Andrew Stern

Labor’s Day at the Federalist Society

by Vincent Vernuccio on November 16, 2009 · 2 comments

in Deregulate to Stimulate, Economy, Labor, Regulation

Workers may get violent if their wages are cut. The United Auto Workers union (UAW) has a monopoly and was an anchor on the Big Three U.S. automakers. These two ideas were professed by two labor leaders at the recent Federalist Society Convention in Washington, D.C.

There may be violence, says Damon A. Silvers, Associate General Counsel for the AFL-CIO and Deputy Chair of the Congressional Oversight Panel for TARP. Silvers spoke on last Friday’s panel “Labor: Wall Street, Labor Unions, and the Obama Administration: A New Paradigm for Capitol and Labor?” Speaking to the panel, he claimed economic downturns which cause people to have their wages cut, can have devastating results.

Silvers pointed to wage cuts in Brazil and spoke of the violence which ensued. He argued that when people are starving they may get violent, that the have nots will take from the haves. Quickly cautioning that this could not happen in the United States, he smirked and added, “but it may.” Not so subtly, Silvers implied that if you cut union wages there may be violence.

Another gem from the convention came from Thursday’s lead discussion “Redistribution of Wealth.” One presenter, when asked what happened to the auto industry in regards to unions, stated, “Unions missed the most basic fundamental economic role they have to play, which is to take wages out of competition. What happened was when they had a monopoly or took wages out of competition for the Big Three people competed more inefficiently…When the transplants came…the union didn’t do its job, it was an anchor to the competitive field as opposed to a help.”

Which right leaning free-market intellectuals stated this fact? None other than any Andrew Stern, the president of the SEIU! That is correct, Andy Stern blamed the collapse of the Big Three in part to the union monopoly of the UAW and called it an anchor to competition.

More characteristically, Stern also spoke of redistribution of wealth saying, “I do no support, I condemn, the redistribution of wealth — that is to say, the redistribution of wealth upwards.”

Advocating the redistribution of wealth? Cautioning of violence if wages are cut? Is this really the message top officials in the two largest labor unions want to be sending? Both Stern and Silvers knew their audience did not agree with them – Stern was sweating during his presentation – but did make an effort to speak to the constitutionally minded lawyers association.

Unfortunately, while tempered, their message was a clear endorsement of class warfare. Espousing unions as the only way for workers to get ahead in America, they chastised the Reagan era and directly blamed the demise of unions for what they claimed were lower worker wages. They ignored facts of other presenters showing that most workers’ standard of living has actually gone up in the last 30 years.

Stern should be given credit for acknowledging that the UAW monopoly helped almost destroy the American auto industry. He must acknowledge that hard work, innovation, and ingenuity are the real engine of the American economy, not collective bargaining. The monopolistic nature of unions in many industries is a liability to both workers and unions. As Stern pointed out in the context of the failure of the U.S. auto industry, unions’ inflexibility can drag down companies and work as a hindrance, not a help.

Unions Disunited — and Fighting

by Ivan Osorio on April 22, 2009

in Economy, Labor

The civil war between the two factions that until recently made up the union UNITE-HERE heated up further this week. Yesterday, the leadership of the rump UNITE-HERE voted to suspend the union’s general president, Bruce Raynor, who led a dissident faction out of the union. Raynor’s group incorporated as a new union, Workers United, which is now affiliated with the Service Employees International Union (SEIU), as a “conference” of SEIU. Today, UNITE-HERE followed up with a protest outside SEIU’s Washington, D.C., headquarters, at which UNITE-HERE claims it had 300 people. SEIU, for its part, is accusing UNITE-HERE of suppressing dissent and of trying “to raid Workers United and SEIU” for new members.

UNITE-HERE was the result of the 2004 merger between the Union of Needletrades, Industrial & Textile Employees (UNITE), which was headed by Raynor, and the Hotel Employees and Restaurant Employees (HERE), headed by John Wilhelm, who now heads the current version of UNITE-HERE. Before the split, Wilhelm headed the union’s hospitality division.

