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a citizen’s journal by Thomas Nephew

Fair Share Health Care veto override vote soon

Posted by Thomas Nephew on 9th January 2006

Maryland’s Fair Share Health Care Act, passed last year, promised to require companies with over 10,000 employees in the state to pay at least 8% of payroll for health insurance, or pay the shortfall into the state’s Medicaid fund. The only company in the state that’s likely to be affected is Wal-Mart; while other large employers like Northrop Grumman and Johns Hopkins University pay decent health benefits, Wal-Mart — by its own admission — does not. From an internal memo leaked in December:

Wal-Mart’s critics can easily exploit some aspects of our benefits offering to make their case; in other words, our critics are correct in some of their observations. Specifically, our coverage is expensive for low-income families, and Wal-Mart has a significant percentage of associates and their children on public assistance. […]

In total, 46 percent of Associates’ children are either on Medicaid or are uninsured

Republican Governor Ehrlich vetoed the bill in May — in a notably disquieting scene in the Eastern Shore town of Princess Anne, with high ranking Wal-Mart executive Eduardo Castro-Wright delightedly looking on as protesters were literally silenced and forbidden to display signs by the local sheriff.

Now the long-awaited attempt by the Maryland legislature to override that veto is finally at hand. In December, the Washington Times’ S.A. Miller reported:

“The House leadership is considering the bill one of the top priorities, if not the top priority,” said [House Majority Whip Anthony] Brown, a Prince George’s Democrat who is also the running mate of gubernatorial candidate Baltimore Mayor Martin O’Malley. […]

Mr. Brown said he was “pretty confident” the General Assembly leadership will secure the requisite 85 House votes to override the Wal-Mart veto when the session convenes Jan. 12.

Sen. Andrew P. Harris, a Baltimore County Republican and the minority whip, expects the veto also to be overridden in the Senate, despite “having every Republican supporting the governor.”

The latest volley in the debate has come from the Maryland Chamber of Commerce, which released a legal opinion last Wednesday that the bill conflicts with the federal Employee Retirement Income Security Act (ERISA). Maryland Gazette.Net’s David Tallman explains:

Under ERISA, the federal government prevents states from requiring employers to provide a certain level of benefits.

“It has a fairly sweeping pre-emption to any state legislation covering employee benefit plans,” said Ronald W. Wineholt, the chamber’s vice president for government affairs.

Not everyone agrees:

Phyllis C. Borzi, who teaches law at the George Washington University Medical Center, said Smith’s analysis would have been valid 10 years ago, but since a 1995 decision, the Supreme Court has given states more control in regulating employee benefits.

Unless state laws specifically prescribe the kinds of benefits, they will not be pre-empted by ERISA, Borzi said.

So suddenly we’re for national employee benefit standards, are we? Let’s check back with the Maryland Chamber of Commerce when a national health care debate gets back in the headlines. The same warning can be given to Governor Ehrlich, who’s criticizing the Act as a new business tax. Yet it’s one that will be a drop in the bucket (politically, if not financially) compared to a national health care system — the chief alternative for providing decent, paid-up health care for those 46% of Wal-Mart “associate” kids. Assuming, for the sake of argument, that Ehrlich and his pals give a damn about them in the first place.

Don’t get me wrong — like Mark Schmitt, I’d prefer a national health care system to a patchwork, Rube Goldberg scheme stitching together Medicaid, employer based benefits, and the rest of it. But I don’t support making the perfect the enemy of the good. And as Schmitt observes, “You only get political consensus for public benefits when there’s pressure for employer-based benefits.”So in the meantime, I want the Fair Share Health Care bill. The Chamber of Commerce may hate it, but not all businesses do; one of the major reasons the bill passed was that Giant Foods CEO Dick Baird supported it — it levels the playing field between his company, paying decent wages and benefits, and the Medicaid-freeloaders at Wal-Mart. Public subsidies for working Americans should not be allowed to result in competition-altering wage and benefit pressures on unionized companies.

You can support the Fair Share Health Care bill by sending an e-mail to Maryland delegates and state senators via Maryland for Health Care.

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UPDATE, 1/9: Wake-Up Wal-Mart provides links to Maryland legislators:

You can contact your legislators by email via this page, find out who your legislators are via this page, or you can talk to them directly by calling the Maryland General Assembly switchboard and asking for them. The phone number is 410-841-3000.

