Paying for the Privilege

I just received my benefit information for 2007. Once again, significantly more cost for the same coverage. The official reason given for this has some vague resemblence to "the rising cost of healthcare and the excessive burden on companies to provide high quality health care to their employees". I thought this might be a good time for a discussion on the US economy and the role played by the government in the country's economic health. After reading Profit over People by Noam Chomsky, several basic truths become evident. The most interesting (to me) is the notion of a "free market economy". We hear this term so often that is generally accepted. I believe the term refers to the openness of markets and the potential for new companies to enter, as well as the adherence to the "perfect comeptition" models taught in MBA classes at the universities. This is assumed to be goverened by the laws of supply and demand, and insulated (at least to a significant degree) from the meddling of governmental and civillian interference. A simple look at this assumption, however, shows vast descrepencies to what actually occurs. In recent years, the oil industry has come under scrutiny due to the immense profits being generated in a governmentally subsidized industry. ($8.6 - $11.3 Billion). Billions of dollars is handed out to various other companies in the form of government subsidies and grants as well. The US Agriculture industry received $21 billion in 2004. The Pentagon sponsors much of the US high-tech development through military programs. The government spends a significant percentage of the GDP to sponsor the US economy. This money, of course, comes from US taxpayers. The irony, of course, is that the PROFITS that are generated as a result of these subsidies do not return to the taxpayers. They instead go to the corporations. In short: US Tax Dollars => US Government => Corporate Subsidies => Corporate Profits So, your tax dollars are being used to create corporate profits. An explanation for this seeming atrocity is that in stimulating the economy with this money, new jobs are created and the employee compensation is a good use of tax dollars. However, existing data on the subject seems to disprove that thought. The workforce is not getting rich. So, who is? Many people know that executive compensaion has exploded in recent years. There are many complicated business studies trying to explain why. In looking at the above information, I can offer a much simpler explanation. Ralph Nader has seen the same phenomenon here, and proposed a solution as well. Limits on Executive Compensation in Government-Supported Corporations: Where the government is conferring substantial, voluntarily received benefits on corporations, it could reasonably limit the scope of beneficiaries to those who do not engage in particular sorts of socially undesirable behavior. One such behavior is excessive executive compensation, which heightens income and wealth inequalities, and tears at the nation’s social fabric. Government subsidies, including tax expenditures, could be denied to corporations whose executives receive more than a predetermined level of compensation, say those whose ratio of executive-to-lowest-paid-employee compensation is more than a certain amount, perhaps 30-to-1. Source: Cutting Corporate Welfare, p.120 Oct 9, 2000 How do you suppose CEO's around the country would react to that?