Union ‘loophole’ isn’t a very big one

Donations this year totaled about $1.4 million

MASSACHUSETTS IS ONE  of seven states to permit labor union political giving while entirely barring corporate contributions – both those from corporate treasuries and from associated political action committees (PACs). Unions are allowed to donate up to a combined $15,000 per election to state candidates, political parties, and PACs. Individuals, meanwhile, are capped at contributions of only $1,000 per entity per election.

Colloquially referred to as the “union loophole,” this regulation stems from Chapter 55, Section 8 of the Massachusetts General Laws, and is buttressed by a 1988 regulatory interpretation by the Office of Campaign and Political Finance. Critics have long decried the statute as granting organized labor an outsized influence at the State House at the expense of employers. One of the rule’s most strident critics – the Massachusetts Fiscal Alliance – has even characterized the loophole as the “country’s worst campaign finance law.”

Last September, the Massachusetts Supreme Judicial Court upheld the constitutionality of the loophole, finding “no evidence” that the true purpose of the statute was to favor labor unions at the expense of corporations. The plaintiffs – with support from the Goldwater Institute – had argued that the rule, in addition to violating basic principles of equal protection, free speech, and free association, was blatantly unfair to corporations. However, the invocation of fairness presumes that union political giving has succeeded at currying favor with politicians in the first place. That is, if unions are truly taking advantage of the loophole to buy influence, then we would observe them providing substantial contributions at the maximum allowable amounts.

Given these concerns, let’s take a look at the aggregate amount of union money in elections. The Office of Campaign and Political Finance reports that unions or associations have donated approximately $1,586,000 to Massachusetts candidates, political parties, and associated PACs this year, not including the millions poured into ballot question committees—on which there are no contribution limits. With one exception, the top recipients are all union PACs for carpenters ($134,832), ironworkers ($122,992), pipefitters ($78,345), firefighters ($53,910) and teachers ($36,597), respectively.

The actual union donation total may be closer to $1.4 million, largely because a number of candidate committee filings were mischaracterized as union filings. (When asked to fix these errors, the campaign office said: “Correctly characterizing contributions in reports is not a statutory requirement for candidates and committees, and is not something our office currently monitors for statutory purposes.”)

When you break down the $1.4 million union spend, the numbers reveal an interesting story.

The top individual recipient from labor unions is Michael Armano, a Lawrence firefighter who ran unsuccessfully for state senate and won the support of firefighting unions around the state—collecting a grand total of $30,800. After Armano, Attorney General Maura Healey has received a total of $29,100 from 20 different unions; John Drinkwater, an AFL-CIO employee who ran an unsuccessful state senate campaign,  received $25,100 from 34 unions (for which he has been publicly chastised); and Gov. Charlie Baker received $24,200 from 57 unions.

Taking a deeper dive into these numbers, the median union contribution is only $250. And only 96 out-of-state unions have contributed to Massachusetts elections, so roughly 95 percent of union giving originates inside of the Commonwealth.

Only 16 unions (out of around 2,000 contributors) donated between $10,000 and $15,000 to a single entity, suggesting union money does not target specific races. Healey is the only recipient of a fully-maxed union contribution (which was given by Teamsters Local Union No. 25). Rep. Denise Garlick of Needham, Armano, and Pete Capano, who is running unopposed for state rep, are the only candidates for smaller offices who received a union contribution over $10,000.

At face value, these figures indicate that the union loophole has not, as some critics have asserted, “crowd[ed] out individual donors with [its] exorbitantly high contribution limit … completely drown[ing] out the voice of employers.” If anything, the scattershot nature of union political giving suggests that unions are not as much attempting to buy influence as signal their political virtues. That is, unions give to candidates they already like, without giving in significant enough amounts to “buy” a politician.

Furthermore, since it is rare for a union to donate the maximum $15,000 to a single candidate, fears about the size of the union contribution limit appear unwarranted. Notably, the amount of funding that candidates receive from unions is small relative to the aggregate amount of campaign spending. MassFiscal’s op-eds have featured hyperbolic estimations of unions exploiting the loophole to influence politicians—but a $250 contribution is unlikely to achieve this outcome. Contributions from individuals in this year alone top $32 million, dwarfing the $1.5 million contributed by unions.

Meet the Author

Rachel Adele Dec

Public Affairs Associate, MassINC
Advocates for changing the system have a choice. They can either support the right of corporations to give as unions do (which will certainly be met with great opposition) or remove the right of unions to give altogether. Given the apparent negligibility of influence that unions currently exercise in Massachusetts elections, closing the loophole would likely have minimal electoral impact.

Buoyed by the Supreme Court’s 2010 ruling in Citizens United, advocates of either course can easily continue to contest the union loophole on constitutional grounds, where many campaign finance reforms have been debated. But these numbers suggest labor unions do not “weaponize” our campaign finance laws, as some have feared. Rather, they barely tip the scale.

Rachel Adele Dec is the public affairs associate of MassINC.