UPDATE, 1/12: Washington Post: Md. Senate Overrides Veto on ‘Wal-Mart Bill’. YAY!

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Maryland Fair Share Health Care fight heating up again

Posted by Thomas Nephew on 17th November 2005

The Washington Post’s John Wagner reports (“Wal-Mart Girds for Battle on Md. Bill“):

Preparing for a showdown with organized labor in the Maryland legislature, Wal-Mart has deployed at least a dozen Annapolis lobbyists and is making strong overtures to black lawmakers, including a $10,000 donation to help them pay for a recent conference.

The company is hoping Maryland legislators will sustain Governor Ehrlich’s veto of the Fair Share Health Care bill, which mandates that Maryland companies with more than 10,000 employees spend at least 8 percent of payroll on health care, with any shortfall paid into a state Medicaid fund.

It will be close in both houses; Wagner reports that the Senate cleared the requisite three-fifths majority by just one vote in the spring. The House of Delegates was one vote shy of that hurdle, although several delegates were absent from the vote. And Wal-Mart is hiring some of the fastest guns in Annapolis to fix the problem:

State Ethics Commission records showed Wal-Mart retaining 12 lobbyists as of last month, nine of whom registered in October. Among the new recruits were Joseph A. Schwartz III and J. William Pitcher, both among the 10 highest-paid lobbyists in Annapolis last year, receiving more than $500,000 each from clients.

Some of the lobbyists seem particularly well chosen to have extra “pull” with — and even “pillow talk level” access to — their targets:

Other lobbyists registered to represent the company included Pamela Metz Kasemeyer, the wife of a state senator who voted for the bill; a father-and-son team, George N. Manis and Nicholas G. Manis, well known at the State House; and Frank D. Boston III, an African American who represented Wal-Mart during the past session.

I think it was LBJ who said something like “if you can’t drink their wine, [@#*!] their women, and still vote against them, you’re in the wrong line of work.” I guess we’ll see about the professionalism of the Maryland political class in the coming days and weeks.

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Subject: Suppression of protest at Ehrlich veto ceremony

Posted by Thomas Nephew on 2nd June 2005

To: Chief Russell M. Pecoraro
Princess Anne Police Department
Princess Anne, Maryland

Dear Chief Pecoraro,

As you know, Governor Ehrlich recently chose to stage his veto of the Fair Share Health Care Bill in Princess Anne. While I was disappointed with that veto, I’m now reading with increasing disbelief in the Washington Post, the Baltimore Sun, the Salisbury Daily Times, and in a press release by the Maryland Democratic Party that your police department — and you personally — prevented protesters from displaying signs, booing or making other vocal protests, and generally from exercising their full First Amendment rights to protest that veto. A WBAL-TV broadcast makes a similar report, and also seems to show your personal involvement in this intimidation.

I hope there is some misunderstanding, since I hope no competent American police officer would make such a poor, unconstitutional, and frankly un-American decision. I’ve neither read of nor seen in TV footage any hint or threat of violence from any of the protesters that would be the only remotely conceivable justification for such serious infringements of a fundamental right. One remaining reason for American troops fighting and dying in Iraq is that they are hopefully extending freedom to those who did not have it. It would waste their sacrifices if you were meanwhile denying the most basic freedom of all to their own fellow citizens.

But if these reports are true, by what or whose authority did you believe you could override the Bill of Rights of the United States of America? I hope it wasn’t merely on the suggestion of some Wal-Mart representative or governor’s aide! Was this decision the result of a direct order from someone, perhaps Governor Ehrlich himself or your town manager, who you felt you could not refuse? Even if it was, it was your duty to refuse such an order; no federal, state or local government has any business whatsoever telling people they cannot protest vocally and with signs, however unwelcome their opinions may be for that government, their police, or their community.

Or was this simply a poor decision that was completely your own responsibility? If so, a prompt apology to the protesters involved and to the people of Maryland might be the wisest course of action. That alone might convince Marylanders that they need not fear censorship or the power of the state as they freely and rightfully voice their opinions. If that is your goal, of course, it would be even more convincing and honorable to resign your post as well. If you did it under orders, those who gave them should also be held responsible.

I look forward to any responses, which I will share with others interested in this issue.

