Labor Unions' Campaign Finance Activities Leave Wall Street Journal Awestruck

After Wisconsin Gov. Scott Walker prevailed in this year's recall election, there can't have been too many people who were left with the impression that America's labor unions had put on some sort awesome display of political clout. But then, it wasn't supposed to be that way. When the Supreme Court rendered its decision in the Citizens United case way back when, the overarching fear that it would usher in a vulgar heyday of corporate spending always came with a caveat: unions would benefit, too. This provided some nominal sense of "balance." Hey, why is everyone worried? America's working stiffs were still going to get some "free speech" out of the deal!

But if the Wisconsin recall election proved anything, it was that Big Labor wasn't in line for a particularly advantageous position in our new campaign finance reality. So it's strange to wake up this morning and find that the Wall Street Journal, of all publications, is somehow really awestruck by the clout of labor unions. And yet, it is. According to this story by Tom McGinty and Brody Mullins, "Organized labor spends about four times as much on politics and lobbying as generally thought, according to a Wall Street Journal analysis, a finding that shines a light on an aspect of labor's political activity that has often been overlooked."

So, what has been overlooked? Well, according to this story, unions "spend far more money on a wider range of political activities." This includes -- uhm ..."supporting state and local candidates" and -- let's see, here ..."persuading [their] members to vote as unions want them to."

I actually had no idea that stuff about labor unions and their political activities was actually overlooked. But, whatever, let's go with it:

The usual measure of unions' clout encompasses chiefly what they spend supporting federal candidates through their political-action committees, which are funded with voluntary contributions, and lobbying Washington, which is a cost borne by the unions' own coffers. These kinds of spending, which unions report to the Federal Election Commission and to Congress, totaled $1.1 billion from 2005 through 2011, according to the nonpartisan Center for Responsive Politics.


The costs reported to the Labor Department range from polling fees, to money spent persuading union members to vote a certain way, to bratwursts to feed Wisconsin workers protesting at the state capitol last year. Much of this kind of spending comes not from members' contributions to a PAC but directly from unions' dues-funded coffers.

Okay, so the unions support candidates and they lobby Congress and they conduct polls and they throw the occasional party and sometimes these parties include bratwurst and all of these activities cost money. Again, has the Wall Street Journal just discovered Washington, D.C. this week? Is it only now learning about the myriad ways that money gets spent to shape the political debate?

In fairness, no. What the authors have discovered is a "a little-known set of annual reports to the Labor Department in which local unions, their national parents and labor federations have been required to detail their spending on politics and lobbying since 2005." From there, they surmise that these reports are evidence that unions have been able to "maintain and in some cases increase their clout," and that "labor could be a stronger counterweight than commonly realized to 'super PACs' that today raise millions from wealthy donors, in many cases to support Republican candidates and causes."

Okay, sure, let's accept that premise. But let's also scoff at it a little bit, because as it turns out, this isn't where the real top-dollar campaign finance clout lives anymore. Rather, the hot new thing in obscene amounts of money being collected to influence politics isn't super PACs. As The New York Times' Mike McIntire and Nicholas Confessore reported three days ago, "there is growing evidence that large corporations are trying to influence campaigns by donating money to tax-exempt organizations that can spend millions of dollars without being subject to the disclosure requirements that apply to candidates, parties and PACs."

Emphasis, of course, on the "without being subject to the disclosure requirements" part. After all, while the Walll Street Journal managed to happen upon "a little-known set of annual reports to the Labor Department," the point is that these annual reports actually exist. By contrast, the New York Times reports that as far as these new tax-exempt organizations go, "[t]he secrecy shrouding these groups makes a full accounting of corporate influence on the electoral process impossible."

The Times does note that "glimpses" of the reality were obtained in some instances through "corporate governance reports, tax returns of nonprofit organizations and regulatory filings by insurers and labor unions." But anyone who studies the New York Times' in-house reportorial style sheet knows that a "glimpse" falls far short of "a portrait emerging." McIntire and Confessore do, however, get a nice scoop about the mega-insurance company Aetna, and a donation they'd hoped to keep secret:

The giant insurer Aetna directed more than $3 million last year to the American Action Network, a Republican-leaning nonprofit organization that has spent millions of dollars attacking lawmakers who voted for President Obama’s health care bill — even as Aetna’s president publicly voiced support for the legislation.

(Of course, if a labor union were publicly supporting worker rights while secretly undermining them, no one would have to worry about its political clout anymore, because its members would revolt. Aetna, on the other hand, doesn't have some set of internal convictions or pressures to dissuade it from working both sides of the street on the Affordable Care Act.)

Now, this isn't to say that unions are some sort of model of transparency. The Times notes that AFSCME made a $100,000 donation to a anti-Walker advocacy group in Wisconsin that "was reported nowhere in Wisconsin." It did, however, come to light in the same annual report that has so gobsmacked the Wall Street Journal today. Thus, a disclosure mechanism, "little-known" as it may be, nevertheless exists.

But how did the Times get the skinny on Aetna's donation to the American Action Network? The short story is that someone at Aetna screwed up royally: "Aetna’s check to the American Action Network, along with a $4.5 million contribution last year to the chamber, was mistakenly included in a filing with insurance regulators." Ha, ha: whoopsie-daisy!

At any rate, it's really hard to read both of these pieces back-to-back and come away with the impression that labor unions are doing anything other than competing on the junior-varsity level of campaign finance activity. The real action is with these tax-exempt organizations that ostensibly exist for some sort of vague "social welfare" purpose, but actually fund 2012 political ads.

Why would the Wall Street Journal make such a big deal about such small potatoes in a week where Mitt Romney's Hamptons donors were occupying so much of the newshole? Well, one could infer a lot of reasons!

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Below, a list of super PAC donors looking to make their mark on the 2012 elections:

Donors Giving $500,000-Plus To Super PACs