Tax the Unions

Perhaps you’ve noticed that while they howl for higher taxes on corporations and the wealthy CEOs who run them, and while they clamor endlessly for the rich to pay their fair share in taxes, Democrats do not howl for higher taxes on unions, which pay none at all on the money they take in.

A labor union is not a charity, not a church, and not a non-profit organization.  According to the IRS, a labor union is “an association of workers who have combined to protect and promote the interests of the members by bargaining collectively with their employers to secure better working conditions.”  Like the unions with which they must negotiate, corporations consist of persons who band together for their mutual benefit and advancement too.  It seems only fair, therefore, that if the advantage-seeking corporations with which the unions negotiate must pay taxes, then so also should the unions.  Like corporations, unions exist for their own and their members’ financial benefit.  If it’s fair to be taxed on the one side, then it’s fair to be taxed on the other.  Nevertheless, despite that fundamental requirement of fairness, one side is taxed and the other is tax exempt.

The reason for this obvious unfairness is not far to find:  Unions funnel many tens of millions of dollars each major election cycle to Democratic candidates across the nation.  In order to keep the money flowing in their direction, Democratic lawmakers grant unions a privileged tax status among the big profit makers.

They also grant to unions a privileged status among organizations with shareholders:  They grant them captive shareholders.  They do so by taking away the independent worker’s right to work.  If you want to make a living in a particular industry or in a particular business, you must buy the union product whether you want it or not.  If you don’t join, you don’t work.  Goldman Sachs, Wal-Mart, and Exxon-Mobil, for example, don’t have captive shareholders constrained to participate and to invest under force of law, but unions do.  Bought-and-paid-for politicians make it possible.

Bottom of FormIf you are concerned with the undue influence of big money on politics, then you should take a closer look at unions.  They spend many times more on the purchase of reliable politicians than do the financial institution, the big oil conglomerate, and the retail chain named above combined.  Unions are perpetual advocates for raising taxes on citizens and corporations alike, yet they are tax exempt on the money they make.  They want to prescribe tax medicine, but they refuse to take it.  Democrats see to it that when it comes to taxes, unions get a pass.

I’ll believe the Democrats are serious about reducing the deficit by making the rich pay their so-called “fair share” when they make the unions pay theirs.  I’ll believe Democratic rhetoric about “sharing the pain” when Democrats make unions hurt.  I’ll believe the Democrats are serious about closing tax loopholes the day they close the most flagrant loophole in the tax code -- union tax exemption.  When unions and their multi-billion dollars in assets and profits come under the tax code knife, things will have changed.  Until then, we know that such “change” is not something for which Democrats really “hope.”

With billions of dollars each year in membership dues at their disposal, unions can well participate in sharing the sacrifice.  But when Democrats talk about paying a “fair share,” when they talk about “shared sacrifice,” they don’t mean a sacrifice shared by unions.  They mean a sacrifice shared by everyone else.  They mean everyone ought to have “skin in the game” -- except the unions who fund Democratic re-election efforts. 

By maintaining this unfair tax exemption for unions, an exemption that puts more money in the hands of Democrats running for office and less money in the public treasury for running the government, Democrats are telling you explicitly that they favor personal advantage over public good.  Mr. Livinggreedy goes to Washington.  Mr. Unionfatcat buys the ticket.

Further, Democrats endlessly bewail the lack of sufficient funding for public education, yet refuse to tax unions in order to limit the shortfall.  They prefer re-election to better schools.

Partisanship, not civic mindedness, makes it happen.

It’s crass political advantage in return for shameless special privilege.


For the record, see:   http://www.laborunionreport.com/portal/2011/09/union-statistics-what-you-may-not-know/