Democrats Trying to Mollify Unions

Posted January 12, 2010 at 6:07pm

Concerned that labor unions might sit on their hands this November, Congressional Democrats are trying to find a way to assuage the concerns of some of their most dedicated and reliable campaign supporters without blowing a funding hole in the health care reform bill.

Faced with not-so-subtle threats from labor leaders this week that union voter turnout might be depressed in what is shaping up to be a crucial election year for the left, Democrats said they are again toying with modifying a proposed tax on high-cost, or “Cadillac,— health insurance plans in the Senate health care reform bill. The tax is a key funding mechanism in the Senate bill, but many unions have negotiated expensive coverage plans for their members and have insisted the provision be axed in any merger of the House- and Senate-passed health care bills.

Although President Barack Obama apparently told union leaders Monday that such a tax would likely stay in the bill, one Senate Democratic source said the White House “did signal a willingness to tinker with it.—

The source added that unions “are certainly making a lot of noise right now, and they are not being shy about conveying that they will be extremely disappointed if changes aren’t made to the bill. We don’t want to unnecessarily upset our friends here.—

But their friends the unions are already upset, and it seems that anything short of eliminating the proposed tax could spell a problem for Democrats at the polls this fall.

Labor bosses appear unwilling to engage the White House or Democratic leaders in possible legislative horse-trading over the contentious revenue proposal. Sources familiar with Monday’s meeting between Obama, AFL-CIO President Richard Trumka and other labor officials said the health care discussions were “very respectful, but not happy.— Unions are not attempting to use the proposed health care levy to negotiate a deal on other union legislative priorities such as the Employee Free Choice Act.

“That wasn’t even remotely part of the discussion,— a union official said of a possible quid pro quo involving the long-pending “card check— bill.

The official also said that Trumka and other labor leaders this week are using their sit-downs with the White House, Speaker Nancy Pelosi (D-Calif.) and other Democratic leaders to add minor tweaks to the bill, including possible deadline extenders and higher benefit thresholds for dangerous occupations such as mine workers and firefighters.

Harold Schaitberger, president of the AFL-CIO-affiliated International Association of Fire Fighters, said the proposed tax marks the first time in recent memory that his organization is unwilling to compromise on a legislative issue. He likened the proposal to the much-maligned alternative minimum tax, which was originally designed to hit high-wage earners but has become a political liability with middle-class voters in recent years.

“Having been around this business the last 33 years, I don’t really ever consider drawing a bright line on any issue ­— I understand the process,— Schaitberger said on Tuesday. “However, on this issue, we’re drawing a bright line. This is simply a bad policy and, as important, it’s bad politics.—

Schaitberger also echoed widely publicized comments made by Trumka and other labor leaders earlier this week that the White House-backed tax could become a midterm political liability for Democratic lawmakers in the fall.

“What could suffer more is a [union] membership that could be harder to motivate,— he said.

Trumka was mum following his meeting Tuesday with Pelosi, House Education and Labor Chairman George Miller (D-Calif.), and other labor leaders, including United Auto Workers President Ron Gettelfinger and Service Employees International Union President Andy Stern to discuss health care, including the tax on high-cost health plans. “Who here has the authority and can deliver on a bill? Anybody? When you prove that to me, I’ll negotiate with you,— Trumka told a group of reporters as he was leaving the meeting.

Pelosi spokesman Nadeam Elshami also declined to offer details, saying the meeting was “positive— and “an opportunity to thank them for their support for health care and their commitment to America’s workers and discuss our agenda on behalf of jobs.—

Rep. Joe Courtney (Conn.) said Tuesday that the Democratic Congressional Campaign Committee is increasingly worried that vulnerable incumbents in its “Frontline— program may be at a particular risk if the Senate-proposed tax on Cadillac insurance plans beats out the House’s tax on wealthy wage earners in a final health care bill.

“Republicans are sharpening their knives,— Courtney said. “I don’t think Republicans are going to cut us any slack on this.—

Another labor official said Senate Majority Leader Harry Reid (Nev.) could feel acute union scorn come November if the provision passes. The top Senate Democrat is a primary target for the National Republican Senatorial Committee in his home state, which continues to experience high foreclosure rates and unemployment.

“It hurts Reid because the building trades will be affected and they’re the big dogs— in Nevada, the source said. “With the economy tanking out there, it absolutely will hurt Reid.—

Democrats on the Hill said they are keenly aware that union leaders have been disappointed that the new Democratic-controlled political machine in Washington has not delivered on some of their key concerns. Most notably, the Senate has failed to bring up the card check measure, which would make it easier for workers to unionize.

One senior Senate Democratic aide said House Democrats probably have the most to worry about, but that either way, Democrats will need to do “substantial outreach— to the local union leaders to convince them that “if you don’t get out there, it’s going to be a lot worse.—

Currently, it does not appear that Senate Democrats can muster the filibuster-proof 60 votes needed to pass the union organizing bill, but another Democratic source said labor leaders have been agitating for a vote early this year in order to gauge which Democrats they should support in November. Notably, party-switching Sen. Arlen Specter (D-Pa.) has appeared to move strongly in labor’s direction on the bill. But while he was still a Republican, he said he could not support it, and union leaders are eager to nail him down before pulling out the stops for his re-election this fall.

“It’s a double whammy: the inability to pass their No. 1 priority and the fact that the type of [insurance] policies that unions have gotten for their rank and file are exactly the type— that need to be reined in to bring down health care costs, said the senior Senate Democratic aide.

“Politically, is it a concern? Yes,— the aide added. “But is it a red alert? I don’t think so.—

Reid is likely to schedule a vote on card check this year, but a Senate Democratic leadership aide said he is “still working on the timing.—

After all, the aide pointed out, unions were one of the first constituencies Democrats paid homage to as they passed a long-awaited increase in the minimum wage. Plus, the jobs bill under discussion and slated for passage early this year is targeted at unionized building trades, the aide noted.

Tory Newmyer contributed to this report.