AFL-CIO Feels the Heat From Key Democrats

Union leaders say there was more “labor bashing” around the Democratic National Committee meeting in Washington last week than they usually hear from anti-union employers who are trying to prevent workers from voting for union representation.

The attacks might be more accurately compared, however, to those of Sen. Gary Hart last year during the Democratic primaries, when Hart angrily denounced the AFL-CIO as a “special interest” after it endorsed his rival for the presidential nomination, former Vice President Walter F. Mondale.

It is clear, however, that none of the criticisms have deflected the unionists from the historic political course that they set for themselves in October, 1983, when, for the first time, the AFL-CIO endorsed a presidential candidate before the major political parties had made their nominations.

Although the labor push gave Mondale’s campaign the strength needed to win the nomination, critics later blamed Mondale’s disastrous loss in large part on the labor endorsement. They charged that organized labor is unpopular and that Mondale was hurt by a public perception that he was a captive of labor.

Liberals Take Charge

The charge was renewed last week at the Democratic National Committee meeting, where a labor/liberal alliance routed the more conservative Terry Sanford and moderate Nancy Pelosi in the race for committee chairman by electing Paul G. Kirk Jr., a longtime associate of Sen. Edward M. Kennedy (D-Mass.).

I. A. Lewis, director of the Los Angeles Times Poll, reflected the view of many critics of labor when he said after Kirk’s election:

“They (labor leaders) should be more sensitive to the kind of image they are presenting. I believe they should try to keep out of the limelight because labor is perceived, rightly or wrongly, as a ‘special interest’ trying to dominate the Democratic Party, and the American people are turned off by that perception.”

Charles Manatt, who has just left the chairmanship, says he believes that it is “a real question at this point” whether the AFL-CIO will again make an early presidential endorsement. He says he would advise against it.

However, the AFL-CIO is still firmly wedded to the idea of making a pre-primary endorsement in 1987.

As in 1983, such an endorsement would require that two-thirds of the affiliated unions agree on a candidate, a goal that AFL-CIO President Lane Kirkland believes is feasible.

The federation leaders also feel pleased with the results of their active participation in intra-party politics. And they intend to increase that participation.

‘Party of Compassion’

The union leaders’ basic goal is to ensure that the Democratic Party is the “party of compassion,” concerned more with the problems of workers, the poor and the elderly than with gaining the kind of popularity some Democrats believe would come if the party followed more conservative policies.

The unionists stress repeatedly that they cannot and do not want to dominate the party but that, as the single largest force within it, they expect to help set policies and nominate candidates.

That basic goal was aided, the union leaders say, by the decision to elect the liberal Kirk. However, the choice certainly did not diminish friction within the party.

At the meeting, California Democratic leader Pelosi accused organized labor of trying to defeat her with an “anti-woman” campaign. She accused AFL-CIO leaders of pressuring their representatives to back Kirk.

Pelosi and others said the party would be hurt by Kirk’s longstanding ties to Kennedy and his “labor connections.”

Although labor has only 41 members on the 378-member Democratic National Committee, its influence is enhanced when those representatives work as a bloc. However, that did not happen last week. Although the union leaders met in Washington on Jan. 9 to consider a united labor front, they did not endorse Kirk.

There was, however, what federation spokesman Murray Seeger called an “overwhelming consensus” among the union people for Kirk.

Pelosi had some significant labor support from, among others, such union leaders as Californians Bruce Lee, regional director of the United Auto Workers; Justin Ostrow, regional director of the International Assn. of Machinists, and Dina Beaumont, vice president of the Communications Workers of America.

Ostrow and most of the other unionists who initially voted against Kirk backed him after Pelosi dropped out in favor of Sanford. He added that he “was not really hurt by Pelosi’s attacks on labor. I’ve worked with her for over four years, and she did an excellent job.

“And I’m accustomed to labor being used as a scapegoat, a whipping boy, by those who need an excuse for their own failures. If they need scapegoats, so be it.”

Ostrow insisted that “not one labor person I spoke to was pressured by the AFL-CIO on Kirk’s behalf.”

Rachelle Horowitz, political director of the American Federation of Teachers, said she was insulted by Pelosi’s contention that labor was running an anti-woman campaign. “That was absolute nonsense and just more of the malicious labor-baiting that went on at the meeting,” she said. Horowitz said a broader perspective is needed on labor’s role in politics.

