I was talking the other day with executives of a media organization about to enter a round of tough labor negotiations. Times haven’t been good, the atmosphere is poisonous, and there is the possibility of a suicidal strike.
But the interesting thing is that wage levels are virtually not an issue. Workers at this place are paid better than the industry standard. The problem is health care. The company wants givebacks, higher co-pays, and especially needs to do something about its legacy costs -- the health care expenses of its retirees.
This is a national problem which will only grow worse and worse. As I see it, we missed a golden opportunity to do something about it after President Clinton was elected.
Health care had been a central theme of his campaign. What he needed to go was realize that throughout our history, a gradual approach has usually worked best. Clinton should have set out to provide minimum coverage for the 40 million uninsured Americans.
Instead, Hillary Clinton’s team produced a complex mess which I knew was doomed from the start, partly because I could not understand it. I get paid to figure things out, and my theory is that if I have a hard time making sense of a program, other people will too.
The health industry lobbyists went to work, and the Clinton proposal went down in flames. This left us with what we have now.
Some of us have Cadillac health care -- Blue Cross and employer-paid vision and dental. Some have none at all. The rest of us have an HMO or PPO which may or may not cover what our particular problems are.
But now we’ve reached a point where even those who make Cadillacs can no longer afford Cadillac health care. To me, requiring someone with a $35,000 pension to pay something like one percent of that for health care is perfectly sensible.
Retirees are suspicious, however, and wonder what happens next. Will it be two percent next year? Will they lose prescription drug coverage down the road? Others have a different worry.
What if the company once known as Generous Motors goes out of business? What happens to them and their pensions and their health care coverage then? That probably won’t happen.
But the future of Delphi, GM’s major parts supplier, is much more in doubt. There soon will be thousands of Ford workers who now have neither benefits nor jobs in places such as Wixom.
Meanwhile, the price of health care gets higher all the time. Let me leave you with two thoughts. The 75 million baby boomers, the largest generation in history, begin turning 60 this year.
And the average American spends half of all the money he or she is ever going to spend on health care in the last six months of their life.
This issue isn’t going away. And no matter how big an impact it is making now, we ain’t seen nothing yet.