Wal-Mart Solving the Heath Care Conundrum

Everybody won. Employers offered generous insurance packages instead of higher pay. Unions delivered benefits; employer costs were postponed. The system no longer works and Wal-Mart & Service Employees International Union among others are cooperating to find a solution.

The U.S. heath care system is busted. We spend more for health care than any other country in the history of the world, yet our health outcomes are not as good as those of many European countries that spend significantly less and around 17% of Americans are not covered by heath insurance.

The employer-based health care system is obsolete. Americans workers no longer expect to trade forty-five years of steady work at one place for a lifetime of security and firms are unable to provide that in any case. Employer based health care tends to tie workers to jobs and places they might otherwise leave and someone who loses a job is in the double risk position of being unemployed and without insurance.

Health care is becoming a competition issue. One advantage Japanese carmakers have over American firms is related to insurance, especially the "legacy costs" of retired workers, some of whom have not produced a car in decades.

Beyond that, we clearly are not getting good value for the money. We cannot afford simply to extend the system we have to include those 17% uninsured. The government cannot afford to shoulder the burden of health care under the current cost regime. Already entitlements make up the vast bulk of the Federal budget. There just will not be enough money in the economy to pay for much more.

I do not know what the solution will be, but I am happy to see a firm like Wal-Mart involved. A firm that can sell you a two liter bottle of Coca-Cola at the everyday low price of 88 cents knows something about cutting costs. Having organized labor in the mix will help keep the needs and rights of the working health care consumers in mind.

This seems like a win all around and at the very least a positive step in the right direction. Read the release.

Posted by Jack at February 7, 2007 6:01 PM
Comment #207055

Having unions involved in anything insures only two things.
1. The employer is gonna get screwed.
2. The employee is gonna get screwed.
The only thing unions care about is putting as much money of both in their pockets as possible.
The best way to solve the health care problem is to do away with health insurance and let the consumer shop for health care providers that give the best care for the least amount of money. And let the consumer have a private health care account that they contribute whatever amount per week, month, or year as they see fit.
When the consumer starts paying out of their pockets they’ll start shopping for the best price possible. That means that health care providers will either have to lower their prices or lose patients.
As it stands now they charge as much as they think the insurance companies will pay. This makes it hard on the folks that don’t have health insurance to get care when they need it.
But sense most Americans have fallen for the lie that they need someone else to take care of them I doubt we’ll see any change in health care except for the worse.

Posted by: Ron Brown at February 7, 2007 6:37 PM
Comment #207058

How the most wealthy nation on earth could not setup an health care system for all its citizens is really beyond…

Posted by: Philippe Houdoin at February 7, 2007 6:47 PM
Comment #207059


We could afford to set it up if we paid as much per captia as you do. We pay much more. Unfortunately, we have got into a situation where we have some “gold standard” care, alot of “silver standard” and then some tin and wood.

We need to cut costs before we can get into total coverage.

Posted by: Jack at February 7, 2007 6:52 PM
Comment #207061

Thanks. You are right.Good sign.Keep us posted.

Posted by: BillS at February 7, 2007 6:56 PM
Comment #207065
And let the consumer have a private health care account that they contribute whatever amount per week, month, or year as they see fit.

Yes, let’s move health to free market consumerism.
So, how many for my kidney? My O+ universal blood?
How much money one could get for his patended endo-hiv virus killer/alzhenmeir/parkinson blocker gen?

Let’s trade health, for god money sake.

Posted by: Philippe Houdoin at February 7, 2007 7:03 PM
Comment #207076

The drug industry, the health care industry and the insurance industry will fight reform tooth and nail to protect their profits and poor performance. There was a partial call on my answering machine today by someone wanting to talk to me about planned changes in medicare part D on behalf of the drug industry. I can only imagine the scare tactics they were planning to use on me had I been home and accepted the call.

Posted by: jlw at February 7, 2007 7:43 PM
Comment #207077

Not to be the skunk in the rose pedals, but does anyone else wonder how a cost cutter will help the debate, particularly a cost cutter who cut costs by shifting the cost of healthcare to it’s employees and the U.S. taxpayer by encouraging it’s employees to partake of medicare? I wonder what THEIR motive and focus will be?

Posted by: gergle at February 7, 2007 7:44 PM
Comment #207089

Jack, isn’t wonderful how consumer protection groups and public opinion and the threat of hostile legislation can force a mega giant business like Wal-Mart to the bargaining table.

