Bloomberg Businessweek put together a handy infographic charting the path of one particular piece of ALEC model legislation, the Private Attorney Retention Sunshine Act, on its journey from approval as a model through introduction in 12 states across the country, and eventually becoming law in three. Shielding corporations from liability for causing harm to consumers and the environment is a major ALEC priority, and this legislation makes it harder for states to hire law firms to bring suits against businesses.
ALEC claims that it is just a library for bills and falsely states on its IRS returns that it conducts no lobbying, but documents submitted by Common Cause to the IRS last week all but prove otherwise. Internal documents show that ALEC actively engages in all the hallmarks of lobbying – from advocating for bills to tracking their progress through statehouses nationwide.
Fresh off of filing a major complaint with the IRS alleging that the American Legislative Exchange Council abused their tax-exempt status by acting primarily as a lobbying organization, the good-government group Common Cause is now pressing for state-level investigations. Yesterday, Common Cause asked New Jersey Attorney General Jeffrey Chiesa to investigate whether ALEC’s activities are in violation of state law.
Nine companies based in New Jersey, including Honeywell, Johnson & Johnson and Merck are ALEC members, and an investigation by the Star-Ledger found that a close resemblance between ALEC model bills and several pieces of legislation and executive actions pushed by the Christie Administration. The investigation also noted that ALEC member corporations and their executives have given at least $200,000 to New Jersey officials who are responsible for advancing these bills.
ALEC claims that it only “provides a constructive forum for state legislators and private sector leaders to discuss and exchange practical, state-level policy issues,” and “does not lobby state legislatures.” But it’s difficult to understand how an organization that pays for state legislators to go to exclusive resorts, where they discuss and vote as equals with corporations on model legislation, can be considered anything but a lobbying front. One thing is clear: ALEC certainly is not the “charity” they claim they are on their tax returns.
Who has ditched ALEC so far?
A major component of the American Legislative Exchange Council’s agenda to transfer the public’s resources to a few private hands revolves around privatizing our public school systems. From model bills that sanction “Virtual Public Schools” run by for-profit companies to subsidizing private school vouchers with taxpayer money, ALEC places corporate profits above children’s needs.
Perhaps this is why the National Board for Professional Teaching Standards (NBPTS), the national certifying body for teachers in the United States and an organization that is ostensibly dedicated to serving children’s educational needs, announced that they are severing ties with ALEC:
Given recent events, the new NBPTS President and CEO decided to discontinue engagement with ALEC. As a result, NBPTS terminated its membership as an Education Task Force Member of ALEC effective April 18, 2012, and also withdrew from participating in the upcoming ALEC conference....The decision to participate in ALEC had been made by previous NBPTS leadership.
–NBPTS spokesperson Brian Lewis
NBPTS is a non-profit organization, but they take positions on many aspects of education policy, including teacher-certification regulations. Before their departure, the organization sat on ALEC’s Education Task Force, which, as the Center for Media and Democracy reports, boasts private-sector members such as the James Madison Institute of Florida and the Pioneer Institute of Massachusetts, both members of the Koch-funded State Policy Network.
ALEC is too toxic even for some for-profit education companies. Last week, Kaplan announced that they are declining to renew their ALEC membership.
The American Legislative Exchange Council’s influence over state legislative bodies is well documented. We’ve seen countless examples of corporate lobbyist-drafted model legislation, developed at exclusive retreats at fancy resorts out of the public’s eye, make its way to the statehouse floor, bringing disastrous results to working families, public education, the environment, voting rights and much more.
Last week, Common Cause released a bounty of ALEC’s internal documents as part of an official complaint to the IRS, claiming that ALEC has abused its tax status as a 501c3 organization. As a result, a new window was been opened into the processes responsible for creating these pro-special interest bills, revealing just how much power ALEC’s corporate members enjoy.
One such document, the minutes from ALEC’s 2011 Telecommunications & Information Technology Task Force meeting in New Orleans, reveals how the private sector (ALEC-speak for “corporations”) has equal – and often greater – policy-making power than elected officials through their influence in developing model legislation that can become law. The document describes how the U.S. Chamber of Commerce offered a resolution regarding federal efforts to curtail internet sites that sell counterfeit products, and after discussion amongst the public and private sector members, the resolution was defeated:
The Task Force then proceeded with a vote on the motion to amend by Mr. Castleberry, which was adopted by the private sector 8-1 in favor and by the public sector 19-3 in favor. On final passage of the resolution as amended, the public sector voted 17-1 in favor of the resolution, but the private sector voted 8-8 in favor; thus, the resolution failed on final passage because it failed to achieve a majority of support from the private sector.
In this case, the will of 94% of our elected representatives participating in the discussion was trumped by just half of the task force’s corporate members. To put it simply: unelected corporations are voting as equals with elected officials on model bills that become our laws.
This is how ALEC accomplishes its stated mission to “advance the fundamental principles of free-market enterprise”: by helping free market enterprises literally vote on public policy.
[H/T Republic Report]
Phoenix, AZ – Today, at the request of House Majority Whip Debbie Lesko and the top lobbyist for SRP, a major Arizona utility company, state legislators and their staff held a closed-door meeting to provide an “update on the fight that ALEC is waging in the media against its detractors.” SRP and Lesko are both members of ALEC, the American Legislative Exchange Council, which has come under intense media scrutiny and public criticism for its role in advancing extreme legislation in Arizona and around the country.
