Labor unions have been well known for their support of progressive causes. Many of them make regular donations to Democratic politicians. The largest labor organizations, such as the AFL-CIO and SEIU, were central to the election of Barack Obama. Heads of these organizations have been throwing their support behind reform of America’s health insurance plan system. However, recent developments in the healthcare deform debate have stirred doubts in union organizers.
Unions intend to represent their members’ interests, although their actual impact and methods are controversial. The largest industry unions have political clout due to their size and financial coffers; a portion of dues goes towards political causes considered appropriate. Over the past several decades, membership in labor unions has shrunk: under 10% of the working population is a union member, while heavily unionized industries (e.g. auto makers) have disproportionately suffered in the recession. Their smaller rosters still have power, however. While labor unions are technically nonpartisan, they generally back Democrats because of their economic proposals, which they feel are more likely to benefit workers. Many employees suffer without a health insurance plan when unemployed, especially as companies have been forced to cut back healthcare coverage for retirees.
Therefore, it is logical that unions jumped up to support healthcare reform. They have spent millions of dollars to pressure congresspersons to support the bill. The bill already contained an unfavorable provisions for many union members; the Senate would tax the “Cadillac” health insurance plan enjoyed by many union members. Also called “gold-plated plans”, they typically entail relatively high premiums (much of which are covered by the employer) coupled with low deductibles and the highest quality care. Such comprehensive health care coverage was usually negotiated by union representatives with employers, often in lieu of pay raises. Health insurance benefits are currently not taxed, so including them as part of a compensation package benefits all parties. Some feel that these plans encourage employees to use more medical care and run up expenses, since they do not see most of the actual costs. The proposed tax would take effect for policies worth over $8,000 in annual premiums for an individual, or over $21,000 a year for a family–most likely serving to discourage some employers from offering such a health insurance plan. In a nation where millions of people are without any health insurance plan at all, some portions of these plans may appear overly generous.
Why would unions be willing to give up such an important benefit? Union presidents, such as the AFL-CIO’s Richard Trumka, strongly believe in the public option. The establishment of a government-run health insurance plan would have greater, far-reaching impact beyond the two or three percent of Americans with a health insurance plan that will fall under the tax. Their motives include genuine concern regarding the increase in Americans without insurance and the detrimental impact it has on their general health, but such a plan would also benefit them. Union workers are more likely to have health insurance, which puts them at a competitive advantage with non-union firms that may or may not offer it.
A public option would put all companies on an even playing field; supporters believe that doing so will allow U.S. businesses to compete with foreign business that are typically unburdened with that expense, but opponents consider it a self-interested power grab. Public sector employees have been shown to be more likely join a union; many of the strongest unions in the U.S. are for teachers and other public employees. Canada, a country with bona-fide single-payer health care (more all-encompassing than the public option health insurance plan), has 61% of its healthcare industry workers unionized, while only 11% of those working in one of the U.S.’s largest industries are in a union. The SEIU, which represents health care workers, would especially stand to benefit.
Unions prefer the House of Representatives’ proposal (which includes a public option), and are already unhappy with Senate Democrats for eliminating the public option, largely at the behest of independent Joe Lieberman. Still, they continued their support until another betrayal. Discontent is running high among labor unions, as well as other liberal-leaning groups, for what they see as Majority Leader Harry Reid’s latest affront. In exchange for dumping the public option, a group of senators from all wings of the Democratic party brainstormed another method of providing a quality health insurance plan to more Americans. Their compromise would have allowed individuals aged 55 to 64–who are often laid off, then unable to find a health insurance plan that will cover them in the private market–to buy into Medicare until they are old enough to fully qualify for that government program. That alternative is also proposed by Lieberman, whose vote is essential to gaining the 60 needed to avoid a filibuster and pass healthcare reform. Some labor organizations of tired of having their pressures ignored. It seems absurd that a legislator who campaigned for the President’s Republican opponent last year may hold the fate of one of the Democrats’ domestic priorities, but he is nonetheless a member of the Democratic caucus. A Capitol Hill press conference meant to inspire senators to push healthcare reform through was supposed to include the Health Care Chair of the SEIU, but Dennis Rivera was conflicted and bowed out. Major labor organizations are dealing with these conflicting views with emergency meetings in order to decide how to proceed. There is an increasing momentum among progressives to kill the health insurance plan bill altogether. That means that organized labor’s months of effort and millions of dollars may have been wasted.
However, it is a possibility that they consider the bill so flawed that if the bill does not improve in committee when both chambers of Congress reconcile their versions, it will be preferable to pass nothing at all. Combined with detractors from the right, who are against most healthcare reform altogether, there is a decent chance that the bill will be scuttled. That will be a devastating blow to prominent Democrats like Reid and President Obama.
(Image: AFL-CIO under CC 2.0)
