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Big Labor vs. The Agent of Change Myth

The Wall Street Journal takes a look at President-elect Obama’s pick for Labor Secretary:

There is joy in Unionville this Christmas. Barack Obama’s pick for Secretary of Labor — Hilda Solis — brings impeccable big labor credentials. The California Congresswoman first rode to power with labor backing against a fellow Democrat, has voted with the AFL-CIO 97% of the time, and got three-quarters of her campaign contributions from unions.

Ms. Solis says her goal is to expand the reach and power of unions in America, and she supports such union priorities as the Employee Free Choice Act, which would do the opposite of its name and end secret balloting to unionize a workplace. Look for a showdown on that legislation in 2009. Meanwhile, the other drama to watch is whether Ms. Solis will turn a blind eye to union corruption by weakening federal oversight.

But card check legislation is not the only issue. There is a plan afoot to end recent enforcement efforts, which require labor unions to disclose key financial information. It is an odd time to lift rules  providing greater transparency:

In the Illinois pay-to-play scandal, Gov. Rod Blagojevich’s chief of staff approached the two-million strong Service Employees International Union about a possible job for the Governor. The SEIU was Mr. Blagojevich’s biggest campaign donor. No one at the union has been charged with any wrongdoing and the SEIU says it is cooperating with the federal investigation.

In Puerto Rico, meanwhile, the SEIU supported Gov. Aníbal Acevedo Vilá, who was indicted this year for corruption. The biggest fraud case of the year involved the SEIU’s home-care workers local in Los Angeles. Its boss, the 39-year-old Tyrone Freeman, was a protégé of SEIU chief Andy Stern. Both Mr. Freeman and his former chief of staff were ousted; a third senior SEIU official is on leave pending an internal investigation, while a federal probe is also under way.

As some labor officials privately admit, Ms. Chao’s financial disclosure rules helped to expose Mr. Freeman. Hundreds of thousands of misspent dollars — including a $13,000 tab Mr. Freeman had rung up at the Grand Havana Room cigar club in Beverly Hills and $650,000 for his wife’s video company — were pulled from the same revised LM-2 forms that unions had so vociferously opposed in 2004.

The Obama administration’s subservience to the whims of Big Labor should come as no surprise. After hundreds of millions of dollars flowed from labor unions into the coffers of Democratic politicians this election cycle, Big Labor naturally expects something for its investment. And that’s the rub: in the age of New Politics (when special interests were supposed to be banished) we will have organized labor calling the tune on a range of issues.

Will the Obama administration capitulate to the howls of the UAW that they not be forced to adjust their wage and benefit structure at GM and Chrysler to match that of U.S. workers at foreign-owned car companies? Will President Obama junk bipartisanship in favor of a bloody battle over card check — which will inflame Republicans and put Blue Dog Democrats on the hot seat? These and other issues will test how far the Obama administration is willing–or is forced–to go to repay its debt to its Big Labor patrons.

In opposition to all this, Republicans, good government types, free marketers, and civil libertarians will have many causes in common: rooting out corruption and defending secret ballots in union elections, to name two. We will see in 2009 if Big Labor finally gets its reward, or if it proves to be the undoing  of the Agent of Change. For Republicans looking for a way to regain their reputation for clean government and fiscal sanity, battles over Big Labor’s dominance in our economy and government might be just what they need.



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