“It's the Health-Care Costs, Stupid!”: Ideas, Institutions, and the Politics of Organized Labor and Health Policy in the United States

In 1978, organized labor formally abandoned its longstanding commitment to public-sector solutions to achieve universal health care. Over the following fifteen years, it embraced private-sector solutions premised on a government mandate that would require employers to pay a portion of their employees health insurance premiums. In many respects, this about-face on the part of organized labor is neither remarkable nor puzzling. After all, labor's prior commitment to national health insurance1. The term national health insurance has many meanings. As used here, it refers to health-care reform proposals modeled on the Canadian experience in which the government replaces private insurance with its own public insurance system, thus eliminating the commercial health insurers. Commonly referred to as “single-payer” plans today, proposals for national health insurance can vary enormously on important details like financing, budgeting, taxation, and the role of individual states. had coexisted with its deep and abiding attachment to the private welfare state of job-based benefits dating back to the 1940s.2. Donna Allen, Fringe Benefits: Wages or Social Obligation? (Ithaca, NY: Cornell University Press, 1964); Joseph W. Garbarino, Health Plans and Collective Bargaining (Berkeley: University of California Press, 1960); Raymond Munts, Bargaining for Health: Labor Unions, Health Insurance, and Medical Care (Madison: University of Wisconsin Press, 1967); Beth Stevens, “Labor Unions, Employee Benefits, and the Privatization of the American Welfare State,” Journal of Policy History 2 (1990): 233–60; and David Rosner and Gerald Markowitz, “Hospitals, Insurance, and the American Labor Movement: The Case of New York in the Postwar Decades,” Journal of Policy History 9 (1997): 74–95. American labor unionists have tended to be strident pragmatists compared to their European counterparts, who have been more consistently animated by a larger social democratic vision. Furthermore, American unions have a long history of deferring to the Democratic party.3. Indeed, some analysts characterize labor's relationship with the Democratic party as a “barren marriage” or “abusive relationship.” Mike Davis, Prisoners of the American Dream: Politics and Economy in the History of the U.S. Working Class (London: Verso, 1986), 52; and Joel Rogers, “The Folks Who Brought You the Weekend: Labor and Independent Politics,” in Audacious Democracy: Labor, Intellectuals, and the Social Reconstruction of America, ed. Steven Fraser and Joshua B. Freeman (Boston: Mariner, 1997), 255. Arguably, labor's support for national health insurance had been primarily rhetorical since the early 1950s, when the industrial unions began to rely on collective bargaining to achieve health-care security for their members. Once President Jimmy Carter and Sen. Edward Kennedy (D-MA) retreated from national health insurance in the face of the new anti-government, dereg- ulatory, deficit-conscious environment that emerged in the mid-to-late 1970s, one may conclude that labor “naturally” abandoned ship as well.