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Latest News - February 2013

February 2, 2013
Examiner Editorial: Obamacare's grave threat to labor unions
Source: The Washington Examiner

John Wilhelm was one of the millions of Americans who took President Obama at his word when the then-candidate talked about health care during the 2008 presidential race. He recalled the president's words during a Nevada rally that year.

"I heard him say, 'If you like your health plan, you can keep it,' " Wilhelm recently told the Wall Street Journal. "If I'm wrong, and the president does not intend to keep his word, I would have severe second thoughts about the law."

That is a significant issue for Wilhelm, who is the chairman of UNITE HERE Health, the insurance plan for 260,000 service-sector union workers. It is beginning to look like more and more employers will either cut back coverage or drop it altogether as the administration's new health care mandates make those private insurance plans uneconomical.

That leaves the unions -- which, remember, were Obama' allies in the getting the bill passed in the first place -- in a bad situation. Negotiating with employers over health care coverage is one of the main benefits they provide their members. As one union official told the Journal: "If we're not offering our members insurance and pension, why would you want to be union?" Quite so.

Big Labor's solution to this is to pressure the administration to extend subsidies to the type of health care plans jointly managed by unions and employers. In other words, the unions want the administration literally to pay off unionized companies not to drop their coverage.

The administration is resisting. Those subsidies would cause the cost of Obamacare to balloon at the very moment officials are trying to keep already skyrocketing costs under control. They already threw Big Labor a big bone by exempting union-run health insurance plans from a high-end "Cadillac tax" until 2018. For everyone else, the tax kicks in this year.

Moreover, if the administration gives in to Big Labor on the subsidies, it's going to have to explain to other employers why they cannot get the same break.

But the White House owes Big Labor. Unions helped to deliver the key battleground states like Ohio, Pennsylvania and Wisconsin to Obama last year. And with overall union membership falling to a mere 11.3 percent of the workforce in 2012, and to just 6.6 percent in the private sector, labor leaders can ill-afford any change that causes members to slip away faster. They're going to press the White House, and hard.

This is the umpteenth chapter of why Obamacare was a bad idea. The real-world consequences -- like what the unions are now wrangling with -- are only now becoming apparent. To those of us who warned about this from the start, there isn't much satisfaction in pointing out that the unions did it to themselves.



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