SEIU's Debt Problem
In today’s Washington
Times RNLA Member, and former Bush Administration official, F. Vincent Vernuccio,
outlines the financial mess that Andy Stern is leaving the SEIU in as he leaves
his leadership post in Obama’s favorite union.
Purple may be the official color of the Service
Employees International Union (SEIU), but Andy Stern is leaving the union deep
in the red. Last week, he surprised the labor community by announcing his
resignation as president of SEIU. Mr. Stern has claimed victories in helping
pass health care legislation and getting President Obama elected, but his
impact within his own organization shows gaping budget deficits and massive
underfunding of pensions.
SEIU has seen its liabilities skyrocket during the
past decade. The union's liabilities totaled $7,625,832 in 2000. By 2009, they
had increased almost by a factor of 16, to $120,893,259. Meanwhile, SEIU's
assets barely tripled, growing from $66,632,631 in 2000 to $187,664,763 in
2009. A significant portion of SEIU's current assets are from IOUs from hard-up
Even more ironic is the shape that the SEIU’s pension funds are in and the
rough shape that they are currently in.
SEIU's pensions are in even worse shape. Both of
SEIU's two national pension plans, the SEIU National Industry Pension Fund and
the Pension Plan for Employees of the SEIU, issued critical-status letters last
year. The Pension Protection Act requires any pension fund that is funded below
65 percent of what it needs to pay its obligations to inform its beneficiaries
of the deficit.
Even worse is the connection between the union and the Obama Administration,
with several high ranking SEIU officials now enjoying prime positions within
the Obama White House. While the
employee pensions are floundering, the goals of the SEIU have taken on a very
political tone recently.
While SEIU's pension plans were failing and its
liabilities growing, Mr. Stern seemed more concerned with electoral politics
than with the internal workings of the union. Indeed, politics can account for
much of SEIU's lavish spending in recent years. "We spent a fortune to
elect Barack Obama - $60.7 million to be exact - and we're proud of it,"
he boasted to the Las Vegas
Sun last year. In all, under Mr. Stern, SEIU spent more than $85 million to
elect President Obama and give Democrats control of Congress. What has been Mr.
Be sure to check out the entire Op Ed in the Washington Times.