The Corporatization of Unions
by Jim Smith
Z magazine, July - August 2002
Nearly every poll shows that workers favor having a union
by a large majority. According to an Associated Press poll (August
30, 2001) "General approval for unions runs by a nearly 3-1
ratio, roughly the same as in recent years but higher than 20
years ago, when it was less than a ^-1 ratio." Yet, unions
continue to stagnate or lose membership and elections at an alarming
rate. Can this be attributed solely to employer resistance?
My experience in leading organizing campaigns for a period
of more than 20 years inclines me to believe that fundamental
problems within labor are also to blame. Beginning with Samuel
Gompers and the founding of the AFL, a corporate model has been
embraced by much of labor. This development parallels the growth
of the modern corporation. It is characterized by a "top-down"
decision-making structure, relatively high salaries for those
on the top and low salaries at the bottom, an ever expanding staff
at the top levels, a reduction in autonomy at lower levels, an
exclusionary structure, a broad agreement with corporate political
goals, and an intolerance for democratic dissent at all levels.
Before the corporate model came to dominate labor, there was
the collegial, or equalitarian model, where every member was called
brother or sister. The earliest guilds were based on this concept
as were the early unions-and their parties-in the U.S. including
the National Trades' Union, the Working Men's Party, the Molly
Maguires, the National Labor Union, and the Knights of Labor.
Many of these unions philosophically, and sometimes practically,
supported worker associations and cooperatives where income was
shared equally or according to a strict formula.
Perhaps the highest development of the collegial model is
the Industrial Workers of the World (IWW). Its decline was a product
of a number of factors. Philip Foner describes the IWW as a congenial
organization for immigrant workers and migrants because of low
initiation fees, small dues, and "rank-and-file" rule.
In contrast to the exclusionary policy of the AFL toward immigrants,
the IWW proclaimed: "Meet the new arrival at the immigration
dock; introduce him to his fellow workers in One Big Union of
the working class..." As a result, says Foner, the IWW "quickly
won a reputation among the foreign born as their spokesman and
they came, often without being asked, to join."
The Growth Of A Corporate Model
At the same time the IWW was organizing the poor and dispossessed,
the AFL was recruiting skilled workers-the so-called aristocracy
of labor. The skilled trades had a bigger stake in the survival
of the capitalist system and were by nature exclusionary. Immigrants,
workers of color, and unskilled workers were seen not as fellow
toilers but as enemies, inferiors, and potential strikebreakers.
A highly complex control of membership and a hierarchal structure
to protect these craft workers seemed to make sense.
Contrary to the goal of autonomous power, in other words,
Gompers and the executive council had by World War I decided to
become a "junior partner" of business. Even as the AFL
was flourishing in the 1920s and the IWW was fading, a new "enemy"
arose, preaching industrial unions. The Communist Party and its
Trade Union Unity League (TUUL) began organizing workers on an
industrial, not craft, basis. Repression by the state and employers
kept these unions from being successful in anything beyond isolated
strikes. However, they laid the foundation for the rise of the
The Congress of Industrial Organizations was a hybrid organization.
It combined a core of radical union organizers and collegial-based
rank-and-filers with a leadership that broke away from the AFL
but retained much of its admiration for a corporate model of organization.
The McCarthy-style purge of Communists and militants in the late
1940s paved the way for a merger of the AFL and CIO that would
be firmly based on the corporate model.
Rise Of The Public Workers Union
A new element-the professional union functionary-came to prominence
with the rise of the public sector unions in the late 1960s and
1970s. When collective bargaining laws for public workers swept
the country, unions scrambled to hire organizers regardless of
their trade or industry. Since public workers covered the gamut
from blue collar and skilled workers to white collar and professional
employees, nearly any savvy organizer equipped with generic "join
the union" pamphlets could fill the bill.
Like the government agencies that employed these workers,
their unions tended to be extremely hierarchical and filled with
"headquarters" staff rather than field organizers. Rank-and-file
diffused by the establishment of small locals without treasuries
or power that were controlled by districts or councils with a
hired professional staff. There was little difference between
the council director and a corporate CEO. Both reported periodically
to a board of directors and occasionally to stockholders or carefully
The top staff (leaders) of the public workers unions joined
the craft union leaders in receiving salaries that were much higher
than those of most of the members in their unions. The appeal
of high salaries became a bigger incentive for workers to seek
union office or be appointed to staff positions than did a commitment
to union ideals and goals.
