The leader of the biggest U.S. labor federation warned President Barack Obama on Monday that failure to act quickly on unemployment would be “suicidal” and would put the Democrats’ control of Congress at risk.
In a strongly worded speech delivered hours before a White House meeting with labor leaders, AFL-CIO President Richard Trumka urged Democrats to deliver “genuine healthcare reform” and job growth or risk a repeat of the Republican takeover of Congress in 1994.
Obama won strong backing from trade unions in his presidential campaign and it is crucial for him to retain the support of working class voters before mid-term Congressional elections in November
Republicans view Obama’s Democratic party as vulnerable over unemployment, which is at 10 percent, and are seeking opportunities to weaken the party’s majority in Congress.
White House spokesman Robert Gibbs said Obama would discuss with union leaders what he wanted to see in the final version of the healthcare bill, including a proposed tax on so-called “Cadillac” health insurance plans.
He said Obama was open to discussing the unions’ concerns.
Some economists say a tax on high-cost plans could help rein in long-term healthcare costs.
Many union members are enrolled in such plans and unions oppose taxing them. They argue that some members pay more for healthcare, not because their plans are generous, but because they cover those more costly to insure, like older workers.
Unions have also campaigned for a government-run health plan, the so-called public option, which is bitterly opposed by Republicans and the insurance industry.
“I think working men and women will ask themselves who’s on the side of insurance companies and who’s on the side of taking insurance companies on?” Gibbs told reporters.
Trumka condemned the Senate’s healthcare bill, which includes the “Cadillac tax” proposal but not a public option. He also warned that failure to move swiftly to bring down the unemployment rate would amount to “suicidal politics.”
“This is a moment that cries out for political courage. But we’re not seeing enough of it,” he said in a speech at the National Press Club.
“We crave political leadership ready to fight for the kind of America that we want to leave to our children and against the forces of greed that brought us to this very moment. But instead we hear a resurgence of complacency and political paralysis.”
Union officials feel betrayed by Obama’s support for the “Cadillac tax” and the possible loss of the public option, both of which weigh heavily on union members who have given up pay increases and job security to retain health benefits.
“This is a policy designed to benefit elites — in this case, insurers, hospitals, pharmaceutical companies and irresponsible employers, at the expense of the broader public,” Trumka said.
He warned that Democratic politicians could see support slump among working people just as it did in 1990s after the North American Free Trade Act (NAFTA) was enacted over labor’s protests.
Obama faces pressure from labor to follow through on promises to restructure U.S. trade policy to put a greater emphasis on creating and keeping jobs in the United States.
He could alienate labor groups this year if he decides to push for approval of free-trade deals with Panama, South Korea and Colombia left over from the Bush administration.