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Friday, January 13, 2006

Wal-Mart commentary: Del. Niemann's reply

(Posted 13 Jan 2006)
Posted and forwarded as requested by Del. Niemann:
From: Del. Doyle Niemann
Date: Jan 13, 2006 8:31 AM
Subject: RE: Updated commentary: What do PG legislators really stand for?
To: "Diane C. Russell", pg-politics@yahoogroups.com, pg-politics@googlegroups.com, PrinceGeorges_Discussion@yahoogroups.com


I dare you to post this response to your comments about the veto of the Fair Share Health Care (“Walmart”) bill.

I would suggest a different way of looking at the issue. Rather than an effort by government to impose its will on the “free market,” the Fair Share bill was an effort – a very small effort, to be sure – to protect the marketplace in ways that work to the advantage of far more individuals and businesses than any alternative.

For better or worse, we made the decision in this country long ago that health care benefits are going to be provided to the majority of our people through the market – specifically through employers. That was not the only possibility. Most other industrialized nations assign this role to the government and so have government control over health care. But here, we have built a system over the last 60 years or more whereby employers provide benefits and the cost of doing so is passed on, as costs are always done, in tiny increments as part of the cost of goods and services.

Government, under this model, steps in to fill in some of the gaps – those deemed socially important – for the elderly, disabled and children. This is necessary because there is no employer available.

By and large, this system has worked – and has provided us with what is arguably the most expansive health care system in the world. To be sure, there are still large pockets of people who do not have access to health care coverage – primarily workers for very small businesses, the unemployed, and individuals not eligible for government-sponsored programs.

So long as everyone follows the rules of this approach, it is a viable way to give people tremendous amounts of choice and still provide benefits across the board.

And remember, the cost of not having health care access are immense to everyone – lost productivity, social and family disruption, higher taxes, bankrupt health care facilities (like PG Hospital), etc.

The problem we face now is that some big employers have decided that they can gain a competitive advantage by cutting health care benefits. And with the average business paying 16% of payroll for health care benefits, this can be a big advantage, too.

I say “big” companies because that is where the change is occurring. In the small business world, benefits have always been an iffy thing, but in the world of bigger businesses, until recently, the assumption that providing benefits was necessary has been the dominant rule.

When a company like Walmart – the largest retailer in the world – engages in this kind of practice, the repercussions are immense because they are undermining other big businesses that do provide benefits.

So what is Giant or Safeway or JC Penny or Sears or Costco or Macys or any number of other competing companies to do. If they want to protect their market share and be “competitive” they have to do the same thing and cut benefits.

Go down this path a bit and pretty soon benefits disappear for hundreds of thousands or millions of people. The “rules” of the game have changed and the market approach is no longer viable.

But the costs remain because people still get sick and need care.

The answer, then, inevitably will be for the government to step in and pick up the pieces. And if you believe that government is more inefficient than the private sector, you will understand that the costs will go up as bureaucracy goes up and choices go down.

The fundamental question is whether we are going to have a market approach towards providing health care benefits or a government approach.

That is what was at stake in this vote. The Walmart approach – while perhaps “logical” from their individual corporate position – undermines the foundations of the entire system for health care. If we don’t take a stand now to define the “rules” of the game when it comes to health care benefits, we will shortly face a situation where are choices are much worse.

Thanks for all the work you do in getting discussion going.


Del. Doyle Niemann
District 47

301-858-3326 Annapolis
301-952-3239 work (State's Attorney's Office)
301-864-1746 home
240-606-1298 cell


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    If Walmart pays for health care rather than the employee, or, if Walmart subsidizes any of the cost to the employee, then the cost is passed on to consumers like me. Why in the heck should I pay the health care cost of Walmart employees?

    Paul Bee

  2. I think the fare share health care bill is great as it will help many receive health coverage.