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Tuesday, February 27, 2007

Legislature lets taxpayers pay for workers' health care costs

CRAIG COLE
GUEST COLUMNIST

For three years, I've asked the Washington Legislature to reconsider the current mindless health care system that encourages employers to be selfish and irresponsible. This session they have another chance with bills being considered that would require large employers to reimburse taxpayers for the cost of providing their employees with state-subsidized health care.

Brown & Cole Stores were founded almost a hundred years ago by my grandfather. Last year, we employed around 1,500 workers, very ably represented by United Food and Commercial Workers and Teamsters. As a 27-store regional supermarket chain based in Bellingham, our stores operated under the trade names of Food Pavillion, Cost Cutter, Food Depot and Save-On-Foods.

I was raised with the American values that good companies take care of their employees. We worked long and hard with our union partners to provide living wages and benefits to our workers and were proud to do so. We made health care payments on 95 percent of our work force, while some of our competitors covered less than half.

In November, Brown & Cole Stores filed for bankruptcy protection. We cited competition from low-paying chains, especially Wal-Mart. We hope to emerge a survivor, but it's difficult for employers who provide family-wage jobs. We're living proof of the very real impact that low-way employers have on the local job base that we all hold so precious.

There is no question that Brown & Cole was undermined by large profitable employers who have abandoned basic American values and pay their employees so badly their workers qualify for public assistance. Using state-funded health care is their profit strategy. They simply dump their health care costs onto taxpayers.

The largest corporation in the planet's history bases its business model on inferior wages and benefits. They're keeping the working poor working -- and poor. Meanwhile, they earn billions by transferring their health care costs onto the rest of us, and they set a very low competitive cost structure that punishes employers trying to conduct business with integrity.

I've brought those concerns to the Legislature for three years now, urging them to make a change. They didn't. Since, I've watched Brown & Cole's hard-working employees struggle with a change that has rattled their lives and the lives of their families. I wish I could tell you of the personal costs, the pain endured. I won't. I will tell you that it's the direct result of a competitive playing field that's not level and getting more lopsided as the months pass. Those irresponsible employers are costing the state a ton of money.

I ask the Legislature: Why are you letting the public pick up the tab? In essence, every state taxpayer puts money into the pockets of large profitable employers setting a new low for corporate social responsibility.

As a society, we have established a framework for commerce and competition that forbids profiteering by pollution, unsafe working conditions and discrimination. Why do we allow a public policy framework that rewards a company for misusing its workers?

Do I blame the companies? Only partially. I blame a public policy framework that encourages them to behave that way. Consumers benefit from slightly lower prices, yes. But workers and all citizens lose.

It's a Faustian bargain: We're giving consumers better deals while we're hammering workers, their families, good businesses and our communities. What kind of deal is that?

The dilemma we face is that there is no real economic incentive to be a good employer, even though company health care coverage keeps people off the state's rolls. Lawmakers need to be pragmatic. If more large profitable employers follow down this path, we'd better provide for the escalating costs of funding an ever-expanding state caseload.

Until universal health care with appropriate cost controls is in place, irresponsible employers shouldn't get off the hook. They'll pay then and they need to pay until then.

The Legislature is considering legislation that will affect only the very largest and stingiest employers who can afford to pay -- but don't. Without it, those companies will continue to degrade the American worker -- and not just their own. They're forcing all employers into a race to the bottom.

Craig Cole is president and CEO of Brown & Cole Stores in Washington state.
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