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Union’s due

Several years ago, around the turn of the century, I published a cover story in CityLife explaining how the Culinary Union’s strength in the resort industry creates higher wages and better benefits in Las Vegas than in other parts of the country. The story started by noting that the Venetian, then and now doggedly anti-union, nonetheless promised its employees, in writing, that it would “gather information on our competitors’ pay and benefits on an ongoing basis” and “guarantees that it will maintain a superior pay and benefits package.”

In other words, pay and benefits at the Venetian were effectively based on the standard set by contracts negotiated between the Culinary and other Strip casinos.

 Attempts to contact Sheldon Adelson while working on the story were unsuccessful, so imagine my surprise when, once the story was published, the phone rang and Adelson himself was on the line. As I remember, the gist was that he was offended at the notion that compensation packages at the Venetian could be influenced by prevailing area compensation standards as established at union properties – or by any other forces or conditions that were external to the supreme control of world-historical figure Sheldon Adelson.

I think Adelson was sincerely befuddled by the larger point of the story; that the ripple effect of labor’s hard-won wages and benefits, as I put it at the time, “makes the union’s impact on the size and prosperity of Southern Nevada’s middle class all that more pronounced, and all that more important to the homebuilders, retailers and everybody else whose incomes are dependent on the region’s only basic industry creating a consumer class with money to spend.”

More than a decade later – which is to say after more than a decade of Republican politicians and wingnut “think tanks” aggressively demonizing unions specifically and wage laborers generally – the positive impacts of the Culinary on the larger Las Vegas economy are even harder for many people to acknowledge or appreciate. To judge from noises made in the public sphere, a business owner in Las Vegas today is more likely to think of middle class workers who earn a living wage under a collective bargaining agreement not as customers, but “thugs” – especially if those workers have the temerity to fight to retain and improve their quality of life instead of meekly scraping and bowing before the magnificence of America’s holy sacred job creators.

Down the street from Adelson’s joint, the exchange of words involving tourists and Culinary demonstrators at the Cosmopolitan caught on video a few weeks ago prompted splashy headlines and predictable squeals of outrage from a citizenry subjected to decades of harsh anti-union rhetoric.

The incident even made Fox News!

The Cosmo is owned (sort of accidentally) by Deutsche Bank, which is reportedly keen to sell the property. The German financial conglomerate’s decision makers are evidently under the impression that the Cosmo will be a lot easier to unload if it isn’t burdened with any pesky contract requiring a prospective new owner to provide the same wages, benefits and working conditions provided by competitors at unionized properties owned by MGM Resorts Intl., Caesars Entertainment and Wynn Resorts. Even though when it opened three years ago the property recognized the Culinary’s authority to collectively bargain a contract, Deutsche Bank has effectively walked away from the table.

Many – too many – people in Las Vegas think the answer to this conundrum is for the entire hotel-casino industry to break the union altogether. Adelson has kept the union out. So has Station Casinos. If the Cosmo can do it too, who knows, maybe Steve Wynn, increasingly wingnutty in his old age, will try to dump the union. Maybe Caesars will follow. MGM already tried to go non-union once, 20 years ago.

It isn’t just about the Cosmopolitan.

While Deutsche Bank thinks the Cosmo will be easier to sell without a union contract, the Culinary is convinced potential buyers would rather not spend billions of dollars on a property where the entrance is routinely staffed by demonstrators from one of the strongest and best-organized private-sector unions in America. Prudish Las Vegans may find the Culinary’s tactics impolite, but the demonstrations aren’t really staged for Las Vegas consumption. The Culinary is grabbing Wall Street’s attention.

Meantime, Adelson may deny labor’s positive economic contribution to Southern Nevada, but you’ve got to believe he admires the Culinary’s aggressive strategy with Deutsche Bank. After all, just the other day Adelson urged President Obama to drop a nuclear bomb on Iran as a way to kick off negotiations over that country’s nuclear program. “Then you say, ‘See! The next one is in the middle of Tehran. So, we mean business,’” Adelson said.

The Culinary may not have nuked any tourists. But it means business. And everyone who relies on a stable and growing core of middle class consumers, which is to say everybody in town, better hope that the Culinary’s pressure makes Deutsche Bank come to the table. Similarly, ongoing negotiations between the union and other Strip properties will hopefully produce contracts that are fair to workers, because any erosion of pay and benefits will diminish the purchasing power of Southern Nevada’s aforementioned consumer core.

And oh by the way… remember how collaterized debt obligations based on mortgage-backed securities created a house of cards that collapsed and took the economy, especially Southern Nevada’s economy, with it? Only three institutions in the world issued more collateralized debt obligations than Deutsche Bank. By signing a fair collective bargaining agreement, Deutsche Bank could do something to help the local economy that Deutsche Bank did so much to screw up in the first place.

HUGH JACKSON’S column runs every other week.