History lesson time: This wasn’t done on purpose. It’s an artifact of decisions made by Congress during World War II to support war production.
So many young men were away at war that it created a labor shortage, even with some women entering the work force. This led to spiraling increases in wages that were threatening the viability of critical war manufacturers.
In an effort to protect this manufacturing sector, Congress capped wage increases. But those corporations were still competing for workers and now they were no longer able to offer them higher and higher wages. So instead, they started offering them “perks” like health insurance, pensions, and paid time off.
THEN:
“In 1943 the War Labor Board, which had one year earlier introduced wage and price controls, ruled that contributions to insurance and pension funds did not count as wages. In a war economy with labor shortages, employer contributions for employee health benefits became a means of maneuvering around wage controls.”
Emphasis mine. And guess what? When those young men returned from war and re-entered the work force, they wanted those perks too. So which company was going to be the first to deescalate the arms race and NOT offer health insurance?
And those perks being so ubiquitous meant the government never had an incentive to provide health coverage directly to anyone of working age, so we only have Medicare for retirees.
History lesson time: This wasn’t done on purpose. It’s an artifact of decisions made by Congress during World War II to support war production.
So many young men were away at war that it created a labor shortage, even with some women entering the work force. This led to spiraling increases in wages that were threatening the viability of critical war manufacturers.
In an effort to protect this manufacturing sector, Congress capped wage increases. But those corporations were still competing for workers and now they were no longer able to offer them higher and higher wages. So instead, they started offering them “perks” like health insurance, pensions, and paid time off.
THEN:
“In 1943 the War Labor Board, which had one year earlier introduced wage and price controls, ruled that contributions to insurance and pension funds did not count as wages. In a war economy with labor shortages, employer contributions for employee health benefits became a means of maneuvering around wage controls.”
Emphasis mine. And guess what? When those young men returned from war and re-entered the work force, they wanted those perks too. So which company was going to be the first to deescalate the arms race and NOT offer health insurance?
And those perks being so ubiquitous meant the government never had an incentive to provide health coverage directly to anyone of working age, so we only have Medicare for retirees.
https://www.ncbi.nlm.nih.gov/books/NBK235989/#:~:text=In 1943 the War Labor,of maneuvering around wage controls.