Corporate Interests

For years, I've been wondering why corporate executives who wail that "health care costs are killing us," haven't been wailing for health care reform. They've been noticeably silent over the past year of health care debates. David Leonhardt helpfully reminds us why that is so.

Republicans have shown little interest in negotiating a big compromise. Remember how Charles Grassley, the top Republican on the Senate Finance Committee, kept moving the goal posts last summer? This is basic game theory: the better Mr. Obama looks, the worse the Republicans’ chances are in the midterm elections. Philosophy plays a role, too. Some Republicans believe it’s not the government’s job to help people get insurance.

Mr. Obama, for his part, has shown little interest in adding conservative ideas that do not win him more votes in Congress. House liberals are already unhappy enough.

It’s not just the politicians’ fault, either. AARP opposes some new payment systems, worrying that the elderly will be hurt. Union leaders oppose a tax on high-cost insurance, fearing members will lose good benefits. Business executives oppose giving workers more freedom to choose their own coverage, because companies like having control over heath plans.

But aren’t business executives always saying that health costs are killing them?

Yes, but that’s mostly a sound bite, as the last year has showed. Companies care about how much total compensation they pay. Rising health costs generally come out of worker incomes, not company profits.

Exactly. In fact the status quo is their preferred state. Executives don't like uncertainty or change. And besides, employee-based health care is an incredible stick they hold, keeping valuable employees too nervous to leave a job that offers health care. And, as Leonhardt says, it doesn't cost them a dime.

And they know, like the GOP leadership, that passing the health care proposals that have already won super-majorities in the House and Senate would be a remarkable boon to the Democratic Party. Perhaps not in the short term, but even in the short term it would change a narrative -- that Democrats can't do anything because the public doesn't support their commie plans -- that helps Republicans. And for many, many business executives, they see their interests as lying with the Republican Party.