One of the primary goals of the International Confederation of Free Trade Unions (ICFTU) was to support people trying to free themselves from totalitarianism. Silverman has revealed that CIO leaders, in joining the new international, expressed hope that the organization would support neither "Stalin" nor "Standard Oil" but a "broad democratic middle where people may fight to have both bread and freedom." The CIO placed faith, in particular, in the capacity of the organization to assist in implementing the Marshall Plan in ways that would benefit European workers. True to their New Deal roots, many CIO leaders anticipated that the Keynesian spending fostered by the Marshall Plan would stimulate European economies. The ICFTU, meanwhile, would encourage labor-management cooperation in increasing productivity and presumably both European workers and business owners would benefit.
Workers in many European countries, however, failed to profit from the Marshall Plan to the extent that AFL and CIO leaders envisioned. The activities of the AFL, and to some degree the CIO, in undermining communist-led unions and in encouraging splits within them, helped to weaken the labor movements in many countries and prevented them from claiming an increased share of their nation's wealth in the postwar era. For example, Ronald Filippelli and Federico Romero have demonstrated that in Italy the AFL worked in collaboration with the U.S. State Department to encourage discord between communists and noncommunists within the Confederacion Generale Italiana del Lavoro, or Italian General Confederation of Labor. Subsequently, both the AFL and CIO supported the formation of rival free trade union organizations in Italy that were devoid of communist influence. While some divisiveness within Italian labor circles would likely have occurred regardless of American meddling, the AFL and CIO nonetheless played some role in making the Italian labor movement one of the most faction-ridden and weakest in Europe by the 1950s. Thus, while Italy experienced the miracalo italiano, or the Italian economic miracle, in the aftermath of Marshall Plan spending, Italian workers remained among the lowest paid in the developed world. As European workers became increasingly dissatisfied with the fruits of the Marshall Plan, European trade union leaders within the ICFTU challenged many American initiatives and a greater balance emerged between the Europeans and Americans in the organization. (In 1969, the by-then merged AFL-CIO withdrew from the ICFTU because it believed that Europeans within the organization had become soft on communism. The AFL-CIO rejoined the ICFTU only in 1984).
The AFL and CIO's early Cold War foreign policy activities also produced mixed results in occupied Japan and in Latin America. As Howard Schonberger has demonstrated, American labor officials played an important role in the U.S. occupation of Japan because U.S. policymakers hoped to build a strong AFL-styled union movement there to check the power of traditional business and political elites whom they believed responsible for Japanese aggression during World War II. A powerful Japanese trade union movement, moreover, would force Japanese Zaibatsu corporations to share some of their profits with workers and lead them to redirect some trade exports toward their domestic markets and away from other markets where they might compete with U.S. goods. In 1945 occupation officials sponsored a trade union law that established the legal framework for Japanese workers to organize unions, bargain collectively, and strike. The Japanese labor movement subsequently grew exponentially and by 1949 represented more than half of all Japanese workers.
Charged with directing the growth of the Japanese labor movement in ways the U.S. government deemed constructive was the Labor Division of the occupation bureaucracy. The Labor Division always contained AFL representatives, and in 1947, James Killen, vice president of the International Brotherhood of Pulp, Sulphite, and Paper Mill Workers within the AFL, was appointed chief of the division. Occupation leaders sought Killen's help because they feared the Japanese labor movement was drifting to the left and were concerned about the militant tactics adopted by Japanese unions. Killen sought to counter the influence of communists by establishing anticommunist cells called mindo within Japanese unions. Yet Killen was also critical of the occupation bureaucracy for not stemming the tide of inflation, which undermined any gains workers achieved, and for its decision to remove government workers from the trade union movement. Eventually, convinced that occupation leaders were more concerned with weakening the Japanese labor movement than with eliminating communist influence, Killen resigned, as did several members of his staff.