I love America.

Posted by: David R. Remer at February 7, 2007 8:24 PM
Comment #207092


Yeah. This is how the free market works.

Posted by: Jack at February 7, 2007 8:27 PM
Comment #207108


You are an interesting critter. Sometimes you sound positively progressive.

Posted by: Trent at February 7, 2007 9:53 PM
Comment #207122

That’s right. The consumer market. The consumer can force a whole heap of things to happen that neither government, insurance companies, or the health care industry either can or are willing to.
When someone isn’t paying for something directly out of their own pocket they don’t really care about what something cost. Once they have to reach into their own pocket to pay for it they start caring about price.

Posted by: Ron Brown at February 7, 2007 10:41 PM
Comment #207124

The consumer conditioning program used by the corporations works better than could have ever dreamed it would. The only thing that works better is subliminal suggestion.

Posted by: jlw at February 7, 2007 10:53 PM
Comment #207130

Jack, I would agree that health care must be removed from the benefit package offered by employers and wages increased to cover the loss to the employee. Its also interesting to see that insurance companies dont seem to be represented in this group.
Ron, employers caused unions. If the unions were still stronger in this country health care would not be such a problem, we have had to many corporate types involved for to long. Hence the problem.

Posted by: j2t2 at February 7, 2007 11:37 PM
Comment #207131

Ron, why hasnt the consumer, who has bemoaned the problem for 15 years, not been able to turned it around if it is truely an issue for the consumer?

Posted by: j2t2 at February 7, 2007 11:40 PM
Comment #207137


Wow, I can’t really disagree with anything you said in your article. The US healthcare system has left too many people behind and those that can pay have to pay too much.

Fixing the system is going to be tough. I have a simple idea that I’m sure creates a lot of “not so simple” problems. Let everyone that’s not otherwise insured buy into Medicare! “Buy into” is a problem in itself. I’ll try as best as possible to lay out what may be a really dumb plan.

(1)Use the “must have” principle that Romney laid out.

(2)Do away with medicaid, it won’t be needed and that will free up some administrative costs. Those on medicaid will now move into the Medicare program.

(3)Expand Medicare!!!!!It doesn’t cover everything but it covers enough (I know first hand) and the administrative structure is already there. Everyone that can’t afford insurance or already qualifies for medicaid can get into Medicare.

(4) Let insurance companies compete with the Medicare plan, but make the insurance companies meet certain standards. (This is already done within Medicare/part D plan providers get report cards/Medicare supplement plans must give extensive details of coverage/I know first hand) This would allow Insurance companies to still compete in the market place and hopefully prevent a huge number of insurance company workers from bloating the unemployment numbers.

Look, it’s almost always easier, and less costly to change the structure of an existing program than it it is to create an entirely new one.

It just seems to make sense to me that with nearly 20% of the populaxce uninsured we begin by using the structure already in place. We could easily eliminate the medicaid structure and shift it to medicare. We should also shift ALL elected officials to the same program. (That alone will guarantee quality) And we must allow private and group insurance to compete!

I assume people still have to have an insurance card to drive legally? (I’m home bound) I just think America can make this work with little more than a loud whine over increased taxation.

Then again we need to increase taxes to pay down this national debt! My ideas may be just downright dumb. I do know that the nation I love will fail if we allow ourselves to ignore those most in need. A nation can not be strong while ignoring it’s most vulnerable citizens.

Posted by: KansasDem at February 8, 2007 12:08 AM
Comment #207138

I must add that I’ve changed part D providers. I now have Humana which everyone says is the “Walmart” of healthplans but both the taxpayer and I are saving money and two months in I’ve had no problems. Competition is good.

