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Today DaimlerChrysler has announced massive layoffs in the American Chrysler division. While there is no question in my mind that I would rather own a Toyota Avalon than anything produced from the American auto manufacturers, there is this small issue of the high costs of healthcare in this country that is detrimental to our competitivness abroad.

The Center for Automotive Research estimates that the additional health care spending at Chrysler is costing the automaker about $600 a car, or more than $1.6 billion a year, compared to its U.S. competitors.

The health care costs are a particularly serious competitive problem for all the Big Three. Even at their U.S. factories, Asian automakers such as Toyota, Honda and Nissan do not have nearly the health care costs as GM, Ford or Chrysler, mostly since they don’t have to worry about health care costs for a large population of retired workers. And at their Japanese plants, health care is a government-provided benefit.

Chrysler spent $2.2 billion on U.S. health care in 2006, with fully two-thirds of that going to cover retirees and their families.

CNN Money → Chris Isidore → How Chrysler’s gains turned to pain

I have not heard that Japan is paying their workers considerably less than are workers in the US, so the usual canard about the unions being to blame seems specious. In addition, I would point out that the noise about nationalized healthcare being problematic in other nations should be taken as a challenge for American ingenuity, not a reason to hide like a coward and refuse to confront reality.

Posted in Healthcare

One Response

  1. lynette

    this is a huge issue in this country, and one which seems to be consistently swept away as not worthy of a serious look.

    my friends in canada and england actually report good things with regard to their nationalized health programs. i expect that american ingenuity could improve upon what’s seemingly working there, but the insurance company lobbyists will do all they can to prevent that.

    we pay $720 a month for basic health coverage. my husband pays another $100+ for medicare and some unknown amount for the disastrous Part D coverage. prescription costs run $800-900 per month even with insurance. i don’t know how most folks can manage and i suspect they’re just crossing fingers and hoping nothing disastrous happens.

    this needs to be a priority in this country. is anyone listening? i don’t think so.

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About Existential Ramble

Existential Ramble is a blog where David will post whatever comes to mind. For a few years, this was largely political in nature as the category cloud reveals. David's blogging time is split between ERblog and his professional website at literarytech.com. The major difference is that if it is a controversial, personal opinion type post, you'll find it here.