Earlier this week, members of the International Association of Machinists and Aerospace Workers Local 2545 went on strike at Maremont Exhaust Products, a manufacturer of mufflers and other auto parts in Loudon, Tennessee. It is believed to be the first strike in the company's 130 year history. The Machinists Union represents a little over half of the operation's 400 employees, but reports say that 75% of workers there support the strike.
At issue is a new contract proposal that would shift more of the cost of health insurance to employees without an accompanying pay increase. According to a union representative, the change would increase health insurance premiums by 350% and result in a pay cut of 68 cents per hour on the average.
The Tennessee company was purchased last April by the International Muffler Company out of Texas. Since then, workers at Maremont say they have made many concessions, including a switch from a defined benefit pension to a 401K plan and elimination of seniority in layoffs.
When I read about the strike, my first thought was that I wished them luck in their contract negotiations, but these workers will likely be out of a job within two years and insurance will be the least of their worries when the company shuts down the operation and moves it to Mexico.
True to form, International Muffler (which says on its website that the "Family Concept" is stressed throughout the company, and that "one of the main reasons for the company's growth is the people") released a statement yesterday that says in part:
During the past few years, the U S Automotive Industry has experienced downturns at both the new car and the aftermarket which adds non-factory parts and features to new cars. The result has been numerous plants being either downsized or closed, and much of the manufacturing process being outsourced overseas.
It is not easy competing with offshore companies who are not required to provide their employees workers compensation, health care or retirement benefits and only pay less than $2.00 per hour.
No doubt, given the fact that "free trade" agreements promoted by corporate America don't provide a level playing field for American workers. And they apparently make for effective bargaining tools.
Regardless, this is one more example among hundreds playing out across America illustrating how our system of employer provided health care is broken and has become a liability instead of a benefit for employees and employers alike.
Today, the Service Employees International Union announced a new coalition of business, labor, and civic leaders to address the problem:
Washington, DC - Standing with the CEOs of Fortune 500 companies and national labor and civic leaders, SEIU today helped launch a historic, new cooperative effort with the goal of fundamentally changing the nation's broken health care system.
The founding members of the new partnership, which was announced at a Washington, DC, news conference, are SEIU and Wal-Mart, the largest health care union and the largest corporation in North America, respectively; AT&T; Intel; Kelly Services, Inc.; Communications Workers of America; the Center for American Progress; the Howard H. Baker, Jr. Center for Public Policy; and the Committee for Economic Development.
"What unites us to be here today, and will continue to hold us together is our belief that it will be a far greater America when we finally get health care for every man woman and child," said Andy Stern, President of SEIU.
The coalition will mobilize leaders from the business, labor, and political worlds - as well as individuals - in the growing movement to overhaul the nation's health care system. Together, the founders pledged to recruit 50 additional partners, seek support from lawmakers, and launch innovative public education campaigns to rally customers and workers alike in the fight for a new American health care system.
As they launched the initiative earlier this year, SEIU laid out a ten point Vision for Reform:
The Health Care Solution: SEIU's Vision for Reform
1. It is time for our nation to guarantee affordable health care coverage for all Americans. Piecemeal reform is not a solution.
2. The current employer-based health care system is not the foundation for 21st century health care reform, particularly given the competitive challenges of a global economy.
3. A universal health care system must ensure a choice of doctors and health care plans without gaps in coverage or access, and the delivery system must meet the needs of at-risk populations.
4. A universal health care system must include a core health care benefit similar to one that is available to federal employees.
5. Preventive care must be a part of any basic benefit plan to promote health, control costs, and eliminate economic and racial disparities.
6. Any plan for health care reform must control costs by providing care that is cost efficient and medically effective.
7. Secure electronic medical records that consumers control are necessary to increase quality and reduce costs.
8. Hospital and physician quality, outcome, and cost data must be available to consumers.
9. A universal health care system must integrate long term care services, reduce out-of-pocket costs, and maximize opportunities for individuals to receive assistance in home- and community-based settings, rather than in hospitals and nursing homes.
10. Employers, individuals, and government must share responsibility for financing the system.
That's a statement of the problem and the solution that's as simple and straightforward as you are likely to find anywhere. Today's SEIU announcement is further evidence that corporate America is finally figuring out that fixing the problem is good for business and necessary if America is to remain competitive in global markets. And it's interesting that labor is leading the way.
Just as an afterthought, universal health care/insurance in some form is the best long-term solution but as I was reading the news about the Maremont strike earlier in the week it occurred to me that labor unions could provide an interim solution.
What if every union in America got together and started their own insurance company for their combined membership? According to the Bureau of Labor Statistics, there are 15.4 million union workers in America. That's a huge, diverse pool of employees and their families -- a million more than the total number of people in the U.S. covered by private health insurance.
Unions could then come to the bargaining table with the huge advantage of taking health insurance out of the negotiations. Employers would get skilled workers with built-in insurance benefits. Workers and their families would be better protected with portable health insurance not tied to their employers. Companies would be more open to working with unions and it might reverse the decline in union membership, especially in the "right to work" Southern states where union membership is well below the national average.
I'm guessing this isn't an original idea, and I suppose it would require some legislation. But it seems like a win-win for business and labor. At least until America finally realizes that the best solution is a system of universal health insurance for all that takes employment out of the equation.