Yesterday, I did a television interview about the buy-out of Chrysler by a private-equity firm. It was striking to me during that interview—and is reaffirmed if you read the MSM coverage of the story—how much the story is being framed entirely around the “sacrifices” that the rank-and-file workers will have to make to keep Chrysler competitive. But, to me, the most obvious questions raised by the deal are: what about single-payer health care and what about CEO pay?

DaimlerChrysler is dumping Chrysler, in part, because of its $18 billion in health care and pension obligations. And here’s how The New York Times reported the story:

By unwinding a nine-year-old merger between Chrysler and Daimler-Benz of Germany, Cerberus is also taking on Chrysler’s $18 billion obligation for health care and pensions for employees and retirees.

Any efforts to sharply reduce those perks — which Chrysler can afford but says represent a cost burden of $1,500 a vehicle — will probably put it at odds with the U.A.W.

And…

The most obvious way for Cerberus to make money off its investment is to cut costs — especially by reducing the benefits that workers hold sacred, including medical benefits for workers and their immediate families for life, with only modest co-payments or deductibles.

What first jumps out in this story is the use of the word “perks.” The word fits with the typical storyline: American auto companies are in trouble. The trouble is caused by “generous” benefits paid to auto workers. Solution: cut those benefits—referred to here as “perks”— to save the auto companies.

As a matter of economics, it’s worth noting that auto workers “perks” amount to a pension that averages $32,000 if you worked 30 years and retired. And that monthly payment by the company GOES DOWN once a worker begins to collect Social Security. Let’s be clear: the Chrysler pension fund is completely funded (actually, it’s more than that—-see below).

Health care is a big cost item—-but, if the auto industry (not to mention the rest of corporate America and many of our political leaders) could get past ideology and focus on economics, there would be a much better solution: a single-payer health care system. If Cerberus wants to make a ton of money, its genius leaders should become immediate advocates for a single-payer system.

This is not a new idea. Two years, I pointed out that the auto industry was the poster child for a single-payer system. Many others have made this point in the past and more recently. It is not deeply complicated.

And, yet, we have candidates running for president and their allies in Congress, petrified to say quite clearly that the market has failed, that health care cannot be run as a profit center for the insurance and drug industries and that that is not a left-wing position but a matter of competitive survival for American industry.

The second issue is the absolute obscenity—-no other word fits—-of telling people, who are just trying to make a decent living, that they should take cuts, while private equity partners are reaping hundreds of millions of dollars in fees and CEOs are continuing to make millions in pay and pensions benefits.

Daimler succeeded in botching the management of Chrysler, wiping out $25 billion in shareholder value during the time the German company owned Chrysler—and, yet, there is no penalty to those executives who failed miserably. In fact, their pay and pensions have grown.

Here’s another delicious irony. Last year, I highlighted a Wall Street Journal article that showed that the fully-funded pensions of average rank-and-file workers at General Motors generated more than $10 billion in investment income—while the pensions of GM executives were under-funded by $1.4 billion. I suspect that that is the general theme at Chrysler, also (companies are very adept at burying this information so I have not had a chance to analyze those numbers).

I do know, from talking to my friends at the UAW, that the pension funds of the Chrysler rank-and-file workers are OVERFUNDED by TWO BILLION DOLLARS (I’m sorry if I’m shouting here). In other words, the company has actually been making money on the investments on workers’ pensions (pensions, lest we forget, are deferred compensation: you agree not to get paid money today so that you can have a bit to live on in your retirement years).

So, if you want a real debate—one based mostly on economics, not ideology—on the future of Chrysler, the frame should focus on reducing health care costs through a single-payer system and a pay and benefit system that ensures that executive compensation (whether for private equity partners or management of the portfolio companies) does not unduly burden the financial health of the enterprise.