Michael A. Ledeen, Mike Moroney
November 1, 1998 | American Spectator

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The White House Joins the Teamsters

Elections

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Bill Clinton has repeatedly tried to commit political suicide, but the Republicans keep sending rescue squads up the ladders to talk him off his balcony and administer first aid. Nowhere is this clearer than in the spectacular pattern of corrupt activities that Clinton and his henchmen have carried out in cahoots with a new generation of labor leaders and their political associates. The evidence of wrongdoing is so overwhelming that even the most unreconstructed publications of the Left, even the Nation itself, acknowledge and condemn it. Most of the facts have been reported in many of the “mainstream” publications (albeit watered down in the usual fashion by National Public Radio). Federal prosecutors have obtained several indictments and guilty pleas. The trail of malefaction leads right into the White House Counsel’s office, and the adjoining rooms of the Deputy Chief of Staff. But the milquetoasts and pantywaists that compose the Republican ranks in Congress have been unable to expose the pattern of corruption, and more often than not those who have undertaken the task–such as Senator Fred Thompson– have ended up looking like fools. More’s the pity, because not only is it a great story, but it’s a harbinger of things to come. If the Clintons survive the current crisis, we will likely see the same methods applied on an even broader scale.

The Birth of a Conspiracy

The heart of the matter is the symbiotic relationship between major financial donors and elected officials, which is much like that between candidates and voters. Politicians and parties can generally count on a traditional support base, but the outcome of the election is often decided by a “swing” block that can go either way. In the case in point, the Democratic Party has long been the recipient of votes and dollars from the trade union movement, but in the 1950’s the International Brotherhood of Teamsters–the largest union in the country and an enormously powerful political force–left the fold to support Eisenhower. This alliance lasted through the Reagan and early Bush years, to the great resentment of Democratic political leaders and organizers, and leftist intellectuals, who regarded the Teamsters’ support of Republican causes and candidates as a form of treason.

The Teamsters returned to the Democratic fold in time for the 1992 elections, a rapprochement made possible by the election of Ron Carey as president in December of 1991. Carey was the darling of the media elite (60 Minutes ran a puff piece just before the election, and the Washington Post was reportedly dissuaded by liberal icon Joe Rauh from running a positive article on one of Carey’s opponents) and some talented people from the New Left. Carey seemed singularly unsuited to play this role. An ex-marine with a ducks-ass hairdo and the instinctive conservatism of blue-collar workers, he was even a registered Republican. But, as one of the more philosophical of the union leftists acidly remarked at the time, “You can’t always choose your Third World dictator.” He was theirs, and they created an image for him that was far removed from the real picture: Carey was portrayed as a white knight who would make the Teamsters more democratic, drive out the Mafia families, and eventually free the organization from the oversight of the Independent Review Board that had been imposed on the Teamsters by the government after the exposure of massive corruption in the late eighties.

Carey’s image as labor’s Galahad–a classic bit of disinformation apparently first launched in Steven Brill’s book on the Teamsters–lasted a surprisingly long time, especially since the FBI had very reliable information–from Alphonse “Little Al” D’Arco, a former boss of the Lucchese family in New York who turned government informant and helped convict an impressive number of Mafiosi–that Carey had worked closely with the mob. Carey’s relationship with Mafia gangsters was underlined when, less than six months after his election, he appointed William Genoese as a trustee of a New York City Teamsters local. Genoese’s Mafia ties were so well known that the appointment was rejected by the Independent Review Board’s trustee Judge Frederick Lacey, who, in a statement that set the pattern for his future actions, absolved Carey of any fault at the same time he noted it would have been easy to uncover Genoese’s unsavory connections.

If Carey had been serious about making life difficult for La Cosa Nostra inside the Teamsters, he would never have nominated the likes of Genoese to positions of power in the locals, which, in keeping with long tradition, maintained considerable autonomy from the national executive. And if Carey had had a sensitive political ear, he would have demonstrated a willingness to work with Lacey, who could easily have criticized Carey for the Genoese fiasco. Instead, Carey launched a campaign to abolish the Review Board. He declared Lacey’s fees excessive, and attacked the government’s reform program itself, even though that program was the key element in Carey’s election victory. Finally, he appointed his campaign manager, Eddie Burke, to the Review Board and authorized Burke to resist the appointment of a third member. Carey lost on both fronts: a federal court rejected the appeal to end government supervision, and Judge William Webster, former FBI and CIA chief, was appointed to the Board.

