- The Washington Times - Sunday, March 2, 2003

Labor leaders, many of whom have been implicated in the seething ULLICO insider-trading scandal, gathered for their annual winter meeting in Florida this week. Their timing was bad.
Not long after the confab had been called to order at the luxurious Westin Diplomat Resort and Spa in Hollywood, Fla., the Labor Department announced that the ranks of organized labor declined by more than a quarter-million workers last year, falling to 16.1 million union members. As a proportion of total workers, union membership fell to 13.1 percent. (Among workers employed in the private sector, it is now well below 10 percent.) It was the 19th consecutive year that the proportion of union workers to all workers has declined. Over that period, the proportion of workers who are unionized has plummeted 35 percent.
As for the setting, well, it must be noted that Marty Maddaloni, the president of the United Association of Plumbers and Pipefitters, spared no expense to make his pals comfortable in the lap of luxury to which they have accustomed themselves. Indeed, as head of the pension fund for the plumbers and pipefitters, Mr. Maddaloni was involved in using $40 million of union retirement money to purchase the dilapidated Diplomat Hotel several years ago. Renovation costs eventually exceeded $800 million, or more than $200 million above the hotel's later appraised value of $587 million. (It turned out that some of the contractors hired for the renovation had been banned by New York City for rigging bids.) No wonder the Labor Department is investigating the matter.
Mr. Maddaloni is also involved in the ULLICO scandal, which is under investigation by the Labor Department, a federal grand jury, the Securities and Exchange Commission and the Justice Department. ULLICO is a private, union-owned life insurance company that resets its share price once a year, depending upon the performance of its investments, which included a major stake in the once-high-flying-but-now-bankrupt Global Crossing. ULLICO directors bought and sold shares based on re-adjustments, and profitted by the millions. Like Mr. Maddaloni, directors of ULLICO are former or current labor leaders.
An explosive internal report of the insider-trading scandal has been completed, but ULLICO's directors have refused to make it public. This refusal led to the resignation of ULLICO board member John Sweeney, the president of the AFL-CIO, who apparently had not taken part in the scheme. United Auto Workers President Ron Gettelfinger has filed a lawsuit against ULLICO to compel disclosure of the report.
Meanwhile, Andy Stern, president of the 1.5 million-member Service Employees International Union (the AFL-CIO's largest), put himself in the running for first prize in any chutzpah contest by declaring that workers "see unions as a positive force against corporate greed." Fallen union membership and the ULLICO scandal threaten to cause open warfare among the bosses and unavoidable revulsion among labor's rank and file.

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