Richard Wolff, economist at the New School in New York City speaks to Paul Jay about the possibility of national health care being available to workers. He says that if the government creates the choice, employers will pressure workers off company care, even if the alternative is lower quality. He also says the reason there is a mushrooming number of retirees companies have to support through health insurance plans is because they’ve pushed them out in exchange for low-paid new employees.
Story Transcript
PAUL JAY, SENIOR EDITOR, TRNN: Welcome back to the next in our series of interviews with Richard Wolff. He teaches economics at the New School. We’re talking about the auto industry and, I guess, also the future of America. Thanks for joining us.
RICHARD WOLFF, ECONOMIST, THE NEW SCHOOL: Thank you.
JAY: So we ended the last segment, and we were talking about the risk and the gamble being put particularly on the auto workers for their health-care plan, a swap of shares for health care, essentially. But if there is real health care reform, I’m sure Obama and the administration said this to the union: “Look, you’re not taking that big a risk with your health care, because we are going to have a national health-care plan of some kind within a year. We’re committed to you. We promise you. So you’re not taking that big a gamble.”
WOLFF: Well, I think the answer to that has many parts. First, without any disrespect to Obama, what kind of a health-care plan he can get is an open question. It’s even an open question whether he’ll get any of it. And what he gets and what it’ll actually mean for working people is very much an open question that all the major interest groups in the United States are struggling over. So he’s really not in a position to make a promise, or at least not in a position, if he did it, to keep that promise. Having said that, absolutely. A real national health plan would dramatically change the automobile industry and most other industries. One of the strange things about the United States is that we have to compete with products produced in other societies where there is national health and where each company doesn’t have to worry about its own money being used to sustain workers health and wellbeing. And that’s a disadvantage of the United States, one imposed on all of our companies by the power of the medical establishment and the drug companies who have their own agenda and have been successful so far in preventing a national health program, so that if that happened, it would improve the condition of the automobile industry in a dramatic way and might have been a difference for a long period of time. But, to be fair about it, let’s remember that one of the reasons the health-care costs of retired workers and the autoworker is made such a big issue of is the fault of the automobile companies themselves. [When they] negotiated the right a few years ago to hire new workers at much lower—50 percent lower salary than they pay older workers, they then went to push the older workers out and to substitute young workers. It’s well known that older workers have more health problems than younger workers. So it looks as though they are sustaining all these retirees, but the swelling of the retirees is itself a result of a profit-making program of substituting cheaper workers for more expensive workers. And so it’s a little unfair to represent this as something that the automobile companies are suffering when they themselves were instrumental.
JAY: Let’s go back to the issue of the health-care plan. So is the health-care plan that was articulated by President Obama during the election campaign—does it solve these issues?
WOLFF: No, because it’s a modest plan. It doesn’t go far enough. It is, for example, particularly concerned—which is understandable—with insuring the uninsured. But when it gets to the actual quality and quantity of health-care services to be provided to everybody, that’s when it gets into the real nitty-gritty, because what working people want is not to leave a reasonably well-funded, good service program from their job for an inferior one that the government provides. If that were to happen, then there would be not only rising health problems but an enormous backlash in the United States, because what people do not want is a diminution in the quality of their health care. They want the government to give them more, better healthcare at a lower price.
JAY: But the argument that would come from the Obama administration is our program allows workers to have the choice. You don’t have to join the government plan. You could stay with your private plan.
WOLFF: Right. But if the government plan is more modest than the private one, then the first thing every private employer is going to need to do as part of the competition of this system is to push his or her workers off the company plan and onto the state plan.
JAY: And the model for that’s happening in Detroit.
WOLFF: Absolutely, and it’s been happening before. We see it already in the substitution of poorer plans for better ones–I give my own–I used to work at the University of Massachusetts. It was a continuous struggle for us as the administrators at the university under financial pressure kept trying to make adjustments in the medical coverage. So our deductibles went up. The illnesses that were covered were decreased in number. It’s an endless struggle. And the whole point of a national health program would be to stop that waste of time and that waste of personnel in the endless struggles that we’re all familiar with from our medical insurance carriers, and to have a reasonable national health system that would save an enormous amount of money by providing quality health care for everybody, so it doesn’t become a competitive tool in the struggle of one company against another or of the employer against the employee.
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