(c) 2018 Jon L Gelman, All Rights Reserved.

Thursday, July 10, 2014

Workers’ Compensation: The Road Ahead

This article is another installment of my continuing series entitled, 'The Path to Federalization."

Historical analysis of corporate wealth provides insight as to why the Nation’s workers’ compensation, conceived as a remedial social insurance program, has become dysfunctional. The National interest that drives the program is a strong predictor of future coverage for injured workers' and their families.

Over a century ago, in 1911, the US adopted a patchwork of programs to provide benefits to injured workers in a summary fashion. While much has changed over the century, the majority of states continue with the traditional programs, although they are seriously restricted in benefit delivery.

James Surowiecki authored an article, “Moaning Moguls,” in this week’s New Yorker magazine that focuses on why the system has really changed:


“A century ago, industrial magnates played a central role in the Progressive movement, working with unions, supporting workmen’s compensation laws and laws against child labor, and often pushing for more government regulation. This wasn’t altruism; as a classic analysis by the historian James Weinstein showed, the reforms were intended to co-opt public pressure and avert more radical measures. Still, they materially improved the lives of ordinary workers. And they sprang from a pragmatic belief that the robustness of capitalism as a whole depended on wide distribution of the fruits of the system.”
“If today’s corporate kvetchers are more concerned with the state of their egos than with the state of the nation, it’s in part because their own fortunes aren't tied to those of the nation the way they once were. In the postwar years, American companies depended largely on American consumers. Globalizationhas changed that—foreign sales account for almost half the revenue of the S&P 500—as has the rise of financial services (where the most important clients are the wealthy and other corporations). The well-being of the American middle class just doesn’t matter as much to companies’ bottom lines. And there’s another change. Early in the past century, there was a true socialist movement in the United States, and in the postwar years the Soviet Union seemed to offer the possibility of a meaningful alternative to capitalism. Small wonder that the tycoons of those days were so eager to channel populist agitation into reform. Today, by contrast, corporate chieftains have little to fear, other than mildly higher taxes and the complaints of people who have read Thomas Piketty. Moguls complain about their feelings because that’s all anyone can really threaten. “

As income inequality continues to fan the stalemate in Washington, there is little hope for a rescue of the nation’s ailing workers’ compensation system from extinction. Unless corporate greed yields to national interest, workers’ compensation as we now know it, will be subsumed into a program financed by taxpayers instead of consumers.

Jon L. Gelman of Wayne NJ is the author of NJ Workers’ Compensation Law (West-Thompson-Reuters) and co-author of the national treatise, Modern Workers’ Compensation Law (West-Thompson-Reuters). For over 4 decades the Law Offices of Jon L Gelman  1.973.696.7900  have been representing injured workers and their families who have suffered occupational accidents and illnesses.

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