Ponce, Puerto Rico At the end of every year we are inundated with the best of this and the top ten of that in music, movies, books, sports, tech, politics, and, well, I guess, almost everywhere. Rarely is there a list of the worst events of the year. Who would read it? The list would be too long since our days seem filled with war, mayhem, abuse, and insult already. If I were making a list of biggest disappointments over the last year, the tragic scandal unraveling the great and historic United Automobile Workers (UAW) would be right at the top.
The last elected president, Gary Jones, resigned under the cloud of a potential indictment that has also implicated the previous president, Dennis Williams. The heart of the federal indictments and investigations of the union center on the expenditures involving the joint Fiat Chrysler-UAW Training Center. More than a dozen company and union officials gone down, and GM has sued Fiat-Chrysler for undermining the automobile labor relations to its own benefit. Jones led a 40-day strike after being implicated and resigned after its successful conclusion. Frankly, I don’t know enough about the ins-and-outs of the diversion of these monies to pay for other union expenses to know how solid a case the prosecutors have legally, and, importantly, neither Jones nor Williams have been charged, though they are widely understood to be Official A and B in the indictments. What I do know is that it all looks bad and tarnishes the reputation of a great union, and that defines tragedy in my book.
To be clear, the law bars a union or its officials “taking anything of value” from a company. Defining the training program as “joint,” means that it was administered by both the company and the union, and to the degree the union is being accused of spending the funds directly, that would not constitute “taking anything of value” from Fiat Chrysler. The other problem with the technical aspects of the case against the UAW officials would rest on whether or not the expenses were approved by the appropriate governing body of the union. The New York Times documents a wide range of expenditures attributed to leadership and something they refer to as a “master account” at various hospitality venues. I would bet money that virtually all of this stuff was approved by the union’s board. In my eight years on the executive board of the Service Employees International Union (SEIU) and other union bodies, there was always a standard resolution approving the expenses related to meetings, conventions, and leadership action between meetings. I would be shocked if the UAW’s board didn’t approve all of these expenses.
The problem that compounds the UAW’s situation is that much of this simply looks bad, even if it is not bad in the sense of being illegal. Times’ reporters use an overly broad brush to paint some things as scandalous, and perhaps illegal, that are perhaps just unseemly and, sadly, simply standard practices in corporations and perhaps too many big unions infected by them. They point to dinners “over four figures” for example. At a big hotel, my friends, you can get to four figures” with a standard meal charge for twenty people. The business reporters at the Times seem not to realize that every convention hotel, not just golf resources, requires the booking organization to have a “master account,” that divides the organization’s financial responsibility from those of individual participants who are guests. This part of the story seems more smear than substance.
On the other hand, they draw from the indictment the following:
At least as early as 2010, according to court filings, Mr. Jones and a colleague began submitting receipts that had already been reimbursed, or that they had manufactured, to a fund that supports the union’s political efforts. The two men would split the reimbursement. Mr. Jones personally received hundreds of thousands of dollars from this scheme from 2010 to 2017, according to prosecutors.
If that was the case, there’s no question, it’s illegal. There is a long line of union officials who have been suspended or barred under Landrum-Griffin requirements for submitting requests for dual reimbursements, though often from their local and the international simultaneously. If Gary Jones did this, he’s history at the UAW, though at this point, he’s toast at the UAW regardless.
I have to add this though. Jones came out of UAW Region 5, headquartered in the St. Louis area and historically over Missouri, Arkansas, a piece of Texas. In the 1970s and early 1980s, there was no greater labor ally of ACORN’s than UAW Region 5 and its representatives. They paved the way for us in St. Louis. We met in their hall in Dallas on Grand Avenue, and Local 100’s office is still on Grand near their old hall. We worked out of their hall in Fort Worth and depended on their leadership there in the central body. Jerry Tucker, the assistant region 5 director, was a good friend and ally and a voice for reform in the union. Herb Bingaman in Arkansas was steadfast, as was his office. They made donations to support our organizing, paid for buses for actions and were friends and colleagues. To see Region 5 at the core of this mess, and now about to be broken up and obliterated in the current clean-up of the union, is heartbreaking.
Bob King, the former organizing director and president from 2010 to 2014 before these problems began, has always been a friend and colleague and supported ACORN constantly, including when I called him for help after Hurricane Katrina. He is quoted in the Times as having “confronted” officials about training center expenditures and regretting not having investigated Region 5 under Jones’ leadership more closely. He argues he didn’t in order to maintain “unity” in the union, which is a euphemism for not having enough internal political support, given the power these decentralized regional directors had over the union’s governance, to take the bull by the horns. What isn’t said is that the governance structure of this great union has always been its Achilles heel going back to the argument Tucker and other union dissidents have made over the last forty years. The election process isn’t membership controlled or democratic, but processed through the regions which are critical in any presidential or board election.
The deeper problem that emerges is the way corporate culture has infected union culture. The ways and means of the bosses have supplanted that of the members. This is an old problem, not a new one in unions. After our affiliation with SEIU, when Local 100 and Local 880 went to our first meeting in 1985 of the Central States Conference of SEIU it was at a golf resort in Traverse Bay, Michigan. A lawyer spoke apologetically at the meeting along with the conference president, that we were “forced” to have a morning of meetings every day to justify the expense of the resort. We vowed to never bring our members to these meetings because they would be disgusted, and they might be corrupted. We wouldn’t have played golf, if our lives depended on it. Old timers would tell us that these traditions had evolved from the times when workers and union leaders worked constantly and often for little or no pay so this was a way for them and their families to do business and have a little vacation. If that was the history, it’s been long forgotten. Union and membership culture cannot mimic corporate and CEO culture. The UAW will come out of this a better union, but all unions and their leadership need to learn lessons from the tragedy now engulfing this great organization.
Wade Rathke is founder and chief organizer of ACORN and ACORN International. You can find Wade’s recent past posts here Chief Organizer Reports. And you can link to his website here Chief Organizer ACORN/ACORN International