Posted by: KansasDem at February 8, 2007 12:22 AM
Comment #207141

A single payer system has some advantages over a socialized system and ad a huge advantage over the what we have now. Insurers hate it because it removes them from the cash cow totally. They do not provide healthcare,healthcare providers do that.
In a socialized system.like much of Europe and Canada, the facilities belong to the government. The health professionals work for the government etc. It works pretty well usually depending on funding and management etc. We have a similar system here that by all accounts works well and is economically efficient. Thats the VA.
In a single payer system the facilities would remain primarily private as now and the peofessioals would work for themselves or private companies. The only difference is that all the bills for services get paid by the government on a set fee schedule after negotiations. The money save on paperwork alone is estimated to be enough to cover the uninsured. Part of this saving is do to the the universal nature of coverage. There are no eliglbility questions to answer etc. Of course there would be restrictions on things like cosmetic breast implants etc.If a private provider wanted to increase cash flow they would have to attract more customers the old fashion way,better service. I like the choice aspect. That is why I think it is the best solution for this country.
What we have now is actually the worst form of socialism. Our bills are high to cover the uninsured but they are ill served,usually getting treatment at E-rooms where we all wait. We have socialism without any accountability or budget constraints.The alternative without major restructuring is to get used to stepping over corpses and allowing infected people to wander among us.
With single payer we would actually save money. One way is by getting one of the larger pigs at the trough out of the picture,insurers. Let them go insure something else like capital,or homes etc.Another is negotiated prices for drugs as well as services. Quality and care standards of course.
There are a varity of ways to pay for all this,all of them are less than we pay now. A business worker split perhaps,only this time on all businesses instead of giving a competitive advantage to some while responsible businesses pick up the tab for their uncovered workers by paying high permiums .Hell even a sales tax. My favorite tax for everything is a $10 a barrel tax on imported crude..but thats another story.

Posted by: BillS at February 8, 2007 12:31 AM
Comment #207143

Ask any Canadian how long it takes to get in to a service provider. Four months is not unusual. Anytime the government gets involved with private enterprise, it throws a monkey wrench into the operation and becomes costly. There are a number of options available without government intervention that can work well. I favor a co-op style.

Posted by: tomh at February 8, 2007 12:41 AM
Comment #207144

The Canadians I’ve talked to are happy with the system.You are right though. It is usually better to keep government involvement to a minimum. Thats why I prefer a single payer approach over the Canadian model.

Posted by: BillS at February 8, 2007 12:54 AM
Comment #207155


In a single payer system the facilities would remain primarily private as now and the peofessioals would work for themselves or private companies. The only difference is that all the bills for services get paid by the government on a set fee schedule after negotiations.

I’m not sure, but I think that the way french health system currently works.

Posted by: Philippe Houdoin at February 8, 2007 4:25 AM
Comment #207168

You can’t turn the ship on a dime, but you start with a little course correction.

Make all healthcare premiums tax deductable.

Who can’t supprot that? Give the free market its chance to reform the employer based system and you will see progress through new products aimed at individual consumers. It might take a while, but it’s a step in the right direction and much better than just talking about reform…..

Posted by: George in SC at February 8, 2007 10:27 AM
Comment #207174

Health Insurance as a product for individuals? Even if you can afford it how do you collect from insurance companies that makes he rules? So far the greed of the insurance industry has made a mockery of the “free market” approach to health care. When does ” poof a miracle occurs” happen in this approach?
As you can tell Im skeptical of the free market approach as it will result in the consumer getting screwed out of the cost of the premium by the employer and out of decent health care by the insurance companies.

Posted by: j2t2 at February 8, 2007 11:14 AM
Comment #207177

George: It deoends on what you mean by “healthcare premiums”. If you mean actual healthcare cost then I could support it. If you mean insurance cost then what you are talking about is a taxpayer subsidy for insurance companies that may or may not be providing healthcare.
There is more than just talk involved. Several states are moving forward with different approaches to solving the problem. CA came very close to adopting a single-payer system last year and may do so this year.

Posted by: BillS at February 8, 2007 11:31 AM
Comment #207181


I mean the insurance premium. Currently if an employer pays the insurance premium then it is considered an employment expense and is tax deductable. If you buy an individual policy yourself you will have to use after tax dollars to purchase it.

I think the Bush plan is a yearly cap of $7,500 for indivuduals and $15,000 for families. I wouldn’t cap it but that’s just me….

Making individual premiums tax deductible may open the door for further reforms that help get employers out of providing health insurance altogether. Employers should not have to decide what portion of employee compensation goes toward insurance premiums versus cash wages. Workers can make those decisions for themselves.

-Steve Buckstein
Capitalism Magazine 27 Jan 07

Posted by: George in SC at February 8, 2007 12:06 PM
Comment #207182

Here is an analysis that Buckstein linked that describes what I’m talking about:

Health Insurance and the U.S. Labor Market

Posted by: George in SC at February 8, 2007 12:13 PM
Comment #207186

The only problem I see with expanding Medicare is finding providers who will accept Medicare patients. I took care of my parents and had difficulty getting doctors who accepted Medicare patients. My own doctor wouldn’t so I had to travel to the next town. Difficult with handicapped parents. And appointments were hard to come by.

