Editorial: Union leaders afraid of disclosure

Among those leading the movement for greater corporate financial transparency among publicly trade firms is the AFL-CIO.


With huge pension funds under its umbrella, the labor federation has a vested interest that happens, despite excesses at the edges of its policy proposals, to coincide with the public interest in a nation of investors. It is curious, then, that the AFL-CIO has now gone to court in an attempt to forestall the same financial transparency regarding its stewardship of member dues that the labor federation demands for public corporations.


Last week the AFL-CIO sued the federal government in an effort to block revision of Labor Department rules concerning disclosure of union spending. For more than 40 years, unions have been required to file summary disclosures on what is known as form LM-2. Under rules set to take effect Jan. 1, regional and local unions with incomes greater than $250,000 must report itemized expenses and receipts of more than $5,000; they also would have to file disclosures of finances of related union trusts, which have figured in many cases of union corruption.


The nature of labor unions, particularly their spending on political and legal operations far afield from their core mission of representing workers at the bargaining table, has changed a great deal since the last substantive change to disclosure rules in the 1950s.


While one may sympathize a little with the AFL-CIO’s complaint that the new rules add administrative burdens, that sympathy is checked by the fact that the money involved does not belong to union leaders; it belongs to the rank-and-file, dues-paying members and union retirees. And it is not as if the rules will require hand-written, double-entry ledgers to be created. We’re talking here about reports easily produced by any competent financial officer.


All of which leads to the question union members ought to be asking of leaders attempting to block the new disclosure rules: What exactly are union leaders afraid of disclosing? Union leaders’ vociferous opposition to disclosure of their organizations’ finances quite reasonably gives rise to suspicion that union members would not be thrilled with how their dues and trust investment dollars are being spent – if they could only find out how those dollars are being spent.


Alas, some disclosures, at least in the eyes of AFL-CIO leaders, are more equal than others. [(Tiffin, OH) Advertiser-Tribune, 12/15/03]