Sincerely,
Thomas Nephew
Takoma Park, Maryland

CC: Winslow Parker (Town Manager, Princess Anne, MD )
James Fisher
(reporter, Salisbury Daily Times)
Governor Robert Ehrlich

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NOTES: For a post on the imminent veto that leads to others about the Fair Share Health Care bill itself, go to “Ehrlich expected to veto Fair Share Health Care today.” (The protest suppression is noted there in an update.) The relevant excerpt from the 5/20 Salisbury Daily News article by James Fisher (article must be purchased): “Before the ceremony began, police officers told the group not to shout, chant or wave banners, instructions that frustrated some of them.”There’s no signs, either for or against the governor,” a police officer said to Glenn Schneider, executive director of Maryland Citizens’ Health Initiative.”They’re saying we can’t boo, we can’t yell, we can’t show our banners,” Schneider complained a moment later. “We can’t do anything.”
UPDATE, 6/14: So far, no replies. I found this quote at a WMDT-TV (Delmarva ABC station) report: “They just want to push how far they can go before they get locked up, and I said, ‘look, we have laws here like anywhere else,'” says Pecoraro. A protester’s apt comment: “This kind of climate works in China, but it shouldn’t work on the Eastern Shore of Maryland,” says [Tom] Hucker.

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Ehrlich expected to veto Fair Share Health Care today

Posted by Thomas Nephew on 19th May 2005

Maryland Governor Rob Ehrlich plans to veto the Fair Share Health Care bill today, the Baltimore Sun’s Andrew Green reported yesterday. The bill requires large (10,000+ employees) Maryland companies to spend 8% of payroll on health care, or make up the difference to a state Medicaid fund. The company most likely to be affected is Wal-Mart, which is notorious for having employees on state-supported health care rolls.

Ehrlich will veto the bill in Maryland’s Somerset County, supposedly highlighting the risk that Wal-Mart will halt plans to build a distribution center there. The problem is, his own administration is contradicting that:

But state officials now say they expect the retail giant to build a distribution center in Somerset County – even if the legislature overrides the veto – because of the incentives Maryland has provided and the market opportunity Maryland presents.

So rather than costing Somerset County jobs, Fair Share Health Care would merely lower Wal-Mart profits and increase state health care funding. Still, that’s plenty good enough reason to veto the bill — if Wal-Mart’s your sugar daddy.

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UPDATE, 5/20: Washington Post, 5/20: “Ehrlich Vetoes Health Care Bill Aimed at Wal-Mart.” Ehrlich’s corporate master attended in the form of Eduardo Castro-Wright, the second-ranking executive at Wal-Mart’s U.S. division. A nice touch by the powers that be: About two dozen protesters turned out, but were forbidden from displaying signs. WTF?! No mention who forbade the signs, or why.

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Fair Share, SEIU, WalMartWatch.com

Posted by Thomas Nephew on 23rd April 2005

The Fair Share Health Care act in Maryland — which has drawn the ire of Wal-Mart for daring to require it to spend more money on health care — has stirred up a lot of interest around the country. The story of how it got passed this year is also pretty interesting. A Baltimore Sun article reports:

Last year, the Maryland Citizens Health Initiative, a group seeking to help those without health insurance, proposed a tax on employers that don’t provide health benefits. That idea didn’t get far in the legislative process. But an effort to expand health coverage to uninsured Marylanders by taxing health maintenance organizations made more headway, narrowly failing in the state Senate.

“With the failure of that bill on the floor of the Senate last year and the failure to override the governor’s veto on the living wage bill, there was a sense in the Senate that they needed to deliver on high-profile working family bills this year,” said Tom Hucker, executive director of Progressive Maryland, which worked on the Wal-Mart bill.

Enter the SEIU and its Americans for Health Care network. The Maryland branch, Maryland for Health Care, helped generate grass roots pressure for the bill. That, the prior year’s legislative defeats, and the fact that Maryland hospitals can fold uninsured patient costs into their costs for everyone else, made the Fair Share Health Care an attractive proposition to many Maryland legislators. As noted in an earlier post, the support of Giant Foods was also key. The company, which pays comparatively decent health benefits, wanted that not to put it at an unfair disadvantage vis-a-vis Wal-Mart.

For their part, Americans for Health Care aren’t stopping with Maryland. From the Baltimore Sun report:

Mueller, the union spokeswoman, said SEIU is working on legislation in Washington and Colorado that would require the states to gather data on how many employees of various companies are enrolled in state-funded health care programs. Once taxpayers realize how much they’re subsidizing Wal-Mart, they’ll push for legislation like Maryland’s, she said.