Nonetheless, AFL and CIO leaders cooperated with occupation officials in 1949 and 1950 in encouraging the development of an anticommunist labor federation in Japan called Sohyo, which they hoped would affiliate with the International Confederation of Free Trade Unions. But much to the chagrin of AFL and CIO leaders, Sohyo did not affiliate with the ICFTU en bloc but instead allowed individual unions to choose whether or not to affiliate. Thus, by 1954 only one-third of Japanese union members belonged to organizations that affiliated with the ICFTU. Even more problematic, Sohyo became one of the leading critics of U.S. foreign policy in Asia. Sohyo lead-ers, for example, persistently criticized the peace and security treaties proposed by the Americans for terminating the Japanese occupation because they did not include Russia and the People's Republic of China and because they did not remove U.S. military bases from Japan. Sohyo leaders also opposed the Korean War. By the spring of 1953, the AFL's Free Trade Union Committee had concluded that Sohyo was a puppet of the Kremlin.
Although its independent positions on foreign policy issues and increasingly militant tactics won it the admiration of many Japanese workers, Sohyo nonetheless failed to develop into a sufficiently strong and unified organization to act as a formidable counterweight to the power of Japan's large Zaibatsu corporations. Enterprise unions, or unions within one company, continued to flourish, helping to cement the loyalty of permanent workers to their companies. Meanwhile, many temporary workers remained without union representation altogether. The fragmented nature of Japan's labor movement undermined Japanese workers' efforts to gain a larger portion of business profits, thereby undermining domestic consumption and propelling the Japanese economy along an export-driven path. Thus, American labor's goals for postwar Japan were largely frustrated.
The AFL and CIO, meanwhile, also became very active in Latin America during the early Cold War. The interest of AFL and CIO leaders in Latin America stemmed not just from their anticommunist animus but from their belief that Latin America was a vital source of raw materials for the United States and an important market for U.S. industrial products. Thus, despite their early differences on Latin American policy, both AFL and CIO leaders supported a plan proposed by Secretary of State William Clayton in 1945 that called on Latin American nations to lower tariff barriers on U.S. goods in return for greater U.S. investment in extractive and agricultural industries. Ronald Radosh has demonstrated that many Latin American labor leaders, by contrast, opposed the plan, which they argued would result in "uncontrolled foreign capital investment in Latin America [which] will cause the deterioration of programs which look to the industrialization of the countries of Latin America, aggravating their great dependence on one crop culture and exports." AFL and CIO leaders believed that communist labor leaders posed a particular threat to American economic expansion and in 1951 developed a Latin-American affiliate of the ICFTU known as the Inter-American Regional Workers' Organization (ORIT). This organization was designed to promote anticommunism within the labor force of Latin America and to undermine support for the communist-led Confederation of Latin American Unions.
The AFL and ORIT became particularly involved in Honduras and Guatemala during the early 1950s. The U.S.-based company United Fruit played a dominant role in the economies of both countries. When impoverished Honduran workers struck United Fruit in 1954, demanding a 50 percent wage increase, the AFL and ORIT intervened. According to a Senate study cited by Al Weinrub, they soon "gained the leadership of the strike." AFL President George Meany encouraged mediation by the State Department and the company quickly chose to settle. Honduran labor activists complained: "After the strike, the AFLCIO, the U.S. Embassy and ORIT" descended upon them "like a plague," gaining them special favors with employers in return for embracing AFL principles of collective bargaining. Meanwhile, left-leaning Jacobo Arbenz Guzman was elected president of Guatemala in 1950 and began a process of land reform that involved expropriating hundreds of thousands of acres of unused United Fruit Company land. Arbenz also enacted a generous labor code that gave trade unions unprecedented rights. Yet AFL President Meany protested the Guatemalan leader's toleration of communists in the labor movement and the AFL and ORIT tried to establish a rival free trade union confederation in Guatemala. Arbenz's government, however, arrested or deported many of the leaders of the new organization.
