Business and Labor
Business and labor undergird the Republican and Democratic parties respectively. However, many in the business community think that President Trump is driving our nation right off the cliff with his trade and immigration policies and general divisiveness and incompetence, and they are supporting Democrats in growing numbers. Likewise, too many white working class workers found President Trump’s messages on trade and immigration appealing and voted for the President in the last election despite the positions of their union leadership. White middle class men and women are respectively split between the appeal and utter revulsion they feel for the nation’s president.
Neither business nor labor have been particularly effective in promoting the sorts of necessary reforms that are ultimately beneficial to America’s long term best interests and too often they simply checkmate each other’s efforts. We would all be far better off if they began to sit down together and hash out the best ways forward for our nation. In fact one could argue that the effectiveness of Presidents Clinton and Obama was their ability to mesh the best of their competing agendas into a strong economic and social agenda for the nation.
I see potential for business and labor negotiating agreements where they have common ground” on rising health costs, on the threats of climate change, on improving the US educational system, and on improving the competitiveness of US manufacturing. After 45 years of experience with health reforms and health policy, I feel confident in saying that without that level of agreement we cannot make the progress we need to make in controlling the nation’s rising health care costs.
In founding ITUP (Insure the Uninsured Project) well over twenty years ago, I had hoped to develop common ground among business and labor on coverage for the uninsured and on slowing the rise in health costs. We had good participation from the small business community who were looking for better ways to get coverage for their workers and from elements in the state’s agricultural community who were looking to develop a better system for low wage agricultural workers. Likewise we had good participation from elements of labor concerned with coverage for flex workers (the gig economy), and low wage work forces such as child care workers and home care workers. The Affordable Care Act (ACA) met many of these important needs, yet needs to be built on to make it far more affordable for moderate and middle income working families.
However we never developed adequate and sustained participation from either big business or big labor to promote any practicable efforts agreed to by both sides. One of my observations was that the business community’s views were too often shaped by large hospitals and big insurers, by big pharma and big medical equipment suppliers, who were not ready to make necessary (or much of any) changes. Another observation was that many in labor were very happy with their own arduously negotiated benefit packages and were not that interested in addressing the broader systemic challenges that were leaving so many uninsured and rising costs and higher premiums for the employed workforce. Furthermore elements of the labor movement benefited from the high prices of health care in the form of the higher salaries they enjoyed compared to other sectors of the nation’s economy. Many of the ACA’s elements designed to slow the rise in health spending have worked; however, many of its fail-safe provisions to cap the growth in health care costs for employers and employees and for Medicare subscribers have been repealed with the support of both business and labor.
Labor and business did play important and complementary roles in California’s 1982-3 reform packages that introduced selective contracting and abolished the state’s role in reviewing the health care industry’s capital expenditures. They played important roles in educating about and rolling out the Affordable Care Act. They have yet to become engaged in designing and developing the next steps of expanded coverage and better, more effective cost controls for the nation even though they are paying providers at very far above their costs.
To really see the changes that are urgently needed to slow the rise in health care, we need new business labor coalitions to form and reach agreements, locally, regionally and statewide. They cannot lose sight of their common interests on health reform despite disagreements on a host of other issues where they may have profound and understandable, differing and likely irreconcilable points of view.
Climate change, if unchecked, is going to destroy the habitability of our planet, and many who live on it. Climate deniers are living in a fantasy world fanned by the flames of self-interested industries that benefit from the status quo and they have taken over the Republican part in Congress and the White House. The urgency for action cannot be understated. There is a recognition on the part of many of what needs to be done, yet business and labor interests have not been able to separate from the deniers in their midst and overcome the partisan divides in our country and forge the necessary changes to our nation’s and the global economy. A new economy with far better fuel efficiency, a refundable carbon tax, more reliance on renewables, greater use of electric cars, solar panels, wind turbines, reusables and recyclables is partially happening already, but still waiting to be created on the necessary scale to slow and stop climate change here in America. It won’t happen without disruptions in the older American economy of large gas guzzling trucks and cars, of the fossil fuels industry, of the energy industry, of transportation, and of gilded age conspicuous consumption patterns, like McMansions and private airplanes. There needs to be a steadily accelerating glide path to reducing climate change from the present towards our shared future (and that’s not on Mars or the Moon).