By the 1980s the growth of union salaries had been extended
to the top of most unions. For instance, Research-Education-Advocacy-People,
a rank-and-file group in the United Food and Commercial Workers
(UFCW) union, lists 37 officers with salaries ranging from $111,000
to $304,000 and 39 directors with an average salary of more than
$120,000. Most members of UFCW are grocery store clerks.
"Double-dipping," or collecting multiple salaries,
is another common practice in some unions. At the Western Regional
Convention of the Service Employees Union (SEIU) in 1995, "Make
the Best Better," an insurgent group at the time, proposed
eliminating double-dipping, which was enjoyed by a number of leaders
including then-president John Sweeney. The proposal was defeated
after fierce lobbying by Sweeney, Gus Bevona (president of the
New York janitors' union, with a salary of $450,000 per year),
arguably the highest-paid union official in the country, and others.
With such high salaries, these union leaders tend to associate
with others in their same income level, adopt habits and haunts
of corporate officials, and believe they are gifted, or at least
better than those they lead. In many cases, they equate their
continuation in leadership with the survival of the organization.
Many become "presidents-for-life." In the case of the
plumbers union and the laborers unions, the presidency was handed
down from father to son. The current president of AFSCME is the
son of one of the most powerful council leaders in the union.
The desire to cling to leadership was so powerful in the Mine
Workers union that it lead in 1969 to the murder of challenger
Jock Yablonski by incumbent Tony Boyle.
Some union presidents have crossed the line from following
a corporate model to corporate profiteering. In its May 2002 issue,
Labor Notes reports on the scandal in the Union Labor Lite Corporation
(ULLICO) where a number of board members who are union presidents
have made hundreds of thousands of dollars by using inside knowledge
on stock trading, particularly shares of Global Crossing. ULLICO
was founded in 1925 to provide death benefits for union members.
However, since then it has become a "player" in investment
banking and is currently financing the construction of Playa Vista
in Los Angeles, which is opposed by a broad coalition of community
and environmental groups.
Another development that can be associated with the rise of
the public worker unions is the phenomenon of "managerial"
staff. In addition to the hierarchy of elected officials, another
level has developed where union employees are divided into managers
and workers. With this division, internal labor unity is additionally
fractured. The income division widens and managers tend to associate
with other managers, while union "workers" associate
with their own kind. Among workers, there is a further division
between predominately low-paid and women workers in the office,
and higher paid and predominately white men in the "field."
In many unions, the office workers have unionized (usually with
the Office & Professional Employees union), while union managers
and officials have vigorously battled attempts by field staff
In some cases, the pay of field staff has gone down, but with
a racist edge. In the Los Angeles hotel workers union, highly
paid white field reps under the regime of Scotty Allen were fired
when the local was trusteed as the international union sought
to address the needs of Latino members. They were replaced by
field reps and organizers of color, but at half the salary of
the previous (white) reps. When they tried in 1989 to organize
with the Newspaper Guild, the leadership and international fought
vigorously, and was ultimately successful in eliminating the staff
The Neoliberal Bombshell
Although union density (percentage of the workforce) had steadily
declined since the 1950s when labor lost the aura of a movement,
it was the rise of neoliberal globalization in the late 1970s
that turned the slow fall into a nose dive.
The desire of Gompers to have labor be "junior partner"
to capital had largely been implemented in the period from the
beginning of McCarthyism until the wave of plant closings in the
late 1970s signaled a new attitude by capital. The "social
compact" disintegrated with the triumph of finance capital
over industrial capital and with scientific-technological advances
that freed capital from its nation-state restrictions.
The dominance of finance capital-caused partially by the huge
demands for investment capital triggered by new technology-homogenized
industry. No longer was the long-term well being of the company
(including maintaining a skilled and loyal workforce) foremost
in the goals of the Board of Directors. Instead, cutting costs
and maximizing short-term profits in order to be more attractive
to investors became the order of the day.
By the 1970s, competition was worldwide. No interference with
the markets could be tolerated. None from government trade barriers
and certainly none from unions. Less profitable enterprises had
to go, regardless of the social consequences.
In Los Angeles, in a period of a few short years during the
late 1970s, the region lost four major rubber plants, three auto
plants, three steel plants including the giant Kaiser Steel Works
in Fontana, plus countless other "feeder" plants and
businesses. The result was devastating to inner city neighborhoods,
which had depended on the availability of good union jobs for
economic survival. Unemployment, suicide rates, and drug use skyrocketed.
