BOOK REVIEW: ‘Solidarity for Sale’ Debunks Few Rotten Apples Theory of Union Corruption; Unions Were Rotten to the Core from Their Inception; Author Robert Fitch is a Liberal and a Union Man; Publisher is Solidly Liberal
Reviewed By David M. KinchenHuntington News Network Book Critic
Hinton, WV (HNN) – In the scale of crimes committed down through the ages by American organized labor leaders, the $5 million looting by Barbara A. Bullock of the Washington Teachers’ Union about three years ago isn’t in a league with the murders committed by members of more violent unions like the Laborers or the Teamsters. Still, it grabbed my attention when I read “Solidarity for Sale” by Robert Fitch (PublicAffairs, 432, $28.50, index, notes, bibliography).
Bullock, a 68-year-old (in 2003) former teacher, ended up getting sued by the parent American Federation of Teachers union. According to Fitch, a former union organizer, writer and college teacher who is still a union member, Bullock spent $35,000 on handbags, plus filling her closets with designer clothes. Her $90,000 a year chauffeur was in charge of laundering the embezzled money.
What is it with women and designer purses, I asked rhetorically. (I even asked my wife, who threw back at me the question “What is it with guys and expensive wrist watches and power tools?” Touche’!)
I can understand whacking rival business agents or contenders for the presidencies of locals, since I agree with Fitch’s thesis that American labor unions have been corrupt from the very beginning. (Full disclosure, I’ve been a member of Retail Clerks, the Newspaper Guild and Steelworkers unions). They’ve not only been corrupt – especially compared with unions in France, Germany, the Scandinavian countries and elsewhere – they’ve managed to defeat attempts at universal health care such as that enjoyed by virtually every industrialized country in the world, Fitch points out.
It was the AFL’s legendary leader Samuel Gompers, in league with insurance companies, about a century ago that did this dastardly deed to protect their own union plans. Believe it or not, in 1912, the Progressive Party came out for national health insurance “and even the American Medical Association and the National Association of Manufacturers were cautious early supporters,” Fitch writes. Yes, that’s the same AMA that opposed national health insurance as “socialized medicine” in the late 1940s, when President Harry Truman proposed it. Think of how much better off General Motors would be if they weren’t saddled with horrendous health-care expenses!
What intrigued me about the mild-mannered AFT is that the pattern of corruption in many unions follows the pattern described by Fitch – briefly – and the Washington Post – at great length – about the looting of the Washington local. Here is an excerpt from a January 2003 Washington Post story on Mrs. Bullock and her band of merry looters:
"The massive misappropriation of union funds and the betrayal of the members that are outlined in our audit are reprehensible and sickening," the president of the national union, Sandra Feldman, said in a statement. "The individuals responsible must be held accountable, and the AFT will do everything in its power to see that these funds are returned to the WTU and its members."
In an affidavit filed last month in a criminal investigation, the FBI said that more than $2 million in union money was misspent, much of it on luxury items such as furs, art, jewelry, silver and custom-made clothes.
The AFT's audit and lawsuit mention such purchases but also provide far more details of the alleged scheme. Forensic auditors said they uncovered a long trail of altered checks, evidence of forged signatures and an operation geared to converting checks to cash. The documents also provided a breakdown of how much each participant in the alleged fraud received.
Bullock, who was elected union president in 1994, made unauthorized and personal charges of at least $1.8 million to the union's corporate American Express cards and used an additional $381,000 for her personal benefit by writing checks to herself or others, the lawsuit said. “
If all politics is local, virtually all union corruption is Local, as in the local branches of a big union, Fitch emphasizes. In this respect, American unions are separate and distinct from European ones, where the big union, say the CGT in France, is what counts and the local officials are paid in the range of $2,500 a month – chickenfeed for heads of U.S. locals, hardly covering their expense accounts.
