IN THESE TIMES
DECEMBER 14, 1997
BY JIM LARKIN
Not long ago, Teamster scandals were
the work of wise guys with names like Jimmy the Weasel, Fat Tony,
Tony Ducks or Tony Pro. The current one, surprisingly enough,
is the work of people associated with the Democratic Party, Citizen
Action, liberal unions and other progressive causes.
During the 1996 re-election drive
of reformer Ron Carey, who was elected president in the union's
first membership vote in 1991, the reputation and moral authority
of his new, corruption-free Teamsters took a serious beating,
not at the hands of his opponent, James P. Hoffa, but due to the
actions of his own campaign handlers and inside-the-Beltway
boosters. Their election violations prompted federal overseers
to order a re-run of the contest, scheduled to begin on
On November 17. the Teamster reform
movement suffered an even greater blow when election investigator
Kenneth Conboy ruled that Carey should not be allowed to participate
in the re-run because he knew about improper fundraising
by his campaign. Carey denies the charge and has pledged to appeal
Meanwhile, federal prosecutors in
New York are continuing a criminal investigation. Three Carey
associates have already pleaded guilty and face heavy fines and
jail time for mail fraud, conspiracy or embezzling union funds
on Carey's behalf. They are: his campaign manager, Jere Nash,
a onetime leader of Mississippi Common Cause and consultant to
the 1996 Clinton-Gore campaign; Martin Davis, a millionaire
Teamster political adviser, who also aided the Democratic National
Committee (DNC) and brokered deals for the AFL-CIO's Union
Privilege credit card program; and Michael Ansara, a former community
organizer and leader of Students for a Democratic Society (SDS)
at Harvard University in the late ''60s, who later became a "socially-responsible"
Other alleged participants in or casualties
of this troika's illicit scheming include the Teamsters' political
director William Hamilton, an alumnus of the American Federation
of State, County and Municipal Employees (AFSCME) and a former
business associate of Ansara. Hamilton was forced to resign in
July and now faces Teamster Independent Review Board charges of
aiding the diversion of dues money to Carey's campaign-a matter
that a federal grand jury in New York is also investigating. Ira
Arlook, director of Citizen Action and another ex-SDSer,,
has run up more than $200,000 in legal bills defending his organization
against possible criminal charges over its Teamster money-laundering
role. The scandal so damaged the fund-raising ability of
Citizen Action's national organization that the group just closed
its Washington, D.C., office and laid off 20 staffers.
The biggest potential losers, however,
are Teamster members-particularly those who have worked for change
in the union. In the face of beatings, black-listing, redbaiting
and other obstacles to reform, Teamsters for a Democratic Union
(TDU - labor's most durable and successful rank-and-file
group-sacrificed and struggled for more than 20 years to eliminate
corruption, gangsterism and sweetheart deals. The reformers' efforts
finally bore fruit six years ago with Carey's victory in an election
conducted as part of the settlement of a Justice Department lawsuit
filed under the Racketeer Influenced and Corrupt Organizations
(RICO) Act. Working with TDU activists around the country and
a minority of local officers, Carey has since put 75 troubled
locals under trusteeship, cut waste, stepped up Teamster organizing,
hired aggressive new staff end won significant bargaining victories
like the recent United Parcel Service (UPS) strike.
Now, the shenanigans of Carey's reelection
team are overshadowing-and threatening to undo- much that he and
TDU have accomplished. Hoffa, son of the union's most notorious
past president, is gearing up for another bid to oust the reformers
from off~ce. Labor's recently improved public image has taken
a big hit as stories about Carey's clean-up have been replaced
by embarrassing media revelations about Teamster election violations.
The scandal has given critics of democracy in other unions stronger
arguments to use against direct election of their top officers.
And it's also created uncertainty about the future direction
of the AFL-CIO because, just as Carey's 1991 victory
boosted John Sweeney's chances of becoming federation president
two years ago, the defeat of Teamster reformers now could undermine
Sweeney's own administration.
In his ruling on Carey's eligibility,
Conboy,, a former federal judge, acknowledges that there is more
to be investigated about Hoffa's fundraising practices. Teamster
reformers argue that if diverting union dues into campaign treasuries
or accepting money from employers or Teamster vendors is going
to be a disqualifying offense for Carey, it should also remove
Hoffa from the ballot. As In These Times went to press,
no new candidates had emerged. Nevertheless, it's worth examining
how the union's reform project became so endangered in what may
yet become a full-blown tragedy for labor.
The current scandal has its roots
in the later stages of Carey's f~rst run for the Teamster presidency.
