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SCANLON: Hilda Solis’ legacy of pandering

She enabled union corruption

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Hilda Solis is leaving her position as secretary of labor -- or, as she saw the job, secretary for the Support of Unions.

The official mission of the Labor Department is "To foster, promote, and develop the welfare of the wage earners, job seekers, and retirees of the United States; improve working conditions; advance opportunities for profitable employment; and assure work-related benefits and rights." There's nothing in that description about unions, which today represent fewer than 1 in 16 workers in the private sector. From her first day in office to the last, however, Ms. Solis was the unions' faithful servant.

Ms. Solis was born into the labor union movement. Her father was a Teamster and her mother a member of what is now the United Steelworkers. During her time in Congress (2001-09), she received more than $900,000 in contributions from unions, and she was a member of the so-called Progressive Caucus, the far left among members of Congress.

When President Obama picked her as his labor secretary, John Sweeney, then the president of the AFL-CIO, said he was "thrilled." At a United Food and Commercial Workers Union convention, she told conventioneers, "President Obama has your back, and so do I."

At a convention of the plumbers and pipe fitters union, she called her audience "brothers and sisters" and called the labor union movement "our movement."

In the Bush administration, the Labor Department had conducted a program of "compliance assistance," a good-cop approach that sought to avoid crippling fines for businesses even as it resulted in record-low workplace death and injury rates and record-high back pay collected for workers. When she became labor secretary, Ms. Solis abandoned that approach and hired hundreds of investigators (710 of them by early 2010) to go after businesses that, she said, were shortchanging workers, denying them rightful benefits and endangering their safety. She would be, in her words, a "new sheriff in town."

She sought scores of new rules and regulations on business, 90 in 2010 alone, but she got rid of rules that unions didn't like.

One of her biggest changes in direction was her reversal of Bush administration efforts to fight union corruption. Ms. Solis' predecessor, Elaine Chao, had issued several rule changes to make it easier for union members and watchdogs to detect wrongdoing, especially conflicts of interest among union officials and the people with whom they do business.

Regarding a conflict-of-interest form that union officials file, the Bush administration offered amnesty to first-time filers in 2005, and the number of filers went from 96 to 13,326. The form, which had not been updated for 40 years, was made more detailed, and coverage was extended to include more officials such as, in some cases, shop stewards.

The new disclosure rules helped union members by exposing corruption. For example, they forced Tyrone Freeman, head of California's largest union local, out of office after the revelation of the union's contract with his wife's video production firm and of the expenditure of nearly $10,000 of union money at a cigar bar.

In Denver, a local president of the United Food and Commercial Workers was voted out of office and replaced with a Safeway bakery clerk after disclosures that the president spent union money on alcohol and Broncos tickets and that, while making $162,000 a year, he put his wife and son on the payroll for a combined $268,000.

The Chao rules helped the Labor Department's Office of Labor-Management Standards obtain 929 convictions, mostly for embezzlement, and recover some $93 million. Other rules would have made it easier to track the operation of union trusts such as those set up for health benefits, pensions, training programs and strike funds.

Ms. Solis rolled back the Chao reforms.

Her excuse? The changes "had a detrimental impact on workers" and "made the union financial reporting requirements not only overly burdensome but ineffective." In response, Ms. Chao accused the Obama administration of "not enforcing laws on union transparency and democracy" and "telling unions that they don't have to comply."

Today, private-sector unions are failing enterprises. They seem unable to adapt to a changing environment -- to global trade, to the advance of information technology and robotics, and to the rise, in states like Indiana and Michigan, of political leaders who do not fear them. In the private sector, 38 percent of workers belonged to unions 60 years ago; today the figure is 6.2 percent.

Ironically, given unions' critical role in electing and re-electing Mr. Obama, the jobs-destroying taxes and hyper-regulation of the Obama era may make it even worse for unions. Unionized businesses, lacking the flexibility of non-union businesses, will be less likely to grow and more likely to fail, which will further diminish the influence and membership of unions.

Hilda Solis ran the Labor Department as an extension of the union movement, but her heavy-handed approach -- seeing business as an enemy rather than as a partner in creating jobs -- may have simply been another nail in the movement's coffin.

Terrence Scanlon is president of the Capital Research Center.

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