There would have to be a provision that doctor’s couldn’t limit thier number of patients based on the patient’s insurance.

Posted by: womanmarine at February 8, 2007 12:28 PM
Comment #207191


Ron, employers caused unions. If the unions were still stronger in this country health care would not be such a problem,

Your right! Because there wouldn’t be any jobs left because the unions would be demanding more than employers could pay.

we have had to many corporate types involved for to long. Hence the problem.

Typical union thinking. Blame everything on the bosses.
BTW, Most these corporate types are the products of our liberal run colleges.

Ron, why hasnt the consumer, who has bemoaned the problem for 15 years, not been able to turned it around if it is truely an issue for the consumer?

Because most folks seem to have fallen for the lie that they can’t do anything about problems of this size because they’re not smart enough to know what they want.
Also most folks don’t feel that they can change things. “After all I’m just one person. What can I do?” And they’re right. One person aint gonna do much. It’s gonna take a few thousand or million to get anything done. And most folks don’t seem to want do for themselves anymore.
If the consumers started to rebel against the way they’re being treated, a whole heap of things would change. And not just with health care.

Posted by: Ron Brown at February 8, 2007 12:54 PM
Comment #207196

My understanding of this is as follows:

WalMart does not want to pay healthcare and is blaming the government for not paying. They are suggesting they be subsidized by taxpayers.

Gimme a break people. I’m all for exploring alternative models for providing universal healthcare, but do we have to pretend that WalMart is doing something good here?

Posted by: Max at February 8, 2007 1:13 PM
Comment #207202

I think it’s worth noting a couple of things regarding unions, health insurance and big corporations.

Health insurance, in the health system we have in the United States, doesn’t insure your health, it insures your assets. If you have little in the way of assets it makes no sense to pay for health insurance. This is the choice made by hundreds of thousands of Wal-mart employees past and present. If your net disposable wealth is thirty thousand or so and you’re paying monthly premiums for, say, an 80-20 plan with deductible along with limited benefits, it doesn’t take a genius to figure out that by paying those premiums you are giving away your money for NOTHING!! If you have a serious illness or accident without insurance in this situation YOU’LL GET WIPED OUT. If you have a serious illness or accident with this type of insurance, YOU’LL GET WIPED OUT!

RE: unions. I have worked in a union shop and non-union both; believe me, union is far superior. To sum up the purpose of a union in a sentence it is: A group of individual employees coming together to bargain COLLECTIVELY with management.
That’s it. Once again it doesn’t take a genius to realize that as an individual employee you have no leverage in negotiating with a large company on issues such as wages, benefits, retirement, health and working conditions.

Re: Corporations. Corporations are there to generate positive numbers. They have no morals, no soul, no sense of civic duty. If they can successfully bend, break, or evade a law, there’s every chance that they will. Sorry, it’s highly cynical, I know. I have owned stock in dozens of individual stocks over the past 35 years (mutual funds are for the lazy) and I expect, out of my limited ownership, that these companies will increase their sales and profits as fast a possible.
Wal-mart’s new found realization that universal health care is a desirable, is nothing more than a company promoting a public policy that would increase their bottom line. I would expect other retailers and manufacturing companies to agree and I would expect opposition from other types of companies who would suffer from a single-payer system (and, although that’s not what wal-mart said, that’s what they mean!!). HMO’s, durable medical equipment suppliers, big pharma, health insurance companies, will fight this to the end.
There is not right or wrong, good or evil, principle or non, it’s all about money

Posted by: Charles Ross at February 8, 2007 1:52 PM
Comment #207208

Charles Ross-
Some of what you post is true. I to have worked in both bargained for and pay for performance shops. I prefer the pay for performance scheme bcause I’m a superior performer, others want the equalizing effect of being bargained for.
It would be great if your definition of insurance were expanded slightly and engraved on everyones identity card. You should only insure that which you stand to lose. Auto liability insurance for someone with a clunker, no job and no assets is such an example. What does he have to lose? Nothing as valuable as the premiums on the insurance. The same is true with the poorest of our citizens. The premiums on a meaningful plan far exceed the value of their assets. Public funds to provide E.R. coverage is the viable alternative at present. Employer subsidies aren’t applicable-no employer. tax exemptions don’t apply-no taxes. Something similar to an expanded Medicare with a subsidized premium is probably better than any existing scheme. Any new plan MUST INCLUDE OUR ELECTED OFFICIALS across the board-top to bottom-no exception.

