Danny Williams is going back to business — a land that has made him a multimillionaire, and that has built much of his personal mythology.
But as he leaves public life and returns to the private arena, it’s well worth using his success in a little bit of what you might call comparison shopping.
It has to do with how we view — and lionize — one group, while demonizing another.
The groups? Businesspeople on one side, and the province’s doctors on the other.
Think about this: Williams spent a lot of time and a considerable amount of cash — along with a modicum of good luck and good timing, like many successful businesses — building Cable Atlantic. He’d later sell the company for whacks of money.
By the numbers
Cable companies usually sell based on a multiplier of the number of customers: you take your number of customers, and bargain over how much you should get for each one. The prices vary: you can see a fair amount of what Williams wanted by reading a judge’s verdict in an obscure case in Ontario, where a financial adviser, Christopher Henley of Henley Capital Corporation, successfully sued Cable Atlantic for not paying for his work.
As the judge in the case describes it, Cable Atlantic’s Dean MacDonald got in touch with Henley to see what he thought of “Rogers’ offer of $2,400 per subscriber. What did Henley think? Would he do an analysis of that offer? Henley said he did a price analysis and prepared a spreadsheet. He told MacDonald he thought Cable Atlantic should be valued at about $3,000 per subscriber.”
After a new bidder came in offering $2,800 per subscriber, Rogers came back with a new offer: $3,050 a subscriber.
In other words, Williams used the possibility of someone offering more money to dramatically increase the bid value of his company, and to dramatically increase the amount of money he was paid for his majority share of Cable Atlantic. He took the highest price he could in the marketplace, and he didn’t accept a discount because his company happened to be in Newfoundland and Labrador. The whole concept that he might have to accept less merely because Cable Atlantic was here is absolutely ludicrous. He was a shrewd businessman.
On the other hand
Now, contrast that with the doctors.
What are doctors?
In their own way, they are also businesspeople, whether they are fee-for-service physicians or salaried doctors or specialists. They have made a considerable up-front investment in both sweat equity — their own time and hard work — and put up cash or financing as they work their way through the many years of college, medical school, internship, residencies and further specialized residencies to learn particular advanced specialties.
They’ve gambled, like a businessperson does, that their investment will pay off at some point in the future — that the same supply and demand equation that made Danny Williams a ridiculously rich man will also work in their favour.
With luck and good timing — and also the requisite interest and caring — they could end up in a specialty or sub-specialty that many different jurisdictions require, and that would be willing to bid higher and higher to obtain.
Right now, doctors in this province are negotiating to get their salaries out of the basement in terms of physicians’ pay in this country. They’ve been offered a large increase, to be sure, but it’s still miles behind what other medical professionals can make.
Now, you can argue that one is a private-sector transaction, while the other one involves workers in the public sector — that’s true, but we’re the architects of that situation. We’ve chosen to allow doctors to only work in the public sector. Would we really prefer them as private businesspeople, charging us whatever the market will bear to do a diagnosis and remove a gallbladder?
Certainly, people’s lives hang in the balance with doctors — but, you know, lives hang in the balance with a whole bunch of businesses. Drug companies make huge profits on live-saving therapies and don’t charge us less because we’re a province with tight purse strings.
The companies that make CAT scanners and MRI machines make millions for their equipment, let alone the gravy they make on service contracts and necessary software upgrades. No one is saying to an MRI manufacturer that they will make less money when they sell equipment to Newfoundland and Labrador, and more when they sell the same piece of gear to British Columbia.
And don’t even get me started on the concept of successful weapons businesses. Face it: captains of industry are lauded for wringing the best price possible for their skills and products, regardless of the business they’re in.
Danny Williams put his skills into learning the cable television business — doctors put their skills into learning medicine.
So why on Earth is Danny Williams a savvy super-businessman, while doctors doing the same thing are classed every day as money-grubbing leeches?
Russell Wangersky is The Telegram’s editorial page editor. He can be reached by email at email@example.com.