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Commentary

Health Care Won't Solve Auto Woes
Tom Bray, New York Sun, 5-11-05

Thomas Bray takes on what he calls an urban legend: “that American manufacturers can’t compete because of high and rising health-care costs.” The Big Three automakers, for instance, cite retiree health care costs as one reason they are unable to meet foreign competition. The solution, proponents of this argument say, is to create a “national healthcare system of our very own.”

Bray points out that enlarging U.S. welfare entitlements (and taxes) would erode U.S. economic growth, as has happened in Europe and Japan. Finally, Bray argues that automakers have only themselves to blame for promising their employees platinum-health insurance at a fraction of its real cost:

For decades, union and management at big companies like General Motors have tried to create their own welfare states. Having failed, they now would like us to believe that what's needed is an even bigger welfare state. What's really needed is for American industry to face reality and stop making promises they - and nobody else - can keep.


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