Two Unions Leave AFL-CIO
In a blow to the already teetering organized labor movement, two of the nation's largest and most powerful unions resigned from the AFL-CIO. The withdrawal of the 1.7 million-member Service Employees International Union and the 1.3 million-member International Brotherhood of Teamsters will drain $20 million from the labor federation's $120 million annual budget. Two other unions, also eager for labor to spend more on finding new members and less on political giving, are expected to join the breakup.
Hecht's, a Local Casualty
Hecht's, the last remaining great name in Washington area department stores, will disappear within a year. Sixty Hecht's stores will be renamed Macy's, the marquee brand of Federated Department Stores Inc., which purchased May Department Stores Co., the owner of Hecht's. The impending demise of the 148-year-old Hecht's completes the disappearance of the once-esteemed department stores that were founded locally: Woodward & Lothrop, Garfinckel's and Lansburgh's. All fell victim to brutal competition in retail.
Sony BMG Settles Charges
Sony BMG Music Entertainment settled an investigation by New York Attorney General Eliot L. Spitzer. The company admitted that its employees gave cash, trips and other payola to radio station workers to get its music on the air. It also agreed to pay $10 million to New York arts groups to compensate independent musicians frozen out by its actions. Other companies, including Clear Channel Communications Inc. and Infinity Broadcasting Corp., have received subpoenas as part of the ongoing probe.
GM to Cool Hot Sales Offer
General Motors said it will end its popular employee-discount program after two months of blistering sales. The come-on apparently worked a little too well. Previously slow-selling 2005 vehicles disappeared so quickly that dealers were begging headquarters for more. GM plans to focus on sales of 2006 models with lower sticker prices as a sales incentive instead of discounts. Ford and DaimlerChrysler, which matched GM's employee-price promotion in July, aren't expected to keep it going much longer either.
Housing Still Booms
Sales of existing U.S. homes broke another record in June, rising 2.7 percent from May and 4.4 percent from the year earlier. The year-over-year increase was the largest in 25 years. Many analysts were surprised by the record because of signs of a slowdown in home sales in many urban areas, including Washington, where the number of houses for sale has climbed by 50 percent. But low-interest mortgages continued to fuel the national housing boom despite worries that the rising prices might not be sustainable.