Thus chastised by Republican appointees, Carey looked to the Democrats for salvation. The Democratic Party convention was scheduled for New York that summer, and Carey established contact with Clinton’s New York campaign chairman, the well-known labor lawyer Harold Ickes, Jr. The contact was arranged by Carey’s friend and advisor Barry Feinstein, the head of Local 237, whose corrupt practices (such as compiling a substantial private art collection, courtesy of the union) led to his lifetime expulsion from the Teamsters a few years later. Feinstein had asked for the Genoese appointment in exchange for political assistance to Carey, and the match he made between Carey and Ickes was a beauty.

Ickes had developed a successful practice representing New York unions, including some, like the New York Hotel and Restaurant Workers local, with notorious Mafia influence. This would delay Ickes’s appointment as deputy chief of staff to Clinton for a full year, pending a governmental investigation of his role in union activities. During that year, Ickes was retained by several unions which were specific targets of the Organized Crime Commission, including, as luck would have it, Feinstein’s Local 237. Ickes also represented another Teamsters local that Bobby Kennedy had exposed as an exclusive domain of Lucchese family boss Tony “Ducks” Corallo.

The Ickes-Carey meeting lay the groundwork for years of intimate cooperation between the Teamsters and the Clinton administration. Once installed in the White House, Ickes wrote a memo spelling out Carey’s great importance to the political ambitions of the Clintons, and urged the president to establish a personal relationship with the Teamsters leader. The alliance promised enormous benefits for both sides. For the Democrats, support from the Teamsters provided the two pillars of political power: money and votes from the largest union in America. For the Teamsters, support from the White House could provide, at a minimum, more tolerant treatment from the hated investigators and overseers. At best, Carey could hope for support for labor causes and even the eventual abolition of the Review Board and a free hand for the union. The Teamsters delivered millions of dollars to Clinton’s 1992 campaign, and quickly gained easy access to the White House. The Clinton administration intervened in a long-running strike in California, instructing Mickey Kantor to urge management to settle the matter.

Things improved with the overseers as well. One never knows people’s real motivation, but for the next several years the Review Board treated Ron Carey quite generously, and Judge Lacey made it emphatically clear that he considered Carey the best available Teamsters president. When two trustees of a New York City Teamsters local threatened to make public the damaging information about Carey, Judge Lacey wrote one of them that

(I)f you brought Carey down…there were “old guard” Teamsters throughout the country that were hoping that Carey would be eliminated as a candidate in 1996 so that the clock could be turned back to what it was when I first came on the scene as Independent Administrator….

As for Judge Webster, William Hamilton, the head of the Teamsters’ governmental affairs office, felt comfortable enough by the spring of 1995 to send the former chief spook some “To Do” lists, including calls to key senators and representatives to lobby them to vote for the appropriation of federal money for the Teamsters elections scheduled for the following year.

The Left

The Teamsters’ turn to the Democrats was not merely a tactical stroke; it was also driven by ideology. Carey’s campaign had in fact been managed by men and women of the Left, who were then appointed to key positions. Eddie Burke, for example, had been an official of the United Mine Workers, but somehow managed to spend two years in New York City to organize the Carey campaign. It is not clear who paid his expenses in this period. Judy Scott, a talented lawyer from the Mine Workers, was moved into Carey’s front office as well, along with her two assistants in the legal office, Rick Bank and Earl Brown. Even Carey’s personal bodyguard, Ken Blaylock, came from the Miners. The front office crowd were a new breed of union leader, well-educated and ideologically sophisticated, not working-class types who had slowly climbed the union ladder. As Rich Lowry wrote, “Veterans of Students for a Democratic Society are all over” the Carey operation, and they were extremely effective at keeping Carey under control. Aaron Belk, Carey’s vice president and the head of the ethical practices committee at headquarters, later complained that the only way he could get a decision from Carey was to find out when he was traveling, and then get in the car with him en route to the airport.

The most likely explanation for the Miners’ blitzkrieg at Teamsters headquarters is the political ambition of the UMW president, Richard Trumka, who probably looked at Carey as his own Trojan horse for a takeover of the Teamsters, and perhaps eventually the AFL-CIO itself. That it was not a fool’s fantasy is proven by events; Trumka is now AFL-CIO secretary-treasurer.

