Companies With Benefits or Potential Welfare Losses of Benefits

Many companies offer employees ‘benefits.’ These include paying for healthcare, investment plans, company gym, luncheons etc. (Just ask a Silicon Valley tech. employee for the full list.)

But why ‘benefits’? And why not cash?

A company offering a young man a zero-down health care plan seems a bit like within-company insurance. Post Obamacare, it also seems a bit unnecessary. (My reading of Obamacare is that it just mandates companies to pay for healthcare, but it doesn’t mandate how they pay for it. So, cash payments ought to be ok?)

The reasoning for investment strikes me as thinner still. Let people decide what they want to do with their money.

In many ways, benefits look a bit like ‘gifts’—welfare reducing but widespread.

My recommendation: give people cash. Or give them an option to get cash.