Meanwhile, corporate bottom lines increased as did the income
disparity in the U.S.
The response to the neoliberal attack was militancy on the
part of many workers. Plant closing coalitions sprang up around
the country. Bitter strikes were waged against Hormel, Staley,
Phelps Dodge, and other corporations. Most of these strikes were
smashed and in many cases workers found they had to fight a two-front
war against their employer and their international union. The
unequal battle got even worse when government support for neoliberal
tactics against unions was signaled by President Reagan's firing
of 11,000 PATCO air traffic controllers in 1981. Some union leaders
were frightened of the militancy exhibited by formerly tranquil
members. These leaders had come to power during the social contract
and had neither the skills nor the inclination to lead a strike,
go to jail, or form an alliance with non-labor groups (or other
unions in some cases).
The Loyal Opposition
The AFL-CIO staggered on through the Reagan and the elder
Bush regimes. Rank-and-file groups formed in a number of unions
and called for more democracy, more militancy, and more organizing.
However with few exceptions, they did not call for wide-ranging
structural reforms. Usually they were ignored or co-opted.
A typical example may be the Concerned Guild Members, a reform
group in the Newspaper Guild (TNG), for which I was the national
organizer, and Juan Gonzalez of the NY Daily News and Gail Lem
of the Southern Ontario Newspaper Guild were the co-chairs. At
one time, CGM had I percent of all Guild members as members of
its caucus. This is perhaps the highest percentage achieved by
any rank-and-file group. We were able to dominate discussion and
win significant votes at annual conventions. The international
leaders then eliminated annual conventions. We called for autonomy
and self-determination for Canadian members, more women and people
of color in leadership, more resources for organizing, and merger
with a larger union. In the end, Canadian members were able to
leave the U.S.-based TNG without retaliation (which weakened CGM),
a career staffperson was elected international president, and
TNG "merged" with the Communications Workers.
In retrospect, the merger movement was an example of corporatization
infecting even the most progressive elements in labor. The merger
of the Newspaper Guild with CWA did not result in more resources
for organizing, but did result in less democracy since TNG became
a numerically insignificant part of the larger union.
The argument for union mergers can be reduced to "the
companies are merging so we should too." Neglected in the
argument is the vast difference in resources and economic might
between merged corporations and merged unions. At worst, the union
merger movement is a form of a "cargo cult. " There
is no experience to which we can point of vastly increased union
might as a result of mergers, but there are many cases of the
erosion of union democracy. The merger of the progressive Oil,
Chemical and Atomic Workers (OCAW) into the Paper, Allied-lndustrial,
Chemical & Energy Workers (PACE) is a case in point. Leaders
of the more democratic OCAW had initiated the formation of the
Labor Party with which PACE is not sympathetic. The inability
of unions to organize bears some examination. As corporate-model
executives, union leaders would certainly welcome more income
derived from organizing. However, a risk-benefit analysis would
likely show that the prospects of gaining income from organizing
were problematic. First of all, it was expensive, around $100
per worker in a labor board election. Secondly, there was a 50-50
chance of losing the election, and even if it was won, there was
still a difficult first contract to be negotiated. There was a
political element too. Newly organized workers tended to be militant
and involved. They tended to identify with their union organizers,
not the remote leaders of the union. In some cases, they had the
ability to turn the incumbents out of office (when janitors did
just that in Los Angeles, the SEIU international swiftly put the
union into trusteeship). Surely, a better way to increase income
was by raising dues.
In spite of all the obstacles, a well-functioning organizing
committee is a prime example of the collegial model at work. The
collective spirit, the enthusiasm and confidence can be inspiring.
The energy and excitement of an organizing campaign stands in
sharp contrast to the ho-hum world of routine union business.
As a result, it can come as quite a shock to organizing committee
members when they come face-to-face with corporate model unionism.
Halfway measures by many unions alternately inspired and frustrated
non-union workers. My own experience in organizing is illustrative.
After organizing the LA Daily News-the largest Newspaper Guild
group to be organized in more than 20 years-I appealed to the
international to continue funding the campaign until a first contract
was secured. "Why should we do that?" asked the international
secretary-treasurer "You're just going to get decertified
anyway." We didn't get the funding nor were we decertified.
The campaign remains a high point in recent Guild organizing.
