Thursday, October 20, 2005

Wages + Benefits = Welfare?


In his latest editorial, while speaking to the very real effects of globalization, George Will replicates his traditional sneering attitude toward the notion that employers should be obligated to live up to their contractual obligations to their employees:
GM has been forced to allow product development, pricing and other decisions to be driven by the need to keep sufficient revenue flowing in so it can flow out in fulfillment of GM's function as a welfare state.
That's right, folks - in George Will's mind, if an employer negotiates a compensation package that includes health benefits, the employer is acting as a "welfare state". And he apparently believes that any such contractual obligation should be one that can be discarded by the employer on a whim.
Concessions by the United Auto Workers will provide GM with annual savings of $1 billion in health care costs. But GM's hourly workers, who pay no health care deductibles and only nominal co-payments, will still enjoy coverage better than most Americans have. Since 2000, the percentage of American businesses offering any health insurance to workers has declined from 69 to 60.
Is it fair to interpret that last sentence as follows: "Yay!", declared George Will, "More of the working masses are uninsured!" And he also spits on the notion of a blue collar middle class,
Delphi proposes cutting the compensation - pay and benefits - of younger workers from $65 per hour to $20 or less, so it can fulfill the promise to retirees of a fixed percentage of their salaries.
Come back to Earth, George - a proposed slashing of wages by 2/3 is about a lot more than paying contractually dictated benefits to retirees. And if you think Delphi isn't going to try to dump those obligations onto the taxpayer via the Pension Benefit Guarantee Corporation or back onto GM through the course of its bankruptcy, you're pretty darn optimistic - Pollyanna Will. Oh, I'm giving Will way too much credit - he doesn't actually care if retirees see a penny of their pension benefits; he's trying to create an intergenerational conflict out of what the very quotes in his article indicate is in fact primarily the result of globalization.
[Robert "Steve" Miller, Delphi's chief executive] bluntly says that the social contract written after 1945 is being - must be - repealed because, given globalization, unskilled manual labor cannot be paid $65 an hour, with the cost passed on to consumers. "When you buy a Hyundai you get a satellite radio as your option, but if you buy a Chevrolet you get social welfare as an option. Long term, the customer is going to desert you if you try to price for your social-welfare costs."
You know what is quite telling about hypocrites like George Will? They have a philosophy of life where they are never willing to sacrifice anything themselves, but never stop demanding that others sacrifice for them, for their comfort, for their ideology. Has Will ever issued a whisper about excessive CEO pay? Did it not occur to him in applauding Delphi's abrogation of contract that he might make mention of the extraordinary severance packages it has afforded departing executives? Did it not occur to him to question why executives, CEO's, and the Republican-controlled House and Senate, are completely unwilling to address the cost of their own perks of office, salaries, benefits, and... yes, defined pension plans? Has he called upon his employers to pare back his own wages and benefits, contracts be darned, in the name of ending a "welfare state"? Has it occurred to him that these are contractual obligations, and some people actually believe that a signature on a contract is supposed to mean something more than "I can't screw you now - so I'll screw you later"? Has it occurred to him that shifting the cost of health care from employers of retirees, the blue collar middle class and working poor from employers onto the taxpayer is not the elimination of a "welfare state", but is instead an element of its creation?

Apparently not in this lifetime.

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