Earlier this year, Raynor accused Wilhelm of trying to take over what had been UNITE’s resources, which were greater than those of the former HERE, whose hospitality constituency showed greater possibility for unionizing large numbers of workers. This combination of more workers to organize (HERE) and greater resources (UNITE) created the alleged synergy that brought the two unions together in the first place. Now the fight has grown into a proxy war between the AFL-CIO, which UNITE-HERE has decided to rejoin, and SEIU President Andy Stern, who led his union out of the AFL-CIO in 2005 and formed his own labor coalition, Change to Win — of which UNITE-HERE was a member.

It’s hard to say what will come next, other than the Wilhelm/UNITE-HERE/AFL-CIO vs. Raynor/Workers United/SEIU fight is unlikely to cool down any time soon — especially with control over the former UNITE-HERE’s assets at stake, and Stern’s propensity to never relent in pursuit of his goals. As union activist Steve Early writes in the left-wing online journal Counterpunch:

With family jewels up for grabs (in the form of UNITE-HERE’s $4.5 billion Amalgamated Bank), guess which Purple Knight stood ready to unite with either or both of the estranged partners, as long the bank was part of the deal.

That’s not not chump change anyone will let go of easily.

For more on SEIU, see here.

UNITE-HERE to Disunite?

by Ivan Osorio on February 9, 2009

in Economy, Labor, Politics as Usual

UNITE-HERE, the 450,000-member textile and hospitality union, is embroiled in a “civil war,” according to its president, who is now openly considering breaking up the union. UNITE-HERE was created as a result of a 2004 merger between the United Needletrades, Industrial & Textile Employees (UNITE) and the Hotel Employees and Restaurant Employees (HERE). The New York Times explains the logic behind the merger:

On paper, the marriage made sense, besides making for the catchy Unite Here name. Unite — the descendant of two illustrious New York unions, the International Ladies’ Garment Workers Union and the Amalgamated Clothing and Textile Workers Union — had lots of money to organize workers, but few workers left to unionize because so many apparel jobs had moved overseas. At the same time, Here was starved for cash, but saw an ocean of hotel and restaurant workers to unionize.

The idea was that once the unions merged, Unite’s ample treasury — it owns Amalgamated Bank, the only union-owned bank in the nation — would underwrite a surge in organizing.

But now the marriage is on the rocks. The merged union, comprising two disparate industries, maintained a dual leadership structure — Bruce Raynor, who headed UNITE before the merger, became General President, while former HERE chief John Wilhelm became president of UNITE-HERE’s hospitality division.

Now Raynor is accusing Wilhelm of wasting what were UNITE’s resources and trying to take over the union. He and some of his allies filed a federal suit accusing Wilhelm of violating the union’s constitution and going beyond their authority. Wilhelm says that he has respected constitutional procedure, and in turn accuses Raynor of a power grab. The rhetoric is getting heated.

“We’re not going to allow them to hijack the resources that were put aside by generations of ladies’ and men’s garment workers,” Mr. Raynor said. “We’ll do whatever we have to do to show that we can’t be held captive by a bunch of thugs.”

Mr. Wilhelm said the executive board and committee had followed the union’s constitution.

“The notion that the merger should be disbanded because Bruce Raynor can’t be a dictator is a proposition that may make sense for Bruce Raynor, but it doesn’t make sense for the workers in our industries,” Mr. Wilhelm said.

According to the Times, the UNITE/Raynor and HERE/Wilhelm factions cannot even agree on whether the union should split into its previous component parts. But someone else sure does seem to think the breakup should take place:

On Jan. 30, Andy Stern, president of the powerful Service Employees International Union, wrote to Mr. Raynor and Mr. Wilhelm saying their merger had failed and suggesting that Unite Here or either of its original halves merge into his union.

