Labor union leaders made a trip to the White House yesterday to hear President Obama’s latest pitch for health care legislation. But judging from remarks earlier in the day from AFL-CIO President Richard Trumka, the meeting wasn’t a typical administration powwow with Big Labor.
Speaking at the National Press Club in Washington, Trumka outlined his strong opposition to the Senate bill’s 40 percent tax on “Cadillac” health insurance packages — the kind union officials negotiate for themselves and their members. After his speech, Trumka was among 10 labor leaders invited to meet with Obama, who supports the tax measure as a way to raise money.
The tax issue remains one of six key differences between the House and Senate health care bills. It’s clearly a big issue for Big Labor — drawing scorn from the Communications Workers of America and National Education Association as well — but it remains to be seen if their lobbying can change minds.
Even though Obama criticized Sen. John McCain (R-AZ) during the 2008 campaign for wanting to lift the tax exemption on employer plans, the White House has expressed its openness to the Senate proposal. SEIU President Andy Stern, a frequent White House visitor, acknowledged it would be difficult to sway Obama.
Trumka stopped short of saying the AFL-CIO would oppose a final bill, but he made clear the union would continue fighting the Senate’s tax provision:
[T]hanks to the Senate rules, the appalling irresponsibility of the Senate Republicans and the power of the wealthy among some Democrats, the Senate bill instead drives a wedge between the middle class and the poor. The bill rightly seeks to ensure that most Americans have health insurance. But instead of taxing the rich, the Senate bill taxes the middle class by taxing workers’ health plans–not just union members’ health care; most of the 31 million insured employees who would be hit by the excise tax are not union members.
The tax issue is just one factor that could sour Big Labor’s relationship with the White House. Trumka clearly favors the more liberal House bill, which includes a public plan and employer mandate. But for House and Senate leaders to strike a deal, lawmakers would almost certainly need to make concessions that agitate leaders like Trumka. Other major issues up for negotiation include penalties of an individual mandate, expansion of the Medicaid entitlement and taxpayer funding for abortion.
With many labor leaders also frustrated by the lack of progress on the misnamed Employee Free Choice Act, the health care negotiations only complicate the White House’s relationship with an important ally. Trumka warned of a scenario that could result in a repeat of the GOP’s 1994 electoral triumph:
In 1992, workers voted for Democrats who promised action on jobs, who talked about reining in corporate greed and who promised health care reform. Instead, we got NAFTA, an emboldened Wall Street — and not much more. We swallowed our disappointment and worked to preserve a Democratic majority in 1994 because we knew what the alternative was. But there was no way to persuade enough working Americans to go to the polls when they couldn’t tell the difference between the two parties. Politicians who think that working people have it too good – too much health care, too much Social Security and Medicare, too much power on the job — are inviting a repeat of 1994.