In 1975, Leonard Woodcock, then president of the UAW, tied the labor movement to making universal health insurance a matter of federal law. It is no stretch to say that Obamacare would never have become a reality without the active support of labor for nearly five decades. But labor’s commitment to what finally took shape in the Affordable Care Act may become the textbook case of a political backfire. Obamacare is killing unionism.
The recent rejection of the UAW at Volkswagen’s Chattanooga plant presents only the latest chapter in the erosion of labor’s appeal. This election wasn’t about wages — VW pays well. Rather it was about work rules and benefits. With so much of the work place already regulated, the election was really about the only thing unions can promise any more, namely, lavish health plans.
But many VW workers recalled that last summer unions begged the President for an exemption from Obamacare’s tax penalty on “Cadillac-style” union benefits. Union members everywhere worry that their plans cannot remain immune from higher co-insurance costs and unwelcome disruptions of provider relationships. The vote in Tennessee was as much about “no-thanking” the UAW for Obamacare as it was about saying “we don’t want Chattanooga to look like Detroit.”