The Washington Post, December 10, 2008, Wednesday

Copyright 2008 The Washington Post
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The Washington Post

December 10, 2008, Wednesday

DISTRIBUTION: Maryland

HEADLINE: Union Official Allegedly Liaison Between Governor, Obama Team;
Blagojevich Apparently Hoped for Job Leading Labor Group

BYLINE: Alec MacGillis; Washington Post Staff Writer

BODY:
Among the revelations contained in the complaint brought against Illinois Gov. Rod Blagojevich yesterday was the description of an official with the Service Employees International Union acting as an apparent intermediary between the governor and Barack Obama's camp in discussions over Obama's Senate seat.

The alleged role of the SEIU official was surprising, given that the union had not figured publicly in the investiga-tion into Blagojevich (D). But on another level, the SEIU's apparent involvement is an indication of the extent to which it has, under the leadership of its ambitious and controversial president, Andrew L. Stern, become an omnipresent force in Democratic politics.

With organized labor holding such high expectations for the Obama administration -- notably, hopes for legislation fiercely opposed by business leaders that would make it easier to form unions -- officials of other unions were hoping yesterday that the SEIU's apparent involvement in the Illinois scandal would not undermine their cause in Washington.

The U.S. attorney's complaint states that Blagojevich mused aloud with his advisers about the possibility that he could seek a high-paying job with Change to Win, the coalition of seven unions -- dominated by SEIU -- that broke away from the AFL-CIO in 2005. Blagojevich and his chief of staff wondered aloud about a "three-way deal" in which he would appoint Obama confidante Valerie Jarrett, a Chicago businesswoman believed to be the woman identified in the complaint as "Candidate 1," to Obama's Senate seat; Blagojevich in return would become Change to Win's executive director; and Obama would reward Change to Win with pro-labor policies.

The complaint also states that on Nov. 12, Blagojevich spoke by phone with an "SEIU official" who was in Wash-ington and with whom Blagojevich had met a week before on the understanding that the official was an emissary to discuss Jarrett's interest in the Senate seat. In the conversation, the SEIU official is alleged to have said that Obama now wanted Blagojevich to consider candidates other than Jarrett.

Apparently undeterred, Blagojevich allegedly suggested that SEIU could assist in the formation of a nonprofit po-litical organization that could employ Blagojevich while also assisting Jarrett. The SEIU official agreed to "put that flag up and see where it goes."

SEIU leaders, who were gathered yesterday at a Denver hotel to discuss the "card-check" legislation that would make it easier to form unions, declined to comment yesterday, saying through a spokeswoman, "We have no reason to believe that SEIU or any SEIU official was involved in any wrongdoing."

A spokesman for Change to Win said: "No one connected with Change to Win ever considered, discussed or prom-ised any position at Change to Win to Governor Blagojevich, his staff or his advisers. In the affidavit released by the United States Attorney, a position at Change to Win is discussed only in conversations between the governor and his advisers."

The complaint's wording suggests that the SEIU official who allegedly talked with Blagojevich was Stern, because it quotes the governor's chief of staff as saying the official "could make" the governor the head of Change to Win, a level of authority that only Stern holds over the coalition. But the SEIU official with the closest ties to the Obama team is Tom Balanoff, head of
SEIU's Illinois chapter. A labor source who was not authorized to speak publicly said that although Balanoff had planned to be in Denver, he was not at the meeting yesterday.

SEIU officials did not return repeated calls yesterday.

Stern has emerged as a central player in the labor movement by pressing aggressively to expand union rolls, along the way irritating AFL-CIO leaders, whom he accused of being complacent, and leaders of some SEIU chapters who accuse him of cutting deals with business and government that enhance his profile while undercutting local chapters. Among his victories was Blagojevich's decision to let SEIU, and not the American Federation of State, County and Mu-nicipal Employees, organize Illinois' child-care workers.

Stern resisted attempts by some SEIU chapters to endorse Obama early in the primaries, because Stern also liked former North Carolina senator John Edwards and hoped to preserve the union's resources for the general election. But Stern went along with a full endorsement in February, and the union invested heavily in the general election -- though it probably played less of a role in key Rust Belt states than the AFL-CIO did. A former SEIU official, Patrick Gaspard, was named Obama's political director.

Richard Hurd, a professor of labor relations at Cornell University, said it was doubtful SEIU would have conspired with Blagojevich, because it knew how relatively weak his ties to Obama were and because it was doubtful that Change to Win would hire him.

"They don't just create high-paying jobs like that. It doesn't even make sense. It sounds like someone's pipe dream."

But, depending on what else emerges in Illinois, SEIU's role could affect labor's agenda, he said: "If there turns out to be a connection with SEIU, it's not going to be a great thing for labor."

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