In May, a devastating piece from the Far Left New Republic highlighted the Teamsters’ officials attempts to get rid of the Independent Review Board (IRB), a federal oversight body intended to police the union’s well-documented connections to organized crime. Here’s a particularly choice example of Teamster union "representation" from the article:

But Hoffa’s efforts [to get rid of the IRB] were derailed by a sensational IRB report that appeared late that year detailing the efforts of Chicago Teamsters, working with a Chicago labor broker, Richard Simon, whom Stier [a former federal prosecutor] would later describe as "having ties to organized crime," to undermine a Teamster local in Las Vegas by negotiating non-union, low-wage agreements to service the city’s numerous business conventions.

Now a former Teamsters boss has written in to announce he’s shocked – shocked – by the magazine’s allegations of corruption. Having already been ejected from the union by the IRB for innappropriate conduct, his credibility on this issue is somewhat strained. Fortunately, the author ably defends his original contentions:

The IRB found that the two men [two Teamsters officials — one of whom wrote in to object to the first article] tried to get the Teamsters local 631 in Las Vegas, which provided workers to convention shows, to allow Richard Simon, a Chicago labor broker, to provide non-union workers to conventions. The workers, which would be provided by Simon’s United Temps, would not receive benefits or overtime. All in all, they would earn less than half of the Teamster workers; and under the labor agreement that the Teamsters had with the conventions, Simon’s cut-rate contract could then become the standard for all convention employees. The Teamsters would be screwed, but Simon would come out ahead, and so would Hogan’s brother Michael, who was the vice president of Simon’s company, and also the head of a convention company that would be hiring Simon’s workers.

Notably, the IRB’s investigation was later validated by a federal court:

"Having carefully reviewed the hearing record," the Appeals Court wrote, "we concluded that the IRB’s findings are supported by substantial evidence, are not arbitrary or capricious, and plainly demonstrate that Hogan and Passo were negotiating a contract that they knew would have harmed the union."

While more oversight may seem desirable, it’s no substitute for real reform. Corruption will remain endemic to labor unions like the Teamsters as long as union officials have access to a bottomless source of mandatory dues payments. Furthermore, the entire structure of monopoly bargaining gives employees no meaningful recourse to combat union fraud and corruption, as union officials are essentially installed for life as workers’ sole representatives [this National Institute for Labor Relations Research paper is good primer on the relationship between compulsory unionism and union corruption].

Good-faith efforts at union oversight are also vulnerable to changes in the political environment. According to this Wall Street Journal article, one presidential candidate has already announced his support for dismantling the IRB and giving the Teamsters free reign to police themselves. Unfortunately, we already know how that strategy will turn out (from the original TNR article):

To build an argument for getting rid of the IRB, Hoffa set up his own internal oversight group. It was called RISE (or Respect, Integrity, Strength, and Ethics) and was run by a former federal prosecutor and organized crime expert Ed Stier.

. . .

For Stier, however, those hopes were dashed the next year when he began investigating Chicago-area Teamster locals for corruption. As he later detailed in a report, Stier discovered "multiple issues related to organized crime [and] corruption" in Local 714, and similar issues in five other area locals. The report concluded, "Issues related to organized crime infiltration and associated corruption in the Chicago area are numerous and cut across jurisdictional lines." But in the fall of 2003, as Stier was still in the midst of his investigation, the Teamster leadership began objecting vociferously to it, and in February 2004, Hoffa shut it down.

Posted on Jul 2, 2008 in Blog