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Big Labor morphs into predatory bankers

With collections from union dues declining, how is Big Labor finding the resources to spend so heavily in elections like the one last night in Wisconsin? According to Peter Schweizer, they are doing it in part by acting like banks:

Big unions are morphing into the kinds of big businesses and banks they decry, hawking to their members everything from high interest credit cards to home loans. . . .

Consider, for example, the “SEIU New Rewards Visa Card” and the AFL-CIO “Union Plus” card. With each new enrollment and subsequent swipe of the card, the union bags a fee and a percentage respectively.
This turns into huge money: In FY2011, according to its LM-2 filing with the Department of Labor, the AFL-CIO received approximately $28,163,266.00 from credit card revenue.

Given the labor movement’s high-wattage rhetoric against the big banks, issuing credit cards to union members seems like an odd revenue source for Big Labor to pursue.

But maybe unions like the SEIU are giving their members breaks. Not so, says Schweizer; they are just as “greedy” as their private sector counterparts:

Both the AFL-CIO and SEIU try to give their members the impression that their cards are superior to others on the market, but they’re not. The SEIU, for example, offers an introductory rate of 12.24% APR to 22.24%, which is consistent with the industry standards the union have labeled “predatory.” The SEIU card boasts that it doesn’t charge a late fee. But union members should read the fine print; if they miss a payment, their rate skyrockets to 27.99%.

Nerdwallet, which Money magazine calls the “Best Credit Card Site” on the web, compares the value of more than 1,000 credit cards. They thrashed the Union Plus card’s slick advertising and complex fine print.

Worse, Nerdwallet points out that many of the card’s so-called benefits are already available by virtue of union membership. “We are appalled at the popularity of the Union Plus Credit Card,” says Nerdwallet. “Avoid the Union Plus Credit Card.”

Most amazing of all is Big Labor’s approach to home mortgages. The AFL-CIO says it has led an estimated 200 protests against Chase and other lenders. The SEIU’s website declares: “Chase hurts everybody. They’re making a profit by lending taxpayers their own money.”

But the AFL-CIO and SEIU hawk “Union Plus” mortgages to their members. And, according to Schweizer, if you use the Union Plus mortgage program, the unions direct you to Chase, with the unions receiving a fee. So far, in fact, the Union Plus mortgage program has directed more than 80,000 mortgages to Chase.

Schweizer’s conclusion is spot on:

All this means that AFL-CIO and SEIU members have themselves become enormous profit centers for the union bosses who control them. When the banks do it, it’s called Wall Street greed at its worst. When the Big Labor does it, it’s simply working the union way.

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