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Labor Nominee’s Brushes With Scandal Loom Before Confirmation

Jan. 29, 2021, 10:31 AM

Marty Walsh is no stranger to adversity—surviving cancer, a gunshot wound, and alcohol addiction on an unlikely odyssey from the streets of Boston’s Dorchester neighborhood to the top job at City Hall.

Now, as President Joe Biden’s nominee for labor secretary, Walsh faces a Senate confirmation battle that will put the 53-year-old mayor’s working-class appeal and deep roots with organized labor in the spotlight—both the years he spent advocating for Boston construction workers and a union-related extortion scandal that shadowed him as mayor.

Walsh’s ties to unions while holding public office, federal extortion charges against a pair of his aides, and a questionable financial arrangement with his girlfriend’s consulting firm all provide ammunition for conservative groups looking to damage his chances of getting confirmed.

Some GOP-aligned groups believe him to be one of Biden’s most dubious nominees.

“He’s particularly interesting among the agency heads because of all the corruption that took place under his leadership,” said Chris Martin, the deputy executive director of America Rising, a conservative political action committee.

Walsh faces a new challenge, having spent his career in a state where Democrats outnumber Republicans 3 to 1 and voters have a thicker skin for political corruption than the general population. The vetting process will require Walsh to conjure the same image of sincerity and fairness that helped him win over Boston voters twice.

“It’s not a state where politicians are held to squeaky-clean standards in terms of corruption, so it’s not really something that I think shocked or horrified anybody,” said David Hopkins, a political science professor at Boston College. “The level of scrutiny you get when you get into the federal government is obviously much higher.”

The two Walsh aides at the center of the scandal, Ken Brissette and Tim Sullivan, were convicted of extortion in 2019 after a highly publicized trial. A federal judge last year overturned the convictions, saying the prosecutors hadn’t done enough to prove their guilt.

The controversy at once showed Walsh’s potential liabilities and his talent for building alliances, an attribute he’ll need to navigate Washington.

“Unions don’t have the best track record in terms of scandals and fraud, crime, abuse,” said Rachel Greszler, a labor research fellow at the Heritage Foundation. “That’s definitely something that needs to be investigated as part of his confirmation hearing.”

Ethical Quandaries

Weeks after Walsh took office in 2014, the new mayor made a seemingly harmless appearance on the hit reality TV show “Top Chef.” Brissette, the city’s top tourism official, learned that the show’s staff was non-union and grew worried that Walsh’s appearance could backfire with his base.

Brissette told a colleague who later testified in court that he would fix the situation by seizing the show’s footage or withholding public permits.

While Walsh was never directly implicated, the allegations were a political threat given his ties to organized labor and relative lack of leadership experience. Before becoming mayor, Walsh was head of a local building trades union federation and served in the Massachusetts State House, where he never held a senior leadership position and was mostly known for his union work.

“That was the source of great trepidation on some people’s part—would he bend over too fully to satisfy the unions?” said Paul Watanabe, a political science professor at University of Massachusetts Boston.

A Biden transition spokesman declined to comment about Walsh’s record as Boston mayor. Inquiries sent to the White House and the nominee’s Boston press office went unanswered.

There were other ethical questions, too. By 2019 Walsh spent nearly $900,000 in campaign funds on a consulting firm where his longtime girlfriend worked, accounting for more than half of the company’s political business since 2013, the Boston Globe reported. The firm’s duties included managing Walsh’s campaign office, mailings, and fundraisers.

Walsh’s payments to the firm reached $13,500 a month by 2018. While there was nothing illegal about the arrangement—the money wasn’t public—it raised eyebrows among Boston political observers who said it created an appearance of nepotism.

In the wake of the “Top Chef” incident, the city hired Brian Kelly, a former U.S. attorney who prosecuted the notorious mobster James “Whitey” Bulger, to conduct an independent investigation. Kelly’s investigation didn’t find any evidence that city officials tied the granting of film permits to hiring union workers or revoked permits based on non-union status, though it did describe a deep concern among Walsh’s staff for preserving the mayor’s relationship with unions.

