Obama and the Dems: Not transparent on unions

When workers join a union, or get hired at a "closed shop" workplace, they pay union dues.

Just where does all of that dues money go?

Elaine L. Chao was Labor Secretary during George W. Bush's entire term of office. Rank-and-file union members probably never had a better ally at Labor than Chao.

Union bosses didn't like her at all.

Chao supports union transparency. But as she writes in today's Wall Street Journal, Barack Obama and the Democrats aren't very transparent when it comes to organized labor.

Fifty years ago, Congress passed the landmark Landrum-Griffin Act to protect rank-and-file union members from malfeasance by union leaders. Senate hearings had uncovered serious corruption and other unethical practices inside the labor movement, and a bipartisan coalition emerged to shine the light of disclosure on union practices.

Nevertheless, Democrats in Congress and in the executive branch have often attempted to undercut that law's financial reporting and disclosure requirements. Prior to reforms adopted in the George W. Bush administration, for example, one union could get away with reporting a $62 million expenditure as nothing more than "contributions, gifts, and grants to local affiliates" -- with no further explanation. Unfortunately, the Obama administration is already showing that it wants to return to this nontransparent standard of financial disclosure.

Within days of the inauguration, the new leadership at the Labor Department moved to delay implementing a regulation finalized in January that would have shed much needed light on how union managers compensate themselves with union dues. The regulation required disclosure of receipts for expenditures and for the purchase and sale of union assets -- disclosures that would help deter embezzlement. The administration has since moved even more aggressively, initiating proceedings to rescind this rule and others promulgated when I was secretary of labor.

The Labor Department's Office of Labor Management Standards (OLMS), created to enforce the 1959 law, also recently announced that it would not enforce compliance with the conflict-of-interest disclosure form (the "LM-30" form) that was revised in 2007. Labor's Web site states that "it would not be a good use of resources."

Unions are possibly the most reliable source of funds for Democratic candidates. That campaign cash comes from union dues.

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