The Left’s capture of Carey led directly to one of the fundamental sea changes in recent American political history. The Teamsters had rejoined the mother of American trade union organizations, the AFL-CIO, in 1987, hoping to gain some protection against the Reagan administration’s crackdown that led to the creation of the Review Board two years later. The president of the AFL- CIO, Lane Kirkland, was well to the right of labor’s center, and probably saw the Teamsters–with their 1.4 million members and traditionally conservative politics–as an insurance policy against a leftist takeover. If so, it was a gross miscalculation, for with Carey at the helm, the Teamsters became the instrument of the Left’s seizure of the national organization. In a political billiard, Kirkland was pushed out in June of 1995 in favor of his longtime friend and ally Tom Donahue, who was closer to the Left than Kirkland. Barely four months later Donahue was purged, and John Sweeney, the radical former head of the Service Employees International, became president.

In all this, the health of the union itself got increasingly short shrift. Carey’s years in office were a flood of red ink, and within two years the Teamsters were virtually broke. Not that this cramped Carey’s own personal style; he somehow managed to acquire an enviable package of real estate in various locations from New York to Arizona, including a home in the Florida Keys he purchased (with a female friend) for $340,000 a few months after the election, blithely signing his wife’s name on the mortgages. Ever insensitive to the political consequences of his actions, Carey decided in 1994 to call for adues increase. The union constitution required a national convention to approve any increase, but the Carey crowd knew they’d be unable to control a convention, and so they called for a referendum. Why they thought they could win that one is hard to explain, especially as they combined the higher dues with a scheme to deprive the locals of much of their autonomy. The measure lost in a three-to-one landslide.

In short, Carey had quickly dissipated the good will he had built up by running as a “reform” union leader. He had offended the senior member of the Review Board, had antagonized the rank-and-file by asking for more of their money in return for less freedom for the locals, and had wrecked the union’s finances. By the end of the year things had gotten even worse, because Bill Clinton, the political star to which he had hitched his own wagon, had crashed and burned in the electoral catastrophe that gave the Republicans decisive control over both houses of Congress.

As Carey faced new challenges, the Teamsters got themselves top-notch legal representation: Charles Ruff, famed for his work on Watergate, and soon to be White House Counsel for Bill Clinton. Ruff has said in a formal declaration that he performed no work for Carey, but counseled the ethical practices committee on anti-corruption measures, a task for which he was eminently suited. However, when the former administrator of the committee, Aaron Belk, was asked about Ruff’s performance, Belk testified to Peter Hoekstra’s oversight subcommittee of the House Education and the Workforce Committee that “Ruff never did anything, to my knowledge.” One thing is known about Ruff’s activities: Of the $262,000 paid to his firm, $175,000 was paid to the investigative firm of Paladino & Sutherland. Jack Paladino is well known as a specialist in digging up dirt on his clients’ opponents and competitors (Clinton campaigns have used him to contain bimbo eruptions), and supporters of Jim Hoffa, Jr. are certain that Carey unleashed Paladino against them when Hoffa ran for Teamsters president.

The Hoekstra committee, which is as timorous as any group of congressional Republicans (Carey once commented that “the Hoekstra subcommittee couldn’t put a hat on a drunken sailor in a bathtub”), has subpoenaed the documents dealing with Ruff’s work, but the Teamsters have refused, claiming attorney- client privilege (a privilege Congress has sometimes chosen to reject in its legislative investigations). After nearly a year waiting for the documents, Hoekstra has recently announced he will call for a House vote on contempt.

The Survival Scheme

The 1994 elections not only depleted the Democratic ranks in Congress, but also struck at the economic lifeblood of the party and the president. By early 1995, the White House was finding it very difficult to meet its fundraising goals, and the unions were among the few institutions that could provide the Clinton-Gore campaign with very large campaign contributions. At the same time, the Teamsters were beginning to gear up for a new election scheduled early the next year, and the Carey team knew it would be a tough fight. Jimmy Hoffa’s son, Jim Jr., was challenging him for the presidency, Carey had lost popularity through his ham-handed schemes, and, like Clinton himself, he was low on funds. If ever circumstances dictated an alliance, this was the time; each would help the other on both political and financial fronts. Each side had the right people in the right positions: The Left was newly triumphant in the Teamsters and the AFL-CIO, and their man, Harold Ickes, was at the right hand of the president.

