TCS Daily

Why the SEIU Wants Health Reform

By Diana Furchtgott-Roth - March 18, 2010 12:00 AM

The largest health care labor union in the United States, the Service Employees International, is using its 2.2 million members' hard-earned dues to finance an intense, expensive lobbying campaign in support of the pending health-insurance bill - in order to prop up its failing pension plans.

It spent a significant fraction of its 2009 lobbying budget of $2.7 million on health, purchasing costly ads in major newspapers and on TV, such as one telling Indiana Representative Brad Ellsworth, a Democrat, "to keep standing up for us, not the insurance companies. Pass health insurance reform now."

The union's president, Andy Stern, who is desperately committed to enactment of the bill, is reported to have been the most frequent visitor to the White House over the past year.

The union's Web home page features "The Final Push for Health Care" and urges union members to phone their members of Congress in support of health "reform." The Web site coaches union members on what to tell Congressional staff and even offers a telephone number that will connect union members to their representatives in Congress.

In contrast, the Labor Department's Web site lists pension plans that are in financial difficulty. Several SEIU pension plans are in critical status, meaning they have less than 65% of assets needed to fund financial obligations to future and current retirees, or in endangered status, with less than 80% of needed assets.

What's the connection? The SEIU needs more new dues-paying members to pay for the retirement of current members if it is to rescue its pension plans from subpar performance. It's a Ponzi scheme that would make Bernie Madoff proud. With many of its members employed in health care, the union believes - not illogically - that if more Americans have health insurance, the demand for health care will expand and so will employment in the health sector.

The Senate is unlikely to pass the Employee Free Choice Act, a bill that would impose mandatory arbitration and take away workers' right to a secret ballot in union representation elections. This was first on unions' 2009-10 wish list, and union leaders want to show that they still have political power. So they will settle instead for the health care "reform" bill.

More than flexing labor's political muscles, the overriding reason for SEIU support of health care reform is that it would bring in more members. The percentage of private sector workers belonging to unions has been declining steadily, and reached 7.2% in 2009. Partially offsetting this is the percentage of unionized government workers, 37% last year, up half a percentage point from 2008.

And without more members, the SEIU's troubled pension funds will continue to fall short of 80% funding, considered by the Labor Department to be acceptable financial coverage.

Even before the stock market crash of 2008-09, the SEIU's 1199SEIU Greater New York Pension Fund was funded at 58% for 2007. The Service Employees 32BJ North Pension Fund stood at 68%; the Local 32BJ Building Maintenance Contractors Association Pension Plan at 41%; and the 32BJ District Building Operators Pension Trust Fund at 56%.

These worker funds are all in critical or endangered status. Yet Andy Stern's SEIU Affiliates Officers and Employees Pension Plan, funded at 102% in 2007, is not in trouble.

The SEIU is hiding these difficulties from its members by misstating the facts. At the same time as its pension funds are listed in critical condition by the Labor Department, the SEIU declares on its pension fund Web page that "the 1199SEIU Funds are among the strongest and largest labor-management funds in the nation, providing a range of comprehensive benefits to 400,000 working and retired healthcare industry workers."

Successful lobbying for health-care reform would expand the health centers available for unionization, driving up costs. The SEIU now represents employees of many providers, including Kaiser Permanente, The League of Voluntary Hospitals and Homes of New York, Tenet Healthcare Corporation, and Dominion Hope. Such providers presumably would expand payroll if 30 million uninsured were covered, with new members required to join the SEIU.

The SEIU also organizes home health care workers, who would gain from the passage of comprehensive insurance.

Furthermore, the Senate bill's insurance scheme, if enacted and not later amended, is unsustainable and likely to lead to a government takeover, leaving us with a Canadian-style single-payer system. The price of plans, already averaging $4,824 for singles and $13,375 for a family, would increase steadily as people chose to pay the $750 fine rather than purchase insurance. With insurance companies required to take everyone, there would be no penalty for waiting to sign up when sick. The pool of insured Americans would get sicker, driving up premiums, and leading to more uninsured with Uncle Sam eventually stepping in.

In a single-payer system unions have far more power to raise costs. According to Brian Lee Crowley, Senior Fellow of the Atlantic Institute for Market Studies in Nova Scotia, "So what happens when you put together a public sector monopoly service like health care...without a hard budget constraint, together with a powerful rent-seeking public sector union? You get hugely increased bargaining power for the public sector union compared to its private sector counterparts. "

Even as unions might drive up the price of care, they would be shielded from the premium increases, because the Senate bill would exempt organized labor from the so-called "Cadillac" excise tax on expensive plans.

The SEIU, driven by the need to prop up its weak financial organization, is using the hard-earned dues of its low-income members, all of whom receive health insurance, to lobby Congress to pass the health reform bill. No wonder that Americans are cynical.

This article first appeared on Furchtgott-Roth is a contributing editor of RealClearMarkets and an adjunct fellow at the Manhattan Institute.