The findings of the report were inconclusive, according to a copy obtained by Bloomberg Law. Kelly’s firm, Nixon Peabody, couldn’t require witnesses to sit for interviews nor force them to turn over documents, though Walsh did voluntarily sit for an interview. A yearlong gap between the alleged incident and the investigation made it difficult for investigators to trust witnesses’ memories.

“Given the limits to our authority, the findings and conclusions related herein are necessarily limited as well,” the report said. “This report is not intended to be an authoritative statement of historical fact, nor should it be taken as such. It simply represents our conclusions regarding what most likely occurred in light of all the evidence we have assembled to date.”

Joe Biden and Boston Mayor Marty Walsh on stage in front of a Stop & Shop on April 18, 2019 in Dorchester, Mass. Thousands of unionized Stop & Shop workers walked off the job over objections to a proposed contract.
Photo by Scott Eisen/Getty Images

Dodging Scandal

In 2016, Brissette and his chief of staff for intergovernmental affairs, Tim Sullivan, were indicted on new federal extortion charges, with prosecutors alleging that the aides threatened to withhold permits for organizers of the Boston Calling music festival unless they hired union labor.

Walsh escaped the fallout by having had made a name for himself as a better-than-expected champion for development, an image that contradicted the charges against his aides, said Watanabe, the University of Massachusetts Boston political scientist.

Ten City Council members wrote an open letter criticizing the U.S. attorney’s office and calling the case “a grievous misuse of limited prosecutorial resources in service of a misguided political agenda.” Rather than criticize Walsh’s office, they suggested his aides were simply advocating for union workers.

“It was an outrageous case—Marty was never linked,” said Mark Erlich, former executive secretary-treasurer of the New England Regional Council of Carpenters and personal friend of Walsh. “A U.S. attorney was trying to get some publicity by going after a high-ranking politician and it failed.”

In February 2020, U.S. District Judge Leo Sorokin took the rare step of overturning jury convictions for Brissette and Sullivan, saying that neither man received a personal payoff. The U.S. attorney’s office declined to appeal.

Positive Reports

Conservative groups are nonetheless pushing to revisit Walsh’s record before Congress, saying it’s a harbinger for how he would conduct himself at the U.S. Department of Labor.

“The ‘Boston Calling’ music festival scandal, in which two of Walsh’s top aides during his tenure as Boston mayor were found guilty by a jury of bullying promoters on behalf of union officials to please their boss, Walsh, is likely a preview of how Walsh will operate the department if he is confirmed as Labor Secretary,” Greg Mourad, vice president of the National Right to Work Committee, said in statement.

It’s unclear how much traction they’ll get with Democrats controlling Senate labor panel and the fact that the committee’s longtime ranking Republican, Lamar Alexander, just retired. A GOP committee official didn’t respond to requests for comment.

Business groups are less than eager to torpedo Walsh’s nomination, a testament to the unlikely alliances he formed in Boston. While the U.S. Chamber of Commerce hasn’t taken a position on Walsh, Glenn Spencer, the group’s senior vice president for employment policy, said he’s received positive reports from New England affiliates.

“He does have a reputation of bringing all parties to the table and actually listening,” Spencer said. “He does want to take into account the concerns of business and we find that encouraging.”

“Of the possible names that came up, Walsh is the best,” said Roger King, senior labor and employment counsel at HR Policy Association, a trade group representing Fortune 500 companies.

With assistance from Ben Penn

To contact the reporter on this story: Ian Kullgren in Washington at ikullgren@bloombergindustry.com

To contact the editors responsible for this story: Martha Mueller Neff at mmuellerneff@bloomberglaw.com; Andrew Harris at aharris@bloomberglaw.com

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