The scheme was as simple as it was corrupt: the unions would pour more and more money into the 1996 campaigns (Clinton-Gore and both state and national DNC accounts), and in exchange the Democrats would fund union projects (such as Carey’s own campaign) and the pet causes of their biggest donors. The money was laundered through “public interest” organizations, the most celebrated of which is Citizen Action, ostensibly devoted to “cleaning up” American politics and defending small consumers, and whose board features a stunning collection of the rich and infamous, from Barbra Streisand to Howard Metzenbaum.

Perhaps the easiest and most entertaining way to understand the operation of the illegal money-laundering scheme is to look at California. In the final week and a half of the campaign, the Teamsters, with Carey’s approval, paid $475,000 to Citizen Action, which in turn kicked back $90,000 to a blatantly misnamed group called Teamsters for a Corruption Free Union (a pass-through organization created on the spot to launder funds for the Carey campaign). As a reward to the fundraiser, Charles Blitz, $195,000 was routed to one of his favorite enterprises, the campaign to legalize marijuana for medical use.

The operation was not only illegal (the Landrum-Griffin Act forbids employers, of which Citizen Action is one, to contribute to any campaign for union office), but an insult to the Teamsters rank-and-file, who most certainly would not want their money to be spent on marijuana legalization. That cause was right out of the sixties, and was most congenial to the Carey consultants–Michael Ansara and Martin Davis–who had come out of the radical campus movements of that decade.

The medical marijuana caper was just one of dozens of such operations, which offered donor organizations the seemingly magical opportunity to make amazing commissions simply by supporting Carey’s campaign. In the final days of the campaign, the Teamsters pumped out $735,000 to Citizen Action, the National Council of Senior Citizens, and Project Vote, and got back $227,500 in kickbacks to the Carey campaign.

It was not enough, and some of the top Teamsters people, like Bill Hamilton, the director of governmental affairs, told Carey that it would be crazy to give even more money to Citizen Action. Carey accordingly sent his fundraisers to his pals in other union organizations, to get more campaign funding with the same sort of scheme. According to the testimony of the fundraiser in the meeting, Trumka (by then the AFL-CIO’s secretary-treasurer) agreed to contribute $150,000 if the Teamsters would contribute a similar amount to the AFL-CIO. (Trumka has invoked his Fifth Amendment rights in these matters, so his version of events is not known.)

Thus, on November 1, 1996, the Teamsters sent $150,000 to the AFL-CIO’s political action committee. The AFL-CIO then sent its own check for the same amount to the ubiquitous Citizen Action, which, in accordance with its publicly proclaimed high ethical standards, kept a third for itself and forwarded $100,000 to the November Group, a direct-mail operation owned by one of the fundraisers, which was the lucky recipient of funds collected by the Teamsters for a Corruption Free Union. The November Group sent out nearly 1.7 million pieces of direct-mail literature on behalf of Carey’s re-election, an impressive number indeed for a union with a total of 1.4 million members. To round out the cast of characters in this cozy scheme, the November Group had earlier retained the services of Share Group, Inc., a Boston telemarketing operation run by Michael Ansara, another fundraiser and consultant to Carey and former head of Harvard’s SDS chapter who briefly experienced the pleasures of capitalism with his first wife Amy Merrill of the Merrill Lynch empire. Ansara’s family was loyal to a fault: His wife, Barbara Arnold, generously contributed $96,250 to the Carey campaign.

It was still not enough, and Carey sent his fundraisers to individual union leaders for further assistance. Two of the fundraisers have testified that they raised $77,100 in cash and checks from Paul Booth, the National Organizing Director of the American Federation of State, County, and Municipal Employees (AFSCME) and from Trumka at AFL-CIO headquarters. Trumka is alleged to have provided $50,000, but only rather late in the day, to Carey’s expressed annoyance. (Carey felt that Trumka in essence owed his high position to Carey’s political support and should not dawdle with a tight election only weeks away.) Booth (a co-author of the SDS founding document, the Port Huron Statement, whose wife Jane, true to the cause, runs the radical Midwest Academy) later confirmed raising the balance, although he was a bit imprecise on the amount because he had not kept any records, a recurring problem in these circles. Booth did testify, however, that his own union’s president, Gerald McEntee, had collected $20,000 in cash from the owners of a printing firm that did business with AFSCME, a fact confirmed by McEntee himself. This sequence raises the specter of a double violation of law. The firm–Kelly Press–was an employer and thus barred from contributing, and, as a supplier to AFSCME, its contribution could be interpreted as evidence of extortion by the union.

