Mrs. Clinton and GM

I am not an economist, nor a politician. I’m just a medical lab technologist who likes working in Canada. A childhood spent in hospitals due to uncontrolled asthma is probable one of the reasons why I’m in healthcare, and why I’m glad I have access to universal coverage.
I’m also a big fan of the U.S. I’ve had the opportunity of visiting my southern neighbor four times and I can hardly wait for the next visit. There are lots to do, the people are great and it is the only place in the world that knows how to make sourdough bread.
Lately though there has been some Canada bashing lately in the U.S. media about the shortcomings of our healthcare. So as a Canadian who works in this industry here are a few observations I have about the situation.
First of all, to any American readers in the words of one of your Presidents, Lyndon B. Johnson, “I’m not going to piss on your rug.” The American system is what it is. Apparently some people think it’s the best system in the world, while there are others who think it is in need of desperate repair.
I agree. The U.S. needs universal healthcare. If you need a reason no go further than to the collapse of GM.
What does the bankruptcy of one of the largest American companies in history has to do with healthcare reform? Economic reasons that’s why.
On Feb. 11, 2005 (over four years ago), G. Richard Wagoner Jr., the CEO of GM told the Economic Club of Chicago that “failing to address the health care crisis would be the worst kind of procrastination.” Mr. Wagoner also said that “GM is the canary in the coal mine for Medicare and everyone else. There are many, many more companies out there in trouble because of healthcare costs than just the auto, steel and airline industries.”
In 2005, the healthcare of 1.1 million people was covered by GM. That would be like going to the city of Dallas, Texas and saying all your healthcare bills are taken care of. How much did it cost? 5.2 billion dollars. If GM healthcare was a country, it’s GDP would be the world’s 140th biggest, knocking out Laos. It was expected to go up by 400 million that year, 7.6%. As a result of these factors, GM had to recoup costs by adding $1500 to the price of each vehicle it sold.
The Indian Carmaker Tata, will be able to produce a car (the Nano) for $2000, just $500 more than what had to be added to the sticker price of a car on the lot in 2005.
How can the U.S. hope to compete globally with this huge burden? What did Mr. Wagoner call GM, the ‘canary in the coal mine?’ Well one can see that the little bird is fighting for its life.
So I have to wonder what Mrs. Clinton is thinking about these days. Who knows if things would have been better if she had been successful in the nineties with her plans for healthcare reform? Would GM be offering a $1900 car in India in this parallel universe?
Unfortunately politics caused healthcare reform to collapse, and it looks like Mr. Obama is falling in the same traps. The only piece of advice I can give him is to paraphrase one of Abraham Lincoln’s more famous lines. When it comes to healthcare reform, ‘you can please some of the people all of the time, you can please all of the people some of the time, but you will never be able to please all the people all the time.’


Thank you for taking the time to read my posting. I look forward to your thoughts and comments.



Regards,

Mark Hawkins