Meanwhile, SEIU president Andy Stern is also on the board of directors of a great new site, WalMartWatch.com. On the “About Us” page, the organization lays out its goals:

To fight Wal-Mart on the streets, in the media, and in the customer’s mind!By serving as a virtual meeting place, research hub and strategic “war room” for the growing Wal-Mart reform effort, WalmartWatch.com will:

  1. Catalyze disparate opposition into coordinated action (online and off);
  2. Facilitate communication and cooperation between existing reform efforts;
  3. Increase and share knowledge and expertise about Wal-Mart;
  4. Create a common language and demand set thru an aggressive PR campaign;
  5. Develop and promote new strategies, policies and legislative strategies.

The jury is still out on the ultimate success of both of these ventures, but they’re getting noticed and having some real impact, and that’s good to see.

As for the Maryland Fair Share Health Care Act: if you’re a Maryland resident, you can help by sending an e-mail to Governor Ehrlich demanding he not veto this eminently sensible bill.

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Bad advice

Posted by Thomas Nephew on 19th April 2005

If you have an effective tactic in fighting a powerful foe, there’s a rough way to tell who your allies aren’t. They’re the ones who counsel you to forswear using that tactic for one odd reason or another. Sometimes it’s because it doesn’t solve every problem they can think of; other times, it’s because they feel it was once abused by the other side. As a frequent, smarmy bonus, they’ll profess to have your deepest interests and ideals at heart.

But if there’s nothing else wrong with the tactic, then what you’re hearing is your opposition’s fondest wish masquerading as friendly advice. And whether that advice is malicious or merely foolish hardly matters as much as the size of the bullhorn amplifying it.

Recent examples — in the well amplified Washington Post and New Republic — concern the Maryland Fair Share Health Care Act (a measure requiring large businesses to make up health benefits short of 8% of payroll to a state Medicaid fund), and the looming abolition of the filibuster process in the Senate (the right of 40 Senators to prevent a vote on an issue by continuing debate indefinitely).

Fair Share Health Care
Here’s Steve Pearlstein, business writer for the Washington Post, criticizing the Maryland Fair Share Health Care Act :

If, as a society, we decide that everyone ought to have health coverage within the context of an employer-based system, it is a mystery to me why anyone thinks small businesses should be exempted. […]

Of course, the only reason the Maryland legislature got involved in this issue in the first place is because the federal government has done bupkes about falling health coverage and rising health costs. […]

I also doubt that local politicians would be so eager to join efforts to contain and punish the country’s largest employer if the National Labor Relations Board hadn’t effectively abolished the right of Americans to join labor unions. Wal-Mart is hardly the only company to thumb its nose at the Wagner Act, but it is one of the biggest and most brazen in its anti-union techniques. If faced with a credible threat that employees might unionize, Wal-Mart would have no choice but to offer better wages and health benefits.

Here we learn that we must unravel all the imperfections of the world before we can solve the one in front of us. Why we can’t solve Wal-Mart’s freeloading one way, and solve the (different) small business issue a second way, is “a mystery to me,” to borrow Pearlstein’s phrase. Not only that, we need to redesign or reconsider employer-based health care, too; Pearlstein probably just forgot to include abolishing the Electoral College. And why should Maryland politicians wait for a restored federal NLRB and labor laws worth the name, instead of getting after Wal-Mart’s “cheating, not competing” business practices in their state right now?

Filibuster
Similarly, we have Jonathan Cohn arguing in the New Republic for giving up the filibuster. The heart of his argument is discomfort with the past history of the tactic — not so much that unpleasant business of Dixiecrats thwarting civil rights, mind you, but that

…since the 1970s, there have been hundreds, plus many more “silent” filibusters in the form of threats that simply prevented legislation from coming to the floor. As a practical matter, the Senate now passes most major laws only when 60 of its members agree.

Suddenly, this essentially esthetic objection is what needs fixing, not the urgent matter of thwarting judicial nominations that would derail 70 years of American jurisprudence and social policy:

But, while the whole point of the U.S. government is to thwart “tyranny of the majority,” the filibuster has arguably gummed up the works too much, making shifts in public policy so rare that voters have grown increasingly angry at the apparent unresponsiveness of government–an emotion Republicans have proved particularly adept at exploiting lately. The majority party shouldn’t get to be tyrants, but they should get to be legislators. That is why the filibuster needs to be severely curbed or even junked altogether, and not just for judicial nominations.