Later, after amassing a 100-member organizing committee at the
Los Angeles Times, the international again decided to cut off
its funding. The local union could not afford to continue the
campaign and the paper remains non-union today.
The lack of organizing by the AFL-CIO has led to a kind of
third-worldization of the U.S. workforce, ala Mexico and Venezuela,
where unionized workers form an elite with health care and pension
benefits while non-union, and mostly workers of color, are mired
Exit Kirkland, Enter Sweeney
The ongoing crisis in the AFL-CIO came to a head, oddly enough,
under President Bill Clinton. Lane Kirkland had presided over
the decline of the AFL-CIO since 1979 and had faithfully carried
out the legacy of his mentor George Meany, as well as the demands
of the State Department. After reeling from the passage of NAFTA,
the final straw for the AFL-CIO Executive Council was the Dunlop
Report. This Clinton-appointed commission was supposed to lay
the groundwork for labor reform, according to Kirkland. Instead,
the report argued for sanctioning company unions. Republicans
gleefully introduced enabling legislation called the "Team
Act." Kirkland was finished.
The "New Leadership Team" lead by John Sweeney,
who was previously not known as a reformer, promised "a new
dawn for American workers" as it took office on October 25,
1995. Unfortunately, the Sweeney vision was to run the union corporation
more efficiently. Seven years later, the AFL-CIO is still slipping
and rumors circulate of a new round of musical chairs at the 16th
The Sweeney "revolution" was never anything more
than a palace coup. Called the "New Void" by a prominent
independent union wag, the New Leadership was not put in office
by a mass uprising of the members (many of whom didn't know who
either Kirkland or Sweeney was).
Had there been an election for the leader of the AFL-CIO,
Sweeney probably wouldn't have been in the running (no scientific
polling was conducted among union members, however, Labor Notes
conducted a mail-in ballot which was won by Mine Workers union
leader Richard Trumka, with Sweeney trailing far behind).
The lack of direct democratic elections is reflective of a
top-down leadership and is an attribute of the corporate model.
Leaders of the AFL-CIO are selected at a convention of international
unions to which local unions, and members, are not invited. At
least one AFL-CIO leader has been candid in defending this limited
democracy: "The question that arises in our union and many
others is whether or not the ideal of democracy and practical
reality have a matchup," said Andy Stern, a reform-minded
leader, who took office last year as SEIU's president. He ticked
off a number of reasons why union elections have their drawbacks:
"They politicize the union's staff, they are costly, they
are distracting from the union's business and they often benefit
incumbents" (Chicago Tribune, "Democracy Dream Still
Eludes Unions," April 7, 1997).
Seattle And Its Aftermath
AImost as challenging to labor as the rise of neoliberalism
has been the fightback against it. When the fightback erupted
in the U. S. with the massive demonstrations against the World
Trade Organization on November 30, 1999 in Seattle, the AFL-CIO
seemed positioned to rebuild an alliance (proclaimed as "Teamsters
and Turtles") with other progressive forces. But even on
that now historic day, as we marched in a labor column 40,000
to 50,000 strong to link up with a like number of community and
environmental protesters in the center of the city, we were turned
away at the last minute by labor monitors and told to return to
the stadium where our rally had been held. Many of us broke through
to stay with those who had already shut down the city and the
WTO. As soon as the thousands of labor marchers disappeared from
view, the police began their rampage with volleys of tear gas
Since then, the AFL-CIO has been unwilling to enter an alliance
of equals with other progressive forces where each would compromise
some of their agenda for the sake of the alliance. The Teamsters,
under James Hoffa, have broken with the Turtles and supported
expanded drilling for Alaskan oil. The Machinists Union became
cheerleaders for "Star Wars," the hugely expensive and
unproved anti-missile defense. That bastion of progressivism in
labor, the United Auto Workers, rallied to the support of their
employers in opposing pollution controls and safety standards
The corporate and collegial models as they apply to labor
have also been characterized by opposite ideological imperatives.
The IWW, et. al., viewed workers around the world as allies. The
AFL-CIO adopted the views of the corporate class in identifying
with the national interests of the U. S., even when they were
harmful to workers in other countries (when German workers, or
at least their leaders, exhibited this identification with their
national interests 100 years ago they were condemned as "social
This common front with employers led the AFL-CIO's international
department to become a tool of the U.S. state department and the
CIA. Reforms made in this area by Sweeney now appear to be ineffective
or half-hearted. The AFL-CIO has cheerfully supported every U.S.
military adventure, even those against progressive governments.
