Political Activity and Political Expenditures
JANUARY 01, 1960 by SYLVESTER PETRO
Professor Petro of the New York University School of Law is the author of The Labor Policy of the Free Society (Ronald Press, 1957) and Power Unlimited: The Corruption of Union Leadership (Ronald Press, 1959).
With their emergence as organizations commanding the greatest power over the economy in the history of the United States, the large trade unions have emerged also as powerful political organizations, perhaps the most active such organizations in the country today.
Their political activities first became a subject of deep concern after World War II, and this concern was reflected by Congress in 1947, when in framing the Taft-Hartley Act it included a section broadly prohibiting contributions and expenditures in connection with federal elections by both labor organizations and corporations. This legislation has had an unhappy career, with no successful prosecutions to date, and with the grave doubts held from the beginning concerning its constitutionality still unresolved. Now, as the McClellan Committee has demonstrated, after twelve years of the Taft-Hartley Act both the economic and the political power and activity of the large unions have increased dramatically, and the grounds for apprehension which existed in 1947 have been magnified accordingly.
The Taft-Hartley Act accepted the special privileges and the ensuing power which prior legislation had accorded labor organizations. It sought to avoid the political consequences of those privileges and power by the direct method of prohibition of political expenditures. History has shown that this was a mistaken approach. Common sense suggests that a new approach is called for today.
Experience under the Present Legislation
The legislation presently in force was enacted in 1947 as Section 304 of the Taft-Hartley Act, in response to the fears felt in Congress and the nation that the heightened political activity of labor unions during and after World War II possessed a grave potential of harm. As a result, to the then existing prohibition of political contributions by unions and corporations Congress added a prohibition of any "expenditures in connection with" elections to federal office, primary elections, and conventions or caucuses to select candidates for federal office.
The breadth and generality of the new prohibition created many difficulties even before it became law, and its career in the courts has been unfortunate. Senator Robert A. Taft was compelled upon several occasions during the Senate debates to hedge his answers concerning the reach of the section. In some instances he declared that an answer to the hypothetical questions posed by opponents of the bill could not be given.’
The few prosecutions which have been brought under Section 304 in the last twelve years have produced some interesting, and confusing, decisions and opinions. The first prosecution was deliberately invited when Mr. Philip Murray, then president of the CIO, wrote an editorial favoring the election of one of the candidates for a congressional seat in Maryland, and caused this editorial to be printed and circulated in the C.I.O. News. Presumably in order to insure violation of Section 304 and thus to provoke a decision on the constitutionality of the section, Mr. Murray had 1,000 extra copies of the union journal printed and distributed at the expense of the CIO. Federal Judge Moore, sitting in the U.S. District Court for the District of Columbia, held that the printing and distribution of the editorial obviously involved an "expenditure in connection with" a federal election and therefore violated Section 304.
The constitutional issue having been raised, Judge Moore then had to decide it. He held that Section 304 violated the First Amendment as a clear infringement of the rights of freedom of speech, of the press, and of association—and dismissed the indictment. On appeal, the Supreme Court affirmed the dismissal, but not on constitutional grounds. It ruled, instead, that the printing and distribution of Mr. Murray’s editorial did not constitute an expenditure in violation of Section 304. After detailed examination of the wording of the statute and its legislative history, Mr. Justice Reed concluded for a majority of the Court that it was not designed to reach political endorsements in regularly issued union media of communication with the membership. (Somehow the 1,000 extra copies were disregarded.)
In a dissenting opinion, Mr. Justice Rutledge (and Justices Black, Douglas, and Murphy with him) accused the majority of "rewriting" and "emasculating" the statute in order to avoid the constitutional issue. The dissenters would hold the statute unconstitutional, however, even as applied by the majority, that is, restricted to election expenditures not in the normal and regular course of a union’s communication with its membership.`’
At about the same time, Federal Judge Hincks, sitting in Connecticut, issued one of the most instructive opinions yet handed down concerning the meaning and the constitutionality of Section 304. He held that the statute prohibited paid political advertisements in newspapers and on radio when they advocated the defeat of certain delegates to a national political convention. The case, involving a Painters Union local which had no regular means of communication with its members, was distinguishable from the C.I.O. News case in that the expenditure was not in connection with a regularly issued union journal and in that the paid promotions were not confined to the union membership, but reached the general public.
