Will Business, Labor Replay 1958 Fight?

Will California again be the stage for an epochal confrontation between business and labor, one that could reconfigure the state’s political landscape for years to come?

The opening shot may be an initiative, targeted for the June 1998 ballot, that would prohibit unions from spending a member’s dues on political activities unless the member grants written permission each year. The measure is pushed by conservative activists who are still angry at the California Teachers Assn. (CTA), whose $9-million war chest helped sink a school-voucher initiative in 1993. Republicans, enraged by the labor movement’s $35-million media blitz against them in 1996 have joined the cause. Gov. Pete Wilson, always eager to stick it to his archenemy, the teachers’ union, has signed on to spearhead the operation.

Caught in the political cross-fire is the state’s business community. Labor has threatened a counteroffensive targeting the political activities and pocketbooks of large corporations unless business leaders head off the GOP’s anti-union charge. Currently circulating, and likely for the November ballot, are three anti-business initiatives: One would require a two-thirds vote of the electorate to approve state or local business-tax loopholes for employers; another would repeal all corporate tax breaks adopted since 1991, and a third would ban corporate contributions to state and local elections and prohibit companies from deducting lobbying expenses from state taxes.

The last big-time confrontation between business and labor occurred in 1958, when GOP Sen. William F. Knowland returned to California to run for governor, the better to mount a campaign for president he hoped. Knowland wrapped his candidacy around Proposition 18, an “open-shop� initiative put on the ballot by an employers’ group called the Citizens Committee for Democracy in Labor Unions.

Knowland hoped “right to work� would split the labor vote. Instead, it united unions, provoking the most massive opposition campaign that organized labor had ever mounted, one ultimately costing $2 million. Furthermore, labor qualified Proposition 17, a measure cutting consumer sales taxes, as a diversionary tactic. Since the initiative would have shifted the state’s revenue sources to income and corporate taxes, business had to spend money and energy fighting the proposition, resources that otherwise would have gone to campaign for right to work.

That November, the right-to-work initiative was defeated by a 3-to-2 margin and labor’s diversionary Proposition 17 lost by 4 to 1--and the Republicans were routed. Democrat Edmund “Pat� G. Brown Sr., a staunch opponent of Proposition 18, won the governorship by 1 million votes, sweeping in all but one of the Democratic statewide candidates. Democrats gained a majority of seats in the state Senate for the first time since 1890 and another in the Assembly for the first time since 1942. The state’s congressional delegation flipped from 17-13 Republican to 16-14 Democratic.

Before 1998 Democrats take too much heart in this history, it should be noted that energized unions were not the only impetus behind the GOP’s defeat in 1958. Republicans also were hampered by a split within their party over the right-to-work measure and a switched-candidacy “deal� between Knowland and incumbent Gov. Goodwin J. Knight.

Nonetheless, because the anti-union initiative appeared on the November ballot, highly motivated unionists and Democrats could determine the resolution of key races. That’s one reason why the sponsors of the ’98 anti-labor initiative want to qualify it for the June ballot: to head off a potentially large Democratic vote in November. If the union-dues curb passes, labor’s clout in the general election could diminish greatly, just when unions are poised, under Proposition 208’s contribution limits, to flex even greater political muscle through “independent expenditure� campaigns.

Shorter-term, a high labor turnout in June could be helpful to Democratic candidates in crowded open-primary fields. Incumbent U.S. Sen. Barbara Boxer, for example, is registering below 50% of the vote in preliminary open-primary match-ups. Labor votes could help Boxer look stronger for November. Similarly, Atty. Gen. Dan Lungren, virtually assured the GOP nomination for governor, looks weak in preliminary open-primary polls against Democrats; he could use support for the anti-union initiative to shore up his Republican base.

The union-dues measure stands a good chance of appearing on the same June ballot as the sure-to-be-contentious and well-funded initiative to dismantle bilingual education. If Proposition 208’s limits on candidate contributions and expenditures stand, that almost guarantees races below the high-profile contests for gubernatorial and U.S. Senate nominations will get swamped by the plethora of high-volume initiative ads.

The fallout from June could affect November in other ways. Republicans would be gleeful at the prospect of attacking Democrats nominated with strong labor support as “tools of corrupt union bosses.� If the anti-business initiatives make it to the November ballot, corporate interests likely would pour loads of money into the campaigns to defeat them, possibly siphoning off funds that might have fueled independent-expenditure campaigns supporting Republican candidates.

Passage of the anti-union initiative in June also could up the ante for electing the governor and other statewide constitutional officers. The Fair Political Practices Commission, whose members are appointed by the governor, attorney general, secretary of state and controller, are charged with implementing the measure. Union leaders worry that the current GOP-dominated commission could take months to design the forms necessary to release union dues, too late to raise labor money for the fall election.

The fight to settle the score with labor could easily break down into pure partisanship, as the 1958 right-to-work campaign did. It could also have ramifications beyond political polarization. In California, union membership is increasingly Latino. Identification with the anti-labor initiative cannot be helpful to Republicans, whose opposition to immigration and affirmative action have already cost them politically among this burgeoning population group.

One thing is clear: When the heavy political artillery hits the air, there will be casualties, and the public interest will be first among them.*