Ford, the UAW, and the Public Option

If you want any further proof that government run health insurance will run private health insurance into the ground look at Ford and the United Auto Workers. The union which along with the federal government owns GM and Chrysler has refused to adjust its contract with Ford to match that which it has with the government owned auto makers. “The deal would have brought the automaker’s labor costs in line with General Motors Co GM.UL and Chrysler Group LLC, both of which won additional concessions as part of their government-financed bankruptcies.” [Quotation from the above link.] The union’s rationale for rejecting contractual readjustments is that Ford is in better economic shape than its American rivals. Not for long if Ford’s labor costs are much greater than its competitors.

The UAW made concessions to GM and Chrysler because the government forced them to. When the government runs a health insurance scheme it will do the same thing. It will adjust its contracts any way it wishes. If these readjustments lose money the tax payers will cover the difference. Private health insurance companies will suffer the Ford Effect. They can only lose.

Ford took no federal money and ran its business better than its bankrupt but bailed out competitors. It’s now going to suffer for doing a better job than its profligate and mendicant competition.   This is the new American way.

And while we’re at it, how does Ford negotiate with the UAW which owns a piece of GM and Chrysler. Is there not some conflict of interest here? It’s not just the camel’s  nose that’s getting into the tent.

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