Billionaire-backed Freedom Foundation launches in Montana
Keila Szpaller
(Daily Montanan) The billionaire-backed Freedom Foundation has set foot in Montana with its goal to dismantle unions and fight bosses who have “ripped off workers.”
Last week, Freedom Foundation director of labor policy Max Nelsen testified in support of a bill that would require public sector unions to re-up contracts with workers every year and inform them — annually — of their right to refrain from membership.
No union worker testified in support of House Bill 216 — and many workers lined up to oppose it. Union representatives described the legislation in part as a violation of the contract clause in the Montana Constitution.
In an interview last week, Nelsen confirmed it’s the first year the Freedom Foundation has a registered lobbyist — him — in Montana.
The organization launched an expansion in 2018 with backing from a “who’s who of wealthy conservative groups,” according to a Bloomberg story published in the Los Angeles Times.
Its most recent IRS Form 990 shows $33.6 million in contributions over the last five years.
Nelsen said the Freedom Foundation has opened in recent years in Oregon, California and beyond.
“Montana’s legislature only meets every other year, but we saw that there were some good bills in play that we supported this year,” Nelsen said.
At least in the court of public opinion, Nelsen and the Freedom Foundation may have a tough climb in Montana.
The Treasure State has a history of workers fighting corporate interests, and a poll released this month by RABA Research said 75% of Montanans surveyed believe unions help the economy.
At the same time, the U.S. Bureau of Labor Statistics said the unionization rate in 2022 was 10.1% of the national workforce, the lowest on record since data were available. It put Montana at 12.3%.
(The number of union members is up in the U.S., but it’s a smaller portion of the overall workforce, the report said.)
Although the Freedom Foundation hasn’t been active in Helena before, it has been busy in its home state, Washington.
There, Mike Yestramski, president of the Washington Federation of State Employees, said the organization has had trouble making headway with legislation or grassroots campaigns.
“Washington recognizes (the Freedom Foundation) for what it is, which is this anti-worker group funded by billionaires who want to suppress wages and screw workers,” Yestramski said.
But the Freedom Foundation comes armed with deep pockets, and it puts its dollars to work in the court system — sometimes successfully.
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At the hearing on HB 216, Nelsen wasn’t surrounded by a flock of supporters as he advocated for public employees to be able to have “meaningful control over their paychecks.”
Just two other people testified as proponents of the bill, both part of the same well-funded free-market economy cohort.
They represented Americans for Prosperity and the Mackinac Center for Public Policy, the latter whose spokesperson testified via Zoom. The Mackinac Center is linked to social media ads that support HB 216.
“Let’s make 2023 the year Montana public employees’ paychecks are protected,” reads one of the ads.
The Bloomberg story about the launch in 2018 of the Freedom Foundation campaign to unravel organized labor noted the three groups share some of the same funding streams including from billionaire industrialists Charles and the late David Koch.
The expansion plan kicked off after the U.S. Supreme Court decided Janus v. American Federation of State, County and Municipal Employees in 2018. It said unions couldn’t take money from non-members, an order political analysts said would be a blow to labor.
An investigation into the rightwing Koch network by researchers from Columbia University and Harvard University published in The Guardian in 2018 said weakening public sector unions was the top priority for Americans for Prosperity.
The Freedom Foundation is focused on that endeavor, too. Its website says in part: “We’re a battle tank that’s battering the entrenched power of left-wing government union bosses who represent a permanent lobby for bigger government …”
More than a decade ago, the organization contributed to a “state budget reform toolkit” that recommends hiring freezes, delaying automatic pay increases, and expanding privatization, among other strategies. A Freedom Foundation director and senior fellow were among the editors of the toolkit from ALEC, the American Legislative Exchange Council.
(The toolkit was released in 2011, but ALEC has said its 23 provisions remain a resource following the pandemic.)
In an interview, Nelsen said he had the time and inclination this year to lobby in Montana. He also said it’s no surprise workers who would be affected by HB 216 weren’t showing up in person in Helena in the middle of winter.
Legislative Services received six written comments from proponents of the bill and 24 comments from opponents.
Workers and union leaders did show up in person, though.
They packed a small hearing room at the Capitol to testify against the bill, sponsored by Rep. Bill Mercer, R-Billings, former U.S. Attorney for the District of Montana.
Nelsen said The Freedom Foundation is tracking other bills this session, but none of them have been introduced yet. Regardless, he said the first steps in Helena are not a breeze.
