Who Needs Card Check? Unions May Prefer Health Care Tax Break

By January 17, 2010Health Care, Taxation

Wall Street Journal editorial, “Labor’s $60 Billion Payoff“:

Richard Trumka of the AFL-CIO says this and other concessions mean the excise tax will raise some $60 billion less than the original Senate version. Democrats are probably going to charge investors for this political perk, by extending the 2.9% Medicare payroll tax to capital gains for the first time ever—on top of all the other taxes. Just what the economic recovery needs.

Meanwhile, the extra five-year dispensation gives labor lobbyists plenty of time to negotiate a permanent extension for the Democratic union base, even as labor is being armed with an important new organizational tool: Eliminating the secret ballot in union elections might be unnecessary when unions have an exclusive tax privilege at their political disposal. Right-to-work states will also be punished because they are less unionized.

Radio host and attorney Hugh Hewitt also detects a huge giveaway to Big Labor:

Not only does this carve-out outrageously treat nearly identically-situated Americans differently –same income, same health plan, but the union member is spared an enormous tax burden and the non-union member or his company pay it– the impact of the exemption will be of far more consequence and a far greater advantage to organized labor than even the very controversial “card check” proposal.  Imagine the extraordinary advantage that will fall to companies like GM –already a government car company– when it doesn’t have to pay any of the tax but non-unionized car companies do have to pay it.  The same advantage will roll through the economy, with every unionized business benefitting and every non-union company in effect paying a premium for staying non-union.  Even long time opponents of unionization will have to reconsider their stance given the cost advantage now open to companies providing their health insurance through collective bargaining.


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