Tuesday, July 12, 2005

Wal-Mart's War Against Employer-paid Health Insurance

Many states, such as Maryland are fed up with large corporations such as Wal-Mart that have few high paying jobs and force many employees to rely on state funded services for health care. This drives taxes up, and provides little social upward mobility to workers to provide a decent standard of living to their families. Large employers who pay little to workers, and provide few workers with health insurance are a chief reason so many states have huge numbers of uninsured workers. This creates state budget problems and provides little social good that large umployers like Wal-Mart actually provide.

Many more responsible employers in America spend 10 to 20% of their payroll on employeee health benefits. This provides workers an important social good, and relieves state governments of added welfare burdens for state budgeted social services. But Wal-Mart provides health insurance to fewer than half of all workers, and spends a very insignificant 5 to 6% of payroll on employee health insurance costs. All of this prompted the state legislators in Maryland to act to pass a bill that all large employers must spend at least percent of company payrolls on employee health insurance costs.

All of this would make a rational person think that the Republican governor of Maryland, Robert Ehrlich would be quick to sign this bill. It would cut tax costs for social services for Maryland, it would use "private funding" of health insurance. Under normal circumstances a rational mind would expect that this would appeal the "Republican philosophy". But that hardly proved true.

After Wal-Mart threatened withdraw plans for a new distribution center in Maryland, the Republican Governor, Robert Ehrlich in an orchestrated "George Bush " syle staged propaganda event staged a veto of the bill requiring 8 percent of payroll for health insurance, with a major Wal-Mart executive looking on, and a high school band playing patriotic music. What this has to do with patriotism or even for the good of Maryland or for employees of large corporations is a very good question. It appeared to be little more than pandering to a large corporation that will offer little benefit or true social good to Maryland.

There are already studies that some large corporations like Wal-Mart do not offer any real constructive good for most communities. These mega-corporations tend to replace higher paying existing jobs with ones that pay less, and also offer the employees a reduced set of benefits including less employer paid health care. Even the Los Angeles City Council found in a study that one job is lost for evey lower paying job with less benefits that Wal-Mart or similar big stores claim to offer. The corporate advertising of Wal-Mart suggests they are a great employer. But when worker's standard of living and health care benefits actually decline with mega-businesses like Wal-Mart, then only the corporate heads benefit. The community is less well off, and government is under increased social welfare costs as more and more working poor are created and become social service clients.

It is not only in Maryland in which employer-paid health insurance have come under corporate fire. In Oregon a similar law that mandated some level of employer paid health insurance was repealed in 1993, after it became law in 1991. Big corporations do not want to pay health insurance costs. More and more part time jobs with lower pay and no health insurance benefits are becoming the rule for many corporations, where higher paying full time jobs with health care benefits are shrinking to less than half of some large corporate jobs.

The American experience with capitalism was supposed to promise great security and promise to rural families to sell the family farm and move to cities and count on corporations for jobs. Instead it has led to breadlines, homelessness, poverty and huge government costs for social services to provide a safety net to these unfortunate victims of the failure of capitalism to provide a decent standard of living to all as promised. It is the moral responsiblity for employers to pay workers as well as possible and to provide health care benefits to provide this essential benefit to workers and their families. This is only moral to do such.


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