In pseudo-reasonable fashion, Cohn continues,

This isn’t to say Democrats should simply forfeit the fight over conservative judges or any other matter. But, in the long run, it is a mistake to make such battles about legislative process rather than public values. Excessive appeals to parliamentary fairness merely reinforce the public’s sense that Democrats care more about legalisms than the difference between right and wrong.

But it’s hard to see how the Democrats do anything but forfeit the fight over conservative judges if they let the filibuster go. Even if the filibuster has “arguably gummed up the works too much” in the past, Democrats shouldn’t now selflessly wave good-bye to it just so Mr. Cohn can watch his idealized government gumball machine execute some cool public policy shifts.*

I don’t think every conceivable political tactic is acceptable. I think that Democratic state legislatures should not engage in extra redistricting to juice up their state’s representation in Congress — let’s leave capricious voter disenfranchisement to the DeLays of this world. (On the other hand, I think threatening retaliation in kind for future Texas or Georgia-style redistricting shenanigans is fair game.)

Philosopher kings ‘Rn’t Us
Someday, in a wonderful world in which the only remaining political arguments are “vanilla or chocolate?” and “paper or plastic?”, the filibuster will have outlived its usefulness, we’ll have health care that leaves no patient behind, and the lion will lie with the lamb. But until then we’ll need imperfect tools like Fair Share or the filibuster to get us a little closer to where we want to be (or keep us from losing our way even more).

Incredibly, Cohn opens his argument with these words:

Things look relatively good for the Democrats right now. Social Security privatization is practically dead, Tom DeLay is actually on the defensive, and President Bush’s approval rating is below 50 percent in many polls.

Cohn sees a way out of that mess: dump the filibuster! No more American public angrily drumming its fingers, waiting for the minimum wage to be declared unconstitutional! Cohn — writing from the leafy academia of Ann Arbor, Michigan — seems to have mistaken politics in the U.S. for an abstract chess match between philosopher kings.*

Senate Democrats are not wielding the filibuster threat for mere issues of legal process. Maryland legislators aren’t leveling the health care playing field to amuse themselves. Anyone who truly counts himself as a friend of Democrats, of labor, or of the working classes generally should know that. Anyone else shouldn’t pretend they’re offering sincere advice.

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* For a checklist of the policy shifts a-comin’, see Jeffrey Rosen’s NYT Magazine article on the “Constitution in Exile” crowd (“Unregulated Offensive“). Social Security, minimum wage, National Labor Relations Board, Endangered Species Act — all unconstitutional via expansive or narrow (as convenient) interpretations of the Article Icommerce clause,” and the 5th and 11th Amendments, among others. That is, if enough troglodytes like William Pryor are railroaded through after Frist’s “nuclear option” blows open the pass. Rosen’s article, incidentally, shows up Clarence Thomas for a liar in his confirmation hearings and a plagiarist in his court opinions.
** Cohn’s rarefied outlook seems more endemic than usual within TNR. In another recent New Republic article, Noam Scheiber inexplicably supports some Democrats inexplicably “closing ranks behind legislation that would allow federal courts to review cases in which end-of-life choices are murky and the family is divided.” As Patrick Nielsen Hayden put it,

“…oh, I get it. The ruling right-wing coalition has one area of serious political vulnerability: people suspect they’re busybodies far too interested in nosing around their neighbors’ morals.

Therefore, Democrats and liberals should emulate them in this. That will make us more popular.

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Fair Share idea spreads to New Jersey… and beyond?

Posted by Thomas Nephew on 13th April 2005

Newsday’s Angela Delli Santi reports (“Newsday.com: Lawmaker wants better health care for Wal-Mart workers“):

Major employers such as Wal-Mart would have to spend more money on health care for their New Jersey workers under legislation being crafted by a state lawmaker.

Assemblyman Louis Greenwald, who contends that Wal-Mart profits are fattened by the company’s skimpy health care plans, is preparing a bill that would require large employers to spend at least 8 percent of their payroll on employee health insurance.

