Union Spending Exposed by New Rule

Union Spending Exposed by New Rule
August 1, 2006

Question: What does Tiger Woods have in common with union officials?

Answer: They both play a lot of golf.

The only difference is that union officials get to play on their members' dime. A lot of dimes, actually. Organized labor spent $1.3 million on golf in 2005.

This and other enlightening facts about union spending are now public because of disclosure requirements implemented in late 2005 by U.S. Secretary of Labor Elaine Chao after nearly two years of delay caused by an unsuccessful AFL-CIO lawsuit seeking to throw out the regulations.

Unions with annual receipts of $250,000 or more are now required to file detailed financial reports disclosing union salaries, benefits, income, and expenditures, giving union members unprecedented insight into how their unions spend their dues.



Lavish Pay, Perks

In 28 states across the country, workers can be required to pay for union representation as a condition of employment. Their mandatory payments have underwritten lavish spending that often has nothing to do with workplace representation. The Center for Union Facts uncovered many of these expenditures by compiling the Department of Labor's reports into a searchable database available at http://www.unionfacts.com.

In 2005, for example, labor unions spent $7.3 million at plush resorts, nearly $1.3 million for amusement park events, $148,000 for liquor, and $641,000 for sporting events. Ironworkers Local 40 in New York spent $52,879 on a new Cadillac for a retiring president. SEIU Local 660 in Los Angeles spent $153,000 on movie tickets.

The rank-and-file pays not only for these exorbitant amusements, but for generous salaries and benefits for union employees as well. While the nation's teachers perennially protest low salaries, National Education Association (NEA) President Reg Weaver makes $272,170, with another $98,258 for benefits and expenses. Nearly half of the NEA's 650 employees make more than $100,000 a year. The AFL-CIO has an official chauffeur, and he makes $70,951.



Spending on Politics

Additionally, unions seem far more interested in amassing political power than representing employees. The AFL-CIO reported spending $49 million on politics and lobbying in its 2005 fiscal year--$20 million more than it spent on workplace representation.

Although 50 percent of NEA teachers identify themselves as conservative, the union gave money to numerous liberal groups last year, including Jesse Jackson's Rainbow PUSH Coalition, the Gay and Lesbian Alliance Against Defamation, Amnesty International, AIDS Walk Washington, the Human Rights Campaign, and the Fund to Protect Social Security. These outlays prompted the Wall Street Journal to call the NEA a "honey pot for left-wing political causes that have nothing to do with teachers, much less students."

These revelations show financial transparency is essential to good stewardship. As a matter of public policy, we require candidates and campaign committees to disclose campaign finance reports to voters. Shareholders of corporations receive regular financial reports. Similarly, requiring unions to disclose financial details to members improves accountability and reduces the potential for corruption.



Fourth Branch of Government

Unions are rapidly becoming the nation's fourth branch of government. In 2005 the nation added 163,000 new government jobs, and unions captured 40 percent of this growth. The U.S. Bureau of Labor Statistics early this year reported 12.5 percent of all U.S. wage and salary workers are union members, down from 20.1 percent in 1983, the first year for which comparable data are available.

The U.S. Department of Labor's new reporting requirements apply only to labor unions that represent private-sector members. Unions that exclusively represent state and municipal employees have no such obligation. As a result, social workers, teachers, firefighters, and other public employees are required to pay dues as a condition of employment yet are given little information about how their dues are spent.

It is thus up to state legislatures to secure full financial accountability for public-sector unions. The American Legislative Exchange Council, a bipartisan organization of more than 2,000 state lawmakers who believe in limited government, free markets, federalism, and individual liberty, makes available to its members model legislation mandating disclosure similar to the federal reporting requirements for unions serving private-sector employees.


Michael Reitz (mreitz@effwa.org) is legal counsel and director of labor policy for the Evergreen Freedom Foundation. This article is reprinted by permission from the June 7 issue of The American Spectator.


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A searchable database on union spending, compiled by the Center for Union Facts from U.S. Department of Labor reports, is available online at http://www.unionfacts.com.