Abuse-friendly Congress slashes union watchdog budget

Union officials have been feeling their oats after claiming credit for Democrats’ rise to power in November. Labor leaders have successfully pushed for a minimum wage increase and are battling to remake labor laws. Now they are working for increased financial disclosure — but only for some.

Within the last several weeks, the AFL-CIO’s second-in-command sent letters to major accounting firms asking that independent auditors give a more thorough going-over of corporations’ financial disclosures and stock options grants. The unions are for disclosure, and they mean business (or would that be “anti-business”?).

Yet at the same time, union-funded politicians in Congress are successfully pushing forward in their campaign to slash the budget for the Department of Labor agency responsible for overseeing how union leaders spend their members’ money. Think of this organization — the Office of Labor-Management Standards — as the SEC for unions.

There’s rank hypocrisy in this union ploy. Worse, there are real-world consequences for union members.

Given its mission, the OLMS offers critical protection for union members who have little power to stand up to Big Labor, a $10 billion-a-year industry. The agency uses its already-meager budget and authority to step in when corrupt union officials rig internal union elections.

More importantly, OLMS investigates abuse of dues money and monitors compliance with accounting requirements. It’s getting the job done. Since 2001 the courts have ordered restitution of $70 million in OLMS criminal cases. That’s real union money that union bosses are really trying to keep covered up.

Perhaps union officials and their allies in Congress are embarrassed about what the public finds in the union financial disclosures overseen by the agency.

There was the union boss who drove off with a $50,000 parting gift — a Cadillac — as his retirement gift. There are the tens of thousands of dollars spent at steakhouses, including $13,000 from one transportation union alone.

Don’t even ask about the resorts (though UFCW members should ask why their officials spent more than $1 million at a luxurious Florida resort over the last two years). Those are just the cases when the unions comply with current financial disclosure guidelines.

An analysis from the Center for Union Facts based on documents obtained via a Freedom of Information Act request found that only 43 out of 643 union audits — that’s a dismal 6 percent — by OLMS passed muster.

The AFL-CIO in particular has reason to grumble about the OLMS. After a recent review, the agency said it found problems with the federation’s “reporting of executives’ spouses’ travel expenses, handling of credit card charges, missing loan documentation, and other items.” That, and the $36,000 the AFL-CIO sent to a union-friendly group without documentation to support the payment.

Unless President Bush vetoes the measure, OLMS almost certainly will have its budget cut by union-friendly politicians in Congress. If that happens, OLMS would be the only agency within the Department of Labor to go backward.

Union members deserve better.

Rick Berman is president of the Center for Union Facts.


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