The power dynamic between San Jose’s two political factions is shifting. For the first time in years, labor has the upper hand over business interests—and some believe it’ll stay that way.
The political fight over raises for city workers ended earlier this month in what was presented as a united victory between the San Jose City Council and labor unions. But South Bay union leaders and allies are tearing into Mayor Matt Mahan for his disapproval of the new contract, which held off a potentially devastating worker strike. Mahan did not shy away from expressing his disappointment over the agreement, which gives two of the city’s largest unions a 14.5% raise over the next three years.
The unions argue the mayor’s opposition is just political grandstanding, while Mahan said the council crumbled to political pressure to approve a contract the city cannot afford.
“What (residents) are seeing is politics as usual,” Mahan said in a news conference last week. “This might be a hard decision for someone to stand up to political pressure to do what is right. But we must do this.”
The fallout epitomizes the divide between two politically strong, yet opposing interests. Tensions between labor and business have yet to ease up, leading critics from both sides to question the political landscape of San Jose moving forward.
The South Bay Labor Council’s reach shouldn’t be underestimated. The labor council, and some of the dozens of unions it represents, have donated millions of dollars to local leaders they believe will best represent its interests. Labor backed half of the current sitting council, including Vice Mayor Rosemary Kamei and Councilmembers Sergio Jimenez, Omar Torres, David Cohen and Peter Ortiz. Councilmember Domingo Candelas is also a labor ally.
The South Bay Labor Council spent more than $500,000 against Mahan in the last election cycle. His two reliable political allies on the dais are Councilmembers Bien Doan and Arjun Batra. Councilmembers Pam Foley and Dev Davis are also closer to business, but do not always vote alongside the mayor.
Jean Cohen, executive director of the South Bay Labor Council, is a powerful lobbyist in her own right—she often calls the councilmembers her organization supports before key votes. She said she is proud to hold the title of lobbyist because the special interests she represents are working families.
“San Jose and Santa Clara County are in a tectonic shift moment right now as it relates to politics and organizing and power. So much of that has to do with elected representatives and the institutions that get them to office as partners to move an agenda,” she told San José Spotlight.
Though she criticized Mahan’s leadership, she said he is in a tough spot because the majority of the council doesn’t align with his vision—and that majority is relatively new. Of the seven open seats last election, four went to labor-backed candidates—though Kamei was also supported by business interests.
Mahan was not available for comment.
State Sen. Dave Cortese, a former San Jose vice mayor in 2001-08 and supported by labor, said the council is not bending to special interests, but is responding to the economic realities. People are leaving San Jose in droves because they cannot afford to stay, he said, while Silicon Valley elites get richer. To address the problem, he said the city has to invest more in its people. Cortese was at a news conference last week where labor leaders denounced Mahan’s position on the strike deal and dismissed it as scaremongering.
“What you’re seeing from labor is more awareness that when there’s periods of big investment by the government, we need to make sure workers get their fair share. If we don’t, it’s going to be brutal later on,” Cortese told San José Spotlight. “This is the first time (the council has) turned the tide (and) shifted back this philosophy.”
The labor-backed majority on the council is a contributing factor to Mahan’s inability to pass major policy decisions his way. The recent labor contracts is the latest example of a compromise he did not support. When it comes to the biggest debates on council this year, Mahan has lost on more than one occasion.
Mahan’s first blow happened with the debate on how to fill two vacant council seats after he won the election. Mahan and his allies wanted to hold special elections, but the council voted in favor of appointments. Because of the labor majority, an appointment process increased the chances of being able to pick a political ally, like Candelas. A special election, on the other hand, would’ve likely resulted in a more business-friendly council. Voting patterns reflect that wealthier residents sympathetic to more conservative candidates vote more consistently in smaller elections.
Another setback for Mahan came during budget discussions. One of Mahan’s main goals was to shift dollars away from affordable housing development to support more quick-build, short-term solutions for homelessness. His plan failed.
Despite Mahan’s warnings that the city cannot afford to approve high raises for workers beyond the original offer, at 12% over the next three years, the council struck a higher deal with the unions anyway.
Larry Gerston, a political observer and San Jose State political science professor emeritus, said it’s a typical tug of war between labor and business – and at this moment, the pendulum is swinging in favor of labor.
“Labor is going to win more battles, on housing, on wages, on all kinds of issues, “ Gerston told San José Spotlight. “It’s happening both statewide and locally across California.”
He said as long as one side has influence, the other side is always going to decry the impact of special interests. But like Cortese, Gerston believes the reason for labor’s rise is economic.
Union membership is growing in California, and so is the political participation of working families. More than 16% of the state’s workforce are in a union, compared to 11% nationally, according to the U.S. Bureau of Labor Statistics. Approval of unions is also at its highest rate in the U.S. in 57 years, according to a 2022 Gallup survey.
“You’re seeing a revolt of some sort, where they’re saying, ‘All this money is being made and we’re not getting our share,’” Gerston said. “And these days, especially with a full economy—where everybody’s working and yet (there are many vacancies)—business needs labor more than labor needs business.”
Gerston said labor also doesn’t have as strong of an opponent from the business side anymore with the fallout of the Silicon Valley Organization—now rebranded to the San Jose Chamber of Commerce. SVO dissolved its political action committee after the PAC distributed racist campaign ads. It was one of the more powerful political forces on the business side.
Since then, the gap appears to be filled by Common Good Silicon Valley, a PAC started in 2021 by former Mayor Sam Liccardo and Jim Reed, his former chief of staff who currently holds the role with Mahan’s office. Common Good spent close to $1 million dollars to support Mahan’s mayoral campaign.
Mahan will have to reach across the aisle to get things done, Gerston said. And significant policy discussions—like where to make cuts to make up for the new union contracts—may not always go his way. Another big battle will be a construction policy coming to council later this year. If passed, it would prohibit private developers who want to do business in San Jose from building projects if they have any outstanding wage theft or OSHA violations.
Despite that, Gerston said the mayor is likely safe when it comes to reelection next year. Labor will likely keep its majority on the dais, and there doesn’t appear to be a strong candidate running against Mahan at this time.
“But it’s fluid. You never know when an election or two will turn everything around,” Gerston said. “That’s why it’s important for anybody with interest to be as organized as possible.”
Contact Jana Kadah at [email protected] or follow @Jana_Kadah on Twitter.