Fuzzy Math at 16th Street

    Keep an eye on where the money goes, I always says--and, if I was one of the Central Labor Council leaders, I'd keep my eye on the recent special 4 cents per capita hike like I'd watch the pea being shuffled by the hustlers in Times Square.

    Which is a way of saying: tomorrow the AFL-CIO Executive Council meets to figure out, among other things, how to close a gap of about $28 million (out of a projected income of $126 million in 2006) created by the disaffiliations of SEIU, UFCW, Teamsters and UNITE HERE. A friendly piece of advice: maybe the Federation should consider a realistic budget which also includes losing another cool two million and change when the Laborers pull out--which is a question of when, not if. Or maybe Executive Council members should demand that the budget be realistic--something they did not do back in July when they approved a budget that everyone knew was unrealistic (it assumed NO disaffiliations) given the absolute certainty, at the time, that SEIU was leaving.

    Anyway, I'm hearing some interesting stuff from a very reliable source close to a significant Executive Council member that there might be some fuzzy math going on here--which might explain why a different source told me yesterday that the AFL-CIO senior staff is keeping things pretty hush-hush as to what will be proposed. Keep in mind that what I'm hearing is rumors and may prove to be inaccurate because Executive Council members themselves are groping in the dark for hard data but...

    To remind faithful readers, in early May, the axe fell on the Federation's budget in the wake of the March Executive Council meeting where the Change To Win coalition pushed, among other things, its 50 percent per capita rebate proposal which would send money back to affiliates for the purposes of organizing. The AFL-CIO top officers, trying to counter the Change To Win coalition, came up with its own rebate proposal which became part of the $22.5 proposed Organizing Fund. Apparently, the proposal to close the gap will rest on the hope that the Federation does not have to pay out any organizing rebates to affiliates.

    As I'm hearing it, no additional large staff cuts will be proposed. That's good news for the staff at the Federation--but I don't entirely believe it. Even if the Organizing Fund is completely eliminated, the Federation is still about $6 million short of closing the current gap--if you assume the unrealistic budget that ignores the inevitable withdrawal of the Laborers.

    The other pool of money to keep an eye on is that additional four cents per capita fund created by Resolution 61, which was a reaction to the disaffiliations of SEIU and the Teamsters just before the AFL-CIO convention opened at the end of July. The fund's ostensible purpose was to deal with "(1) the financial distress that some state and central labor bodies will face because the disaffiliated unions will no longer be members of those bodies; (2) raids by the disaffiliated unions on AFLCIO affiliates; and (3) the adverse impact on trade and industrial departments."

    But, it's a little squishy how that money gets spend. My guess is that the very vague langauge will allow the Executive Council to say that the funds will go to maintain the Federation's staff programs and services, rather than as money that flows directly to central labor bodies to make up for income lost at the local level because of the disaffiliations. Which would make the current negotiations between the AFL-CIO and the Change To Win about Solidarity Charters even more crucial for the AFL-CIO to resolve postively strictly from a budgetary standpoint (and I have new there, too, so stay tuned...)

    My back of the envelope calculations has that extra 4 cents per capita bringing in about $4.3 million a year---and with that money, presto, it's getting closer to plugging the deficit. My only point is to the central labor council leaders: if you're thinking of seeing any of that cash directly into your bank accounts, not bloody likely.

    Of course, eliminating the Organizing Fund does raise one question: how will the commitment to organizing, expressed in a variety of speeches and other resolutions, be funded?