Morning Bell: The Union Threat to Our Economic Recovery

Conn Carroll / December 31, 2008

It has been quite a year for the Service Employees International Union (SEIU). As the Los Angeles Times documents today, despite the fact 2008 was filled with SEIU corruption, intimidation, and violence, the largest union in North America still managed to spend $85 million electing Democrats across the country and President-elect Barack Obama to the White House. One shudders to think about the influence this multi-billion dollar racket will have at the federal level in the coming year. But before we get to their coming policy priorities, lets review their performance this past year:

• In April, violence erupted when members of California Nurses Association tried to sneak past SEIU organizers, who were blocking CNA efforts to represent the 6,000 nurses employed by LA County hospitals. Police arrested a CNA organizer for slapping an SEIU organizer and similar battles played out in states like Nevada and Ohio.
• In August, the president of the largest SEIU local in the country, former-Los Angeles local member Tyrone Freeman, resigned after the Los Angeles Times revealed that Freeman fleeced his fellow union members — who make about $9 an hour caring for the infirm and disabled — of over $1 million in 2006 and 2007 alone. When Freeman was first faced with the charges, he sent out “lieutenants” to force other union members to sign loyalty oaths supporting his continued presidency. According to the Los Angeles Times, SEIU national president Andy Stern had been repeatedly made aware of Freeman’s nefarious activities since 2001 but declined to do anything about them. His spokeswoman told the LAT: “Until we read these allegations in the L.A. Times, nobody ever brought before us serious credible evidence of wrongdoing.”
• In November, federal prosecutors revealed that the SEIU was a major player in Gov. Rod Blagojevich’s (D-IL) efforts to sell President-elect Barack Obama’s vacated Senate seat. Prosecutors have not yet accused the SEIU of specific knowledge of Blagojevich’s scheme, but a trio of SEIU officers who were also Blagojevich appointees have all faced varying degrees of scrutiny in the investigation. There is a well established history of pay-to-play behavior between the SEIU and Blagojevich. SEIU’s Illinois Political Action Committee gave Gov. Blagojevich $908,000, making it the single largest campaign contributor for his re-election campaign. In fact, labor unions comprised 9 of his top 15 donors. In turn, Blagojevich signed a state law handing over 49,000 state child care workers to SEIU local 880, which is run by the notorious community organizing group ACORN. The deal nearly tripled SEIU 880’s income from $7 million in 2005 to $21 in 2007.

This mafia like pattern of behavior by the SEIU should come as no surprise. Both the mob and organized labor have the same business model. US Court of Appeals judge for the 7th Circuit Richard Posner explains:

The goal of unions is to redistribute wealth from the owners and managers of firms, and from workers willing to work for very low wages, to the unionized workers and the union’s officers. Unions do this by organizing (or threatening) strikes that impose costs on employers. … Unions, in other words, are worker cartels. … There is also a long history of union corruption. And some union activity is extortionate: the union and the employer tacitly agree that as long as the employer gives the workers a wage increase slightly above the union dues, the union will leave the employer alone.

At a time when all of our businesses need to be as competitive as possible, parasitic and corrupt union influence is not what our economy needs. But that is exactly what Obama has planned for us. Referencing the SEIU’s support of his campaign for Illinois state senate, Obama wrote in his autobiography: “I owe those unions.” And so Obama is still pledging to support the SEIU’s top priority in 2009, the end of secret ballot elections in union organizing campaigns. A policy proposal that even 1972 Democratic nominee George McGovern believes is a threat to our nation.

Quick Hits:

• U.S. troop deaths for the year in Iraq and Afghanistan are the lowest combined total since the Iraq war began in 2003.
• When it comes to repairing the faltering U.S. economy, Barack Obama offers vision, numbers and detail. But as Israeli bombs and Palestinian rockets explode in the Middle East, the president-elect has responded with silence.
• A Washington lobbyist filed a $27 million defamation lawsuit against the New York Times yesterday, accusing the newspaper of falsely intimating that she had a romantic relationship with Sen. John McCain and used it to benefit her clients.
• Russian President Dmitry Medvedev signed a constitutional amendment Tuesday extending presidential terms in the country from four years to six, a change that many suspect is intended to benefit his predecessor — and possible successor — Prime Minister Vladimir Putin.
• Celebrities are shelling out big dough to pay for Obama’s Inauguration next month.