These were not the only cash contributions. Theodore Kheel, the famous New York City labor attorney (and an employer himself) contributed $20,000 from his bank account and safe deposit box on condition that it be kept confidential. The Carey people were fully obliging: They didn’t bother to report the contribution at all, despite a legal requirement that they do so.

It was still not enough, and the Democratic National Committee, by then under the de facto sway of Harold Ickes, Jr., was approached to see if the same scheme might work with them. The Teamsters promised large campaign contributions in exchange for DNC supporters’ help for Carey. The fundraisers have testified that the scheme was agreed to by Terry McAuliffe, a top official of the Clinton-Gore ’96 re-election committee who reported directly to Ickes. The DNC gave the fundraisers a list of targeted recipients for Teamster contributions (interestingly enough, mostly state and local Democratic organizations rather than the national group), and put the Teamsters in touch with a Filipino woman who owned a shell company in northern California and was primed to contribute.

The deal was never consummated, but it was certainly approved. And it’s instructive to note that the Teamsters were quite careful to hold on to their cash until the DNC had delivered, which saved them a considerable bath. Close proximity to the Clinton machine had not inspired confidence in the reliability of Clinton-Gore ’96 promises.

The Unraveling

It would be nice to report that these various corrupt schemes were uncovered by diligent investigators, vigorous overseers, or intrepid journalists, but in fact the hero of the piece is a Boston-area Teamster by the name of John Murphy, who didn’t like Carey and had worked for Hoffa in the election campaign. When the ballots were counted, Carey was proclaimed the winner by a small margin, and the Hoffa people searched desperately for grounds to challenge the election. Murphy, an older man who’d been involved in leftist politics most of his life, noticed that the Carey campaign had received more than $90,000 from Barbara Arnold, whom he found to be the wife of Michael Ansara, the old leftist. So Murphy did his own investigation, knocking on doors and calling up old friends until he had pieced together the outlines of the conspiracy. Some who have worked on this story call him “the Teamster from central casting,” and if Hollywood really cares about single individuals who search for the truth against all odds, somebody will make a movie about Murphy.

Murphy uncovered enough to warrant an investigation by Barbara Zack Quindel, the election officer for the Teamsters. By late August of 1997, she had established that several illegal contributions had been made, as a result of active solicitation by officials of the Carey campaign. This was enough to nullify the election results and organize a new election. But Quindel didn’t feel she had enough information to charge Carey with election violations, and so he was entitled to run again. Further information emerged from the investigation by the U.S. Attorney’s office in the Southern District of New York, which produced guilty pleas by three Carey fundraisers. As Quindel studied this new information, she felt obliged to recuse herself (perhaps because her husband was on the board of Citizen Action in Wisconsin). A new election officer, Kenneth Conboy, was appointed, who assembled a more complete picture that showed Carey’s part in the conspiracy. Carey has since been expelled from the Teamsters for life, and must now deal with a number of legal problems.

Thus far, these events have been “investigated” by Congressional committees headed by Fred Thompson and Pete Hoekstra, and you can judge the impact for yourself. The much-ballyhooed deposition of Harold Ickes turned into a rout… of the interrogators, and the Hoekstsra people were apparently so impressed that they hired some of Thompson’s mid-level staffers to lead the House investigation. One constantly hears that the Southern District is getting ready to hand down indictments of such worthies as Trumka of the AFL-CIO and McEntee of AFSCME, but then one hears the same about Ken Starr’s operation. If ever there were a scandal tailor-made for the Republican Party, this is certainly it. There’s not a lot of sex, the malfeasance is well documented, it involves top Democrats and hypocritical political opponents, and it reveals that the self-proclaimed leaders of the working class have been stealing from the workers to enrich their own consulting firms. But the Republican leaders continue to sort through the latest polls, whine about their bad luck, and hope that the voters will reward them yet another time.

Of one thing we can all be sure: If crimes of this magnitude are not punished, they will be repeated, on an even larger scale. We hear Hillary is angling for the top slot at the World Bank, so she can fund all her friends, all over the world. That way, the Left won’t have to find wealthy non- employers; they can run amok with tax-free grants.

Michael A. Ledeen is the Freedom Scholar at AEI.

Corruption