NCPA - National Center for Policy Analysis

Will New Form Promote Disclosures of Union Political Spending?

January 21, 2003

Last December, Federal Bureau of Investigation agents raided homes of officials of the Washington (D.C.) Teachers Union -- an affiliate of the American Federation of Teachers. They seized such luxury items as mink coats, alligator shoes and a Tiffany's silver service that investigators say were purchased with more than $2 million stolen from members' dues.

The scandal has prompted Labor Secretary Elaine Chao to revise a 1959 department form called the LM-2 -- originally intended to keep the mob out of organized labor to require unions with annual revenues greater than $200,000 to itemize all "major" disbursements -- with thresholds set somewhere between $2,000 and $5,000.

Observers say the union financial reporting form can to used to uncover more than graft and corruption among union officials -- it could help determine how much is being misappropriated for union officials' pet political causes.

  • For example, although the National Education Associate claims to spend absolutely nothing on politics, it lists tens of millions of dollars of spending under ambiguous categories on its LM-2 forms -- including $45 million in 1999-2000 under "Other Disbursements."
  • Unions would also have to account for how their salaried staffers spent their time -- probably the largest source of soft-money contributions.

Iowa Democrat Senator Tom Harkin inserted language in the committee report accompanying the department's appropriations bill forbidding the Secretary of Labor to revise, amend or change "the reporting requirements imposed on labor organization;" however, Secretary Chao is reportedly prepared to pursue her quest.

Source: Editorial, "Union Don'ts -- And Dues," Wall Street Journal, January 21, 2003.

For text (WSJ subscription required),,SB1043110237591413024,00.html


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