Dancing With the Devil?

On February 7th, the Service Employees International Union (SEIU) announced a surprising accord with Wal-Mart on the need for universal health care. The unlikely partnership quickly fell under criticism, with other unions and progressive reformers attacking SEIU for allowing Wal-Mart to garner good press from agreeing, in principle, to universal health care without making a concrete commitment to fight for it or even increasing coverage among the company's own workers. Below, the Prospect's Ezra Klein talks to Andy Stern, president of SEIU, about the alliance, what it means, and what, if anything, has been demanded of Wal-Mart. The transcript is edited slightly for length and clarity.

EK: How did you begin working with Wal-Mart on healthcare?

AS: Well, we began working with Wal-Mart by working against them, because we believe that the largest company on earth should not ask other workers and taxpayers to pay for their health care. From there, I wrote an editorial in The Wall Street Journal arguing that it was time to end the employer-based health care system and that it was important that employers join the call for universal change. [Wal-Mart CEO] H. Lee Scott appeared shortly thereafter on Charlie Rose and talked about how business and labor needs to work together to solve the health care crisis. And from there, a whole series of discussions began not just with SEIU and Wal-Mart, but with SEIU and a lot of executives, asking whether could we do something together help this country solve its health care crisis.

Then, of course, Wal-Mart agreed and forward you went. So tell me what you actually agreed on. What has Wal-Mart and SEIU endorsed?

We agreed on a set of principles that say that it's not time for incremental change, its time for fundamental change, which means universal health care for every man, woman, and child. That we believe in quality prevention, choice in the health care system, and a shared responsibility in financing, which includes employers.

I actually want to talk about that term "fundamental change" for a minute. What struck me when I read the principles was that SEIU could be talking about one thing and Wal-Mart could be referencing another. So you can achieve "universal health care" by giving the insurers massive subsidies so it's profitable for them to cover everybody, or you can really reform the system, institute community rating, end discrimination based on preexisting conditions, refocus the system on patients rather than profits, and so on. Now, those two approaches are very, very different, but both fit within the rubric that you laid out there. So when you say fundamental change, do you think you and Lee Scott are thinking along the same lines?

In the sense that in the end every man, woman, and child will be covered by a basic health care plan? Yes. Do I think I and everyone else agree not just with Wal-Mart but with people in labor and community organizations and other businesses on the exact plan? No. But I must admit SEIU has a fairly simple standard: that we deal every single day with women and men who are childcare workers, security officers, janitors, homecare workers, nursing home workers, and even nurses that don't have health care. We understand their life consequences for the failure to have health care, including, unfortunately, in some cases, like Roselio Somanov, illness and potentially death for an untreated incident that she thought was chest pains and turned out to be breast cancer. So, we are not gonna let the perfect be the enemy of the good.

And certainly if we were laying out specific principles, we would probably disagree. But here's the real life facts: If you put Wal-Mart and ourselves and AARP and a bunch of Democrats and Republicans in a room, I think we could solve this health care problem in America. I think people just realize that it's long overdue that we find a solution. It's not just a moral problem but its now an economic, a job creation problem as well. More women went bankrupt last year than graduated college, the majority having to do with unpaid health care bills. This is a ridiculous way to run a health care system and I think, as governors Schwarzenegger, Romney, Rendell, and Blagojevich are showing, with a little bit of leadership, you can assemble something that takes you down the road you need to go.

But I just want to press on this for one more minute because when I look into Wal-Mart's health care record, they have a very clear view, it seems, of what health insurance looks like and they seem to allow the very concept of coverage to override the imperative for protection. So when you say every man, woman, and child covered, I agree that that is certainly the goal, and I don't think SEIU has shown much of an interest in having that coverage be high deductible, high-risk plans for individuals.

Exactly, we're not for high deductible plans or catastrophic plans or Wal-Mart's plan because they're inadequate.

That's what I'm trying to get at. How do I know Wal-Mart isn't saying that they're going support high-deductible health care for all, so we'll all have to pay $6,000 when we get sick, and it'll be universal coverage because the law will mandate that we all purchase it?

I haven't had that level of specificity [with them], but I can tell you that they've said in a number of public setting that they operate in many countries in the world that have, what most Americans would think, are pretty comprehensive health care systems, like the UK, like Canada, like Germany. And they felt that that was not a competitive issue for them, that it was a level playing field and they felt that there was nothing wrong with those systems -- not that they would choose those for America but they didn't see them as impediments to their business success. I think for a lot of these employers, as they begin to operate globally, they begin to appreciate that America's health care system is more of a problem, because it's unpredictable, it can be a competitive advantage or disadvantage. In Wal-Mart's case it's both. In some places, as odd as it may seem, in rural areas, they provide much better health care than their competitors, as sad as that is. In some places, in unionized areas, they're the ones that are dragging down standards. But I don't get a sense that they would look at other systems that they compete in now and say that they are unacceptable -- not that they are the choices they would start with. And I think only time's gonna tell.