Posted by: Clyde Bollinger at February 8, 2007 3:01 PM
Comment #207229

Any new plan MUST INCLUDE OUR ELECTED OFFICIALS across the board-top to bottom-no exception.

Posted by: Clyde Bollinger at February 8, 2007 03:01 PM

Your right. But unless things change that won’t happen anytime real soon.
Our current crop of politicians think they’re better than the rest of us and therefore entitled to better than we get.
One thing you can bet your bottom dollar on is that neither the government or the unions are going to come up with a fair system. The government will tax the working class to death to pay for it. And the unions will make business to pay the total cost. Something none of them will be able to do.

Charles Ross
I know you’ll most likely deny it as by your post I can tell your big on unions. But one of the problems Ford and GM, as well as a lot of other union companies, are having today is paying for the health care plans that the unions have stuck them with. The problem is that it has become to expensive to pay health insurance for thousands of full time employees and then there’s the thousands of retired employees.
Between the two businesses I own I employ 60 people. It’s getting very hard to pay the health insurance on them. And they pay for 25% of it out of their pockets.
BTW, right after I bought the factory I made the mistake of letting a union in. I had 10 employees at the time. I had to hire another 15 just to get the same amount of work done. And the quality of work went down. I just about went belly up.
When the contract was finally up I refused to sign another and told the union to take a hike. After I kicked the union out things started picking up and today I have a total of 45 employees there. And I’m going to hire another 15 or so as soon as the new addition is complete in May.

Posted by: Ron Brown at February 8, 2007 7:40 PM
Comment #207230

Womanmarine said, “There would have to be a provision that doctor’s couldn’t limit thier number of patients based on the patient’s insurance.”

I’m not sure that is in line with what most people speak of in terms of a single-payer system. It is line with a publicly run system where most healthcare is provided by the government. In that case, the doctors become government employees, and they have to abide by government rules.

If they are not government employees, they have the right to charge a set rate for their services, and if the government rates don’t match, then they can find other customers. That’s only fair. We can’t force supermarkets to set the price of peanut butter so that those with food stamps can afford it. Similar logic applies.

Posted by: Rob at February 8, 2007 7:42 PM
Comment #207233

Nice post Jack this is something that does effect me. I am one of the 17%. Though not as serious as KansasDems health issues, my heartattack at 35 and self employment have precluded me from affordable “Health Insurance”. In CA, I can get a group policy for my company, but there is two of us and payroll and all of the costs associated with it are tough enough every two weeks. The cost for me to go through the govt. is prohibitive.

I don’t agree that the “Health Care System” is broken, The ponzi schemes that finance it are. And currently, I don’t see much in the funding of health care that resembles the free market. Costs are dictated by insurance companies, and the government. Drug companies are trying to recoup huge R&D dollars due to in some part to the length of trials mandated by the FDA.

My solution is based on the free market,
A)Phase out employer health coverage by taxing it along with all other income. Afterall, they do not pay for private auto insurance or homeowners insurance etc. (Don’t understand why the employer is responsible for 16 non working hours a day and 48 hours of weekend personal time anyhow).

B)Allow boutique health insurance—I will not need pre-natal care the rest of my life, ETC.

C)Allow us to form consumer groups nationwide.

D)Make all patients pay for there services rendered and then go fight with the insurance company or goverment for re-impbursement. Thus taking it out of the doctors daily employment costs.

E)emphasize the change in paradigm of dr./patient relationship. Unless everyone questions the orders and perscriptions, inquires about cost prior recieving services, and counts as much of the inventory of medical supplies while recieving services—you are just blindly adding to the cost of care. (yes, I realize that in emergencies, costs are somewhere down at the bottom of the list of priorities and patients ability to deal with)

I am a cash client for my heart dr. every 6 mos. I pay for a blood test, an office exam and perscriptions on a 90 day basis. I ask about all tests, pills etc. I can and will negotiate with the hospital here in town when and if the time comes. In fact, for a cash customer, I get a 50% discount. Which really tells me that the hassle of billing and trying to get paid by the government is large manhour load for the hospital. I am responsible for my heartattack, I don’t believe that I should make you all responsible for paying for it. I only see the greenlight for bad personal lifestyle decisions if there is universal health insurance.

