Business and politics-unhealthy

I have many simple business rules. This is a blog about one such rule:

Business is about business... it should avoid any politics.

This does not mean businesses should not lobby or try to influence legislation or fight political battles in the courts. This does not mean that owners or leaders of business should avoid politics and political issues. That is an ad hoc matter.

What it means is illustrated in the following story.

Four years ago, in San Francisco, the local Board of Supervisors introduced a tax on all local businesses that required them to either pay into a city health care fund or provide roughly $2 per employee per hour payment for health insurance. The Restaurant Association set up a trust fund for medical insurance. The two dollars was paid into the fund and employees could submit bills for payment. Rarely do the employee medical expenses equal the amount of money in the fund, they are always much less.

Nearly all the large restaurants in the city during the first year of the new health requirement added a few percentage points to the customer bill. These ranged from 2% to 5% and in some cases it was a dollar amount like two dollars. Always mentioned on the menu.

On the face of it, this restaurant behavior was absurd.  When taxes on business are raised it is rare to see a gas station or a supermarket or department store add the new taxes as a supplemental charge. But the Restaurant Association was angry and felt they could educate the public by listing this new charge on every restaurant bill.

Over the four-year period the politicians forced a few changes on the restaurants. They prohibited the wording “health charge”. Restaurants responded with “mandated charges”.

Last month, the City Attorney, running for higher office, announced that all restaurants could only apply a surcharge if all the money went to employee health care. He also announced penalties that will put any restaurant out of business.

What happened is businesses tried to get into the world of politics to educate the public. The public, San Franciscans, don't give a shit about the restaurants plight and never responded. The politicians who are anti-business, mean-spirited and vengeful are getting even with the restaurant businesses.

Back to my original observation: businesses should stay out of politics. Just raise your prices to accommodate or move.