The Roots of the Problem
Sep 25th, 2007 at 11:20 am by Susie
I thought this was pretty interesting:
The roots of the healthcare system’s current problems lie in World War II, when Congress sought to keep inflation in check by freezing workers’ wages. At the same time, however, lawmakers allowed companies to be as generous as they pleased with benefits.
As a result, employers competed for relatively scarce labor by offering plenty of perks, including medical coverage for workers and their families. By the time Congress lifted the wage cap after the war, employer-based health insurance was a routine part of workers’ compensation.
A pivotal moment came in 1950 when GM and the UAW were negotiating autoworkers’ contracts. The head of the union, Walter Reuther, believed universal coverage should be the law of the land, and that GM should lead the way in ensuring that all employers in all industries provided equitable health benefits to workers.
GM’s president, Charlie Wilson, balked at the notion. Instead, he argued that each company should look after its own workforce to the best of its ability. In the end, Wilson won out, and the foundation of the U.S. healthcare system was in place.
Today, GM finds itself with crippling healthcare costs and 47 million Americans are uninsured.