Following a private conference between Central Intelligence Agency Director Allen Dulles and Meany, the AFL president announced that U.S. labor supported a plan to come to a showdown with communists in Guatemala. In June 1954 an invasion force that included members of the free trade union confederation created by the AFL and ORIT crossed the border from Honduras and toppled the Arbenz government. As subsequent scholars would reveal, the coup was financed and carried out under the direction of the Central Intelligence Agency. The AFL immediately hailed the coup as a victory for democracy. By contrast, some CIO leaders initially opposed the coup, suggesting that communist penetration in Latin America had been greatly exaggerated and that State Department policy was really driven by its desire to give aid to the United Fruit Company. After Carlos Castillo Armas took power in Guatemala, AFL, CIO, and ORIT members traveled to Guatemala to reorganize the labor movement along anticommunist lines. Yet his government proved quite hostile to labor and thousands of unions were dissolved by the military regime. Union membership plummeted and Guatemalan workers remained impoverished. The Armas government, however, satisfied the U.S. government and corporate interests by returning expropriated United Fruit land. Activities like these helped to discredit ORIT. As the U.S. Senate conceded, "To many Latin Americans … ORIT is an instrument of the U.S. State Department."
The AFL and CIO merged in 1955, and during the 1960s, to overcome its increasingly bankrupt image in Latin America and other underdeveloped regions, the AFL-CIO created three new labor centers: the American Institute for Free Labor Development (Latin America), the African-American Labor Center, and the Asian-American Free Labor Institute. The organizations' goals were to provide education and training for trade unionists from underdeveloped countries. Yet some charged that paternalistic assumptions permeated the centers' educational programs. As Nathan Godfried writes, American labor leaders active in the centers tended to assume a stage theory of trade union development comparable to the stages of economic development posited by Western economic theorists for developing countries. Trade union movements in the Third World were allegedly in a "primitive" stage of development and thus were preoccupied with unrealistic political and radical agendas. By contrast, mature unions from the developed world focused on plausible economic goals that could be obtained through peaceful collective bargaining. Thus, Everett Kassalow, director of the AFL-CIO's Industrial Union Department, argued that American labor-education efforts would enable unions in the Third World to skip "long years of struggle which molded Western union leadership and membership." But critics from Africa, Asia, and Latin America countered that U.S. models were often unsuitable for conditions existing in other areas of the world.
More troubling than criticisms of the content of the centers' educational programs were charges that the institutes worked with the Central Intelligence Agency and other U.S. government operatives to undermine democratically elected but left-leaning governments in Third World areas. The American Institute for Free Labor Development, in particular, was implicated in U.S. efforts to undermine the governments of Joao Goulart in Brazil in 1964 and of Salvador Allende in Chile in 1973. In both cases, the institute channeled money to conservative union groups that staged disruptive protests and strikes designed to paralyze their governments. Both Goulart and Allende were eventually overthrown in military coups supported by the United States. Former CIA agents such as Philip Agee subsequently disclosed that the institute was riddled with CIA operatives during these years and was a conduit for the agency. In contrast to the early Cold War period, the institute's activities provoked dissension within the U.S. labor movement as critics like Victor Reuther of the United Auto Workers concluded that it represented "an exercise in trade union colonialism." By the 1980s many grassroots labor councils had also emerged to oppose U.S. policy in Central America and to criticize the AFL-CIO's collaboration in these policies. The African-American Labor Center and Asian-American Labor Center operated in greater obscurity, but they too faced increasing criticism for allegedly collaborating with the CIA and other government agencies to promote U.S. Cold War objectives.
The Vietnam War also provoked opposition to the AFL-CIO's international agenda during the 1960s and 1970s. George Meany, president of the organization during these years of turmoil, unstintingly supported the policies of the Lyndon Johnson administration, as did the regular yearly conventions of the AFL-CIO. The executive council, in defending the AFL-CIO's hawkish position on the war, argued that to undermine support for U.S. military forces in Vietnam would be aiding the "communist enemy." Newscasts left an indelible imprint on the American memory by featuring demonstrations of "hard hat unionists" supporting the war and sometimes attacking antiwar demonstrators. Yet opposition to the war within the labor movement began to build from at least 1967, when a National Labor Leadership Assembly for Peace met in Chicago. Chapters of the assembly spread to at least fifteen cities. Following the bombing of Cambodia, United Auto Workers President Walter Reuther condemned the widening of the war, as did a host of other labor unions and local and regional labor bodies. The dissenters ultimately failed to alter the prowar policies of the AFL-CIO, but they set the stage for revival of debate within the labor movement over the proper direction of the AFL's international policies in an increasingly global economy.