Another Health Care Scam

Among the laundry list of Colorado constitutional amendments this fall, labor unions have put up Amendment 56, which forces businesses with more than 20 employees to pay for employee health care. The very concept of Amendment 56 exposes the cynical self interest of unions, and a willingness to sacrifice Colorado’s economy to their power agenda. Also, Amendment 56 shows how liberals believe that only the government knows what is best for regular people.

Unions operate under the basic assumption that employers are immovable, reliable, cash wells for their exploitation. Unions think that companies are a family and that employers must take care of employees as a part of a social compact.

While many CEOs give lip service to the stakeholder concept, those that do not deliver market returns for shareholders are quickly replaced with those that do. Employees are not stakeholders, and corporations are not families. Companies hire employees to provide essential services so the companies can profit. Whether an employee earns a high pay with no benefits or a lower pay with many benefits makes no difference to a company. Only the total cost to employ, including employer matching taxes, is the relevant measure.

This is why unions seek measures like minimum wage hikes and Amendment 56. They know that their above market compensation packages hurt the companies they infect. In order to keep non-union companies from outpacing union ones, they use their political influence to force union rules and compensation on all employers. This raises costs on all companies and reduces the competitive disparity with open shops. The real result is, of course, that most traditionally union jobs have moved overseas, beyond union political influence.

Forcing companies to pay for health care will not increase the compensation of employees, it will only shift the mix of pay vs. benefits more toward benefits. This is because the services of any employee are no more valuable to a company with or without Amendment 56. Companies will either lower cash wages or lay off employees to keep costs in line.

Some other likely results will be the relocation of mid sized companies to other states, the general avoidance of Colorado by companies looking to relocate or expand, smaller companies avoiding expansion, the layoff of marginally valuable employees, decreased wage growth, an increase in outsourcing, and an expanded black market for unregulated labor. Anything to keep labor costs competitive with other states and countries.

Despite these many troubles, unions are unconcerned. Their primary mission is to punish employers and employees who don’t want to participate in the union racket.

If simply mandating employee health care does not increase total employee compensation, the real result of Amendment 56 is essentially to force employees to buy health care whether they want it or not. Amendment 56 says that if you want a job in Colorado, you must buy health care.

Why punish people for working? Instead of requiring people to buy health care in order to work, why not require people to buy health care in order to drive a car? Why not health care before buying cable TV, or buying liquor, or buying Broncos Tickets, or taking a vacation? There are untold indulgences and frivolities other than employment that the government could use to strong arm people into buying health care.

So, please spread the word that Amendment 56 is a job killer, an economy stifler , and a union ploy to entrench their political power. Further, Amendment 56 is a cynical lie in that it pretends that employers will magically increase real employee compensation, and that employees are incapable of deciding how to spend their pay without government guidance.