The basic strike issue is one of costs: Who should bear the costs of healthcare across a lifetime? Is it the responsibility of the employer or the employee? Traditionally, it has been the province of the employer, which was a simple and elegant solution for a global economy in which the United States was overwhelmingly dominant, and our standard of living was many multiples of our nearest trading partners. It was the complacency of expecting eternal growth in sales and profits among the Big Three that led them to promise lifetime, best-in-class healthcare as part of their labor deals over the past generation. In a world where national healthcare in other countries serves as an indirect subsidy to industries in those countries (by keeping an important element of labor costs low), our industries suffer a structural cost imbalance with their competition.
But a solution in which the individual themselves is responsible for the cost of their healthcare is not sustainable either. Apparently, many people will choose not to purchase health insurance, although the cost of treating them will still be borne by the nation in the case of an emergency. This can be seen by the number of people who do not, in effect, choose to purchase health insurance but do choose to purchase cable or satellite television service. In 2006, approximately 87% of households had cable or satellite television, but only 84.1% had health insurance. (Of that 84.1%, only 59% was employer-provided health insurance. And it should be noted that the uninsured rate in the South was over 18%.) The uninsured do not go without healthcare as much as they go without preventative care. In emergencies and critical situations, they are served, and their costs are often picked up by the taxpayer, state or hospital itself.
After eight years of Republican governance, the corporate interests of America are strong and used to limited regulation, and deference from their government. So far, our country's business interests have been afraid, in a way, of what the future holds with the rise of the progressives.
Progressives should make a grand bargain with corporations. The corporations agree to pay their fair share of taxes (more on that in a moment) in exchange for some form of national health insurance system.
If we examine the actual cost of care per person, across a lifetime, the costs are not that high. According to the NIH, the average cost of healthcare per person, across the course of a lifetime, is $316,579 (in 2000 dollars). To be conservative, we can add an additional 25% and the lifetime cost becomes just about $400,000. If we assume the average worker will work for 40 years, (22 to 62, for example), that means lifetime healthcare costs are around $10,000/working year. That is approximately $416/paycheck/person. If that is the case, why is it that so many of us are paying so much more than that for our healthcare?
The fact is the health insurance market is remarkably inefficient. Insurance companies have incentives to keep healthy people and drop sick people. The $400,000 number is a national average, and only works on the great aggregate. When you start breaking the market up into segments, costs range much more wildly. Hence, the great variance in coverage and costs.
This is not necessarily a case for a universal health insurance plan, with a single payer that is the Federal Government. It is a case for a collective market for health insurance. With a bigger pool, the costs are more evenly distributed, and thus more easily managed. The government needs to insure that a) the pool(s) of insured are wide enough and diverse enough that no insurer can gain a competitive advantage by microsegmenting the market by declining coverage to the sick and b) the catastrophic costs of health care, which so frequently lead to individual bankruptcy and steep rises in company premiums, are no longer waiting in the wings. (This idea, of course, was the essence ofJohn Kerry's plan in 2004.) I am completely agnostic, however, as to the exact nature of the healthcare plan. I could care less for how it happens, as long as everyone gets coverage, and there is no discrimination of coverage based on ability to pay.
Which begs the question "how to pay for it." For this there is a simple solution I feel would benefit everyone: Make companies report the same books to the IRS that they report to Wall Street.
In spite of studying some management and finance in graduate school, I find it difficult to understand how a company can report no profit to the IRS and perhaps even get a refund on their R&D costs, and yet report excellent profits and growth to Wall Street. I propose a simple solution: corporate taxes are assessed on the profit reported to Wall Street, period. I know the question is more complicated than that, but this is why we have legal and accounting experts to work out the details. I expect many tax deductions would need to be eliminated, but I suspect that the value of those deductions in terms of reduced taxes is far less than the health care costs that the corporations pay today, and will pay going forward.
That is the deal, America agrees to carry the cost of healthcare for Americans, and in return corporations pay their taxes based on their actual profits. Companies take the gamble that they will save more in health care costs than they gain from tax deductions. America takes the gamble that a broader pool of insurees will introduce a lower average cost per insuree.
It is only an idea, and possibly not the best idea. But it is an idea nonetheless.
[Update] Apparently, the big picture context of the UAW strike is on other people's minds too. Dan Neil had a commentary on Marketplace on the subject: "The UAW's fight is our fight." It's a great piece of analysis which examines how the UAW's fight for healthcare and job security is the front line in the battle for the American workforce.
[Update 2]And kos makes the point about healthcare even stronger:
# I've been dealing with pain for two weeks because Blue Shield won't approve the CT Scan I need to find out what exactly is wrong with me. And all Bush can talk about is getting more people on private insurance? The hell with the HMOs. They haven't proven to be the solution. (And don't get me started with Eli's birth, and their refusal to pay for half the bills unless we hounded them to death. Single payer, baby!
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