Big Business Supports Screwing Competition

This made me chuckle. 

A group that includes executives from some of the country’s largest corporations, including chief executives of Manpower and Northwestern Mutual Life Insurance Co., has concluded that the system of providing health insurance through employers is failing and must be scrapped.

For those of you liberals who are going to jump on this as some sort of vindication for socialized medicine, I suggest that you look at the motivations here.  Why would “big business” want government-run health care?

Right now, health insurance expenses cost companies a fortune, and it is a cost that continues to go up.  Big businesses tend to provide health insurance for most of their employees - particularly their most expensive employees.  As the cost goes up, it hits the companies’ bottom line.  As the companies try to mitigate the damage to their profit margin, they have to push some of the cost onto their employees, which tends to tick off their employees.  In the end, the companies are forced to either take a smaller profit and absorb the cost, or tick off their employees. 

For big businesses, the notion of government-run health care is a great idea.  The cost that they spend on health insurance now is simply converted to a payroll tax.  It’s roughly the same dollars, so what do they care?  If the health coverage sucks, then what do they care?  Their employees won’t get mad at them - they will get mad at the government.  Furthermore, big businesses tend to have a lot more sway with politicians than they do with the health insurance providers.  With government-run health care, don’t be surprised to see tax breaks for big businesses to off-set the rising costs.

Finally, big businesses would like government-run health care because it would help kill of competitors by increasing the cost to enter the market.  Many small entrepreneurial companies don’t provide health insurance because they can’t afford it - or they provide creative health insurance plans with high deductibles.  By forcing a mandatory 15%-20% cost onto every employee, it makes it more difficult for new companies to get off their feet and challenge the established old companies. 

Once again we have big businesses using their power and influence to try to make things better for themselves while killing off competition.  There isn’t anything wrong with that, but understand where they are coming from.

As I have always said, my opposition to government-run health care is rooted in the inherent loss of liberty when we turn our health care over to politicians, but the opportunity cost in terms of new businesses and innovation is a high cost.  There’s a reason that America’s economy continues to be innovative while the European economies are lethargic. 

1. The article states that this will NOT be a Gummint-run health program, and then states that the management will be akin to a Fed Reserve-type institution.

   Kurt Gielow is not a wacko.  This may or may not be the best resolution, but it is not likely to be Hildebeeste-care.

   Posted by dad29 on October 22, 2007 at 0653 hrs




2. If what we are on is the Cheddarsphere, then this blog is Swiss Cheese.

   I don’t know if Healthy Wisconsin is totally the answer or any other plan, but at least people are coming up with alternatives to wallowing in this health care mess. It is not a question of these execs knowing something you don’t know, it’s thanks to your ideological straightjacket you don’t care to know.

   No, the European economies or the Canadian economy for that matter are not lethargic. The piss poor American dollar tells us who is doing better. If there is any slow down in Europe it is probably from the drag produced by our sub-prime mortgage debacle.

   Sweden with a 50% tax rate vs GNP is blowing our doors off. And why not? They are spending less of their GNP on health care and the military.

   As far as innovation their tighter regulation means better internet throughout Europe.

   As far as entrepreneurialship, it is higher in Canada than here because people can leave their jobs and not worry about having health coverage.

   As usual you are reading into the situation what you want to read. As much as us liberals can quarrel about the excessive compensation given top executives (which gives you no trouble) these are smart people and their companies are successful for a reason.

   They realize when ideology is useful when it serves as a guide and must be dumped when reality tells you different. As usual there will be some of you and right-wing pols who will lash your selves to for profit health care and right it down to the bottom like Moby Dick and Captain Ahab.

   When does the swift boating of the CEO’s of NWM and Manpower begin?

   Posted by (JavaScript must be enabled to view this email address) on October 22, 2007 at 0716 hrs




3. dad29, you mean Romneybeste-care.

   Owen, you lost me here:

   With government-run health care, don’t be surprised to see tax breaks for big businesses to off-set the rising costs.

   Which rising costs are those?

   Finally, big businesses would like government-run health care because it would help kill of competitors by increasing the cost to enter the market.

   Kind of like the cost to enter the market we have now?  Like “I won’t have health insurance if I start my own business”?

   Posted by scott on October 22, 2007 at 0918 hrs




4. Right now, health insurance expenses cost companies a fortune, and it is a cost that continues to go up.  Big businesses tend to provide health insurance for most of their employees - particularly their most expensive employees.  As the cost goes up, it hits the companies’ bottom line.  As the companies try to mitigate the damage to their profit margin, they have to push some of the cost onto their employees, which tends to tick off their employees.  In the end, the companies are forced to either take a smaller profit and absorb the cost, or tick off their employees.