By this decision, Judge Hincks was called upon to decide the constitutional issue. The statute did to some degree infringe upon First Amendment rights, the judge recognized; yet, he observed, it by no means canceled those rights, but rather left considerable leeway for political activity by unions in the form of lobbying, discussion of issues, and so on. On the other hand, he noted, Congress has a heavy responsibility to protect the political process in the interest of the vast mass of the general and unorganized electorate, as against powerful pressure groups avidly seeking their own interests. Taking into consideration the fact that trade unions have been the beneficiary of substantial special privileges and immunities as a gift from Congress, Judge Hincks observed, a reasonable basis existed for some restriction on their First Amendment rights, and thus, he concluded, Congress’s method of exercising its duty and power to regulate the election process did not violate the Constitution.3
On appeal, the Second Circuit reversed Judge Hincks, just as the Supreme Court had reversed Judge Moore in the C.I.O. News case—not on the constitutional question, but on the question of whether the paid advertisements involved an "expenditure in connection with" a federal election. Thus, the natural reach of the statute’s language was further circumscribed. Speaking for the Second Circuit, Judge Augustus Hand declared that "an interpretation… which would allow expenditures in the case of a union publication and prohibit them when made by a union through the use of an independent newspaper or radio station seems without logical justification."4
A majority of the Supreme Court, in the most recent decision involving Section 304 which that Court has handed down, disagreed with Judge Hand’s logic. It held that the section does prohibit an expenditure of general union funds for a telecast advocating the election of certain congressional candidates. The case came to the Supreme Court prior to a trial of the facts, the district judge having dismissed the indictment before trial as failing to allege a violation of the statute. While holding that the indictment would, if proved, establish a violation of Section 304, the majority, in an opinion written by Justice Frankfurter, refused to pass on the constitutional issue. As Justice Frankfurter put it, the Court gets into most of its trouble by passing prematurely upon constitutional issues, and it would be time enough to pass on that issue when a trial actually established the facts alleged in the indictment. He went on to say that the trial would have to establish, before a violation could actually be found,
(a) that the telecast was financed from general membership funds;
(b) that it reached the general public; (c) that it involved actual electioneering rather than a mere statement of fact or issues; and (d) that it had been sponsored "with the intent to affect the results of the election."5
Justice Douglas, joined by Chief Justice Warren and Justice Black, took the position that the dismissal of the indictment should have been affirmed. His desire, apparently, was to construe the statute out of existence; for otherwise, in his opinion, it would have to be held unconstitutional. According to Justice Douglas, Justice Frankfurter’s insistence on the establishment of the four facts listed above could make no difference insofar as constitutional validity was concerned. Justice Douglas summarized his conclusions in these words: "The Act, as construed and applied, is a broadside assault on the freedom of political expression guaranteed by the First Amendment. It cannot possibly be saved by any of the facts conjured up by the Court. The answers to the questions reserved are quite irrelevant to the constitutional questions tendered under the First Amendment."
The last decision worth noting involved grass roots political activity on union time by three salaried union agents in behalf of the local union president, who was running for Congress. The three agents did such things as ring doorbells, urging registration, and transport voters to the polls. Dismissing the indictment, Federal Judge Duncan, sitting in Missouri, simply said that he did not believe Section 304 could be so far-reaching. If this case involved an illegal "expenditure," he said, "then any political activity of any person on the payroll of a labor organization, from its president to its janitor, would render that Union and its principal officers liable, if such persons devoted any appreciable time in support of, or in opposition to, any candidate [for federal office]."6
The Basic Issues
The decisions and opinions holding Section 304 unconstitutional have brought into sharp focus the fact that political activity is an essential part of the public life of any representative government and that legislative restriction of such activity will always run into considerable difficulty on constitutional grounds. The decisions which avoid the constitutional issue, and the single decision squarely upholding the constitutionality of the statute, have emphasized the weight of the duty which rests upon Congress to prevent abuse of the elective process, and the dangers to that process which large and powerful pressure groups pose.
