The Discordant State of Unions

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The confrontation has all the earmarks of a classic union organizing battle, including charges that workers have been forced to sign loyalty oaths, stories of a violent row at a rally that left one organizer dead from a heart attack, and calls for a federal investigation.

But this isn’t a battle between a union-busting corporation and organized labor. It is, instead, part of the increasingly bitter war between two unions over some of the most promising organizing turf in America—the healthcare system, especially its hospitals—and it says much about the direction of the labor movement today, and the growing price that taxpayers must shell out for its successes.

In one corner of this no-holds-barred match is Barack Obama’s most important labor supporter, the Service Employees International Union, which helped spur a contentious split in the labor movement in 2005 when it bolted the AFL-CIO along with four other unions and formed the Change to Win coalition. Formed in the 1920s as a Chicago union representing janitors, SEIU has morphed into one of America’s biggest unions, representing some 1.9 million workers, by pursuing organizing efforts in sectors that are growing with taxpayer money.

Not surprisingly, SEIU’s biggest successes have come in healthcare, whose workers now constitute about 50 percent of its membership. Although only 8 percent of America’s private sector workforce is unionized, some 17 percent of hospital workers belong to unions and 21 percent of all registered nurses are unionized. While union membership shrinks elsewhere, in the last 20 years the number of nurses covered by union contracts in the United States has increased by 80 percent, a gain of some 240,000 union members.

This lucrative business for SEIU has turned traditional notions of union organizing on its head. Since government pays nearly half of all medical bills in this country, SEIU has scored many of its biggest victories working as a powerful lobbyist, often in collusion with employers rather than in confrontation with them. In New York State, for instance, the union’s local, 1199SEIU, struck up an unprecedented partnership with an employer group, the Greater New York Healthcare Association, and together campaigned relentlessly (and mostly successfully) to protect and expand the state’s Medicaid program—the most expensive such program in the country. Hyperbolic ads produced by the alliance condemned former Gov. George Pataki in 1999 when he tried to reform and trim the state’s Medicaid program, and again in 2007 when newly elected Gov. Eliot Spitzer targeted the bloated program for cost savings. In both cases politicians backed off as their popularity ratings sank from the advertising onslaught.

Even more astoundingly, when the contract between workers and hospitals represented by 1199 and Greater New York was about to expire in 2002, the alliance persuaded Pataki and the state legislature to ante up $1.8 billion in taxpayer money to give raises to 210,000 union members--an unprecedented gift by a state government to private employers and their workers in a state election year.

SEIU has been expert at using its legislative muscle to thwart efforts at health care cost savings. As California tried using more home health care workers to visit the sick, in hopes of reducing hospitalizations and nursing home admissions in its Medicaid program, SEIU persuaded state legislators to pass a bill making the workers, who were considered independent contractors, government employees, and then additional legislation to finance the cost of union contracts. Although Gov. Pete Wilson vetoed the financing bill, his successor, Gray Davis, whose 1998 election bid was heavily supported by SEIU, signed it, and from there it was a snap to organize the workers in a series of local drives, including one in and around Los Angeles in which SEIU signed up some 74,000 workers, the largest successful labor drive since the United Auto Workers organized General Motors in 1937. In this case, however, it was not car buyers, but taxpayers on the hook for the added costs of the contract. In the first five years after Davis signed the legislation, the state’s cost of the home health care program soared some $740 million.

Given SEIU’s size and clout, only a competitor with lots of moxie could successfully challenge it. That’s certainly a way to describe the California Nurses Association, which has been transformed by a former Teamsters’ organizer from a traditional professional association into a militant labor union. The CNA has gone on an ambitious organizing crusade outside of California and now boasts some 80,000 members, though its methods have been controversial. It has been called “a wildcat group” by the head of an Illinois nursing association and “California interlopers” by the chief executive of the Georgia Nurses Association. When California Gov. Arnold Schwarzenegger delayed implanting new hospital staffing regulations supported by the union, it picketed him at dozens of appearances around the country, sent a blimp to fly over a Super Bowl party he was hosting, and spent $100,000 on ads attacking him.

Like SEIU, the CNA has counted legislative victories as crucial to its growth. Its biggest victory so far has been to get Davis to sign legislation in 1999 mandating lower ratios of nurses-to-patients in hospitals, a move which state hospitals estimate when fully implemented will require an additional 4,000 nurses. Although a study published earlier this year by the peer-reviewed journal Policy, Politics & Nursing Practice concluded that so far the law, which has been phased in since 2003 in California, has had little effect on patient care in the state, CNA has heavily publicized its California legislative victory in its organizing efforts in other states.

In their present war over recruiting new members, both sides have accused the other of underhanded methods. CNA organizers are said to have posed as pizza delivery workers to gain access to a nurse’s unit in a Cincinnati hospital where CNA was trying to undermine an SEIU effort to organize some 8,000 workers at Catholic hospitals. SEIU responded by sending protestors to a speech by the head of CNA, where a small riot broke out between members of both unions. The two unions have been trading charges in ads run on left-wing Internet sites like Daily Kos.

Although labor leaders are worried that the spat will be a major distraction during a year in which labor is hoping to come together to influence the November elections, efforts to resolve the conflict haven’t gone very far, mostly because fundamental to this battle is animosity generated by the 2005 union split.

For taxpayers, however, the real import of this battle lies not in the ultimate winner, but in the road to victory that both unions have been employing. Although Democratic Presidential contenders Barack Obama and Hillary Clinton have tried to woo the union vote by promising to support legislation to make it easier for unions to sign up new members, in an American economy where most workers don’t want to be organized (only 35 percent of American workers said they might consider joining a union in a Zogby poll taken at the time of the Change to Win split) such legislation is only somewhat important.

The real payoffs for unions like SEIU and CNA is in supporting candidates that pledge to expand government-financed programs whose pay scales and contracts can then be influenced politically. For SEIU and CNA, promises by Obama and Clinton to pour more money into Medicaid and the federally financed State Children's Health Insurance Program represent the real future. Even more promising is the pledge both candidates have made to lift restrictions on states’ abilities to expand their own government-financed health programs, since unions wield more power in many state capitals—as their successes in Sacramento and Albany demonstrate--than they do in Washington, D.C.

Regardless of who wins the increasingly bitter battle between CNA and SEIU, both unions have their eye on one target—taxpayer-financed health care programs.

Steven Malanga is an editor for RealClearMarkets and a senior fellow at the Manhattan Institute

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