Prez of United Steelworkers scoffs at those who say wages will go up

[dkf]

Leo W. Gerard, president of the United Steelworkers, scoffed at arguments that by restraining health costs, the tax would lead to higher wages

“The people who are promoting this tax say companies will make up for this with higher wages,” Mr. Gerard said. “These people who say that have never been at the bargaining table. It doesn’t work that way.”

http://www.nytimes.com/2010/01/09/business/09union.html?pagewanted=2&hpw

[last1standing]

1. My father was a steelworker.

And one of the few things he got for it was premium healthcare for his family. I will never vote for an anti-Union politician and that includes ANYONE who votes to tax workers with good healthcare.

[dkf]

2. My parents are state retirees.

They didn't get paid much when I was a kid but boy am I glad they set themselves great for their golden years.

I'm the biggest beneficiary of their union.

[Goldstein1984]

7. I'm back in the private sector now, but

I have 14 years vested in a state pension plan, which includes some medical benefits. I have no intention of letting go of it. It won't be much, but the medical plan will be like gold if things are still as bad in ten years as they are now.

[dkf]

9. I'm thinking no matter how well I do I'll still need to work to get medical coverage.

A federal job sure does look good.

[Goldstein1984]

10. Feds have good benefits

One of the reasons that my wife and I are considering a friend's suggestion to join him in retiring to Thailand is that they have U.S. trained physicians, but even catastrophic medical care there is affordable without insurance.

I'm fortunate to make good money right now, but fortunate means I have enough to help out family members who are struggling just to eat and pay for prescription medications. We're going to have a modest retirement, and out-of-country seems like the best solution for us.

How did we get here? Were we sleeping?

[dkf]

11. A friend of mine was talking about retiring in the Philippines

I'm not sure about medical but the cost of living was great.

[Goldstein1984]

13. I'm betting this generation sees a lot of expatriate.

My wife and I have been thinking about retirement in Latin America for years, but it's starting to look like that will be the next battleground in the wars on drugs, terror, and whatever else we're supposed to be afraid of by then.

[Hello_Kitty]

3. They've got their economist blinders on, big time.

Here is Paul Krugman's justification for his faith in the wage increase theory, from his latest piece:

Second, there’s the argument that any reductions in premiums won’t be passed through into wages. I just don’t buy that. It’s true that the importance of changing premiums in past wage changes has been exaggerated by many people. But I’m enough of a card-carrying economist to believe that there’s a real tradeoff between benefits and wages.

Color me less than convinced by that.

Not only do these econo-wonks not understand union negotiations, they also don't seem to realize how symbiotic the relationship between unions and the government is. As I've pointed out in a couple of other threads, many union workers are either direct government employees or they work for companies with a lot of government contracts. State and local governments throughout the US are broke. Any savings from reducing benefits due to this excise tax will NOT be plowed into higher wages for workers. They will go toward plugging budget gaps. And the "savings" will passed on to workers in the form of higher out-of-pocket costs for health care. Which means fewer consumer dollars in the economy.

[dkf]

4. Maybe increased wages mean wages not cut which would have been cut had

they not decreased benefits!

[Hippo_Tron]

16. I have a question for you regarding union negotiations then

What seems to be the assumption here is that if this tax is passed, it is a given that employers are going to switch to cheaper health plans and that the unions will be powerless to do anything about that. Yet health care costs have been rising drastically and unions have managed to keep their plans in spite of that. So I don't see where that assumption comes from.

The way I see it is that the reason unions have managed to keep these plans because of their success at the negotiating table. A rational employer would certainly trade them higher wages for a lesser health insurance plan so long as the wage increase is less than the difference between the higher cost health insurance plan and the lower cost health insurance plan. This tax would increase that difference between those two and thus in theory increase the amount that an employer would be willing to give in wages in return for acceptance of a lower cost health insurance plan.

In other words, assuming that union workers will be stuck with a cheaper insurance plan and no wage increase is assuming that this tax will somehow create a shift in bargaining power from the union to the employer. I don't see how that is the case, but you know a lot more about unions than I do. How will this happen?

[Hello_Kitty]

20. As union leaders have pointed out, repeatedly

They negotiated for those plans IN LIEU of wages.

[Hippo_Tron]

23. I understand that

So what about this tax is going to change that? Under their current contracts shouldn't they continue to receive the same benefit plans in lieu of wages even if the cost of the plan goes up (as it has been for many years now)?

[Oregone]

5. Bullshit. Anytime a corporation reduces the cost of production they pass it straight back to workers

Because really, benefits are, to the corporations, just another cost of production (all compensation for labor is considered as such). Anytime there is savings, the shareholders are willing enough to forgo on increased dividends in the favor of the men on the line. Right?

[dkf]

6. Lol

So sad I had to laugh.

[IndianaGreen]

14. Capitalists will always maximize profits

which means that, among other things, any reduction in the cost of production is passed to the investors. This is why the corporatist Democrats pushed for NAFTA, shifting millions of jobs to cheaper foreign labour pools in order to drive up the price of their stocks.

[Goldstein1984]

8. Employers always try to maximize union compensation

For example, this story was recently told to me:

The unions that represent the contractor workers on the Trans-Alaska Pipeline are being squeezed for a 5% pay cut. The Pipeline selected a non-union contractor, then offered the unions the opportunity to hold onto the work if they made concessions. The membership wasn't even consulted, they just got a letter from their business agents telling them that if they wanted to keep their jobs this is the way it is going to be.

There is little doubt that the non-union contractor never really had the work. They were just used to force concessions out of a very experienced group of employees with decades of pipeline operations and spill response experience that the non-union contractor could never have replaced.

[TheKentuckian]

12. I never dreamed so many Democrats bought into voodoo economics

What will it take to once and for all prove that trickle down does not work?

People are both dense and crazy. Why do they think the same pieces of shit and vermin that would ship up and compete against their own fucking country to make an extra buck and a half, cut wages even as profits and productivity go up, and slashing benefits with reckless abandon are going to give up shit?

[IndianaGreen]

15. From voodoo Reaganomics to voodoo Obamanomics

It is the never ending BOHICA for the American worker.

[Hawkowl]

17. No shit

This is the stupides thing I've EVER heard. Why would a company increase your wages simply because it now doesn't have to pay some of your expenses? Wouldn't companies simply pocket the difference and pat themselves on the back?

Corporate dems have to be the biggest bunch of fucking morons. O.K. maybe right wing fundies disavowing evolution are bigger fucking morons but DLC'ers are coming in a close second.

[IndianaGreen]

19. If if was up to the capitalists, there wouldn't be an 8-hour workday

or child labour laws, or workplace safety, to name just a few.

People died on the streets of Chicago for the 8-hour workday!

[hollowdweller]

24. Have the Dems been sleeping the past 10 years??

OK so the GNP has been growing and tons of money made before this downturn.

Yet real wages have shrunk for workers and there was that report for the last decade we had zero job growth.

Is that not enough of a sign that profits will not be passed to employees???

Obviously the people saying this do not know anyone in the middle class anymore.

What's left of it.

[highplainsdem]

18. K&R

[johnaries]

21. Actually, it does for non-Union jobs. If the Union can't negotiate

higher wages when benefits costs go down, then they need new negotiators.

[Vidar]

22. K&R.