Meanwhile, Tennessee superblogger Southknoxbubba linked to one of my Maryland Fair Share posts, giving me the chance to point out to that this plan might bring some needed revenues to Tennessee’s beleaguered “Tenncare” system as well. As the AFL-CIO pointed out early this year:

One out of four Wal-Mart workers in Tennessee have to go to the state’s social authorities to get their health care costs paid. A survey by TennCare and the state Department of Labor, quoted at the AFL-CIO website, found 9,617 of the retailer’s 37,000 workers were enrolled in TennCare, designed to provide health care for low-income workers.*

Now I’ve been out of the Volunteer State for a while, but my impression was that Tennesseans are like anyone else and don’t like freeloaders one bit. Here’s a big one, and it’s helping sink a decent health care program right out from under them.

I think the Fair Share Health Care idea has real legs. I’d much rather they supported it, but something like this also has the potential to leave a lot of Tennessee Republicans (and sadly, perhaps Democratic governor Bredesen as well) caught flat-footed when the whirlwind passes over. The more so if that god-awful bankruptcy bill puts more Tennesseans at the poor house door in the years to come — or, worse for status quo politicians, in front of TV cameras.

Will Fair Share “make my red state blue”? Probably not any time very soon. But meanwhile, it’s satisfying to latch on to a strategy of my own and giddyup that little pony down the road. Feel free to come along.

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* Via a second SouthKnoxBubba post, here’s an AP story discussing this study — commissioned by the Chattanooga Times and published in January 2005. Wal-Mart is the tip of an iceberg in Tennessee, with temp agencies and Krystal coming in close behind in the numbers of employees forced to use Tenncare for their health needs. SKB feels this argues for simply decoupling health care and employment. Maybe so, in the long run. In the meantime, I think Fair Share plans help avoid penalizing businesses that aren’t short-shrifiting their employees.

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Washington Post opposes Fair Share Health Care

Posted by Thomas Nephew on 11th April 2005

Last week, Maryland legislators passed the Fair Share Health Care Act, requiring companies with more than 10,000 employees which didn’t spend 8% of their payroll on health care expenses to make up the difference in payments to a state Medicaid fund. Quite by design, this legislation affects Wal-Mart, a company notorious for freeloading health care in state after state around the country.

Today, the Washington Post editorialized against the legislation (“Right Problem.Wrong Solution”), concluding

The larger problem is 40-odd million uninsured Americans, and the soaring cost of health care, which has made it increasingly difficult for employers to continue providing benefits. The legislation in Maryland is a symptom of that problem, but surely not the solution.

But why the act must be “the” solution rather than part of it? The Post warns darkly of “populist stunts” and of its suspicions that some legislators are “piling on” Wal-Mart. Interesting notions. Maybe this editorial is a “capitalist stunt” by editors congenitally predisposed to preferring a rapacious company like Wal-Mart to the people’s representatives trying to pry it away from the public trough.

In its single halfway substantive argument, the editorial finds fault with legislation that basically singles out Wal-Mart by targeting companies with over 10,000 employees who spend less than 8% of their payroll on health care expenses:

Hundreds or maybe thousands of smaller firms in Maryland would also fail to meet the 8 percent threshold, and collectively their workforce may far exceed Wal-Mart’s. They are untouched by the legislation.

So is this legislation a kind of economic bill of attainder — or legitimate regulation of the marketplace? I say the latter. Both this Wal-Mart and its future emulators are served notice of the public’s intent that it is not legitimate to grow to 10,000+ employees by essentially freeloading their health care expenses on to the rest of the Maryland economy. The injured party here is not Wal-Mart, it is Giant Foods and other large Maryland companies who pay their employees decent wages and benefits, and then see their decent business practices undermined by Wal-Mart’s piratical ones.

Wal-Mart is not singled out by its name, it’s singled out by its practices — and, yes, by its aggregate impact on Maryland. The state’s legislators would be foolish not to target the single largest unnecessary drain on their state supported health care expenses. A given small business not meeting the 8% threshold remains just that — a small business. A global behemoth doing the same is much more than that. It’s a mortal threat to any other way of doing business — and preventing that is very much in the public interest.

The Maryland legislature has done the right thing. And the Washington Post should be ashamed to oppose this bill.

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HA! Maryland legislators end Wal-Mart freeloading

Posted by Thomas Nephew on 6th April 2005

Last week I mentioned that Maryland legislators were considering a “Fair Share Health Care” bill requiring large businesses to spend an amount equal to 8% of payroll on health benefits, making up the difference in contributions to a state fund earmarked for Medicaid.