But Mr. Stern’s own union has been riven by dispute. He has ousted the leaders of a local representing 150,000 health care workers in California, and they responded by founding a rival union that is trying to get many of those 150,000 workers to secede from the service employees and join them.

You’d think Stern would have enough on his plate.

Among the accusations and insults volleying back and forth between Raynor and Wilhelm, it’s hard to assess who has the stronger case, but one thing seems certain: Competing egos like these cannot be easily assuaged. This may drag on for a while.

As a side note, I couldn’t help but notice this quote:

“It’s terrible to have these civil wars going on right now in what are among the most dynamic unions in the country,” said Joshua B. Freeman, a labor historian at City University Graduate Center in New York. “It’s a terrible waste of energy and undercuts tremendous possibilities.”

Is there any other area of the social sciences where one can expect to hear such blatant advocacy?

For more on UNITE-HERE, see here.

For more on SEIU, see here.

Update: UNITE-HERE Executive Vice President Edgar Romney today announced that he and several other union officials have filed a resolution with the union’s General Executive Board to dissolve the 2004 merger and for a disaffiliated UNITE “[t]o explore a relationship with SEIU.”

Update 2: John Wilhelm, president of UNITE-HERE’s hospitality industry division, announced on Monday night that, “the General Executive Board of UNITE HERE voted by a substantial 62% to 38% margin to remain unified.” Now it’s time to watch for Raynor’s next move.

SEIU Split in California?

by Ivan Osorio on January 29, 2009

in Labor, Politics as Usual

Ousted officials from a Bay Area local of the Service Employees International Union (SEIU) announced yesterday that they were forming a new union, and asked members to join. They were ousted from the local, United Healthcare Workers-West (UHWW), after a long-threatened takeover by the union’s national office became official on Tuesday, as the local was placed in trusteeship, for alleged “financial malpractice.”

From the SEIU national office to claim such concern about corrupt practices now seems strange, particularly in California. A Los Angeles-based local, with which the national SEIU wants to merge UHWW, has recently been involved in a serious corruption scandal. The Los Angeles Times, which broke the story on the scandal last August, also reported:

A source close to the union said Trossman was informed six years ago of allegations involving Freeman’s finances and personal relationships. It is unclear whether a review was undertaken at that time;  Trossman said that the SEIU might have performed an audit of the local because of the allegations, but that he couldn’t be sure.

In addition, questions have been raised concerning the union’s connection to Illinois Governor Rod Blagojevich.

For more on SEIU, see here.

Whither Union Transparency?

by Ivan Osorio on January 20, 2009 · 1 comment

in Economy, Labor, Regulation

As Barack Obama is sworn in as the nation’s 44th President today, Rep. Hilda Solis (D-Calif.) will likely be the next Secretary of Labor. As I’ve noted here recently, her cozy relationship with organized labor should raise concern among not only lawmakers and the public, but among rank-and-file union members who could soon find it harder to find out how union leaders spend their dues. The Department of Labor, under outgoing Secretary Elaine Chao, has enacted stronger reporting requirements. Reports The Los Angeles Times:

The federal government has adopted new financial disclosure rules for labor organizations that officials say would help expose the sort of corruption allegedly found in the largest California chapter of the Service Employees International Union.

The U.S. Labor Department, in the final hours of the Bush administration, has toughened standards to require most unions to publicly report nearly all compensation and expenses for officers and employees, the agency announced Friday.

Also broadened were disclosure requirements for the sale and purchase of property, with the aim of revealing whether any union officers or employees profit from the transactions.

In the alleged SEIU scandal, the Los Angeles-based local’s former president, Tyrone Freeman, has been accused by the union of enriching himself and his family with more than $1 million in misappropriated dues money. The SEIU ousted him after The Times reported on his spending practices last summer.

