We all understand that elections are fundamental to democracy. There has to be a peaceful way of kicking the ins out. And while they are in, to make them afraid of something. But my goodness, elections are costly.
We’re currently having one in Quebec. We vote October 1st, not a moment too soon. The promise-laden emails are arriving daily. $100 million here, $100 million there. And we’ve still got three weeks to go.
So far my $100-million favourite is from the governing Liberals. Because of the fiscal room freed up by the difficult restraint of the last few years, they say, they can now promise — wait for it — $7-a-day parking at hospitals. To balance the provincial budget, ordinary citizens paid higher taxes for slower growth of services, while bureaucrats took job cuts and salary freezes. But finally, here’s the payoff we’ve all been waiting for. We have $7.50-a-day day care in Quebec, which allows you to park your kid for the day at well below market rates — if you can get a space. Now, for 50 cents less you’ll be able to park your car all day, too. At hospitals, that spot will actually be free for the first two hours and max out at $7 for the day. And if you require regular or follow-up treatment, it will be free, period. As it will be at long-term-care institutions. After the nanny state comes the valet state.
The thing about populism is that it’s often, well, popular. In Ontario, thanks to an election promise from the Ford PCs, beer-drinkers now have brew for a buck. Or at least they have that possibility. How many breweries will take permanent advantage of the new lower legal floor price is not clear, but beer drinkers are presumably happy.
At least buck-a-beer politics accords with good economics. Legally enforced floor prices, whether in beer, milk or oil, prevent competition from driving prices down to the true cost of producing whatever good we’re talking about. In fact, the real problem with the Ontario Tory policy is that it leaves a floor in place, albeit a lower one, instead of abolishing the floor altogether, which would let competition decide how low beer can go.
I don’t doubt that price ceilings on hospital parking rates will be popular. Most people think the current prices are a kick in the teeth. A loved one needs hospital care and in addition to the psychic trauma associated with that you’ve got to pay $20 or $25 a day in parking. It’s like a tax on illness.
Why do they do it? As signs indicate in some parking lots I’ve used over the years, it helps fund the hospital. The Liberals’ announcement doesn’t say much about how the ceiling will be administered, but the apparent $100-million price tag could be for the government to reimburse hospitals and other institutions for lost revenue. If not, then the new policy constitutes a transfer from patients, who will lose $100 million of services, to parkers, who will save on cash payouts. Since most parkers will be related to a patient, that might not actually be a trade-off families would like. Worse care for my loved one so I can pay less for parking? I don’t think so.
But even if the government does make up the hospitals’ revenues, what’s the ultimate effect on parking? As politicians should have tattooed on their foreheads, demand curves slope downward. If you arbitrarily lower the price, any price, more people will want to consume whatever it’s charging us for. We know this from health care itself. With a price of zero, more people want to use the system than the system can handle. The result: Wait lists.
So, sure, parking will be free — if you can find a spot. How much harder will that be? Where hospitals and institutions aren’t situated in wide open spaces, my guess is plenty hard.
Much as it’s refreshing to see a government actually show concern for people who drive cars, if it really wanted to do something nice for people visiting health care institutions, it could: stop harassing Uber and other ride-sharing services; end quantitative restrictions on taxi licenses; adopt a “fit, willing and able” rule for entry to that industry; and prevent neighbouring municipalities from charging more for street parking than parking congestion requires.
As for the idea that price ceilings will help: Park it.