Since its origins in the 1880s, Labor Day has served as our nation's tribute to working men and women. Vacation time is standard in a way it wasn't back then, of course, but that extra day of leisure is a needed reminder of the value of work. The holiday also provides occasion once more to ponder the untrustworthiness of so many labor unions, presumably the trustee of workers' interests.
It is hardly news that American organized labor has a long history of corruption at national, district and local levels. And despite all the successful investigations and prosecutions, union financial crimes still occur with disturbing regularity, and on due occasion through sweetheart deals with the criminal underworld. The top leaders of the International Longshoremen's Association, for example, for over a year have been under civil RICO indictment in connection with their alleged long-term alliance with the Genovese and Gambino crime families of New York.
Two recent books, Robert Fitch's Solidarity for Sale (Public Affairs) and James Jacobs' Mobsters, Unions, and Feds (New York University Press), explain in detail that unions such as the Laborers, the Teamsters, and UNITE HERE for decades have operated in a manner barely distinguishable from that of their allied gangsters. Each author, though sympathetic to labor's concerns, knows something has gone awry, even if most union officials can't bring themselves to admit it.
Going after union corruption has proven easier said than done. In a report published earlier this year by the National Legal and Policy Center, labor lawyer Phillip Wilson notes that anti-corruption statutes tend to overlap and make it costly for union members to sue their union without fear of reprisal. If our legal system were more streamlined, these acts likely would have been nipped in the bud.
Union leaders often cooperate in federal anti-corruption probes, but that in itself is misleading. The cooperation is out of necessity, not choice. Left to their own devices, unions would continue honing their well-practiced blind spot for discrepancies on annual financial statements they are required to submit to the Department of Labor.
This reality was brought home nearly three years ago when the department, led by Secretary Elaine Chao, issued new regulations requiring greater disclosure in union financial reporting. The whole point was to enable the general public and individual union members to detect corruption before it happens. Far from being an arbitrary exercise of regulatory authority, the new transparency rules were true to the spirit of the Landrum-Griffin Act of 1959 -- talk about overdue. The AFL-CIO, ever resistant to public scrutiny of unions' balance sheets, sued to overturn the rule, eventually losing in federal appeals court in May 2005.
Union members bear the greatest costs of corruption, especially those who reluctantly contribute dues in order to keep their jobs. Mail fraud, embezzlement and other financial crimes are driven, more than anything else, by dues furnished by 15.5 million union members and by agency fees (often set almost as high as dues) paid by another 1.5 million nonmember workers covered by union contracts. In the 28 states (plus the District of Columbia) without a Right to Work law, workers not consenting to having dues or fees deducted from their paychecks can be fired, thanks to "union security" agreements with employers.
Common sense and experience suggest that the larger the pot of money, the greater incentive to steal. It's little coincidence that most of the really serious union corruption scandals have occurred in non-Right to Work states.
Nobody is suggesting that working people shouldn't have a right to organize or join unions to advance their interests. Employers across a wide range of industries certainly are organized into trade groups, replete with aggressive lobbyists, to advance theirs. Nor is anyone trying to downplay the existence of corporate corruption. We all know about the scandalous behavior by top brass at Enron, WorldCom, Boeing and other companies.
But organized labor officials can't keep pointing to aggressive and illegal corporate behavior as a way of avoiding the fact that they've got major integrity problems of their own. Each month brings a fresh new set of arrests, indictments and convictions of union leaders and/or their office employees somewhere in the U.S. The fact that unions during the 2003-04 election cycle raised nearly $200 million for political organizations doesn't exactly dispel their image as being more devoted to maintaining their own power than to representing employees.
A loss of public credibility explains in part why less than 8 percent of the nonfarm private-sector work force now belongs to a union. If labor leaders want to boost that share, they need to be more honest in their dealings. Congress may one day be forced to intervene and repeal the forced-dues collection clause in the National Labor Relations Act.
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