Much of the political left views Corporate America as a greedy, profit-driven behemoth that does much to shaft Joe Citizen. Such perspective is usually brought to bear on Corporate America’s interaction with public policy. Witness how the left blasts Wall Street’s interests regarding Social Security reform. However, such critical faculties are quickly suspended the moment Corporate America supports a policy the left favors.
A case in point is General Motors. Last year, GM’s CEO, Richard Wagoner Jr., gave a speech complaining that American spending on health care made our businesses less competitive. “Our foreign-based competitors have just a fraction of these costs because they have few retirees in this country,” he said, “and in their own country where the bulk of their people are, their governments pay a much greater proportion of their employee and retiree health-care costs.”
The flailing automaker now finds itself with some strange bedfellows. In a recent rambling piece in the Los Angeles Times, Barbara Ehrenreich lamented, “Consider poor General Motors, once the nation’s flagship corporation and now sinking under the weight of its employee health benefits — which account for $1,500 of the sticker price of each new vehicle.” Pity Richard Wagoner — health care costs have nickel and dimed his company to near bankruptcy!
Another lefty to go gaga over Wagoner is (who else?) Paul Krugman. “Last year Richard Wagoner Jr., G.M.’s chief executive, gave a speech about the costs of America’s ‘Kafkaesque’ health care system that sounded a lot like my recent columns,” Krugman happily writes. “And his company has made it clear that it likes Canada’s system: in 2002 the president of General Motors of Canada and the head of the Canadian Auto Workers signed a joint letter declaring that ‘it is vitally important that the publicly funded health care system be preserved and renewed.'” Would that Wagoner had supported personal accounts for Social Security.
GM’s angle is so obvious that only ideologues like Ehrenreich and Krugman fail to see it. GM’s annual report shows that it sold about 8.2 million vehicles around the world in 2004. At $1,500 per vehicle, that means GM’s health care costs are near $12.3 billion. GM’s increasingly red bottom line just might turn black if that amount could be dumped on the taxpayers. All that’s needed is a Canadian style health-care system.
GM’s executives would do well to read Sally Pipes’s book, Miracle Cure: How To Solve America’s Health Care Crisis And Why Canada Isn’t The Answer. President of the free-market Pacific Research Institute, Pipes reveals how Canada’s system rations care in order to contain costs. Of note:
* Hospitals in Canada are ill prepared to deal with flu outbreaks due to a reduced number of beds. In 2003, hospitals in Ontario had to cancel 1,050 surgical procedures, including cancer and hear surgeries, and postpone 31,000 clinical visits in order to deal with the SARS outbreak.
* The rationing results in increased waiting times for treatment. From 1993-2003, “the median waiting time from referral by a general practitioner to treatment increased by 90 percent, from 9.3 weeks to 17.7 weeks.” For patients seeking cancer treatment, the wait time for medical oncology increased from 2.5 weeks to 6.1 weeks, and for radiation oncology it increased from 5.3 weeks to 8.1 weeks.
* The wait times for breast cancer treatment appear to have reached the breaking point. “In March 2004, a class-action lawsuit was launched against 12 Quebec hospitals on behalf of 10,000 patients who waited more than eight weeks for radiotherapy after being diagnosed with breast cancer.”
In his speech, Wagoner echoed other leftist talking points: “In the U.S., health-care costs are rising at an annual rate of 14 percent to 18 percent and already account for 15 percent of our gross domestic product — 50 percent higher than the next most expensive country. The worst part of all this is that these very high costs don’t necessarily buy the best health care.”
Well, yes it does. The best way to measure any health care system is how well it responds to those who become seriously ill. One way to measure this is to look at the population most likely to get seriously ill — the elderly. Two researchers at Duke University recently examined the survival rate of people over 80 in the United States, Sweden, France, England, and Japan. They concluded that, “For people 80 years old or older, life expectancy is greater in the United States than it is in Sweden, France, England, and Japan. This finding suggests that elderly Americans are receiving better health care than the elderly citizens of other developed countries.”
The fact of the matter is GM has consistently signed contracts with the United Auto Workers that do little to contain health care costs. Americans should not suffer the indignity of a single-payer system because GM has failed to bargain effectively with the unions.
Unfortunately, the idea of co-opting CEOs as props for government-run health care is gaining currency among the left. In Thursday’s New York Times, Matt Miller of the Center for American Progress [sic] proposed a major effort by Corporate America to deal with the issue:
A dozen marquee C.E.O.’s would convene a “Manhattan Project”-style effort on the future of health care. They’d propose a new goal: instead of health costs rising from today’s 15 percent of G.D.P. to 20 percent by around 2020, as is now projected, the nation should shave two to three percentage points of G.D.P. (or more) off projected growth in ways that improve quality, even as we extend coverage to the 45 million uninsured.
Of course, Miller is willing to stack the deck in favor of a particular solution: “…eligible C.E.O.’s have to grasp that most rhetoric in the health debate…is rubbish. Republican C.E.O.’s who think ‘big government’ is always the problem may be at special psychic risk.” One wonders if Miller has already signed up GM’s entire board of directors.
Were GM’s critique of our health care system not conducive to the socialized-medicine agenda, it would be seen for what it really is, a company in decline pleading for corporate welfare. Perhaps it is best to view the major automaker as representing the “command-and-control systems” of “the U.S. economy of the ’50s and ’60s, when General Motors was the very model of a modern major company.” The author of those words? Paul Krugman.
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