“First, those who did not want Mondale to be a candidate last year hold labor responsible for the fact that he was the party’s nominee, and for his defeat. Yet everyone should know by now that what defeated him was not our endorsement--60% of the AFL-CIO votes went to him--but the economy.

“Mondale was defeated by the declining inflation rate and economic growth, the appeal of President Reagan to the selfish ‘me-first’ attitude of many Americans and his (Reagan’s) personal popularity.

“Until the Democrats regain the economic issue,” she said, “the election of Democrats will be a massive problem that will not be solved by organized labor hiding in some corner.”

Obviously, those who want labor out of politics have failed so far and, in fact, indications are that the AFL-CIO is more determined than ever to remain an integral part of the Democratic Party’s operations.

Problems at Akron

Union members at Akron discount stores were dismayed a few weeks ago when management insisted that they take pay and fringe-benefit cuts of as much as 50%. On Jan. 6, they voted to reject management’s demand and strike if another round of bargaining talks didn’t improve the company’s offer.

Management held firm, and on Jan. 26 a majority of the 51 unionized members (of a total of about 100 employees) voted to accept the cuts. By last week, however, nearly half of those union members, several of whom had worked 20 or more years at Akron, had quit in protest.

Waltraud Lopez, who departed after 25 years at Akron, said that, while everyone was upset by the new pact, the majority voted for it because “they just wanted to go to work” and did not want a strike.

But Vince Schmeltzer, who quit after 23 years, asked: “How can we live on that kind of money?”

And a management executive, who contended that the cuts were necessary for the company’s survival, said: “Don’t quote me by name, but I guess you can’t really blame them for leaving us.”

The new pay scale is $4.20 an hour, down from a top of $7. Many fringe benefits, such as dental and vision care, several holidays and pay for employees on jury duty, were also eliminated. In addition, plans are being made for substantial cuts in the pension program.

A spokesman for the United Food and Commercial Workers, which represents the Akron employees, said the union tried to fight the company demands, but he asked rhetorically: “How do you strike a company that is almost going out of business?”

Akron recently agreed to sell up to 17 of its 20 store leases to Circuit City Stores, a fast-growing consumer electronics retailer based in Richmond, Va. Union leaders say they expect that Circuit City will try to operate without a union. Circuit City would not comment.

An Akron spokesman said the company will operate at least three of its own stores and hopes to expand the number to as many as 24 by the end of 1986. The economically troubled chain had been sold by Thrifty Drug Co. in December, 1982, to Hong Kong investors C. K. Chan and L. H. Chan.

Pension Fund Plan

Robert A. G. Monks, who recently left his post as administrator of the pension and welfare benefits section of the Department of Labor, has an innovative plan that he hopes will help to modernize the nation’s business system as well as its pension funds, which now have reserves approaching $1 trillion.

In his government position, Monks helped set government policies and standards designed to ensure that pension fund trustees complied with laws regulating those funds.

But he says the trustees need private, not government, help to avoid inadvertent violations.

Perhaps more important, he suggests, is that, with some guidance, pension fund trustees can use their tremendous power to add a major dimension to the management of almost all corporations: long-range planning.

To achieve those goals, he proposes creation of a private, self-regulatory organization that would do for pension funds and the Department of Labor what the long-established Financial Accounting Standards Board does for the accounting industry. Such a private agency, he said, would cut down on the work of the Labor Department and reduce delays in the department’s investigations.

In addition to helping pension fund trustees police themselves, Monks said, his proposed agency would allow pension fund trustees to meet the “really exciting possibilities” that go along with their control of funds that could, within 15 years, own an estimated 50% of the common stock of the nation’s corporations.

“The most challenging goal possible for them as trustees is as long-term shareholders, to allow management to make long-term corporate decisions,” Monks said.

“So long as we are stuck with the present perception of management that they must be held accountable for each quarterly earnings report and minute-by-minute stock prices, there will never be an adequate opportunity to turn to really important, long-term considerations of management.”

Some critics may argue that Monks’ proposed private agency might be too much like the old notion of letting the fox guard the hen house. But Monks stresses that the government would still be responsible for enforcing federal laws and that the agency would only help trustees understand and comply with the laws.