Posted by: scottp at February 8, 2007 8:06 PM
Comment #207247


What we need is something that pays for catastrophic problems but lets people save and pay for the routine problems.

Posted by: Jack at February 8, 2007 9:23 PM
Comment #207251


You are right. I was even hoping that the HSA’s with catastrophic insurance would be a savior for me, but still turned down. I figure I am good for about 5 to 10 thousand dollars of contribution to a catastrophic medical issue. I however, am not at all worried about being fixed first. It is the payback that is a little worrisome. But if I can afford the, I believe I was quoted $500 per month for just me, then I can afford to pay it the arrears. Sure would be nice to trade a couple of chickens for a house call.

Posted by: scottp at February 8, 2007 10:00 PM
Comment #207273

Only problem with that is if people do not take care of routine things they often become catostrophic. That is what we see now with E-rooms full of uninsured people who waited to long for treatment.

Posted by: BillS at February 9, 2007 2:09 AM
Comment #207279

BillS, This may be so, but with freemarket forces comes advertising which leads to consumer education which leads to solving some of the small things. The advent of walkin clinics has helped here. In CA we have what is called “Doc-in-a-Box”. They do a variety of primary care including physicals and drug tests for employment.

Posted by: scottp at February 9, 2007 8:42 AM
Comment #207283


Health care is plagued by life style variables. This is the real hard to solve problem. Poor peope tend to have several characteristics. They are poor. They do not make great decisions; they have trouble understanding the consequences of the decisions they make, and they lack self discipline. All these thing go togther because they tend to have joint causality.

So you get this problem in health care that the poor suffer more lifestyle related disease than the non-poor. Then they do not get proper care, but sometimes they cannot handle proper care. For example, taking medication on schedule or diet to control high blood pressure or diabetes.

I do not have a solution for this. But I think it is important to define the problem properly. It is NOT merely lack of access to health care.

Posted by: Jack at February 9, 2007 9:07 AM
Comment #207293

one thing not mentioned by Bush is that his tax deduction approach is actually a money maker for the government at the expense of citizens.

It is also a boon to corporations who, in all likelihood, will not pass on the cost of healthcare to its employees as income. It is almost certain that employees would get some increase, but not the equivalent that corporations were paying out. That’s a guaranteed year of bonus earnings for all public companies.

Employees will, of course, end up paying additional Social Security taxes, since nothing gets away from Social Security.

And the biggest kicker of all, if the Alternative Minimum Tax is not eliminated, the tax deduction won’t matter - that deduction is not allowed under the AMT - and the good old US citizen will have gotten the shaft by three in a row.

Posted by: CPAdams at February 9, 2007 11:13 AM
Comment #207313


What we need is something that pays for catastrophic problems but lets people save and pay for the routine problems.

Got any simple ideas on how to do that?
I sounds simple but knowing our government they’ll get it so complicated that it’ll take a lawyer to figure it out.
I also sounds like a good idea if it could be kept that way.

Posted by: Ron Brown at February 9, 2007 12:16 PM
Comment #207315

Those aint just uninsured folks ya see in the ER.
A lot are folks like me that have insurance but are too stubborn to go see a doctor. Then they have to go there in the middle of the night because their doctors office is closed.

Posted by: Ron Brown at February 9, 2007 12:20 PM
Comment #207356

Ron, I am, as you suggest, very pro-union. I certainly would not endorse all actions taken by all unions over the years but do strongly endorse the notion of collective bargaining. There are some obvious points of tension in the relationship between employees and their employers, union or no, even in the best of companies. Big companies know very well the bargaining power of one individual (just about zero) and the value of a “divide and conquer” strategy with their employees. That’s why these so called “right to work” (for nothing) laws are promoted by business.
I was a shop steward in a couple of negotiations and will admit that it is very difficult to bring around a union to proposals that create “win-win” situations for both union members and management. My union consistently thought that if the company was wining anything, by definition it was a loss for the membership.
I own a small business that I have described in past posts and must say that more than needing cheap labor I need consumers who have money in their pockets to buy the more expensive (profitable) products I sell. If the trend continues to the may-I-super-size-you-regular-or-super-non-fat-latte-if-you-can-make-it-over-the-border-you’re-hired society I will be in trouble!!! Unions play a big role in putting money into working people’s pockets and that is a bad thing why?

