HSAs and Wal-Mart's CEO

It is worrisome that the liberal blogosphere, so effective in helping to kill preznit's public efforts to privatize Social Security (private efforts are another story), have been so complacent about HSAs. Writes EJ Dionne of Bush's recent speech on health care given at...wait for it...Wendy's:

Take, first, the case that received little attention. Campaigning at the Ohio headquarters of the Wendy's fast-food chain for his proposal to expand health savings accounts, President Bush dismissed critics who contend that the accounts "are not a solution for the uninsured, they're regressive, they favor the wealthy."

That was an accurate enough description of the opponents' criticisms, but then came this zinger: "It's kind of basically saying, if you're not making a lot of money you can't make decisions for yourself. That's kind of a Washington attitude, isn't it -- we'll decide for you, you can't figure it out yourself. I think a lot of folks here at Wendy's would argue that point of view is just simply backwards and not true."

But opponents of Bush's plan are not "kind of basically saying" anything of the sort. They want people "not making a lot of money" to have a chance to buy affordable health insurance. They are arguing that HSAs, as the accounts are known, would offer a lot of money to the most well-off among our fellow citizens without increasing health coverage. Indeed, there is good evidence, mustered this week by the liberal Center on Budget and Policy Priorities, that HSAs would instead lead to a net increase in the number of uninsured.

And, as Elisabeth Bumiller pointed out in the New York Times, a $5,000 contribution to an HSA would have saved a couple with two children and a combined income of $40,000 just $630 on their 2005 federal income taxes. (And that assumes the couple could have afforded to put away the whole five grand, which is unlikely.) But a comparable couple with an income of $120,000 would have saved $1,500.

In other words, HSAs give the smallest benefits to those least able to afford health insurance. That is not exactly showing respect for those who are "not making a lot of money." The elitism here lies with those making the proposal, not with its critics.

I caught one post on this by Josh and one from Kevin, but where's the relentless drum beat that attended the Social Security bamboozlepalooza? And Brad, Max, this is your respective areas of expertise, no? We need to hear from ya.

And on a related thread, here's what the CEO of Wal-Mart has been saying on his company's intranet:

Asked about Wal-Mart's stock price, which has fallen 11 percent in the last five years. Mr. Scott said: "You cannot have Target or Walgreens beating you day after day after day." Mr. Scott wrote that one reason Wal-Mart's same-store sales were growing more slowly than Target's was that Wal-Mart's customers earn less and have been squeezed worse by soaring fuel prices.

"Wal-Mart's focus has been on lower income and lower-middle income consumers," he wrote. "In the last four years or so, with the price of fuel being what it is, that customer has had the most difficult time. The upper-end customer got a tremendous number of tax breaks about four years ago. They have been doing very well in this economy."

He said having to pay $50 to gas up a car did not change anything for rich customers, but did for those who didn't earn a lot. "It changes whether or not you go to the movie, whether or not you buy new sheets, whether or not you go out to eat."

And on government-sponsored health care:

November 11, 2005

...The underlying issue, though, is that health care in the United States is at a crisis state. There are 45 million uninsured people in the U.S. and government has to be involved. In Wal-Mart's case, although our health care plan stacks up very, very competitively, there are people who are saying that as a large company, our health care plan should be better than the competition. The problem we have with that is that if our health care plan is more costly than the competition, then how do we compete in the retail industry? You can't have it both ways.

So we think government needs to be involved. We don't want heath care costs, insurance levels, those kinds of things, to be a competitive advantage. We want it to be a competitive advantage if we hire healthier people and if our people are wiser at spending their health care dollars. But we don't want it as a competitive advantage because we would provide less health care than a Target or the Gap or Bed Bath and Beyond or whoever else.

In the past month, I've met with five governors, talking to them about what it is at a state level they can do and Wal-Mart can do in joining with them. What we'd like to see is a national program or at least state program that are reasonably consistent that impact everyone equally. So that all of our associates and customers have access to adequate health care that's affordable to them, but also affordable for government and affordable for business. People are working on it, but at this point, the federal government doesn't seem to have an appetite to take this on.

You may remember that Sen. Hillary Clinton tried, but it didn't work very well for her at that time. My personal feeling is the time is right, and right now, business and government have the opportunity to join together and get this problem behind us. [yes, all emphasis is mine]

Tell it to Wendy's.