CEO ponders healthcare reform; my thoughts on "universal" healthcare
As a rule, I don't like Starbucks. I think they're overpriced, but from a business standpoint, I admire what they've accomplished. I admire their market penetration and brand acceptance, and the way people actively seek them out over just about every other brand. They're sort of like Bose in that respect: way overpriced for what you actually get.
But I must say that after reading this brief article from Fortune, I admire CEO Howard Schultz for more than just his business acumen.
On a freezing winter day in 1961, 7-year-old Howard Schultz came home from school in Brooklyn to find his parents in tears. His dad, a deliveryman, had broken his ankle and was out of a job, with no health insurance.
His family's fear scarred Schultz. Later, as he grew Starbucks, he vowed to build "the kind of company my father never got a chance to work for." Schultz was a leader in offering comprehensive benefits to part-timers - and the loyal talent Starbucks has thus attracted, he says, has been central to its success.
Now Starbucks' benevolent coffee republic is at risk. Like every business, it has seen double-digit increases in health costs.
I think the backstory is central to humanizing Schultz, of course. Without it, I'd probably be pointing my finger and saying that it's a ploy to get on the public's good side. And it certainly could be that, but it's probably more than that as well.
In any event, Schultz has taken the stage in the fight for better employee health benefits. I need not remind you of the bad karma that treating employees like expendable assets buys you. Smoke in mirrors is the key here — employees may be largely replaceable, but the goodwill of the populace is not. Everyone wants to feel like they're important, and not subject to the whims of a faceless corporation.
Now I'm preaching the book. Back to Schultz's initiatives:
Such questions led Schultz to make the rounds in Washington, but he came away discouraged. "It's all great when you're there," he says. "Then you leave, and nothing happens." His next idea was to convene a summit on CNBC to call attention to the issue. He pulled it off late last year - barely.
"It wasn't easy to get CEOs to appear publicly on this issue," Schultz says. A few CEOs came, but one withdrew even after agreeing to join. "I just can't be out front on this," he said.
I ask Schultz why CEOs are so timid. He sips his coffee (a rare Ethiopian blend from his chairman's stash). "It's the cloud Hillary created when she tried to change the system," he says. "People burned her so badly, and everyone remembers that. It's a subject people don't want to touch."
I'm not sure I necessarily agree with that. While I can only vaguely remember Hillary's universal health care plan initiative — yes, I am that young — could its defeat really strike fear into the hearts of the business titans? Maybe, I guess. Honestly, I haven't heard mention of the initiative since we were all talking about Medicare Part D last year, and before that? Well, it had been a while.
If universal coverage ever comes, it'll be in fits and starts; a little bit here, a little bit there. There won't be a single master stroke — that's too much change all at once for the American public to handle. If the US ever moves towards universal healthcare, we'll see taxes increase in the same fits and starts as the programs that make up the "universal coverage" develop and mature. We'll have to — unless the US radically re-prioritizes its spending, there simply isn't enough money in the pot to tackle everything all at once at the current rates of taxation, and our debt spending as a country is through the roof since 9/11 anyway. And we all know how well the public likes higher taxes.
I could see the myriad programs that spring up eventually being integrated into one agency, but it wouldn't start out that way. And there'd be hot debates about it — we'd see the "S" word dragged out (socialism) by the right, and an equally charged response from the left.
In any event, I believe that universal health coverage provided by the government is a bad idea, because government reimbursement for medical expenses is so low — we'll see decreased innovation shortly after such programs are implemented, and that, my friends, is bad for everyone over the long haul. There simply isn't another country in the world with enough wealth whose healthcare system is not controlled by the government to continue to fuel the dizzying pace at which life science breakthroughs are being made.
And no, more government funding is not the answer. The hunger for profits by lean, mean money-making business machines, is. The desire for the next blockbuster drug; the constant over-the-shoulder glances at the competition fighting for the same billions you are. That's our current system, and it brings a lot of good and a lot of bad with it. Take your pick: universal healthcare and a stalling of medical research in five years, or a fragmented private system where R&D continues and people continue to fall through the cracks.
Neither is an optimal solution, but one can't have everything, I suppose. If you could marry the two goals in some way, we might have a shot. But I don't see how it could be done in any meaningful way, because there's no way to create a positive feedback loop like there is in the current system.
[tags]Medicine, pharmacy, healthcare, economics, Starbucks[/tags]
No Comments »
No comments yet.
RSS feed for comments on this post.
| TrackBack URI
You can also bookmark
this on del.icio.us or check the cosmos