AFL-CIO Pension Funds Invested In Faltering Israeli Institutions

By Israel Shahak

One of the most important and least discussed pro-Israeli pressure groups influencing US Middle East policies is the American labor movement, as represented by the AFL-CIO. Because of the reluctance of the American media to discuss in any detail the internal operations of the pro-Israeli forces in the US, information concerning the Israeli connections in the AFL-CIO comes instead from the Hebrew press in Israel.

An exceptionally revealing article was printed August 30 in the Hebrew newspaper At Hamishmar, written by the newspaper's Washington correspondent, Daly Shkhory. Some excerpts from the article, based upon Shkhory's talks with Daniel Bloch, the refiring Israeli labor attache in Washington, follow:

"Although the position of the Israel labor attache is formally under the Israeli Ministry of Foreign Affairs, by a long-standing custom Histadrut, the all-encompassing Israeli labor organization, recommends the candidate who is to be approved by the ministry. Thus Daniel Bloch was nominated by Histadrut. In addition to his routine duties, Bloch was asked to cultivate personal connections in the Democratic and Republican parties and report on the rising forces in these parties.

"Bloch was interviewed in the midst of arrangements for his departure from Washington. Bloch said his special task had been to mobilize and to use US trade union political and media influence in favor of Israel in the US and internationally. The AFL-CIO is an important pressure group, particularly in the Democratic Party. It has 15 million members and its president, Lane Kirkland, is a great friend of Israel.

Israel's Beneficial Relations with US Trade Unions

"Good relations with the trade unions also have an economic benefit for Israel. US trade unions have large pension funds. They buy shares of the (Israeli) Development Loan. They also donate to the Histadrut Appeal and to institutions like ORT (Israeli Vocational Schools) and to the Israeli/American Friendship League. They prefer to conduct their business with the Hapoalim Bank and Ampal Investment Co. The labor attache's job is to encourage and increase these activities.

"Can he point to successes? It's a delicate question since he acts behind the scenes to ensure that decisions taken in international conferences will be pro-Israel or, at least, not against it.

"A short time after Bloch arrived in Washington, the AFL-CIO convention passed resolutions condemning Israel's invasion of Lebanon. The Israeli government at the time was a Likud one while Histadrut supported the Labor Alignment. Bloch had to move delicately between the two forces to prevent further US labor condemnations of or unfriendliness toward Israel.

"Bloch said, 'This time of the intifadah is a challenge. I did not tell US labor contacts never to criticize Israel, but I insisted, successfully, that specific criticisms not interfere with overall relations with Israel, and the special connections with Histadrut and the Israeli labor movement.'

"US trade unions are helping to elect candidates to the House of Representatives and the Senate. Bloch told me about some cases where he had succeeded in influencing the trade unions to take into consideration the attitude of the candidate toward Israel. For example, US labor unions in 1984 supported Rep. Paul Simon (D-IL) in his campaign to unseat Sen. Charles Percy (R-IL), who was not known as a friend of Israel. The unions would not have taken this stand if Simon had not been a labor movement supporter. But, in marginal cases where both candidates have demonstrated equal support for labor, it was possible to influence the unions to support the candidate who sympathizes with Israel.

"During his period as labor attache, relations between the labor movement and the White House were not good. Notwithstanding the fact that the labor unions did not have influence in the White House, they helped Israel several times by employing personal connections. Lane Kirkland is a good friend of Secretary of State George Shultz, and during the first year Shultz was in office, there were several cases in which Kirkland intervened on behalf of Israel.

Intervention on Israel's Behalf

"An example this year was help offered by the trade union to the platform committee of the Democratic convention in Atlanta, both in the formulation of the platform and in the rejection of modifications sought by Jesse Jackson's camp. The labor representative consulted Bloch as to which version to agree with and which to reject."

Not only does Shkhory's article reveal a little-known aspect of Israeli influence in American political affairs, it also touches on some other aspects of a strange relationship which surely verges on breach of trust between the AFL-CIO leadership and its rank-and-file dues-paying members.

The Histadrut-owned Hapoalim Bank is near bankruptcy. Anyone who would invest in it or in the many other bankrupt or nearly bankrupt Histadrut enterprises would be considered a fool in Israel. The very survival of this bank is dependent on handouts by the Israeli government. So much money will be needed to save Histadrut-owned businesses from financial collapse that nothing less than a huge emergency grant from the US Congress will be able to save them. It would certainly have been safer had US unions prudently invested their members' pension money in American securities instead of risking it in unsound investments in Israel.

ORT, referred to above, is a system of Israeli vocational schools that by their structure serve to perpetuate anti-Palestinian discrimination. Most of these schools are located in Jewish towns and villages. Except for a few Druze villages, no ORT school is to be found in any Palestinian town or village. The Israeli government bars the founding of Arab private vocational schools so as to keep Israeli Palestinians at the bottom of the social and economic ladder. Support for ORT is therefore support for discrimination and racism.

Behind-the-Scenes Influence

The extent of behind-the-scenes Israeli influence in American labor politics is impressive. One can compare the relations between the Israeli labor attache and the US unions to the relationship between the boss and his "yes" men. What makes it worse is that, unlike most other kinds of political conspiracy, this one is unlikely to be exposed because of the habitual silence of the American news media whenever it comes to domestic news that might reflect unfavorably upon Israel or its influence upon American domestic politics.

The self-censorship practiced by the American media with respect to news concerning Israel is remarkably similar to that practiced by the media in a totalitarian state. It is not possible that all of the reporters in Atlanta during the Democratic convention could have been unaware of the intervention of Israeli labor attache Bloch in platform committee proceedings.

Many members of the AFL-CIO, whether or not they favor either the Israelis or the Palestinians, would be indignant to learn that their pension funds have been invested in nearly bankrupt Israeli institutions. It is a sad commentary on the US media that US union members can only find out through translations from the Israeli press.

Dr. Israel Shahak is a veteran Israeli peace activist. Introductory issues of his translations from the Israeli press are available at no charge from the Washington Report on Middle East Affairs.