I went to Governor Schwarzenegger's health care forum in October, right before the election, and people told me that it was a fraud, a phony, a publicity stunt. They said he had vetoed bills on universal health care, he would never believe in it, he tried to take away people's health care. I think people are now looking at what Governor Schwarzenegger is doing and say hey, it's a real deal. It may not be perfect but it's going way in the right direction, including for undocumented children. So, I think if you take risks sometimes you end up holding the bag and sometimes you end up making huge progress. And I think the jury's out on which way Wal-Mart's gonna go.

Let me ask, then, what have they promised to contribute? What is actually underpinning the agreement on principles? Are they willing to give X number of lobbying dollars? They said they would still support politicians who are against universal health care. So, in exchange for the publicity of being part of the SEIU health care agreement and getting a little bit of a counter-narrative to the argument that they are firmly against health care and worker benefits, what are they promising in return?

I think their presence with us, our presence with them and AT&T and Intel and Kelly Services and Howard Baker and John Podesta, was a statement that was important to people. I think it was a statement to the country that it's time to solve this problem. That's a huge contribution. And I think we are all out recruiting more CEOs to come to an event in May in New York to try to broaden the coalition. Further, all of us are trying to figure out how to do some public education, whether it's amongst our members, in our stores, with our customers. The time is now to solve the health care problem. We're all prepared to press the presidential candidates about universal health care. The texture, the form of that is still in discussion, but this is not a publicity stunt. I hope, and believe, additional actions will follow.

But they aren't laid out yet. I hate to be a cynic on this because in fact, I've always had serious problems with the way the left treats Wal-Mart. I agree with you that the employer system is dead and the question should always have been how you force these companies to stand aside while you pass a national plan, not how to get them to offer slightly better, mediocre plans. But what does concern me when I look at the array of members that are around the table, it's an easy way for them to get good publicity on something they need. But it doesn't seem to me that there's a high bar for them to clear for that publicity. Wal-Mart even said at that event, we will not stop supporting politicians that don't support us on this issue, which is fine, but how do you lobby when there's no threat of appraisal?

Well, look, that applies probably to most unions. I didn't want to say that. Did you ask most unions, look at the last election, did they support politicians that didn't support universal health care? The answer is yes, all the time.

They do, but they, and SEIU, certainly make forcing politicians to come to the table on health care a real priority. I haven't seen anything suggesting that Wal-Mart is ready to do that. And so I worry that they'll get all this good press, and then do nothing for the cause.

I agree. But listen, here's the issue. They are not Congress. I think the left and progressives spend way to much time trying to create policy priorities and policy proposals rather than trying to make change. And the civil rights movement didn't write bills in lunch rooms. People marched on the street, they demanded change and change came. And I think what we're seeing now from polling, from corporations, from unions, from insurance industries, from governors, Democrats, and Republicans is demand for change. That is how change, I believe, is made in Washington, D.C. We are so policy-centric, candidate-centric about the change process as progressives that we don't understand that the winds of change don't blow like MapQuest.

I agree with you on that, but I think the question is not one of how does change happen, but whether or not your partners are committed to change. Wal-Mart has been, at many times, very disingenuous on health care. You certainly read the memo where they talked about exactly what they were going to do to reduce the generosity of their workers' health care.

I leaked the memo.

Exactly, it's your organization, or one you help fund. So in light of that, and maybe there's not a whole lot you can give me on this, but what I've seen is a lot of skepticism that Wal-Mart is actually for real change, rather than good publicity.

You would be living in fantasy land not to be skeptical about this. And I happen to believe they are. I happen to have heard them say to congressmen and senators as we lobby together, they were certainly not asking to be let off the hook. They certainly would be willing to pay and potentially pay more that they're paying now. They just want a level playing field in this process.

Now, I don't know, I spend a lot of time with people who say one thing and do another, including many people in the communities in which I exist. So, you make judgments. I wish life were a science and not an art. Our union has made a judgment that the best way to move this health care program forward and the way we failed in 1993 was to have the business community and the insurance industry and others out to kill it. It was done as a sort of Washington, Ira Magaziner, think-tank kind of process where everyone assembled themselves in a room to find a perfect solution and it failed. So, people are making different kinds of judgments about being with a business roundtable in our case, or between UFCW and Safeway, who had the moral strike with them. [Safeway's CEO] Steve Burd and [UFCW's president] Joe Hanson are talking about what they can do on health care together. And peace is breaking out and I think you have to take a risk.

Well, I certainly hope you're right on it.

Me too! 'Cause if I'm not I'm gonna eat a lotta crow!


Ezra Klein is a Prospect writing fellow.

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