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This Would Be A Very Painful Divorce


If organized labor goes through an ugly divorce, an outcome that seems to be gathering steam, expect divisive spats over everything from politics to money to new members. For now, AFL-CIO President John J. Sweeney has a majority of union leaders backing him for reelection at the federation's convention in late July. But dissident unions, which recently formed a group called Change to Win Coalition, are threatening to pull out of the AFL-CIO if the federation fails to undertake major reforms and reelects Sweeney.

In the past few months the possibility of a breakup has pushed antagonisms sky-high, and tensions will only worsen if anyone actually decamps. Even if the coalition, led by Service Employees International Union (SEIU) President Andy Stern, breaks off into a rival federation, both groups will have plenty of incentive to avoid open warfare. But it's also possible that the maneuvering could degenerate into tit-for-tat retaliation, causing nasty rifts. If the coalition unions quit, "you're looking at the total restructuring of the AFL-CIO -- no more solidarity, just divisiveness," says key Sweeney backer Jerry McEntee, president of the American Federation of State, County & Municipal Employees.

At this point the threats are aimed at swaying union leaders' votes to one side or the other. For example, Sweeney has told the AFL-CIO's Building & Construction Trades Dept. to kick out the United Brotherhood of Carpenters, which left the AFL-CIO in 2001 over displeasure with Sweeney's leadership and recently joined Stern's coalition. Sweeney has tried to force the quasi-autonomous department to dump the Carpenters several times but has been rebuffed. Why? The Carpenters often are the lead union on construction projects, so other building-trades unions could lose work for their members if they kick that union out. Now, in an attempt to intimidate coalition unions, Sweeney has given the department what he says is a firm deadline -- right after his reelection -- to oust the Carpenters.

The federation president has followed up with a threat to cut off other unions that mutiny, too. He has drawn up a resolution for the convention that would require other AFL-CIO bodies to stop doing business with disaffiliated unions. This could be pre-election posturing, but if Sweeney carries out the threat, the measure could wreak havoc among some of the AFL-CIO's 600-plus state and local entities. At the Los Angeles County Federation of Labor, for example, the SEIU makes up about a third of the union's membership. Yet that group's political activism has been held up by Sweeney and others as a model for other such state federations. It could be dealt a crippling blow if Sweeney's resolution forces out the SEIU, says county federation President Ricardo F. Icaza. In fact, Icaza might have to leave himself since he is also president of Local 770 of the United Food & Commercial Workers, a member of Stern's coalition that may quit the AFL-CIO. Charges John W. Wilhelm, No. 2 at another coalition union, UNITE HERE: "The consequences on the ground will be overwhelming if Sweeney pursues this scorched-earth tactic."

His side has equally divisive ways to strike back. The Carpenters union could yank some $500 million it has invested in ULLICO Inc., a labor-owned insurance company. Coalition unions also could withdraw from the AFL-CIO's credit-card program, which earns unions $52 million a year. And in June three coalition unions fired a warning shot at Sweeney by pulling their members' names from the AFL-CIO's master political-contact list. The two camps would probably endorse the same candidates, but labor's clout could diminish if unions don't coordinate.

Meanwhile, Sweeney and other AFL-CIO officers have urged allies to cut off the Amalgamated Bank, owned by UNITE HERE, if that union exits the federation. The Communications Workers of America, staunch Sweeney allies, recently pulled $50 million without waiting to see if it does.

Publicly, leaders of both camps decry the partisan sniping. But given the powerful emotions at play, a divorce could cause rifts that might undermine labor's clout -- and take years to heal.

By Aaron Bernstein in Washington


Steve Ballmer, Power Forward
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