Who said unions no longer have influence?
I guess this story belies the contention by someone recently around here who said that unions no longer have andy power or influence. That was Roy, wasn't it?

It's also interesting to note the $2.7 billion in lobbying money in 2009 alone. We see that leftiest always decry when industries have such lobbying power, as do I, but it's not clear if they also decry all the union lobbying.

The answer to such lobbying would be that the government not be able to grant the favors that the lobbyists are trying to buy. If there were proper 'separation of HC and state', who would bother trying to bribe government?

Road to Serfdom
Centralizing power and control over our private lives and private sector economy is off to a big start and only beginning. With unions being handed large swaths of the Healthcare economy and territory to stake their demands they will feed back money and foot soldiers into the statist project progressives find their own meaning and purpose in. Americans need to make change their own goal, with the statists being removed and their pernicious influences stuffed back in the trash bin of history.

Yup, and next up on the agenda after 'Health Reform'..
...instant and immediate CITIZENSHIP for tens of millions of illegals.

Some predicted details:

1) Like in the health care takeover, they will outright lie and say that they are only providing the 'path' to citizenship while actually it will be citizenship or de-facto citizenship.

2) ACORN or similar organizations will get fed money and authority to process these amnesties.

3) As part of number two, ACORN will also be given federal authority -- screw the Constitution (again) as it pertains to the States actually administering elections and voter registration -- to automatically register these new citizens to vote.

4) As a consequence of number three, ACORN will have the funds and the data to be able to execute massive voter fraud in 2012 that makes elections in Kenya and Indonesia look like honest events by comparison.

They might even be able to 'practice' with that they'll have in time for the November congressional elections, too.

5) ANYBODY who tries to stand up to this will be branded a 'racist' just as viciously and hypocritically as Sarah Palin was attacked by FemiNazis.

If these five steps occur, we have effectively lost the nation. We will be like the Romans who handed over the Roman Empire to the barbarians long before they openly sacked Rome itself.

Artwork: "America After The Failure of Obamanism":

If this comes to past, either in part or full, many of you reading this post will be faced with a real harsh decision: flight or fight. Believe it or not, but I believe that the latter will be proven to be the most successful option, even if it is the most scariest.

Obama, HG Wells, GB Shaw, Paul Ehrlich, Jon Holdren confirmed
Unions and the progressive socialist movement have made a firm step toward their 90 sum odd year goals of control and redistribution today. But, they are not as disguised and motives not as pristine as they usually prefer, and Americans seem aware of what they are really up to. I can't wait for the showdown in November.
I suspect another American revolution on the level of ideas is about to re-occur.. but that is still left hanging to see how many have succumbed to statism and the dumbing down; and how many prefer freedom. This coming November is the shot that will be heard around the world, waking it up; or a spent blank shot will be heard without much affect. Freedom will have expired under the weight of all the re-progressivists have lain down.. or it will be fully awakened, for many when the pain exceeds the narcotic effects of statism. Roy and his like will no doubt prescribe an increase in the opiate dosage to maintain. mass control and stasis.
This next connonade will be heard round the world, and I hope it is the sound of freedom of the individual that resounds.. At least is will be heard within America.
Let's win one for Founding Fathers, and by the way.. the Gipper, and send these guys packing.

that's just it: we can't vote them out...
...not after your votes have been totally diluted with the millions of 'give me more freebies' immigrants they will grant amnesty to.

Hell, most of them won't even have to actually vote: ACORN will do that for them.

Union power and influence
"It's also interesting to note the $2.7 billion in lobbying money in 2009 alone. We see that leftiest always decry when industries have such lobbying power, as do I, but it's not clear if they also decry all the union lobbying."

I'd like to see your source for that number. It seems high-- in light of the fact that our largest conglomeration of unions, the AFL-CIO, has spent only $17.4 million for federal campaign contributions since the 1990 elections.

So naturally I wonder. Did the unions spend $2.7 billion in a single year? Or did they spend $17.4 million in the past twenty?

Please give us your informed answer. Even the author of this article only says that "It (SEIU) spent a significant fraction of its 2009 lobbying budget of $2.7 million on health, purchasing costly ads in major newspapers and on TV.."

So then. A fraction of $2.7 million spent on HC lobbying. Not billion.

Meanwhile, just to provide some contrast, guess what kind of money the health care industry has spent on lobbying since 2006? That would be $1.7 billion.

Not million.

Now let's examine the numbers in closer detail, for the nine months of January through September, 2009. The HC industry spent $396 million on lobbying. In just nine months.

Even Wall Street only spent $334 million during that time. And big coal, oil and gas, mining and timber combined only spent $300 million.

Now here's the $64 question: where did all that money come from? Didn't it come from the pockets of their customers?

It sounds to me like we could save a half billion dollars a year on HC just by shutting down these vultures. That's not the kind of thing I want my premium dollar to have to pay for.

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