Unsurprisingly, union chiefs are howling, deriding the requirements as “onerous,” and calling for them to be pulled back — except for one.

An SEIU dissident, however, said he welcomed further disclosure. Sal Rosselli, president of an Oakland-based local, has feuded with the SEIU’s national leadership over the direction of the union. He said the national office has refused to fully disclose how much money it has spent on the internecine fight.

“Transparency on how unions spend their members’ dollars, from our point of view, is wanted,” Rosselli said. “We let our members look at every check.”

Rosselli’s local was recently forcibly merged into a giant “superlocal” with the scandal-riddled local formerly headed by Tyrone Freeman.

Having consistently hewed to the union line, Solis could yet surprise by taking seriously the concerns of Rosselli and others with similar criticisms. Step one is simple: First do no harm. In other words, do not scale back reporting requirements only because union bosses want the Department to do so.

In many states, workers must pay union dues as a requirement for employment, through legally imposed exclusive (i.e. monopoly) representation. Short of reform of this situation, the least workers deserve is to know where their dues are going.

For more on the Freeman scandal see here and here.

SEIU/CtW Deny Blagojevich Ties; “source” names Stern

by Ivan Osorio on December 9, 2008 · 1 comment

in Economy, Politics as Usual

The Service Employees International Union (SEIU) and the Change to Win (CtW) union coalition have each released statements denying involvement in the corruption scandal that led to the arrest of Illinois Governor Rod Blagojevich this morning.

However, it may be some time before more is known. SEIU, in its statement, says, “In keeping with the U.S. Attorney’s request, we are not sharing information with the media at this time.”

Meanwhile, the Politico‘s Ben Smith credits an unnamed “Democratic source” with confirming the identity of “SEIU official” mentioned in the case.

A Democratic source confirms that SEIU President Andy Stern is the “SEIU official” referred to in the federal complaint against Rod Blagojevich.

There’s no allegation that the SEIU official did anything wrong, and what appears to be a wiretap transcript has the official reacting non-commitally to Blagojevich’s offer of a quid pro quo. Another Democratic source tells me that Stern was been in Chicago November 3 meeting with Blagojevich, a discussion thought to have included talk about the Senate seat — though that meeting isn’t mentioned in the complaint.

An SEIU spokesman didn’t respond to a call or email seeking comment.

It’s too early to tell what, or where anything improper, took place. Still, the SEIU and CtW connections are worth watching as the case unfolds. (By the way, Change to Win and SEIU are inextricably tied. SEIU President Andy Stern created CtW when he led his union out of the AFL-CIO in 2005, and SEIU Secretary-Treasurer Anna Burger is also CtW Chair.)

A Blagojevich-SEIU connection?

by Ivan Osorio on December 9, 2008 · 6 comments

in Economy, Features, Politics as Usual

Service Employees International Union (SEIU) President Andrew Stern is not known for being shy about his ambitions. Since taking his union out of the AFL-CIO and forming the new Change to Win federation in 2005, he has sought to assert his union’s influence over private equity firms, centralize his authority within the union by forcing various locals to merge, and negotiate large deals with employers without member participation. Now, however, it is worth asking who is really in charge at SEIU.

Amidst all this power grabbing, things seem to have gone awry. The arrest this morning of Illinois Governor Rod Blagojevich and his chief of staff John Harris, for allegedly seeking to essentially sell the appointment to the Senate seat about to be vacated by President-elect Barack Obama, involves a tangled web of conversations between Blagojevich and other politicians and SEIU officials. The Chicago Sun-Times reports that on November 7:

[I]in a three-way call with Harris and Advisor B, a consultant in Washington, Blagojevich and the others allegedly discussed the prospect of a three-way deal for the Senate appointment involving an organization called “Change to Win,” which is affiliated with various unions including the Service Employees International Union (SEIU).

While no one at SEIU has been charged, the union’s less-than-stellar record in handling corruption within its own ranks should be cause for concern.

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