WASHINGTON — Labor leaders irate over a proposed tax on high-value health insurance plans met with President Barack Obama on Monday to express their frustration over his support for the levy. Some labor officials have warned Democrats of political fallout for backing the tax.
The president of the AFL-CIO, Richard Trumka, said a frank discussion took place at the nearly two-hour White House meeting with about a dozen leaders of the country’s biggest labor unions.
Earlier in the day Trumka delivered a broadside to Obama and Senate Democrats who are planning to pay for overhauling the nation’s health care system with a tax on insurance plans that union leaders fear could hit their workers.
Trumka warned Democrats risk catastrophic election defeats similar to 1994 if they fail to come up with a health bill labor likes.
“A bad bill could have that kind of effect, a place where people sit at home,” as happened in 1994, when Democrats lost 54 House seats and eight Senate seats, costing them control of Congress, he told reporters.
The chief of the International Association of Firefighters, Harold A. Schaitberger, made similarly threatening remarks in a statement Monday. “The president’s support for the excise tax is a huge disappointment and cannot be ignored. If President Obama continues to support it and signs a bill that includes the excise tax on workers, we will hold him accountable,” said Schaitberger was not among the attendees at the White House meeting.
Trumka made his remarks before delivering a speech in which he bashed the tax proposal in the Senate’s health overhaul bill, contending that it “drives a wedge between the middle class and the poor.”
“The bill rightly seeks to ensure that most Americans have health insurance. But instead of taxing the rich, the Senate bill taxes the middle class by taxing workers’ health plans, not just union members’ health care. Most of the 31 million insured employees who would be hit by the excise tax are not union members,” Trumka said hours before going to the White House. “This is a policy designed to benefit the elites.”
Trumka stopped short of saying labor would oppose the bill if it included the tax. Trumka said bringing Americans health care reform “is too important for us to get this close and then say we quit.”
Obama supports the tax on what he calls “Cadillac” health insurance plans, arguing it’s a way to control spending on health care services, one of his goals for his health care overhaul.
Trumka and other labor leaders prefer the approach taken in the House health care bill: an income tax increase on individuals earning more than $500,000 a year and households earning more than $1 million.
White House officials released no details of Monday evening’s meeting beyond a statement from spokesman Reid Cherlin saying that a productive discussion took place. Earlier in the day White House spokesman Robert Gibbs indicated Obama was open to adjusting the tax so it would affect fewer people.