There were no high-priced consultants around when he launched
his original campaign in 1989. Back then, he was a Queens, N.Y.,
UPS local president with a reputation for honesty, militancy and
independence from the corrupt power structure of the union. He
was the very definition of a "dark horse" candidate-and
widely dismissed as such by labor insiders and the press.
Carey's first election effort relied
almost entirely on TDU because he had so little backing within
the union's bureaucracy. Only 30 out of 600 Teamster local presidents
ever endorsed him. Directed by ex-United Mine Workers
staffer Eddie Burke, a hero of the 1989 Pittston coal strike,
the off~cial Carey campaign was often an exercise in improvisation-constantly
shored up by TDU National Organizer Ken Paff in Detroit and the
group's network of experienced activists (who were heavily represented
on Carey's slate). Unlike last year's fiasco, Carey's earlier
run was low-budget (costing less than $1 million) and based
on the leafleting, phone-banking and organizing activity
of hundreds of rank-and-file volunteers.
To reduce the official campaign's
dependence on and political debt to TDU (which Carey has never
joined), Burke made a fateful decision in 1991. He hired the November
Group, a Washington, D.C.-based political consulting firm,,
and a Somerville, Mass., fund-raiser called the Share Group.
The now-defunct November Group was a typical hive of liberal
hustlers. Its then 30-year-old co-founder and partner,
Martin Davis, got his start working for Walter Mondale. He and
Hal Malchow, the firm's other principal, had a client list that
included the DNC, state Democratic parties and the Clinton-Gore
campaign. Their specialty was campaign strategy, fund-raising
and get-out-th-evote "persuasion mail."
Davis and Malchow's main contribution to Carey's first run was
a series of embarrassing ads in The Teamster magazine that featured
photos of pigs feeding in a trough and models dressed up as cartoonish
Mafia fi gures. Even the Carey backers most concerned about union
corruption found the material crude and vacuous.
Neither the November Group or Share-founded
by Michael Ansara and partly owned by Davis and Malchow-raised
much money for Carey's first campaign or made big bucks off of
it. But Davis and Ansara saw their work as an investment in the
future. It was a foot in the door of the Teamsters' "Marble
Palace" in Washington that they believed would lead to more
lucrative deals after the reformers took over.
The consultants' payback wasn't long
in coming. Even before Carey's February 1992 inauguration, the
November Group made a failed bid to take over Teamster publications.
Then the firm moved in on the union's legislative depattment and
its $4 million political-action fund. At Burke's suggestion, Carey
hired Jere Nash to take charge of the Teamsters' "transition
process." Nash's chief credential was that he had once overseen
the transition team of Mississippi Governor Ray Mabus.. Like his
fellow political consultants, Nash had never worked for a union
before, knew nothing about the Teamsters and had no connection
to members or to the reform movement.
Nash, in turn, gave the November Group
a key role in making recommendations about me future of the union's
political program. Not surprisingly, the consultants suggested
using more direct mail and consultant services. Between 1992 and
1996, the November Group billed the Teamsters for $650,000 (and
rewarded Nash by making him a contract employee of the firm).
More importantly, Malchow and Davis profited from introducing
their political clients-Democratic candidates in need of cash-to
their new friends at the Teamsters, who had a big pile of money
in the union's DRIVE (Democratic Republican Independent Voter
The consultants worked closely with
Hamilton, who became the Teamsters' chief dispenser of
hard and soft money. In this role, Hamilton thwarted any Teamster
backing for the fledgling Labor Party and arranged only
token giving to the New Party. His idea of independent political
action was telling Transport Topics last January that
"the Teamsters' PAC had plans to give more to the GOP"
since "they control Congress" and the union wanted "to build
bridges to those in power."
In the larger scheme of things within
the "New Teamsters," this business-as-usual approach
to politics might only have been a minor disappointment of Carey's
first term. After all, Carey had, with the help of other staffers,
staked out an independent position on political issues ranging
from NAFTA to the merits of Bill Clinton (whom Carey refused to
endorse in 1996 because of his anti-worker free trade deals).
But, unfortunately,, Carey's vocal criticism of politicians who
betrayed labor didn't translate into new DRIVE priorities that
might actually affect their behavior. The union's political apparatus
remained in the hands of Beltway insiders preoccupied with Democratic
Party deal-making, White House invitations and coneressional "access."
Carey's deferral to these folks on political matters became the
Achilles' Heel of his administration.
Reformers had a tougher time getting
re-elected last year than they expected. Carey's crackdown on
crooks and leadership perks alienated large sections of Teamster
officialdom. Still-powerful bureaucrats who split their support
between two "Old Guard" candidates in 1991 bankrolled
a unified $4 million challenge, fronted by Hoffa. For too long,
Carey adopted a "Rose Garden" strategy in the face of
this threat. He avoided the personal campaigning in the field
that had made such an impact on members the first time around.