They have done this in spite of the evidence that it is primarily
working class youth-including union members and sons of union
members-who fight and die for the benefit of U.S. corporations.
With extremely rare exceptions, labor leaders have been unwilling
to break with the Democratic Party, even when the latter is obviously
acting against the interests of workers and the poor. Calls for
support for the Labor Party or for candidates of the Greens or
Peace and Freedom have largely fallen on deaf ears. This has prevented
union activists from being able to associate with third-party
progressives and radicals and with organizations based on a collegial
model. It has also prevented labor from establishing links with
cynical non-voters, including some of the most oppressed workers,
who are effectively outside the system. Instead, labor has sought
to curry favor by means of monetary contributions to Democratic
political leaders who follow a pro-corporate line. Fearing to
rock the boat, labor has not even promoted reforms in its best
interest, including establishing long-term unemployment insurance
at two-thirds of salary and making it available to strikers. Nor
have they fought for single-payer health care (in 1994 some California
unions opposed the single-payer initiative because it would hurt
their Taft-Hartley plans), a universal basic income, a reduction
in the workday, etc. Surely, a collegial-based labor movement
with real democracy would have made these and other pro-labor
goals a priority.
The Future Of Unions
At this writing, there is no end in sight for the decline
of corporate-model unions. Economic and technological trends antithetical
to this union model continue to accelerate. Unions are becoming
more and more insignificant in the media and in society as a whole.
Yet they are desperately needed. A real revolution in the structure
and outlook of the AFL-CIO must take place or it will surely arise
independently of it. The nature of this revolution will likely
be different than any of us can imagine. However, it may well
include some common elements, including:
* A collegial model where decisions are made at the lowest
effective level, that is, at the department, plant, office level
where the problem originates and where the real power of the union-collective
action-can be most impressive.
* Outreach to people in struggle outside the union to form
broad alliances to fight common enemies. This would involve new
ways of thinking about problems. For instance, it would be easier
for building trades workers to oppose unneeded corporate projects
that are harmful to the environment if there is a broad alliance
fighting for and winning new affordable housing construction.
* Leveling of salaries and differential prestige within unions.
If individuals are attracted to working for unions because of
the salary, then labor is on the wrong track. Working for a union
must be seen as a cause and an honor for which individuals are
not penalized financially (compared with continuing to work on
the job). Ultimately, there is no good reason, except for seniority,
why John Sweeney should make more money than a competent union
office worker. That is, if both are doing it for the "cause."
* Reduction in the size and complexity of labor union employment
as the movement elevates elected job stewards to the top position
in the "hierarchy. "
* A democratic process from top to bottom, including direct
election of all officials. This should be combined with strict
term-limits to avoid continuation of an entrenched leadership.
* A quota-based affirmative action program that will make
union leaders look like the membership.
* Move the union out of the office buildings and into the
streets with store-front service centers.
* An inverted pyramid where "higher" levels of the
union are tools of local unions to accomplish goals they can't
do alone, such as industry-wide bargaining. Trusteeships, which
are often used for political purposes rather than to root out
corruption, must become a thing of the past.
A Final Thought
There is a theory called Glocalism, which in true dialectical
fashion says the development of globalization is causing local
communities to assume more importance. Katherine Harmsworth writes
in Glocalism "The shrinking of the world reinforces the link
between the local and the global. As engagement in the globalized
world increases, so too does the importance of the local places
where individuals live. In part, this is a reaction to the loss
of control on the vast global stage."
Glocalism may well apply to unions as well. Intensive development
of the locally-based union, instead of extensive development of
merged unions, may point the way to the future. It is at the local
level where democracy is found in its purist expression. It is
also here that the opportunity for developing links with the community
are the greatest. This is not an argument for company unions,
but rather for democratic associations of local unions united
for a common purpose.
The future of labor may entail an understanding and appreciation
of those pioneers of union democracy, the IWW's Wobblies. Nearly
100 years ago, they acknowledged the utility of city locals made
up of workers of all types. In true social movement fashion they
were concerned about the worker on the job and in the community.
The free speech fights of the Wobblies were not necessary to win
a better contract, but they were essential to the dignity of the
working class. Today, the role of the union must be to ensure
fair and equal treatment of all workers, both on and off the job.