They did it! The Washington Post’s John Wagner and Michael Barbaro report (“Md. Passes Rules on Wal-Mart Insurance“):

Maryland lawmakers yesterday approved legislation that would effectively require Wal-Mart to boost spending on health care, a direct legislative thrust against a corporate giant that is already on the defensive on many fronts nationwide.

They add that Governor Ehrlich is likely to veto the measure — but that both Maryland House and Senate majorities are likely veto-proof (some absent votes in the House are probably supporters). The Maryland Senate adopted some last minute amendments, but they don’t seem to have provided Wal-Mart (or would-be imitators) with a full-time employees-only loophole to avoid meeting the 10,000 employee threshold.*

If this goes through, the impact on Wal-Mart operations in Maryland could be interesting. If there’s no strong financial advantage to part-time employees, Wal-Mart might decide to go to a full-time employment model to reduce turnover and training costs. I suspect that could bring benefits of its own to communities and workers. While it’s been suggested they may downsize to get around the 10,000 mark, that seems like a stretch at their current level of over 14,000 Maryland employees.

Almost as interesting and encouraging as the news itself is the front page, above-the-fold treatment it got in the Post. Given room to expand on the topic, Wagner and Barbaro have made the article a one-stop shopping spot drawing attention to a number of other initiatives aimed at Wal-Mart. Familiar ones included the UFCW ABC News campaign and the Wal-Mart Fact Checker. But the Wal-Mart Litigation Project is a new one to me, I think I’ll check them out — thanks WaPo!

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* To be honest, my eyes glazed over trying to interpret the amendments, so I’m basing my guess that part-time workers count too on the absence of loud squawks from Maryland Health Care for All initiative — who apparently deserve huge praise and support for this success. They provide a succinct summary of the bill and its value to the public on their web site. The pull quote is particularly good:

All we ask for, and what we need, is a ‘level playing field’ where every employer pays their fair share, and where a company’s competitive advantage is achieved by means other than avoiding the provision of medical care coverage and shifting the costs towards those companies who do provide that coverage.
Dick Baird, CEO, Giant Food, Baltimore Business Journal, 2003

I plan to use that in my letter to Governor Ehrlich urging him not to veto this bill. I also plan to e-mail a letter of thanks to my state senators and delegates who supported this bill.

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Maryland legislators target Wal-Mart freeloading

Posted by Thomas Nephew on 1st April 2005

Steven T. Dennis and Catherine Dolinski of the Montgomery County Gazette report:

The House of Delegates and Senate Finance Committee voted Friday to impose an 8 percent payroll tax on large companies that do not spend that much on health care for their employees.

On Tuesday, however, the Senate Budget and Taxation Committee voted to recommend that part-time workers be excluded from the bill.

The Fair Share Health Care plan would tax the payrolls of companies of 10,000 employees or more, and has been dubbed by many as the ‘Wal-Mart tax’ based on the assumption that only Wal-Mart would be affected.

Advocates say the change by Budget and Taxation would exempt Wal-Mart and are hoping that Finance, the main committee on the bill, will reject the recommendation.
(link added)

The bill actually requires large employers to make up the difference between its health care benefits and 8% of its payroll. Any funds collected could only be used to support the Medicaid program.

According to an analysis by the Maryland Department of Legislative Services, just two other Maryland employers — the Giant supermarket chain and Johns Hopkins University — have over 10,000 employees. Under the Fair Share act, Wal-Mart would need to spend about $22 million either in health benefits for its 14,301 Maryland employees, or in the Medicaid-earmarked tax to the state of Maryland.

This is a great idea, and deserves your support. Wal-Mart is shifting health care costs to state after state, as studies in Arkansas, Georgia, California, Tennessee, North Carolina, and many other states show. As CE Petro points out, this effectively gives Wal-Mart another unfair swipe at its upstanding competitors who pay decent health benefits.

If you’re a Marylander, it’s worth a letter or e-mail to your state senator; here’s a locator to get you started. If you’re not lucky enough to live in our fair state, suggest it to your own state representatives.

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UPDATE, 4/4: The bill had already passed the House on 3/24 (blush), but will be considered by the Senate; a hearing is scheduled for this Wednesday. Hence, “delegate” was changed to “state senator” above. Note that it’s particularly important that the “part-time” exemption be dropped, since Wal-Mart’s strategy has always been to avoid paying benefits by mainly hiring part-time workers.

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