This enabled Hoffa to don the mantle of the insurgent. The wealthy
Detroit labor lawyer masqueraded successfully as a populist critic
of a 'New Teamster" establishment that was spendthrift, incompetent
and run by "outsiders." To strengthen his political
base and survive a July 1996 convention dominated by the Hoffa
forces, Carey decided to broaden his Executive Board slate.
Some of his new running-mates delivered
much-needed votes through their own local political machines.
But, overall, the Carey administration's tilt to the center had
a dampening effect on grassroots campaigning wherever there was
tension between the rank and file and offficials now allied with
Enter the "Gang of Three"-Davis,
Ansara and Nash-with their political contacts, rich friends, focus
groups, telemarketing schemes, junk mail and self-serving advice
about how consultants like themselves could save the Teamsters
from Hof~a. With Nash ~nstalled as Carey's campaign manager, they
conspired to finance a costly "air war" on Carey's behalf
that was viewed as a safe political substitute for fighting it
out on the ground. Their crowning achievement was a panic mailing
of 1.7 million fliers sent out during a one-week period so late
in the campaign that many Teamsters didn't get them until after
they'd already voted while others received as many as five different
Carey leaflets on the same day.
Footing the bill for this $700,000
last-minute barrage was a big challenge. Since the bill was coming
from Davis' own November Group, he took the lead in raising the
necessary funds. He devised various ways of leveraging and transforming
union expenditures into Carey campaign revenue through "contribution
swaps." His partners in this enterprise-unwit- or otherwise-included
institutions and individuals ineligible to donate money to Carey
because they were union vendors, employers or relatives of either.
One of Davis' biggest overtures was
to his pals at the DNC. In return for the Democrats tapping their
donor list for Carey, Davis promised-and the union delivered-hundreds
of thousands of dollars to state party organizations. Another
deal involved Citizen Action, which suddenly got almost half a
million dollars from the Teamsters directly. plus $150.000 funneled
through the AFL-CIO, for mailings last tall on behalf of its
labor-backed "Campaign for a Responsible Congress."
Some of this money was diverted to pay for the November Group's
Carey mailings and to reimburse Ansara's wife for a $95,000 Carey
donation that Ansara unlawfully solicited from her as part of
his plotting with Davis. Ansara then hit up various progressive
funders, raising more than $200,000 that Carey later had to return.
Ansara also skimmed money off a $97,000 contract he got from Hamilton
to have non-union telemarketers make 150,000 calls last fall reminding
Teamsters to vote for Bill Clinton and the Democrats.
Carey supporters over at the AFL-CIO
were also drawn into this scheming. People who wouldn't touch
Carey with a ten-foot pole in 1991-like AFL-CIO President John
Sweeney, Secretary-Treasurer Richard Trumka and AFSCME President
Gerald McEntee-fell all over themselves trying to help him this
time around because of his crucial role in their 1995 palace coup
against Lane Kirkland and Tom Donahue. Union staffers were reportedly
pressured to give and, according to U.S. Attorney Mary Jo White,
"large sums of money, including cash, were raised by off~cials
of various labor groups for the Carey campaign." White's
investigation of such transactions, which are prohibited by federal
Carey has been questioned several
times before a federal grand jury (which has also heard testimony
from Sweeney and Trumka).He has pledged full cooperation with
all investigators and repeatedly declared himself to be an unwitting
victim of the "Gang of Three" and what Ansara calls
their "misguided idealism." In the end, the criminal
investigation-like Conboy's probe-will come down to the old Watergate
question: What did the president know and when did he know it?
Teamster reformers were scheduled
to meet November 22 in Cleveland to assess the situation at the
annual TDU convention. Whether Carey remains their standard-bearer,
or a replacement candidate emerges, strict new contribution rules
ensure that the next round of electioneering will be much less
expensive than last year's $7 million slugfest. TDU is taking
the offensive against Hoffa-this time, by exposing his ties to
anti-union Republicans who held congressional hearings in October
to discredit the reformers and thwart public funding of the re-run.
(Taxpayers paid $20 million for the 1996 vote; the Teamsters are
splitting the tab with the government this time.)
It remains to be seen how all of this
will play with the members when they get the chance to vote again.
The 110,000 Teamsters employed in the trucking industry are likely
to be most concerned about the Carey administration's progress
in renegotiating their national contract, which expires March
31. If Teamster reformers can spearhead another UPS-style victory
in freight, their electoral prospects will be greatly improved.
is the pen name of a labor activist involved in Teamster reform
activity for the last 20 years.