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Worse Than I Thought

And I thought that card check was already pretty bad:

Under EFCA, the terms set by the arbitrator will be the furthest thing from a "contract." It won't be an agreement between management and labor. Rather, wages, hours and terms and conditions of employment will be dictated by a government appointed arbitrator. The mandate will be binding on the parties for two years. Neither the company nor the employees can reject it (At least when the Central Committee set the wages for tractor assembly workers in the Leningradskaya oblast there was always the possibility that the wages might change later that afternoon).

Currently, if employees don't like the tentative agreement negotiated between union leaders and management the employees can vote it down and instruct their leaders to go back to the bargaining table to get a better deal. Not so under EFCA. If the employees don't like the arbitrator's decree of a 2% wage increase, they're stuck. Similarly, if the company can't afford the arbitrator's command to pyramid overtime, the company's stuck. The consequences aren't difficult to imagine.

This is a small business owner's nightmare. As is the health insurance mandate. Obama will be a disaster, economically, at least if the Democrats get enough votes to block filibusters in the Senate.

[Update a couple minutes later]

Here's more on the job-destruction potential of Obama's health-care plans, from that bastion of right wingery, the New York Times:

the penalty in Massachusetts is picayune compared with what some health experts believe Senator Barack Obama, the Democratic presidential nominee, might impose as part of his plan to provide affordable coverage for the uninsured. Though Mr. Obama has not released details, economists believe he might require large and medium companies to contribute as much as 6 percent of their payrolls.

That, Mr. Ratner said, would be catastrophic to a low-margin business like his, which has 90 employees, 29 of them full-time workers who are offered health benefits.

"To all of a sudden whack 6 to 7 percent of payroll costs, forget it," he said. "If they do that, prices go up and employment goes down because nobody can absorb that."

Writ large, that is one of the significant concerns about Mr. Obama's health plan, which like this state's landmark 2006 law would subsidize coverage for the uninsured by taxing employers who do not cover their workers. And it is a primary reason that so-called play-or-pay proposals have had an unsteady history for nearly two decades.

This is 180 degrees from the direction that we need to go. Most of the problems of the current health-care system stem from its being tied so much to employment, which is an artifact of wage controls during World War II. The first critical step in fixing it is to decouple it from the job, so that plans are portable, and people are more connected with choosing their provider. McCain's plan isn't perfect, but it's a big step in the right direction, and the demagoguery of the Democrats on this issue (as on most issues) has been shameful.



Brock wrote:

It's almost like they don't believe in TANSTAAFL.

I predict a greater wave of outsourcing. The difficulties imposed by language barriers and time difference can be overcome given the necessary incentives, and Barry is handing out those in spades. If you really need native English speakers though there's a budding call center industry in the maritimes of Canada, and Ireland isn't that far off time-wise.

I've been thinking of starting my own business recently, and I'm pretty sure it will be structured to make maximum use of outsourced labor and independent contractors. Headcount: 1.

Carl Pham wrote:

I wonder if anyone remembers F. A. Hayek's immortal warning, which is that economic control inevitably leads to social control?

I mean, anyone who's in an HMO has seen all the advertisement and pressure to be healthy -- stop smoking, lose weight, et cetera -- because the nature of an HMO means they're on the hook if you get sick.

What happens when the HMO is no longer limited to mere persuasion, because it's run by the state, or is a state agency? What happens when they can actually fine you for smoking or failing to lose weight, or not eating enough broccoli, or not taking the cholesterol medicine that makes you impotent, as an unfortunate for you (but not expensive for the state) side-effect?

Or, you know, if a different administration gets in power, how about when they can put you in jail if you're HIV positive (so you don't go spreading the virus)? Or maybe just if you're gay and sexually active (why take chances)?

Karl Hallowell wrote:

Finally there is the matter of ballooning health care expenses. Massive dumping of money into health care policies (especially for low priority procedures) just encourages the consumption of healthcare and drives up its cost. So what costs 6% of salaries now may well cost a lot more later.

Larry J wrote:

My wife works for a major insurance company dealing with worker's compensation coverage. She can tell hours of horror stories about claimants who "lawyer up" to drag out coverage for as long as possible (not realizing that the lawyer's fees comes not from the insurance company but from the claimant). The lawyers direct that all communications with the claimant go through them (gotta get them billable hours!) and they choose medical providers who're guaranteed to drag out things for as long as possible.

As a nurse, she saw first-hand doctors doing things that either bordered on or were outright fraud. We taxpayers get stuck with a lot of that expense.

You also have to love those commercials for things like mobility scooters and medical supplies that are aimed at senior citizens. They're told that "if approved, it won't cost you a penny." What they aren't told is how much it'll end up costing the taxpayers.

There's a lot of fraud and blame to go around. Medicare and Medicaid have unfunded liabilities that make the current economic bailouts and even Social Security's looming shortfalls look like nothing. However, the Democrats assure us that not only is there no problem, but if we turn over 1/6th of the US economy to them (healthcare), everything will be peaches and cream. I might have confidence in them if those existing programs were so well ran that everyone was eager to join.

Karl Hallowell wrote:

"Employee Free Choice Act"? I notice several things about this title. First, it doesn't mention employers. Second, if by "free choice", you mean a euphenism for "freely accept the mediator directive because you have no choice", then sure, it's "free choice".

Further, this all is starting to sound like the early 1930's. We don't need a repeat of the Great Depression.

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This page contains a single entry by Rand Simberg published on October 27, 2008 7:04 AM.

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