Posted by: charles Ross at February 9, 2007 2:52 PM
Comment #207384

Ain’t a thing wrong with putting money into working folks pockets. But when unions jack up their dues more than the raise who is that helping? And when unions demand more pay than the employer can pay without raising his prices enough above the nonunion shops that customers go to the nonunion shops, who is that helping?
And I can tell of several cases of both. But I’ll just give ya two examples.
My brother-in-law, a strong union guy, lives in Sacramento, and is a motor mechanic. He worked for a company in the bay area that was union. Every time the contract was up the Brotherhood of Electrical Workers demanded more money and that the company pay more and more of the health insurance. And the company had to keep jacking it’s prices up to make a profit.
The company started losing it customers to the nonunion shops because they were cheaper and (even my brother-in-law admits this) did just as good of a job. Finally the company had to close down because they were bankrupt.
Now just who in the hell benefited from all that? The shop is out of business and it employees lost their jobs, retirement, health care, and any vacation time they hadn’t taken yet. But the union is doing just fine.
BTW, the union didn’t even try to help anyone find a job. They all had to go to nonunion shops or find new careers. My brother-in-law had been with them for 19 years and had to start all over again.
One of my uncles worked in a union factory up in Chicago in the 50s. They couldn’t come to terms on a new contract and the union (I think it was the AFL-CIO, but don’t quote me on it) sent them out on strike. They were out for 3 weeks. When the union finally came to terms that they’d send to the members they only got a nickle per hour ($2 a week) instead of the dime the union wanted. And BTW, what the company offered to start with. The union then raised it’s dues $3 a week. Now just who profited from that?
Yeah, unions sure do a whole heap of good.
Is your business union? If not why?
Another thing, why won’t unions let employers fire employees that won’t work or do a good job?

Posted by: Ron Brown at February 9, 2007 4:36 PM
Comment #207389

My business has only one two people engaged in the business, me and one person working as an independent contractor, so, no, it is a non-union business. I provide no benefits other than a commission share of the profits. He makes @ $56,000 a year (@ 52 net after a few business related expenses). I would certainly agree that there are excesses by unions, I witnesses many. Union dues, for me at least were never a factor. I found, working in both situations, union and non, that I had more control over my working conditions in a union setting. If i complained about a safety issue, for instance, my complaint was considered more carefully. Wages and benefits were definitely better. It’s hard to generalize from one’s personal experience or the stories of friends or relatives, but I still think, leaving the word “union” out of it for the moment, that there is nothing wrong with the notion of collective bargaining, getting with other like-employees to talk about all aspects of their employment, with the employer. If it were strictly a non-union world it would be very difficult for an individual to engage with and negotiate with an employer. Before a position is offered it is the employer’s position TO offer, but when an offer of employment is accepted I think that the employee has, to some degree, an ownership interest in that job.

Posted by: charles Ross at February 9, 2007 4:53 PM
Comment #207496


Before a position is offered it is the employer’s position TO offer, but when an offer of employment is accepted I think that the employee has, to some degree, an ownership interest in that job.

The employee’s only interest in a job is to do the best job possible. Pay raises on merit, not collective bargaining, will insure that the employee will do the best possible job. The better they do the more pay they receive.
Collective bargaining only encourages laziness. The employees know they’re going to get a raise regardless of the job they do or if they even do it at all. So they have no incentive to do the best job they can. Both quality and production suffer from collective bargaining.
There are at lot of nonunion shops that have been give their employees either profit sharing, and/or the option to buy stock in the company. Both these give the employee an incentive to produce the best quality product possible.
With profit sharing the employee gets a percentage of the profits. It might not be the same amount as it would be if they owned stock and got dividends. Then again it could be more.
But the possibility of an extra $1,000 or so a year is plenty of incentive to keep both quality and production numbers up.
Basically the more that goes out the door, and the less that comes back, the more the employees stand to make.
Either or both of these with a decent wage, decent health benefits, and other perks will go a long way toward making contented employees. And contented employees are productive employees. It pays the employer to keep their employees as contented as possible.
BTW, I ain’t talked to very many union employees that are very contented with their jobs.

I mentioned earlier that we’re putting a new addition on the factory. When it’s completed we’re going to start rebuilding electrical parts for aircraft. Something I had in mind when I bought the factory. It’s taken me this long after kicking the union out (1990) to get to the point where I feel we can afford the risk.

Posted by: Ron Brown at February 10, 2007 2:27 PM
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