“I have my hands full working on one bill as it is,” Nelsen said. “It takes a lot of work to meet with folks and to have discussions with legislators. Again, this is a new endeavor for us. It’s starting from zero and having conversations with lawmakers and educating people on the issues.”
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In Washington, Yestramski said the Freedom Foundation is tight with a handful of elected officials, but it doesn’t have much sway with the legislature or with grassroots or social media campaigns.
In 2019, the organization spent $128,000 on lobbying in Washington, double what it spent the previous year and much more than it’s spent in years since, according to reports filed with the state Public Disclosure Commission.
Expenses included an annual dinner with four legislators and plus-ones for $294 a head.
Nelsen said the Freedom Foundation doesn’t have a particular budget set aside for lobbying in Montana this year, and he estimated the Washington reports might look higher than necessary given strict disclosure requirements. (“That’s all just basically my time … (we) tend to report anytime we drive by the Capitol.”)
But lobbying and public opinion campaigns haven’t been a winning strategy for the organization in Washington, as Yestramski sees it. However, he said litigation is a tactic the Freedom Foundation can afford and readily employs.
“Because they’ve got basically unlimited money, they just try to bury us in lawsuits to shift our resources away from actually helping workers into defending these ridiculous lawsuits,” Yestramski said.
The Freedom Foundation president acknowledged that strategy, according to audio posted on Accountable Northwest. At a fundraiser, President Tom McCabe said he didn’t care if the organization wins many of the cases it files because lawsuits cost labor unions money.
Accountable Northwest describes itself as a Pacific Northwest watchdog for working families.
In 2021, the Freedom Foundation spent $1.1 million on legal expenses, according to its IRS Form 990. The 990 did not appear to be posted on the Freedom Foundation’s website; Nelsen provided it to the Daily Montanan.
(The foundation does not always report its legal expenditures. In 2020, a court in Washington ordered the Freedom Foundation to pay $80,000 for campaign finance violations because it failed to disclose the value of legal services. Attorney General Bob Ferguson has described the Freedom Foundation as a “repeat offender.”)
Nelsen said the Freedom Foundation hasn’t filed any lawsuits in Montana — “we’re newish to operating out here.” If it does go to court, though, he said it’s because the organization believes it has a shot at winning.
“We may not always win our lawsuits, but we only move forward if we are confident it’s the right thing to do,” Nelsen said.
He said the Freedom Foundation has gone to court on behalf of public employees who have employers taking deductions against their will.
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At the hearing, Nelsen pointed out a number of union contracts in Montana that still include illegal language requiring public employees to be union members and pay dues.
Afterward, he disputed the idea the inclusion could have been an oversight a phone call would fix given the number of problematic contracts — some 30 by his count: “It would be an exercise in futility.”
As the hearing was underway, however, the Montana Federation of Public Employees deputy executive director sent a note to “all staff” asserting the language should have been removed after June 2018, as proponents stated.
In the email, provided by MFPE President Amanda Curtis, Quint Nyman referred to the hearing taking place and admonished those with open contracts to remove the provisions this spring.
“None of those contracts should have that language left in it when bargaining is complete,” the email said. “Check all contracts assigned to you and ensure it is removed.”
Nelsen said he doesn’t think there’s a good reason for the contracts to have outdated and illegal language in the first place given the extensive nature of labor negotiations.
He also said the incorrect information underscores the need for HB 216, for workers to be properly informed of their rights.
“At best, what we’re talking about is lazy labor relations on the part of the city or the county,” Nelsen said.
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If passed, Curtis said HB 216 would chip away at resources for workers.
It would direct staff time toward administering annual signups, she said — a rigamarole she said would irritate members and lead them to drop memberships — and it could keep the organization tied up in court on lawsuits it can’t afford.
“While he’s funded by corporate billionaires who are just trying to find a way to pay their employees a penny less, we are funded out of the actual paychecks of workers,” Curtis said.
Curtis said she does hear concerns about union membership, but they’re namely around affordability given inflation and housing costs.
(Dues run on a sliding scale; a recent chart puts the cost at from $6.50 to $32.33 a month.)
“People want to be a part of who we are,” Curtis said. “Union membership is an identity.”
On its website, the Freedom Foundation said it has “liberated” public employees from exploitation by having them leave unions, and it exists to “empower” them to “use their hard-earned money as they see fit.”
When it comes to public employee paychecks in Montana, one of the more significant bills is House Bill 13, which outlines negotiated pay increases. The Freedom Foundation did not take a position on the bill, and Nelsen said he was unfamiliar with it.