing reactionaries. I believe in big government. I support universal healthcare and feel it should be expanded. I support social welfare, I believe employment insurance should support more people, I think public utilities should be publicly owned, I drive on our highways and enjoy our parks. 

I feel that we should decide which areas should be privately owned and which should be publicly owned. And we should maintain a clear distinction between the two. We need to keep them separate. Government should not compete with its citizens for the same sales dollars or even staffing.

It seems obvious that the entertainment and hospitality industries should be taken care of by private business. Government involvement in this area seems ludicrous. Movie theaters, restaurants, night clubs, cafes, sports bars, pool halls and any other entertainment and hospitality business should be owned by private business.  And yet, the government sees fit to run large scale entertainment venues, complete with restaurants and bars, in the form of the casinos. These casinos were built on a scale that most private investors would only dream of. (In fact, when the First Nations opened their casino on Brokenhead, Manitoba Lotteries limited their size to reduce competition with their own casinos) And, these casinos compete directly with small business in Manitoba.  Although the concepts are a little different, when citizens are deciding where to go and spend their entertainment budget, they must choose between McPhillips Street Station and Bistro 7 1/4. (Just ask which has the bigger marketing budget)

Beyond the question of scale, there is a question of regulation. Manitoba Lotteries, who runs the casinos, gets to decide who will be their competition, how big they can be, and under what rules they must follow. The Manitoba Liquor Control Commission decides who gets to sell alcohol, how much they must charge, when they can be open.  There is an inherent conflict of interest when a government body is allowed to regulate the industry which it profits from.  The MLCC should regulate the liquor industry, but should not retail alcohol. And the casinos should be privately owned and run by the mob, just like in the good old days.

And so, when cooks need to decide where to go work, they need to choose between the big four column ad promising better pay and benefits to deep-fry chicken fingers, or the little ad promising the chance to cook duck confit and pork belly for people who really love food. 

p.s. I decided to go with the $10 border

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