Big labor's split matters - even to nonunion America

Sometimes, organizations take a step backward to make two steps forward. Other times, they're simply headed in the wrong direction.

Which is it this time? This is the question organized labor faces in the aftermath of its most important split since the 1930s. And the answer affects all Americans, whether unionized or not, because the rise and fall of labor determines the balance of power in the United States. The stronger unions are, the less powerful business is. The weaker they are, the more power shifts to the corporate suite.

This idea was neatly spelled out in the 1950s - at the peak of labor's power - by Harvard economist John Kenneth Galbraith. He called it "countervailing forces" - the idea that government, business, and labor served to keep a check on one another. Dr. Galbraith saw it as a good thing, helping assure that ordinary Americans got a fair share of the economic pie.

But that was then. Today, unions are too weak, observers say.

"Labor has long ceased to be much of a countervailing force to business in political and economic life," says Robert Reich, former secretary of Labor in the Clinton administration.

That assessment comes from a friend of labor. What Dr. Reich and others agree on is that last week's split within the AFL-CIO will certainly not revitalize organized labor's power in the short run.

The two large unions that left the labor federation last week - the Service Employees International Union and the International Brotherhood of Teamsters - not only sap it of some 3.2 million members, but will also drain millions of dollars from the AFL-CIO's coffers. That could mean fewer staff and resources to lobby Congress and turn out voters in the important congressional elections next year. It also could intensify the struggle among unions for the right to represent workers.

The two departing unions, however, claim that they'll rebuild the labor movement by organizing more workers and rebuilding union ranks. Certainly, something needs to be done if organized labor is to rise again. In the 1950s, 35 percent of workers belonged to unions. Today, fewer than 8 percent of private-sector employees do.

The question is: What's at the root of the slump? The slow-moving AFL-CIO or the rising clout of corporations?

One reason for labor's weakness is the might of money. Organized labor gave $61.6 million to federal candidates and parties in last year's election, says the Center for Responsive Politics in Washington. Business interests donated $1.5 billion, some 24 times as much.

Another problem: Labor unions provide Democrats with important get-out-the-vote efforts. But Democrats see a need for campaign funds from business as well. That often makes them unwilling to oppose corporate interests.

Even government isn't much of a counterweight to business nowadays in determining regulatory and taxation policies, some political scientists argue.

"Government and corporations are so intertwined, there is no countervailing power," says Charles Derber, a sociologist at Boston College. "Crony capitalism" has reached such a height that corporations have even more power than in the Gilded Age of the late 1800s or the 1920s era of corporate might, he holds.

Partly as a result of corporate giving, the Clinton administration "didn't do anything for labor," says labor historian Priscilla Murolo. "The labor movement hasn't gained much from its loyalty to the Democratic Party. Labor is too ready to support Democrats in return for vague promises and cosmetic support."

Another key reason for the weakness of unions is that labor law has not stopped employers from taking increasingly aggressive actions against unions, often with the help of lawyers specializing in union busting. For example: It's illegal to fire employees trying to organize a union shop. The National Labor Relations Board has a large backlog of such cases to deal with. But the penalties are so small that companies often consider them the cost of doing business. Thus 1 in 10 union organizers is fired illegally, says Michael Yates, author of a book on labor law. If the NLRB gets around to a decision in an individual case, maybe in two or three years, the employer may be forced to pay back wages - but wages the individual earned if he or she got another job in the meantime are subtracted.

It's certainly far cheaper than paying the higher pay and benefits that a union is likely to negotiate.

That is, if the company bothers to negotiate. By law, it is supposed to bargain "in good faith." But if it doesn't, there is no monetary penalty, says Mr. Yates. The union may call a strike to get management's attention. If it does, the company is free to hire replacement workers.

Employers are "threatening with ever greater alacrity" to hire permanent new employees, says Reich. "The law has to be changed to make it more difficult."

So more is at work than AFL-CIO inefficiency. Still, might a competing group organize more workers? "There is an unknowable dynamic," says Mr. Derber.

At some point, he says, the increasing economic stress and dislocation of many workers will become so great that it will create political instability and discontent sufficient to revive a new voice for labor - perhaps even trade unions.

"We are already close to that level," he adds.