06.30.2009 0

Ending Transparency; A day in the life of the Obama Department of Labor

  • On: 07/31/2009 11:03:48
  • In: Government Transparency
  • By Nathan Mehrens

    The Obama Administration has been hard at work since day one to end financial transparency for labor unions. This is essentially payback for the incredibly expensive support the unions gave Obama during his presidential campaign costing incalculable amounts of money.

    The Labor Department recently announced that it is considering revoking recent updates to the financial transparency regulations (Form LM-2 and Form T-1) and the conflict of interest regulations (Form LM-30) that are statutorily mandated. One of the required steps in this process is holding a “stakeholder” meeting to solicit comment from the public regarding potential regulatory changes. The Department held this meeting on July 21 and the results were all too revealing.

    When the Labor Department under President Bush held such meetings, the lack of substantive comment received from attendees made the meetings awkward. No union reps wanted to go on record regarding anything approaching transparency for fear of losing support among their peers.

    But that’s all changed now. With a new sheriff in town who is fully intent on getting rid of all this pesky transparency, the union reps were literally giddy at the prospect of hiding items such as the following: expenditures of union members’ money; substantial gifts to union officers from entities attempting to influence the union; the “offshore accounts” of unions, i.e., their trusts, etc.

    After the issues were introduced by Department personnel, the floor was opened to comments. Up first was counsel for the AFL-CIO, who claimed among other things that the Form LM-30 is “overwhelmingly complicated” and that it is “impossible for union lawyers to understand.” If that is the case, they may need better lawyers. What he probably meant is that it is now much harder to structure transactions in such a way as to avoid reporting and hide graft.

    When it comes to reporting conflicts of interest the burden is small. In fact, here’s a little secret on how it works.: If you are a union officer or union employee and someone gives you money or gifts, or buys you a car, a house, a houseboat, keep track of this. If you own stock in the company whose employees you represent, keep track of it. You then look to see whether the source of the aforementioned gifts or holdings fall into a specified list. If not, then no form is required to be filed.

    It’s that simple. The whole notion that these reporting forms can’t be understood by union lawyers is nonsense—unless the goal is to make everything opaque.

    After all, the statute requiring this disclosure is the “reporting and disclosure” act, not the “hiding and obfuscation” act. If these same reps tried to convince the IRS that their members couldn’t keep track for income tax purposes of the money they earn, they would be laughed out of the room. But, that is exactly what they are doing here. “This stuff is just too hard to keep track of.” “People throw money at us and we have no idea why or even the source of the money.” Right. Somehow other Americans never seem to find deals like this.

    Unfortunately those wishing to engage in obfuscation and hiding now have their own people in positions to make decisions regarding these issues. So much for Obama’s grand notions of transparency and a new era of accountability. When it comes to controlling union graft and corruption, the only “change” is for the worse.

    ALG News Contributor Nathan Paul Mehrens previously served in the U.S. Department of Labor under President George W. Bush.


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