Saturday, March 19, 2011

Madison Bus driver - Randy Hopper Ad

Randy Hopper is running a radio ad. You can listen to it here, it is listed under March 15, Hopper campaign.

In this ad, it cites the high salary of a union bus driver in Madison. Here is a link that digs deeper on that claim.

Here is a quote from the article:

The driver, John Nelson, was able to earn $160,000 in 2009 not because of his annual salary, but because he worked a huge amount of overtime hours. He was able to do this because of previous rules, negotiated by Teamsters local 695, that allowed drivers with most seniority — and the highest salaries — to rack up large amounts of overtime. As a result, in 2009, Nelson worked 1,896 hours of straight time, but he was also able to add on a whopping 2,012 hours of overtime. This, not the exorbitant salary public employees supposedly enjoy, is what accounts for his huge haul that year.

My first question, who sets the work schedules? wouldn't it be management?

My second question, why is there so much overtime available? I think I know the answer to this. It is cheaper to pay overtime when compared to hiring more workers because of benefit costs. This returns us to the rising cost of medical care and insurance costs. It is a systemic problem.

Later in the article:

According to Rusch, the city of Madison went to the bus drivers union last year and said the rules allowing the highest-paid bus drivers to snap up the most overtime had become a major problem. Turns out the union agreed, and renegotiated a deal to limit overtime in a way that has left Metro Transit happy. And guess what: That deal was negotiated through collective bargaining.

The complete story seems to be a positive argument for collective bargaining.

Next, let's take a look at the form of argument in this ad. Using a single egregious example (actually two, more on the second one to come) to broadly paint all public workers is a misleading device. We would be better served if we were told the median salary and the range of salaries.

I could make the same type of argument about the salaries of CEOs of charities, which are tax exempt organizations (thus subsidized by the taxpayer). Here is the highest paid for 2008:

Highest CEO Salary: Zarin Mehta, New York Philharmonic

Compensation (2008): $2,649,540

It would be wrong to paint all charities with this number. Here is a link to the complete data that we should look at:

I could make all kinds of arguments about charities and their actions and the cost to us as taxpayers. I encourage you to take a look at this website.

The second distorted fact in the ad is the Milwaukee Teachers union viagra claim. In the ad, the claim is that "it would have cost taxpayers almost a million dollars." Here is a quote of the number from Fox news webpage:

A consultant for the school board has estimated that reinstating the drug benefit would cost $786,000 per year.

I found the same quote in a Milwaukee Journal article that you can read here.

Notice in both articles that the number is an ESTIMATE from a consultant. Also, the ad says almost a million dollars, stretching the number a bit to cloud your perception. We also need to ask what is the policy on insurance coverage for other employees in the US.

That information is not very available. Here is what I found on the coverage of Viagra by insurance.

From the chart data for 2008, it looks like 30% of large employers exclude ED drug coverage. 37% cover with limits and 15% cover without limits. Again, we should compare the benefit in question with the rest of the market. Looks like about 50% offer some coverage.

This is a difficult issue that needs thoughtful discussion. Here is a link to an article abstract that is helpful in identifying the many interest groups involved and the moral issues.

A quote from the abstract:

Proponents of ED drug coverage included the Pharmaceutical Research and Manufacturers of America trade group and the American Urological Association. They argued that ED was a legitimate medical condition with recognized, effective treatments. They contended that because ED was typically a result of or a precursor to more serious health problems—such as diabetes, prostate cancer, and high blood pressure—coverage of ED drugs brought more people to the doctor’s office, where other health conditions might also be discovered and treated.8 The drugs’ manufacturers supported these arguments with substantial investments in lobbying and marketing. In 1998, Pfizer earmarked $35 million in the United States to promote sildenafil’s coverage by public and private insurance companies after several of them, including Kaiser Permanente of California, decided to deny ED drug coverage.9

I would love to know how much Pfizer spent on consumer advertising. I saw those Bob Dole ads constantly when it was first released.

I would love for the Governor and Sen Hopper to discuss how we or the insurance companies decide what to cover. Better yet, let's discuss the rising cost of medical care in this country, that is the core issue. Here is a link to a chart that shows the scope of this problem.

Can't we have a reasoned discussion of the real problem?

1 comment:

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