   Owen, nice synopsis of why health care reform is so necessary.  The rest was a convoluted cross pollination of rhetoric from the right and the left (conservatives are now going to argue that corporations are crooks out to rip us off through government regulation and programs?!?!?).  But that second paragraph succinctly made the case for a national health care system.

   Posted by (JavaScript must be enabled to view this email address) on October 22, 2007 at 0936 hrs




5. Funny how when it works contrary to a position that Emperor Robinson likes, then he assumes that businesses are just out to screw their employees.  But when it comes to matters like wages and benefits, he assumes that employers gladly and willingly give their employees everything they’re worth, making requests for more compensation or, gasp, strikes, completely and totally unnecessary.

   So when it comes to compensatory matters, employers are kind, benevolent souls.  But when it comes to health care, they’re cruel, heartless, sons of bitches who would do anything to f&)* their employees over for a dollar.

   The absolute lack of any kind of philosophical consistency over here these days is positively astounding and most entertaining.  It’s like we’re supposed to forget anything else ever said or written on this blog.

   If you’re going to start assuming the worst about big business, remember that such a basic assumption contradicts a number of other things you’ve said around here.  But at least you’ve finally gotten the assumption right.

   Posted by Recess Supervisor on October 22, 2007 at 1052 hrs




6. Many that have worked in corporate America know that this has long been one thing they have wanted to do. If you’re a executive or a manager you are looking into the future and they have seen the mess coming we are now in for a long time.

   There has to be a way to stop or breakup the corporate healthcare mess we now have. If we don’t it will sink our economy.

   Posted by (JavaScript must be enabled to view this email address) on October 22, 2007 at 1055 hrs




7. The employer in question is Manpower.  Of course Manpower would love to see a health care system financed by a payroll tax as proposed in the article.  Such a system, as was proposed in Healthy Wisconsin, benefits low wage employers, and in addition provides an incentive for employers to shift to low wage temporary employers like Manpower.

   Posted by (JavaScript must be enabled to view this email address) on October 22, 2007 at 1112 hrs




8. There has to be a way to stop or breakup the corporate healthcare mess we now have. If we don’t it will sink our economy.

   If only there could be agreement on this one point.

   Thanks Anon.

   Posted by (JavaScript must be enabled to view this email address) on October 22, 2007 at 1142 hrs




9. This is not a business group- nor a WI group.  The chair is a drug exec from CA who wants to sweeten the pot he’s feeding from.  The group includes “a long list of current & former university presidents”, etc., including former business execs who no longer have to worry about the impact of their proposals on their company or the economy.  And, they are proposing mandatory coverage- not single payer.

   Posted by (JavaScript must be enabled to view this email address) on October 22, 2007 at 1204 hrs




10. Fun with google.

    Here’s a link to their board of trustees.  Kinda tough to argue their business credentials.

    http://www.ced.org/docs/trustees.pdf

    Posted by (JavaScript must be enabled to view this email address) on October 22, 2007 at 1248 hrs




11. When the oldest and wealthiest and one of the largest companies in the state—and one of the most conservative—is for this, why the focus on the comparative upstart Manpower, BVBro?

    It seems to be a pretty diverse group supporting this.  Some will benefit more, because some always do—and do so now. . . .

    Posted by (JavaScript must be enabled to view this email address) on October 22, 2007 at 1326 hrs




12. Manpower is hardly an upstart, and they are precisely the type of company that would have benefitted heavily from Healthy Wisconsin.  I am disagreeing in part with Owen as to the motivations of all the parties involved.

    Posted by (JavaScript must be enabled to view this email address) on October 22, 2007 at 1333 hrs




13. It’s not as cut and dried as the article or proponents of the “healthy Wisconsin” debacle would like you to believe.

    First, I think it is wrong to assume it is employers’ responsibility to provide health care coverage. Just as wrong as it is to assume it is the government’s responsibility to do so.

    What these and other employers are doing is looking for a way to not have to shoulder so much of the burden of providing coverage. In today’s global economy, American employers are at a huge disadvantage to their European counterparts who do not carry this burden. That’s where the left has attempted to recruit CEOs to support their call for government-run care.

    But, the CED is NOT advocating government run care.

    The report they produced does not remotely resemble Healthy Wisconsin.

    Some excerpts:

    A government-run, command-and-control system will not succeed;

    ndividuals, not employers, must have choices among insurance options that meet their needs; no one should be forced into any one plan. People should be able to keep their coverage when they change employers. And importantly, people should be able to realize the savings – dollar for dollar – if they choose a less-costly plan, using clear information on quality and cost. This new competition would drive providers to minimize costs and improve quality.

    Every individual, therefore, could buy quality health insurance at no out-of-pocket cost. Anyone could purchase a more-expensive plan by paying only the extra cost. People could keep the kind of health insurance and doctor that they now have and prefer.

    Not even remotely close to the 15 Billion Dollar Wisconsin Government Health Care takeover suggested by Senate Dems.

