The Brothers Who Busted Philly Unions. For Good.
The name “J. Leon Altemose” remains a flashpoint in Philadelphia—associated with union-busting and the right-to-work or “open shop” movement. In 1972, Altemose, an East Norriton native and contractor, proposed to build the Valley Forge Plaza with a mixed force of union and non-union workers. Building Trades countered by amassing 1,000 men and storming the site. In a sophisticated paramilitary action, they assaulted the planned $18 million hotel, office and retail complex with firebombs and hand grenades, causing at least $300,000 in damage. Months later, union men beat Altemose at a Center City bank. It was perhaps the most audacious display of muscular, unionized lawlessness in modern American history. But the contractor persevered, finishing the project without union workers. The dispute put 11 union members in jail. And Altemose remains widely credited—or derided—for opening the Philadelphia suburbs to mixed and entirely non-union job sites.
The war next door, however, never crossed our borders. Building Trades spent the next 40 years accumulating political power, seeking to keep the ghost of Altemose at bay. Then the Pestronks showed up.
“There’s a general sense that this is the acid test,” says Frank Keel, a spokesman for electricians union head John Dougherty.
The fear, for the city’s unions, is that if they lose at Goldtex, what happened in the suburbs will happen here. And it isn’t unfounded. Industry observers Mary Tebeau of Associated Builders and Contractors, a largely non-union trade organization, and Kevin Gillen, of Penn’s Fels Institute, say they’ve been in contact with numerous developers, in and out of town, who are rooting for the Pestronks to succeed and open Philadelphia for business.
Indeed, the stakes are so high that most people contacted for this story declined to be interviewed or spoke only on condition of anonymity.
I was able to interview enough people at the core of city development, however, to understand the issues involved, a lesson that starts with the following unworkable equation: We have Cleveland rents and New York construction salaries.
Class A office space here rents for about $26 per square foot, about the same as Cleveland. Yet our unionized construction workers earn wages competitive with those in rich real estate markets like San Francisco, Chicago and New York, where rental rates can be double those found here. A Philadelphia carpenter makes nearly twice as much as his counterpart in Washington, D.C., where similar space rents for almost twice as much. The housing market fares no better. A 2008 report by Econsult found it to be unprofitable to build in most of Philadelphia, ranking it below even Madison, Wisconsin, as a desirable place for new construction.
These discrepancies hurt us all, even shifting our demographics. According to Gillen, the economics of our Trades unions hinder middle-income developments and force developers toward high-end luxury residences. Yet Building Trades flaunts its power with labyrinthine work rules and outrageous demands. Most famously, the Comcast tower was equipped with two sets of pipes—one “green” and functional, the other old-fashioned and disconnected—to feed the union beast. But the Trades are an everyday drag on the local economy. Union plumbers must call in the electricians if a single wire needs to be moved.
This sort of high strangeness is taken as a given here in Philadelphia. But to the Pestronks, it was merely strange. Sometimes, fresh eyes make all the difference.
Michael Pestronk says that last January he was driving in his car, guiding a potential creditor to his company’s offices in Germantown, when he noticed the banker’s wasn’t the only car following his.
Fred Cosenza, a high-ranking Building Trades official, declined to comment for this story. But Pestronk says that Cosenza had tailed him for a couple of weeks before that day. Fearing Cosenza might spook the banker, Pestronk picked up his cell phone. “I need to stop for gas,” he lied to the banker, giving directions to go on to the office without him.
Pestronk pulled into a Sunoco at Wissahickon and Rittenhouse. But instead of stopping at a pump, he tooled out the other side of the lot and parked behind Cosenza, who had pulled over on the side of the street.
Pestronk says that when he emerged from his car and confronted Cosenza, the union man looked startled but quickly composed himself. “Hi, Mike!” Cosenza said cheerily.
“Fred,” Pestronk said, “what are you doing?”
“I’m just out for a drive,” Cosenza replied.
“Don’t play dumb, Fred. You’ve been following me for weeks.”
“Did you just call me dumb, Mike?” Pestronk says Cosenza answered. “’Cause if you did, I’ll smack the shit out of you.”
“All right, Fred,” Pestronk said. “I’ll see you around.”