Articles

ObamaCare's Coalition Begins to Fracture

July 17, 2013

The letter was unusually harsh. Addressed to Senate Majority Leader Harry Reid and House Minority Leader Nancy Pelosi, it was really intended for President Barack Obama. The letter was not from Mr. Obama's GOP adversaries but from the presidents of three powerful unions.

On July 12, James Hoffa of the Teamsters (1.4 million members), Joseph Hansen of the Food and Commercial Workers (1.3 million members) and D. Taylor of UNITE-HERE (200,000 members, mostly culinary and hotel workers) wrote to complain about the president's Affordable Care Act.

These union heads charged that unless Mr. Obama enacts "an equitable fix," the Affordable Care Act "will shatter not only our hard-earned health benefits, but destroy the foundation of the 40-hour work week."

The tough talk was backed by facts. Millions of union workers, the letter notes, are covered by nonprofit health plans jointly administered by employers and unions, and won't qualify for ObamaCare's generous taxpayer subsidies. This makes a unionized workforce more expensive for employers and hence less attractive for workers.

Union leaders are correct that ObamaCare "creates an incentive to keep employees' work hours below 30 hours a week." After all, employers can avoid a $2,000-per-worker fine if they don't provide insurance as long as employees work fewer than 30 hours a week. Union leaders have realized—too late—that ObamaCare will affect the livelihood of millions of workers who wait tables, wash dishes, clean hotels, man registers, stock shelves and perform other tasks that can be limited to shifts of less than 30 hours a week. The White House take on this concern? Press Secretary Jay Carney said it "is belied by the facts."

But the data from the Bureau of Labor Statistics show that, in 2010, the year ObamaCare passed, full-time employment grew at an average monthly rate of 114,000 while part-time employment dropped an average of 6,000 a month. So far this year, as ObamaCare is being implemented, full-time employment has grown at an average monthly rate of 21,700 while part-time employment has increased an average of 93,000 a month.

The three union leaders also complained their nonprofit insurance plans are still subject to ObamaCare's new 2%-3% tax on each insurance policy. They want their members exempted from the tax every other family with health insurance must pay. Who knew labor leaders were such staunch tax opponents?

It will not help Democratic enthusiasm in the 2014 midterm elections if ObamaCare causes (a) more workers to lose their union-provided insurance and (b) their hours and paychecks to be cut. In addition, Democratic candidates could be seriously damaged if the three labor bosses follow through on their letter's threat to stop helping elect Democrats if the law isn't changed.

Republicans cannot just watch and jeer from the cheap seats. According to a poll last month by Crossroads GPS (a 501(c)(4) issue advocacy group I helped form), voters will respond to a focused discussion of ObamaCare's shortcomings and a robust set of alternatives.

The GPS poll strongly suggests Republicans treat ObamaCare as a pocketbook issue: 62% believe making health care more affordable should be the top health-care priority. Among these voters, 38% say ObamaCare makes things worse while 23% say it will make things better.

According to the poll, 55% of voters believe ObamaCare will hurt job creation and say they have "a great deal" of concern that insurance costs, premiums and co-pays will go up because of the new law. A majority are also greatly concerned that ObamaCare's taxes on drugs, insurance, medical devices and health providers will be passed along to consumers (54%), and that the law will force automatic Medicare cuts (52%).

On the flip side, the poll showed strong backing for conservative reforms that reduce costs. For example, 81% support letting families save more tax-free for out-of-pocket health expenses, 82% are in favor of allowing individuals to purchase health insurance with pretax dollars, and 78% back the sale of insurance across state lines.

The high level of discontent with ObamaCare suggests that Republicans can win on the issue of health care—but not simply by offering endless votes in the House to repeal the law. The GOP must offer substantive conservative alternatives. These alternatives exist. It's time Republicans showcase them.

A version of this article appeared July 18, 2013, in the U.S. edition of The Wall Street Journal, with the headline: ObamaCare's Coalition Begins to Fracture and online at WSJ.com.

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