    Posted by Fraley on October 22, 2007 at 1401 hrs




14. the report they produced does indeed contain elements of Healthy Wisconsin, the payroll tax among them.

    Posted by (JavaScript must be enabled to view this email address) on October 22, 2007 at 1424 hrs




15. Sure, as a potential funding mechanism for a plan with a price tag dramatically lower than Healthy Wisconsin’s per capita costs.

    Ah, that doesn’t make the two plans similar. But I’ll tell you what. If the Dems in Wisconsin want to rally around the CED’s approach as their own, and abandon the concept of gubmint run mandated program, I’ll take that as a huge win for us free market good guys.

    Posted by Fraley on October 22, 2007 at 1429 hrs




16. The problem with the payroll tax is that it places an unfair burden on higher wage employers.  It will also be the preferred method of collection for any such program, and probably the only method considered, because the taxpayer never sees it, the government doesn’t have to rely on individuals to report it, and it will not be subject to a whole series of deductions. 

    The two plans are basically government mandated private insurance with completely unknown costs.

    Posted by (JavaScript must be enabled to view this email address) on October 22, 2007 at 1435 hrs




17. I’m sure there are a great many differences between what the Committee for Economic Development would deem to be a good plan for businesses and workers and what Healthy Wisconsin was/is designed to be.  However, the basic premise sure sounds the same.

    Government issues a payroll tax.  That tax ensures people a basic level of coverage.  That coverage is provided by the private market, after it is purchased by the government.  Anyone wanting more coverage can pony up for it themselves.

    The summary of their findings is available online.

    http://www.ced.org/

    So I guess you can determine for yourself if the Dems were truely on to something, even if their plan wasn’t ready for prime time.

    Posted by (JavaScript must be enabled to view this email address) on October 22, 2007 at 1438 hrs




18. In today’s global economy, American employers are at a huge disadvantage to their European counterparts who do not carry this burden.

    Which of course begs the question, why don’t they carry this burden?

    And how can the Europeans be competitive with those burdensome European tax rates that I often read about here?

    Posted by (JavaScript must be enabled to view this email address) on October 22, 2007 at 1637 hrs




19. In and amongst the plans should be:

    1) Coverage and access for everyone

    2) Health care that causes no one to go bankrupt

    3) Coverage for pre-existing conditions

    Posted by (JavaScript must be enabled to view this email address) on October 22, 2007 at 1716 hrs




20. 4) a single 300-million-person-strong voice to lower prices.

    Posted by scott on October 22, 2007 at 1728 hrs




21. More evidence that like it or not, socialized medicine is pretty much inevitable.

    Fraley, let’s just use the GOP style of funding it: pay about half now, and borrow the rest from China at 5% interest.

    Posted by (JavaScript must be enabled to view this email address) on October 22, 2007 at 2127 hrs




22. Oooh, and I think that comment right there will be checkmate.

    Posted by Recess Supervisor on October 23, 2007 at 0159 hrs




23. Well, ATV, I’ll try to stay on point. Socialized medicine is NOT inevitable. Hopefully, near-universal coverage is.

    Socialized medicine will evolved into two-to-three tier systems. You can’t prevent someone from obtaining better than what the government will provide.

    But it is clearly in society’s best interest to have its members have access to affordable health care. The question is whether Government becomes the financier, the provider, both or neither in any or all instances.

    Keith—as per your ‘coverage for preexisting conditions’ requirement, what’s the point of insurance then? Why not wait til you are in a terrible car wreck before purchasing automobile liability and collision insurance. Or call a homeowners insurance agent after the fire department has arrived to the two alarm blaze at your house?

    See, Keith, people with pre-existing conditions still receive health care. But it’s true, it costs a hell of a lot more if they didn’t plan on protecting themselves from that particular risk.

    Posted by Fraley on October 23, 2007 at 0223 hrs




24. Fraley said,

    “Well, ATV, I’ll try to stay on point. Socialized medicine is NOT inevitable. Hopefully, near-universal coverage is.

    Socialized medicine will evolved into two-to-three tier systems. You can’t prevent someone from obtaining better than what the government will provide.”

    I’d like to agree. Don’t confuse my prediction with support. But inaction by the feds favors socialized medicine in the long term, and the Dems will unfortunately block any attempt at free-market solutions.

    “But it is clearly in society’s best interest to have its members have access to affordable health care. “

    Wow, Fraley admitting that everyone benefits when everyone in society has something? What happened to every man for himself?

    Posted by (JavaScript must be enabled to view this email address) on October 23, 2007 at 0643 hrs




25. I don’t think inaction will favor socialized medicine.    Inaction has already resulted in market solutions and it will continue to.

    Posted by (JavaScript must be enabled to view this email address) on October 23, 2007 at 1114 hrs