May 6, 2003 - Make no mistake about it, America is in the throes of class warfare and it is more far reaching than just the Bush Administration’s push to shift the primary burden of income taxation to the working class by cutting the highest marginal tax rate and making dividend income tax free. There is a Bill pushed by the House Republicans which will permit American corporations to cut their funding of employee’s pensions. The premise upon which the Bill rests is that Blue Collar workers die younger than do white collar workers. On the surface the logic behind the Bill seems sound.

At present corporations are required to fund pension plans at a level based upon sound actuarial consideration of the overall life expectancy of Americans. The Bill would permit companies to consider the life expectancy of Blue Collar workers separately from that of white collar workers. The present system lumps the two together in determining the actuarial average upon which the funding requirement is based. Since the study upon which the proposal is based found that Blue Collar workers died sooner than White Collar workers the result of applying the different standards will be to cut back funding requirements for hourly and union employee’s pension while increasing the current level of funding for salaried managerial and executive employees. Except the bill does not do that. Instead it assumes that all of the company’s pension obligation will be to blue collar workers.

The problem is that the figures on which the proposal is based are not accurate, at least not according to Edwin C. Hustead, chairman of the actuarial panel that produced the new mortality tables. He says that the figures that his panel produced are misapplied and that the blue – white collar distinction is not accurate. Indeed, he says, the more significant factor in life expectancy is income. The panel found a direct correlation between income level and life expectancy but decided not to report it. It was a political and not an actuarial decision according the chairman.

It is a politically shocking proposition to quantify actuarially the proposition that rich folks have better access to health care than poorer folks and that they tend to live longer. Who knows, that scientific proof of the proposition might be used to support calls for making quality health care available and affordable for most, if not all, Americans. The actuarial panel decided to leave the lid on that can of worms and suppress their findings.

The UAW was induced to support the bill on the promise that the corporate savings will be passed on to the workers in the form of higher wages. I wonder if the UAW executive committee is investigating the purchase of the Brooklyn Bridge. That sure isn’t any better deal than the one they have bought onto.

There is class warfare in America alright, but the targets of the assault don’t inhabit the board rooms and the casualties will be found spread out on the factory floor.