The tension between these opposing considerations has produced two significant results. In the first place, the statute has had virtually no effect. It has been restrictively interpreted. Each of the cases reviewed has beyond much question literally involved a union "expenditure in connection with" an election to federal office, but in not a single one has there been a conviction. Although unions are probably the most active political organizations in the country today, there has been only a handful of prosecutions under Section 304. Section 304 seems to be the statute which you cannot violate, no matter how hard you try.
In the second place, there has been an inordinate delay in resolving the constitutional issue, and this suggests that the Supreme Court is greatly disturbed on the question. Three of the present justices have already indicated that they will hold the statute unconstitutional unless it is construed into impotency. Not one of the justices has yet committed himself to the view that the statute is constitutional, even when interpreted as restrictively as it has been. The conclusion indicated is that the statute, or any other legislation seeking the same objective, will survive only in a highly restricted or in a completely impotent form. In either case there is no likelihood that it will serve to reduce significantly the dimensions of the problems posed by the prodigious political activities of the large unions.
Sound Principle as a Way out of the Dilemma
In the one opinion squarely upholding the constitutionality of Section 304, Judge Hincks acknowledged that Congress could have handled the problems posed by excessive union political activity in a manner other than the one it adopted in the Taft-Hartley Act. Congress could have met the problem "by a major curtailment of the economic power of labor organizations without at all trenching upon their freedoms." And if Congress had but withdrawn the special privileges and immunities which it had granted to unions, according to Judge Hincks, they would not have enough power to raise much of a problem. But, he went on to say:
"Congress deemed it preferable to make no major reduction in the economic power of labor organizations, believing, apparently, that their continued power in the economic field would be of public benefit and not necessarily a source of danger if not supplemented by unrestricted political power as well…. I hold the Act not invalid because of its incidental restriction on the political activities of aggregations which owe their strength to special privileges and immunities conferred upon them for their discharge of a public economic function."
If the political activities of labor unions were properly a cause of concern in 1947, when the Taft-Hartley Act was passed, it goes without saying that we must be close to a condition of crisis at present. The political power and activity of unions was substantial then; in comparison, it is colossal now. The Taft-Hartley restriction of political contributions and expenditures has obviously had no effect at all. What then is to be done?
The experience of the last twelve years indicates that Congress made a mistake in attempting to curtail the political power of unions while leaving their economic power, based on special privileges and immunities, alone. The mistake is not surprising when one realizes that Congress acted on an invalid premise. Judge Hincks pointed out that Congress continued the special privileges of unions on the theory that unions were virtually an arm of government, discharging a "public economic function." What the judge had in mind was the prevailing assumption that by raising wages through collective action unions were in effect public servants.
Economists and the public generally have come a long way since 1947. More and more persons in all walks of life are beginning to appreciate that far from serving a public function in their constant pressures for higher wages, unions are simply another special-interest group, selfishly concerned with increasing their share of the national income, regardless of the consequences to the public welfare. Outstanding economists of this country today are firmly of the conviction that the economic pressures of unions do not serve even the interests of all working men and women, let alone the general public interests of consumers, retired persons, and others on fixed incomes.8
This being true, and it also being true that the method of direct prohibition of political activity by unions has proved a failure, it would seem that the only promising alternative is for Congress to reconsider its assumptions concerning the role of unions and the decision it made in 1947. Elimination of the special privileges and immunities of unions is what the situation demands; with that will come a reduction in union power.
Under no circumstances should unions be burdened with restrictions which other private associations do not bear. To impose such restrictions is both undesirable and unnecessary. The principle of equal application of all laws is too important to the life of society to justify abandonment under almost any conceivable conditions. Certainly the current conditions, bad as they may be, do not call for an abandonment of that principle. As a matter of fact, our present troubles can be traced to the wholesale abandonment of that principle which has occurred in recent years.