Fitch, whose first encounter with labor unions was as a 15-year-old who joined Laborer’s Union, Local 5 in Chicago Heights, Illinois, says the fatal flaw of American unions – one of them, at least – is “the fiefdom nature of the system – the localness, the complexity of the ties between leaders and members – that makes it almost impossible to build a broad base across the whole membership or keep from being co-opted by the demands of loyalty.”
I noticed this on a recent trip to Chicago, where I met a number of construction workers on condominium projects on the lakefront. One of them is a 39-year-old member of the Sheet Metal Workers union, a foreman, who makes $105,000 a year. (I never made even close to that kind of money as a reporter for a major metropolitan newspaper). His loyalty clearly was to his Local, as indicated by his T-shirt, for one thing.
Fitch notes that some labor unions acknowledge the widespread corruption of organized labor, excusing this on the – two-wrongs-make-a right-basis – that “sure labor is corrupt, but so are employers.” Look at Enron, Global Crossing, WorldCom, etc., they say. Fitch does look at Global Crossing, where CEO Gary Winnick sold off $734 million in stock, at the same time urging his employees to buy more.
AFL-CIO President John Sweeney, who made the reference to Global Crossing, which collapsed in 2002, wiping out those who had invested in it, while leaving Winnick with plenty of money and a $92 million house in Bel Air, CA, is hardly one to point fingers. The AFL-CIO’s insurance company, Ullico, founded in 1925, was one of the investors in non-union Global Crossing’s 1997 initial public offering, receiving GC shares then worth $7 million, “which turned into shares worth an incredible $2 billion before Global Crossing collapsed five years later, nearly taking Ullico with it.”
The Ullico debacle is only one of dozens of examples cited by Fitch in his rambling, somewhat disheveled book. The book reminded me somewhat of the movie “Stripes,” which is really two movies in one. This comment is fair because throughout the book, Fitch brings in literary and cultural references, including movies like “On the Waterfront.”
Don’t let the piled-high-with-newspapers nature of the book – a reference to the typical reporter’s desk at most of the newspapers I’ve worked on – turn you off from exploring “Solidarity for Sale.” The book’s virtues far outweigh its faults.
While there were attempts at corruption-free unions with the early IWW and the Knights of Labor, corruption was at the heart of the movement from the 1881 founding of the United Brotherhood of Carpenters to the organized crime-back looting of the Mason Tenders pension fund in the 1990s, Fitch demonstrates in almost excruciating detail.
Pension funds – the “piggy-banks” of mob dominated unions like the Teamsters – are big business with organized labor, but there are many flies in this particular jar of ointment.
American labor leaders manage more than $350 billion in pension funds. Unfortunately, he points out, obligations exceed assets by more than $150 billion: “Officials explain that the market’s been down and they talk about actuarial problems. But simple corruption and the fragmented character of the unions perhaps explains a great deal too,” he notes, adding that one reason is that there are too many plans: “Why does the AFL-CIO need to have 2,100 separate pension plans for its 13 million members? That’s a plan for 6,200 members. Social Security has one plan for 280 million [probably over 300 million now] Americans. Social Security’s administrative costs run about $11 per year per person” while Fitch points to one Teamsters local on Long Island where administrative costs run to $420 each year for about 2,700 member participants.
And so on, and so on.
Reform movements, such as the widely publicized attempt to portray Ron Carey of the Teamsters as a “reform” candidate, have come to virtually nothing, Fitch demonstrates in great detail. He also notes that liberal or “progressive” publications like The New Republic and The Nation, not to mention the Pravda-like labor-owned publications, generally have a hands-off policy on covering labor corruption.
The credibility of “Solidarity for Sale” is certainly enhanced by the credentials of both the author and PublicAffairs, a solidly liberal, “progressive” publisher that ranks among the best in the world. I recommend Fitch’s often exasperating-to-read book for its insights in American labor and the peculiar American exceptionalism that seems to make us unable to take advantage of good ideas that originate elsewhere.
Publisher’s web site: www.publicaffairsbooks.com