Stop Me Before I Vote Again

Called a “single payer health solution” for America's big three auto families, the proposed grand health VEBA is really just one big corporate rip dip and shift -- a massive Enron-scale financial fraud that will end up sticking it to workers one way or other, either through direct charges to workers or in a bailout by corporate field-dog, Uncle "Fetch and Carry" Sam.

http://labornotes.org/node/1248

What's a VEBA, comrades? Stands for Voluntary Employees Beneficiary Association. It takes some solemnly-promised stream of benefit payments off the books of corporate America -- in this case, the future wage-employee health payment obligations of Chrysler, Ford and GM -- for a one-time, good-faith, duly-diligent, fairly and squarely discounted lump-sum pay-in to a very specially chartered nonprofit -- in this case union-administered – fund. And what happens then? Well, it's all in the numbers really.

Looking with gimlet eye at this auto VEBA, I'd say it's likely to become the absolutely biggest bust yet. Despite the union's heroic efforts to "responsibly" offload as much as possible of the upcoming payment stream back on the retired workers themselves, the time will come when the fund goes bump in the night. Enter Uncle Sap.

By that point the workers will, by honest accounts, have paid for it all at least twice already -- first up front, in corporate promises in lieu of wages, and at the back end, in passthrough charges in lieu of funds. And the “health” industry will no doubt manage to extract a third payment from the man in the striped suit. What remains unpaid out of the bills overcharged, will prolly in a burst of state generosity -- after a union leadership heartswelling sturm-und-drang worthy of Rock Hudson -- end up on Uncle's famous riskless tax-backed people's credit card.

PS:

My favorite mild underlining in the labor notes story linked above: "Business analysts claim... under-funding is one of the key advantages of a Big-3 VEBA solution." Care to give a better working definition of a corporate welfare state?