Howard Dean wasn't the only loser in Monday night's Iowa caucuses. Big Labor gambled big -- and lost even bigger. Some 21 unions endorsed fourth place candidate Rep. Dick Gephardt (D-Mo.), who ended up with only 12 percent of the caucus votes. While two of the nation's biggest, most politically powerful unions, the Service Employees International Union (SEIU) and the American Federation of State County and Municipal Employees Union (AFSCME), endorsed Dean.
AFSCME and SEIU are estimated to have spent $2.6 million in Iowa trying to win the state for Dean, who ended up with only 18 percent of the vote. Meanwhile, the unions backing Gephardt put more than 900 organizers in the state, made 2,000 phone calls a day on Gephardt's behalf and knocked on more than 20,000 doors, according to the Wall Street Journal's John Fund. But while almost one in four Iowa caucus goers was from a union household, most ignored their leaders' recommendations and voted for Sen. John Kerry, the big winner Monday night with 38 percent of the vote.
Unions have traditionally refrained from backing candidates in hotly contested Democratic presidential primaries, but this year was different. The Teamsters Union, which flirted with President Bush during the early days of his administration and has endorsed Republicans for president on occasion, decided to back Gephardt early, as did many industrial unions. Gephardt's protectionist trade policies and pro-labor voting record made him a favorite among the AFL-CIO's old manufacturing and industrial unions. The more left-leaning, public employee unions decided to go with Dean, mostly because of his aggressive anti-war stance and populist rhetoric.
But none of these unions could turn their dollars and manpower into votes -- even from their own members and their families. Perhaps this should come as no surprise since unions don't poll their members on what they want or whom they support. Decisions about such important matters are left up to union bosses, who are often accountable to no one. Yet these same union officials freely spend their members' dues on politics -- with little recourse on the part of the members. According to Fund, "some unions now routinely deplete their entire treasury in election years.
There's nothing wrong with unions becoming involved in the political process and nothing wrong with unions donating money to candidates -- so long as it is collected voluntarily from union members. But the union cash that was flowing in Iowa was almost entirely dues-funded, not voluntary contributions made to the unions' political action committees. Unions are allowed to spend dues on politics to get out the vote and promote union-endorsed candidates among union members and their households. But there's little doubt that the money spent in Iowa went beyond union households to the general public, which isn't legal if it exceeds the limits on campaign donations, as it always does.
The press doesn't bother keeping tabs on such activity, so it goes largely unnoticed, unreported and unpunished. And even if unions follow the rules and spend dues only in legitimate get-out-the-vote efforts among union households, they are still required to report this spending on their tax returns. Yet few unions comply. The National Education Association (NEA), for example, spends literally millions each year on politics, yet reports no political spending on its tax returns.
As tax-exempt organizations, unions must pay taxes on that portion of their revenues which are used for politics. Landmark Legal Foundation has recently filed complaints with the IRS on the NEA's refusal to obey the law, but, so far, the unions have managed to get away with massive tax evasion on their political spending.
Recent efforts by the Department of Labor to force unions to file more detailed reports on how they spend members' dues have now been held up. A Clinton-appointed judge imposed an injunction in December blocking the Department's new regulations, which would have allowed more scrutiny of unions' activities, until well after the 2004 elections. For the time being, at least, unions will be able to keep wasting their members' dues and ignoring their wishes -- with absolutely no consequences.
Linda Chavez is chairman of the Center for Equal Opportunity and author of Betrayal: How Union Bosses Shake Down Their Members and Corrupt American Politics .
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