Remove the Special Privileges
There is every reason to believe that the political and other dangers which the large unions pose will be substantially reduced if the special privileges of compulsion which they now possess are removed—and if the removal is designed in an effective way. Specifically, all stranger picketing and other boycotts, and all forms of compulsory-unionism contracts, should be prohibited; for they give unions a special privilege to restrain and coerce employees in the exercise of the basic right, recognized in federal and state law, not to join unions. But a mere paper prohibition will not be enough. The experience of the last twelve years, under the Taft-Hartley Act, demonstrates that direct access to all courts, especially for immediate injunctive relief from the irreparable injury of unlawful union action, will have to be provided, if the strictures upon union compulsion are to be effective. In order to accomplish this, it will be necessary to repeal the Norris-LaGuardia Act, abolish the National Labor Relations Board, and specifically overrule the Supreme Court’s pre-emption doctrine.°
I am aware that there is an inclination to consider these proposals "radical." That is simply an error in understanding and in perspective. It should be remembered that we are faced with a seriously threatening condition. It should also be remembered that, in perspective, the proposals advanced here are neither as momentous nor as "radical" as the subjects to which they are addressed. The Norris-LaGuardia Act, the National Labor Relations Board, and the pre-emption doctrine were, when they were introduced not very long ago, not only "radical" but revolutionary innovations. They have worked very badly. We are suffering the consequences now.
The frank intention of these proposals is to create conditions in which unions will be in fact the voluntary associations which they now incorrectly claim to be. When they are voluntary associations, they should have the right, shared with all other voluntary associations, to run their internal affairs and to spend their money as they please, subject only to the general law prohibiting violence, coercion, fraud, and thievery. At present, unions are in a position to spend funds for political purposes and objectives opposed by some of the very members who contribute those funds. Worse than that, a man may be forced into a union by coercive organizing devices, kept there by a specially privileged compulsory-unionism agreement, and be forced to pay dues which are spent for purposes in which he has no interest and to which indeed he may be opposed.
The present situation is one largely created by Congress, and only Congress can repair it. Confused and contradictory efforts have brought Congress to a frustrating impasse. On the one hand, by according trade unions special privileges, Congress has allowed them to become an enormous threat to the economic, social, and political life of the nation. On the other, it has tried to remove the political threat, by legislation which threatens First Amendment rights and thus has had considerable trouble in the courts. Principles vital to the life of the nation are being mangled on both sides.
The only wholesome solution is to restore the principle of equality under the law by withdrawing the special privileges which unions now have, and to eschew all the restrictions which now exist upon political contributions and expenditures. Neither those special privileges nor the restrictions upon political expenditures have a proper place in a free country whose central political institution is representative government. Moreover, they create the kind of trouble which ensues always upon the abandonment of any sound principle. For one of the marks of a sound principle is that it works.
In conclusion, I should like to emphasize that I am as greatly disturbed by the present character and scope of political activity by unions as any man. Yet, I believe that direct controls are neither sound in principle nor workable. In precisely the same way that price controls and rationing are no sound answer to the problems of shortages and inflation, direct controls upon the political activity and expenditures of unions—or of any other groups—will not remove the causes of present concern. The history of the present legislation proves that. The approach I have suggested is, I believe, the only effective approach available.
¹See 2 Legislative History of the Labor Management Relations Act, 1947, at pp. 1526-35, 1546-50, 1601-4; large excerpts from the debates are quoted in the majority and dissenting opinions in U.S. v. C.I.O., 335 U.S. 106.
²U.S. v. C.I.O., 335
4U.S. v. Painters, 172 Fed. 2d 854, (2d Cir. 1949).
5U.S. v. Automobile Workers
6U.S. v. Construction & General Laborers Local 264, 101 F. Supp. 869 (D.C. Mo. 1951).
7U.S. v. Painters Local 481, 79 F. Supp. 516.
8 See Philip D. Bradley (ed.), The Public Stake in Union Power, (Charlottesville: University of Virginia, 1959).
9 The Supreme Court has held in effect that the state courts may no longer take jurisdiction in labor cases involving interstate commerce, except in regard to violent action. (Garner v. Teamsters, 346