We have educational systems that are failing to serve the low and moderate income students and provide them opportunities to exit poverty, that are bankrupting too many of today’s college and graduate students and their families with soaring tuitions, and that are not run with the needs of students first and foremost in the minds of policy makers. They are not well equipping enough of our high school and college graduates to compete in the modern and evolving economy. Rural students, inner city students, students of color, immigrant children are not being taught as well as they need to be. See for example the recent student performance by income and ethnicity of students at LAUSD (Los Angeles Unified School District) and the other large urban school districts in California at https://home.lausd.net/apps/news/article/925831. The state of California and the LAUSD have been reluctant to even identify the schools needing the most improvement due to pressures from state and local teacher’s unions, yet if we can’t name and identify our problems, how can we begin to fix them. http://laschoolreport.com/for-the-first-time-in-six-years-california-names-its-lowest-performing-schools-here-are-the-110-lausd-schools-that-require-intervention/ The US was the first nation to institute public education for all and the earliest and most successful leader in public education; however that progress has not been maintained, and we have now fallen to mid rank globally. https://www.businessinsider.com/us-ranks-27th-for-healthcare-and-education-2018-9 California’s public schools, which used to rank in the top 5 in our country, now have fallen to 37th in the nation. http://worldpopulationreview.com/states/public-school-rankings-by-state/ We need the best public education possible for every student to compete whether in technological advances or in skilled manufacturing.
We have fallen behind China as a manufacturing powerhouse, even though our infrastructure is still very strong. https://www.brookings.edu/research/global-manufacturing-scorecard-how-the-us-compares-to-18-other-nations/ The problem is that for too many years we sat on our global manufacturing lead and failed to update our manufacturing base. Now we need strong national policies focused on improving American manufacturing, beginning in the industrial Midwest. Trump’s protectionist policies on trade, immigration, reliance on fossil fuels and increasing income inequality are taking the nation in the wrong direction. The Brookings study suggests the sorts of industrial policies that our next President needs to embrace: political and economic predictability, and open trade policies; proper financial incentives to promote innovation, education, and workforce development; 21st century tools such as Big Data, automation, and artificial intelligence; technology research and workforce development, and finance the necessary physical and digital infrastructure to support business development. You’d have to grade the Trump Administration somewhere between a D minus and an F on reviving and building on the strengths of American manufacturing; his sole shining moment was the cut in the corporate tax rate, albeit poorly targeted and performing primarily to generate short-term profits and stock buybacks without the long-term productivity gains which are the only true path forward.
Business and labor need to form the partnerships designed to move us forward. There are already some such partnerships that are taking us backwards. For example US steel manufacturers and the steel worker’s union can agree on protectionist barriers such as tariffs to keep out foreign steel manufacturers, these are not the types of agreements our nation needs. Coal companies and miner’s unions can agree on the need to promote coal burning power plants; these are the wrong types of agreements as well. School districts and teacher’s unions may agree to keep out the development of well-run, high performing charter schools; again these are not the types of business and labor agreements that move us forward. After years of mutually satisfactory backscratching that led to the near total collapse of the US domestic car manufacturing, the Obama Administration, the car manufacturers and the autoworker’s union agreed on a series of reforms to revive and restore the competitiveness of US car manufacturers, that is the type of forward looking reforms we need to promote. After the Trump administration deep-sixed the Obama era rules to improve car’s fuel administration, the state of California and four major car manufacturers reached voluntary agreements to improve fuel efficiency and reduce green house gases; these are the types of reform agreements our nation urgently needs.
We need presidential candidates who will develop and promote business, labor and government (as needed) partnerships to move the needle on the important issues confronting our nation. We do not need a lot of rhetorical hot air and over-heated blame gaming and excuse making. We need political accountability, realistic promises made and delivered. We need an inclusive vision of our shared future and practical plans to get there. The last three years have set our nation back on so many fronts, both domestically and globally. Yet in many states, cities and counties, in many workplaces, and in many institutional settings, we are still moving forward despite the chaos, division and corruption emanating from 1600 Pennsylvania Avenue and that big domed building down the street. We cannot afford to waste any more of our time and the nation’s energy on backward looking nostalgia when our times call for renewing our democracy, refurbishing our health and education, saving our planet from global warming, and accelerating and more widely sharing the benefits of economic growth.
Prepared by: Lucien Wulsin
Dated: 10/22/19
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