14 May 1998 United Way Retracts False Statements About Paycheck Protection

A United Way of America (UWA) report containing numerous false allegations about the effects of “paycheck protection” on charitable giving was retracted yesterday by United Way leaders after drawing sharp criticism from paycheck protection supporters, United Way donors and even the former president of the charity.

Paycheck protection legislation would require employers and labor unions to obtain permission from a worker before taking money from that person’s wages to pay for political activity. The retracted UWA report focused on Proposition 226, a paycheck protection ballot initiative on California’s June ballot.

“Giving workers the ability to control how their money is spent on politics is a simple matter of fairness, and its opponents have always relied on untrue and misleading accusations to try to make their case,” said David W. Almasi, the editor of The National Center for Public Policy Research’s Political Money Monitor newsletter. “The United Way is to be commended for helping to stop the vicious rumor-mongering that detracts from a real debate of this important issue.”

A “legislative alert” issued by UWA in April warned Proposition 226 could apply to charitable giving, and “curb the United Way’s ability to engage in ‘political’ or policy activities.” The Yes on 226! campaign, however, issued a statement clarifying that “payroll deductions for taxes and charities are not made for a political purpose” and therefore not covered by the Proposition 226. Yes on 226! officials said they received several calls from concerned United Way donors who also supported Proposition 226. Many of these people reportedly later called UWA Chairman Michael Cook and President Betty Beane to complain about the misleading report.

Immediate past UWA president and chief executive officer Elaine Chao issued a statement calling the report a “thinly veiled campaign document” that was “in danger of seriously damaging the reputation and effectiveness of the entire organization.” She pointed out that the suggestion in the report that readers “become involved” in the campaign against Proposition 226 is “a violation of the [organization’s] prohibition on politics.” This could also endanger UWA’s non-profit tax status.

In a May 14 statement, the UWA formally announced it had “no organization position” on Proposition 226, and that the alert “was released without review or authorization by the UWA Board of Governors, and does not represent the views of the leadership of UWA.” The statement further cleared up false statements in the analysis by noting that “Proposition 226 applies only to political contributions and has no bearing upon voluntary charitable contributions.”

“Opponents of Proposition 226 and paycheck protection severely damaged their credibility with this United Way report,” said Almasi. “Not only have their actions tarnished the image of one of America’s leading charities, they have also proven that they cannot engage in a truthful discussion of the issue.”