“Free markets increase total wealth. Competition encourages entrepreneurs to find new ways to release more value from both people and resources.
Because capitalism is voluntary and consumers have choices, the only way capitalists can get rich is to offer us something that we believe is better than we had before.
That creates new wealth.
Steve Jobs became a billionaire. But by creating Apple, he gave us more: millions of jobs and billions of dollars added to our economy.
Research shows that entrepreneurs only keep 2.2 percent of the additional wealth they generate. “In other words, the rest of us captured almost 98 percent of the benefits,” says economist Dan Mitchell of the Center for Freedom and Prosperity.
“I hope that we get 100 new super billionaires,” he adds, “Because that means 100 new people have figured out ways to make the rest of our lives better off.””
“When private equity firms acquire nursing homes, patients start to die more often, according to a new working paper published by the National Bureau of Economic Research.
Private equity acquisitions of nursing homes is a pressing topic: Total private equity investment in nursing homes exploded, going from $5 billion in 2000 to more than $100 billion in 2018. Many nursing homes have long been run on a for-profit basis. But private equity firms, which generally take on debt to buy a company and then put that debt on the newly acquired company’s books, have purchased a mix of large chains and independent facilities — making it easier to isolate the specific effect of private equity acquisitions, rather than just a profit motive, on patient welfare.
Researchers from Penn, NYU, and the University of Chicago studied Medicare data that covers more than 18,000 nursing home facilities, about 1,700 of which were bought by private equity from 2000 to 2017.
Their findings are sobering.
The researchers studied patients who stayed at a skilled nursing facility after an acute episode at a hospital, looking at deaths that fell within the 90-day period after they left the nursing home. They found that going to a private equity-owned nursing home increased mortality for patients by 10 percent against the overall average.”
“the increased mortality is concentrated among patients who are relatively healthier. As counterintuitive as that may sound, there may be a good reason for it: Sicker patients have more regimented treatment that will be adhered to no matter who owns the facility, whereas healthier people may be more susceptible by the changes made under private equity ownership.
Those changes include a reduction in staffing, which prior research has found is the most important factor in quality of care. Overall staffing shrinks by 1.4 percent, the study found, but more directly, private equity acquisitions lead to cuts in the number of hours that front-line nurses spend per day providing basic services to patients. Those services, such as bed turning or infection prevention, aren’t medically intensive, but they can be critical to health outcomes.”
“The combination of fewer nurses and more antipsychotic drugs could explain a significant portion of the disconcerting mortality effect measured by the study. Private equity firms were also found to spend more money on things not related to patient care in order to make money — such as monitoring fees to medical alert companies owned by the same firm — which drains still more resources away from patients.”
“The researchers make a point in their opening to stipulate that private equity may prove successful in other industries. But, they warn, it may be dangerous in health care, where the profit motive of private firms and the welfare of patients may not be aligned”
“Last week, a restaurant owner in Seymour, Indiana, told her local paper that the city should restrict access to food trucks as a way to bolster business at her brick-and-mortar restaurant. She’s taken issue with a particular food truck owned by a national chicken chain.
“The days they were in town, we did have a considerable loss, and they had a line all day,” Lori Keithley, owner of Brewskie’s Downtown in Seymour, told local newspaper The Tribune. She claims Brewskie’s “can’t compete with Chick-fil-A.” So she wants the city to force food trucks operating in the city—including the Chick-fil-A truck, which went through the same licensing, permitting, and inspection process as other food trucks operating in the city—out of the downtown area.”
“some who can’t or won’t compete throw up their hands and ask the government to limit choice by stifling competition. That’s protectionism.”
“Watching things like that should help me sympathize with the people rioting last night.
So should my friend Fabian’s experience. When Fabian was 20, he bought his first car, a luxury edition Infiniti J30 Sedan. He’d saved up for it working as an airplane technician, transporting U.S. soldiers to war zones around the world.
Then, while pumping gas back in NYC, police officers approached him, demanding his license and registration.
He produced the documents and showed them that the car was registered in his name. But Fabian is black, and the police would not believe that the car belonged to him. They arrested him and charged him with grand theft auto.
He sat in jail for two days.
Finally, a judge dismissed the case—using the same documentation Fabian had showed the police. They released him—without any apology.
The trauma still haunts him. Fabian says it evokes a sense of helplessness—a fear that “anytime there’s an encounter with law enforcement, getting arrested or even death could be the outcome.”
Yet, as I watch protesters (even two lawyers were arrested) throwing Molotov cocktails at police officers, and I see opportunistic young people looting stores, and my privileged left-wing white friends say things like, “the looting of our society by unrestrained capitalism is worse!” I get even more furious.
This country, and capitalism, has done more good things for disadvantaged people of all races than any society, ever.
Fabian, despite his terrible experience, says that living as a black man in America is a gift. He came here as a teen from Jamaica. America, he says, gave him opportunity he would never have had elsewhere.
Now, he’s a capitalist who owns things.”
“Capitalism is great at making people want things they don’t need.
And of course this is what we should expect from a system that runs on production and consumption. Companies make and sell products and those products have to be consumed by as many people as possible — that’s what makes the whole thing work.
So it’s not surprising that businesses do everything they can to convince people to buy whatever they’re selling. But what happens when marketing becomes active manipulation? More precisely, what happens when companies use science and technology not only to refine our pleasures but to engineer addictive behaviors?”
“I’m not anti-capitalism, but I am calling attention to a certain species of capitalism that cultivates addictive behavior for profit.”