Politics & Policy

The Democrats’ Financiers

Labor's commitment to the Left grows.

Big Labor is sweating profusely these days. Despite its working hard to avoid coming apart at the seams, widening cracks plague the union movement, exposing several troubling rifts. Internal disputes about direction and other problems associated with declining membership are causing unprecedented friction. The controversy could reach a boiling point in July when the AFL-CIO has its annual convention in Chicago.

While some problems have been building gradually, others are of more recent vintage. According to an editorial in last week’s Washington Times, 12.5 percent of the labor force is unionized, compared to 35 percent in 1955. Losing members also means mounting financial problems and new divisiveness. The AFL-CIO’s largest faction, the Service Employees International Union (SEIU), is threatening secession unless the federation agrees to spend $60 million annually to recruit and organize new members and stop the spiraling membership/financial decline, according to the newspaper.

Even so, at least America’s labor movement remains unified and dogged on one matter–helping Democrats beat Republicans.

According to a recent analysis by Washington attorney and campaign-finance expert Cleta Mitchell, “labor agreement” with the Democrats was breathtaking in 2004, especially compared to the corporate community, which generally views giving to Republicans and Democrats as a necessary component of political success. Some businesses seem to think “bipartisanship” is axiomatic–the political equivalent of Adam Smith’s law of supply and demand or David Ricardo’s theory of free trade.

Yet most unions reject classical economics–as well as the ides of giving money to Republicans.

Mitchell’s analysis underscores this point. The seven largest labor-union PACs gave over 94 percent of their money to Democrats, while the largest corporate PACs were more split, giving just over 60 percent to Republicans.

These numbers alone are not surprising. Labor always supports Democrats more than Republicans and many corporations play both sides of the fence–big deal. But the breadth and magnitude of labor resources given directly to Democrats, as well as union contributions through independent expenditures (IEs) and to newer liberal organizations like 527s, should raise concerns among Republicans and conservatives. For example, Mitchell argues that not only are labor unions more concentrated Democrat givers, they are also big and getting bigger. Of the top 20 political-action committees in the 2004 cycle, ten were labor unions (five others were non-union labor allies like America Coming Together, Emily’s List, and trial lawyers). If political money were an arms race, Republicans could be headed for electoral annihilation. “The largest corporate PAC (United Parcel Service) is smaller than the 10 largest labor PACs,” Mitchell reports.

Beyond individual candidate contributions, IEs are another way to affect election outcomes and here again labor trounces business. Mitchell reports the 12 largest corporate PACs spent $233,000 in IEs in 2004, while the biggest labor PACs spent $19.5 million. IEs can mercilessly pound away at candidates in battleground races with media buys, having a major impact in congressional races where voter information is low.

But the most troubling trend for Republicans and conservatives is the interaction of labor and liberal 527 organizations. Money flows seamlessly from large union PACs to the most liberal, anti-conservative groups, like those funded and organized by George Soros. Mitchell shows that labor unions were the largest donors to 527 organizations in the 2004 cycle, topped by the Service Employees International Union ($53,187,817), the American Federation of State, County, and Municipal Employees ($30,327,630) and the AFL-CIO ($11,424,853). These are all contributions above and beyond labor’s direct funding of candidates and Democrat organizations.

Big labor faces a host of internal disagreements about its future direction and strategy. Yet when it comes to beating Republicans, on the ground, in the air, or through the money chase, unions maintain a strong consensus–a kind of “labor agreement” that could cost the Republicans control of Congress unless their allies mount an alternative effort.

Gary Andres is vice chairman of research and policy at the Dutko Group Companies and a frequent NRO contributor.


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