Veto Override on HCSA

Today the City Council, to the chagrin of the editorial board of the New York Sun (The NY Post soon to follow) will override the mayor's veto of the Health Care Security Act (HSCA) in spite of some last minute efforts to amend the bill in order to afford some additional protection for some of the predominately minority-owned supermarkets. There is still support, however, for amending the law after tomorrow’s vote. There just wasn't enough time to get a consensus so amendments could be drafted.

That being said there is still a great deal of disarray among various industry factions with some, particularly the National Supermarket Association (NSA), looking to perhaps sue to have the law overturned. Needless to say that posture doesn't help persuade the Council to amend the law.

The larger problem that the NSA has is its lack of any well-developed political operation. The HCSA was incubating at the Council for over a year and a half but the NSA either wasn't aware of its existence or had underestimated the bill's potential impact on its members. In addition, since a number of supermarket chains had joined forces with labor to support the HCSA, the Neighborhood Retail Alliance, the usual defender of the markets' interests, remained on the sidelines (something we have been taking a good deal of heat for).

The rejectionist posture is not without risk however. In tackling the Council (and labor we might add), in a direct and personal way the NSA is in danger of making it difficult to achieve any of its other legislative goals. This is even more so since the group's support for councilmembers has never been commensurate with its economic clout. Right now the organization is in need of more sophisticated political advice.

Higher Grocery Price Argument

The economic opposition to the bill comes from fiscal conservatives, like those at the NY Sun, who argue that the bill, by mandating that employers provide health benefits to their workers, will lead to higher food prices. They have a point, one that we have been making all along: The fact that Wal-Mart does not provide adequate health coverage does give the retail giant a competitive edge over those unionized stores that do.

In fact labor costs account for around 60% of a store's overall overhead. Wal-Mart began in the South and its employee base was predominately female. These workers, particularly in the more chauvinistic South, were viewed as supplemental income earners to their male spouses. Since the company's inception, however, the face of retail employment has changed dramatically. The decline of manufacturing has made retail employment family-supporting out of necessity.

The other point is that the largest retailer in the world should not be forcing the government to cover their employees' health care needs. That is precisely what Wal-Mart is doing and the company has been cited as the leading corporate recipient of government hand-outs in state after state. The failure to mention this makes the opposition to the HCSA short-sighted indeed.