Hostess Bankruptcy Backstory: The AFL-CIO vs. SEIU Rivalry

The controversy over the impending shutdown of Hostess Brands — and who is to blame — has pitted two unions against each other. That isn’t particularly noteworthy, since different unions’ interest can diverge. What is noteworthy is the fact that the two unions in this standoff — the International Brotherhood of Teamsters and the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union (BCTGM) — are aligned with two different camps within organized labor that have had an uneasy relationship with each other: the Service Employees International Union (SEIU) and the AFL-CIO.

In fact, this could be seen as the latest round in a seven-year-old union civil war that began in July 2005, when SEIU, the Teamsters, and a few other unions left the AFL-CIO to form a new labor federation, called Change to Win. Then-SEIU President Andy Stern led the walkout, claiming that the AFL-CIO and its member unions were devoting too much money to politics at the expense of organizing — an odd charge, given that SEIU was one of the nation’s top 10 donors this past election cycle; the Teamsters weren’t stingy, either.

Whatever the real reason for the 2005 split, it’s led to some major drama, including the acrimonious breakup of the UNITE-HERE, which had been the result of the 2004 merger of a textile union (Union of Needletrades, Industrial & Textile Employees) and a hospitality union (Hotel Employees and Restaurant Employees). In 2009, UNITE-HERE, a Change to Win member union, broke back up into its former constituent parts, largely as a result of infighting between their two presidents, who headed UNITE-HERE in a dual leadership arrangement that proved untenable.

UNITE’s former president, Bruce Raynor, led a breakaway faction out of UNITE-HERE and affiliated with SEIU. UNITE-HERE’s president, John Wilhelm (who headed HERE before the merger) then took his union back into the AFL-CIO’s fold. For SEIU, the acquisition of Raynor’s breakaway union proved very profitable, as it acquired control of Amalgamated Bank, the nation’s only owned bank.  For Raynor, the new arrangement didn’t work out so well. He was pushed out of SEIU’s leadership over $2,316.00 in allegedly misreported meal expenses.

The Teamsters have strongly criticized the Bakers union’s recent actions, suggesting that BCTGM members had been misinformed and that, “The BCTGM leaders are putting Teamster members in a horrible position – asking them to support a strike that will put them out of a job when they haven’t even asked all their members to go on strike.” The Bakers union, meanwhile, refused to talk to the press following the news of the company’s shutdown, though the AFL-CIO came to its defense.

The latest round in this bout is just beginning. Get the popcorn.

For more on labor, see CEI’ s labor policy website,