(FORTUNE Magazine) – Doug McCarron, president of the carpenters' union, seems an unlikely savior for Big Labor. After all, McCarron delivered a body blow to the labor establishment in March when he pulled his 550,000-member United Brotherhood of Carpenters and Joiners (UBC)--and its $4 million in annual dues--out of the AFL-CIO. But McCarron's rebellion may contain the best blueprint for labor's restoration.

His defection highlighted Big Labor's central crisis: declining membership. The AFL-CIO spends a lot of money on public relations, lobbying, campaign contributions, and bureaucratic featherbedding--funds McCarron believes would be better spent on recruitment. "We're surrounded by opportunity," says McCarron, who unfolds from a sitting position like a carpenter's rule, all the way to 6 feet 5 inches. "There are a million unrepresented carpenters out there who should get fair wages, health care, and a pension."

McCarron's move, while shocking, was a long time coming. His every act since taking over the UBC in 1995 has widened the gulf between the reform-minded UBC and Big Labor's bloated bureaucracy. McCarron pared an administrative staff of 240 to 26. He demolished the carpenters' venerable but underutilized marble headquarters at the foot of Constitution Avenue in Washington, D.C., and is replacing it with a modern ten-story office building that will generate $20 million a year in rental income. He rooted out Mob influence in New York City (it was a "cesspool," says one union official); collapsed 1,700 competing UBC fiefdoms throughout North America into 55 regional councils; redirected a staggering 50% of the UBC's annual expenditures to recruitment (single-digit percentages are the norm); hired 600 new organizers (many of them Hispanics with ties to the construction industry's immigrant work force); and boosted membership by 70,000, making the UBC one of the few private-sector unions in America that's actually growing.

"I think he's done more to restructure [his union] for the future than anybody in the labor movement," says John Wilhelm, president of the hotel and restaurant employees' union. Richard Bensinger, former organizing director for the AFL-CIO, now a consultant to various unions, including the UBC, calls McCarron "heroic."

But McCarron won't be politically pegged. He is a meat cutter's son from Los Angeles who took a job after high school hanging dry wall (disappointing his father) and earned a reputation for never backing down from a fight. He ticked off labor's environmental allies in May by meeting with Vice President Dick Cheney, then pausing for cameras in the White House driveway to praise Bush's energy plan, which McCarron believes would lower gas prices and create jobs for his members: "We can build those power plants."

His decision to quit the AFL-CIO was widely condemned--even by people like Wilhelm, who says he doesn't "disagree with his arguments," only with his conclusion. "I wish he would stay within the federation and push for the changes that need to be made," says Wilhelm.

The secession comes at the worst possible time for John Sweeney, president of the AFL-CIO, who's up for reelection in December. Sweeney won the post in 1995 on a platform that promised unity and growth, but he has failed to deliver on both counts. Today a scant 13.5% of the U.S. work force belongs to a union, down from 14.9% when Sweeney took office and more than 25% in the decade after World War II. "Sweeney's lucky [McCarron] got out," says a former Sweeney supporter, "because if he had stayed in, he would have overthrown him."