California's system for compensating injured workers is so fraud-ridden and inefficient that it cannot be reformed and should be abolished, Ron Unz, a Republican candidate for governor, said Wednesday.
Unz, a wealthy Silicon Valley businessman who is challenging Gov. Pete Wilson in the June 7 GOP primary, said workers should buy private insurance if they want protection from the financial ruin that can come with being injured on the job.
Returning to such a market-oriented system would eliminate the intermediaries--mainly doctors and lawyers--who absorb much of the $11 billion that employers pay in workers' compensation premiums each year, Unz said.
He said those premiums, although paid by employers, represent a hidden tax that reduces wages for workers at an average of hundreds of dollars per year for employees covered by the system.
Unz's proposal is part of his libertarian-leaning economic program, which also includes a reduction in the top state income tax rate from 11% to 5%. Unz said he would balance the budget by cutting welfare spending. He also asserts that lower tax rates would prompt economic growth and boost tax revenues.