On Tuesday, Russell Smoldon, SRP’s Senior Director of Government Relations and a member of the ALEC Private Enterprise Board, sent out the following invitation:
Debbie Lesko and other ALEC legislative members both present and past would like to invite you to a meeting this Thurs. (April 26th), 11:00am at AGC to get the latest update on the fight that ALEC is waging in the media against its detractors. We would really appreciate your attendance.
Marge Baker, Executive Vice President of People For the American Way Foundation, issued the following statement:
“Now that ALEC’s agenda is out of the shadows, they are scrambling to justify their extreme policies to the public. It’s telling that SRP and Representative Lesko promoted this meeting to defend ALEC, which advances policies that benefit corporations’ bottom line at the expense of individual workers and consumers. This meeting demonstrates how the people’s representatives, with ALEC as facilitator, are at the beck and call of corporations and special interests. It’s time to expose those who do ALEC’s bidding and restore the public interest as our elected officials’ top priority.”
People For the American Way Foundation has released two reports in conjunction with Common Cause, Progress Now and the Center for Media and Democracy detailing ALEC’s influence in the Arizona legislature through side-by-side analysis of ALEC model bills and actual Arizona legislation. Following the release of the second report, Arizona Public Service Company (APS), Arizona’s largest utility in the state, announced it was severing ties with ALEC.
Responding to pressure from consumers who don’t want the companies they do business with to support an extreme agenda, 13 major corporations have withdrawn their membership from ALEC. The organization has been under pressure from activists outraged at ALEC’s support for draconian immigration policies, vote-suppressing legislation and gun laws like “Stand Your Ground."
Last week, ALEC released a statement saying that it was disbanding the Public Safety and Elections Task Force responsible for turning these extreme policies into law, instead claiming that the organization would be shifting its focus back to economic issues:
“We are refocusing our commitment to free-market, limited government and pro-growth principles, and have made changes internally to reflect this renewed focus.
“We are eliminating the ALEC Public Safety and Elections task force that dealt with non-economic issues, and reinvesting these resources in the task forces that focus on the economy. The remaining budgetary and economic issues will be reassigned.”
We were skeptical that the decision was anything more than a savvy PR move – and now an ALEC member has confirmed it. This move was just a stunt; the Public Safety and Elections Task Force’s whole portfolio will be reassigned to another committee, according Republican State Rep. Jerry Madden of Texas, the Task Force’s former chair:
Republican State Rep. Jerry Madden of Texas chairs the Public Safety Task Force and although he is disappointed the committee is disbanding, he said many of the issues will be transferred to other committees.
"ALEC's decision won't impact the important issues we've worked on," Madden told The Christian Post"But I will say this, these groups are targeting ALEC because when conservatives get together, we influence state and federal policy in a major way and these groups are scared of us – and should be."
Considering the ever-growing list of corporations and legislators who have deserted the organization in recent weeks, maybe it’s ALEC that should be worried.
One such defector, State Representative Ted Vick of South Carolina told Ed Schultz his reasons for resigning:
“It started moving to the right and getting very extreme…right now if they continue to do the Right-Wing thing they are doing and pushing agendas that have nothing to do with more efficient government, then it doesn’t have a place in politics in my opinion, and that’s why I’m resigning.”
PR stunt aside, the fact remains that ALEC’s core agenda is just as extreme and dangerous. Somehow, ALEC’s “jobs agenda” still manages to include attacks on working families, the environment, women, public education – the list goes on. As PFAW president Michael Keegan stated,
The true economic consequences of the ALEC agenda – which includes privatizing public resources such as schools and prisons, dismantling unions and stacking the deck against average people who try to seek justice in a court of law – is that wealthy special interests get even richer while the rest of us are left in the dust. ALEC believes in job creation – unless job elimination is better for the bottom line of a few corporations.
It’s been a rough start to the week over at the American Legislative Exchange Council.
Common Cause has submitted a formal whistleblower complaint against ALEC to the IRS this morning, alleging that the organization has flouted federal tax laws by portraying themselves as a tax-exempt charity and misusing their 501c3 status by acting primarily as a lobbying organization, according to a press release.
501c3 organizations have very strict limitations on lobbying, and ALEC consistently states on its tax returns that it does not engage in lobbying. But it’s hard to see how an organization that helps facilitate meetings between corporate representatives and state legislators, produces model legislation and coaches state legislators on how to advocate for and defend such legislation can be considered anything BUT lobbying.
Corporations provide the vast majority of ALEC’s funding. But since their membership dues are written up as donations to a “charitable” organization, they can deduct the dues from their taxes – leaving the American taxpayers to make up the difference, says Common Cause president Bob Edgar. “Corporations that have been funding this organization have, in fact, been lobbying and getting a tax break. The taxpayers of the United States have been paying for a lobbying operation because these corporations can take this off on their taxes.”
The 4,000 pages of internal ALEC documents submitted to the IRS make the case that ALEC is an active lobbying organization, and by law, the IRS is required to launch an investigation.
As if that isn’t headache enough, a thirteenth company, Procter & Gamble, has ended its membership in ALEC. As a P&G spokesperson told Color of Change, the company “made the determination that ALEC does not help P&G compete for consumers’ loyalty and support.”
The pressure is now on Johnson & Johnson, one of the companies still connected to ALEC and a target of a petition drive to get ALEC-member corporations to leave the organization, to explain how ALEC’s extreme agenda benefits their consumers when their major competitor P&G concluded it did not.
In the week since the call went out for the corporations on ALEC’s Private Enterprise Board to disassociate from the organization, a whopping TEN companies have publicly announced that they will no longer bankroll the American Legislative Exchange Council’s extreme agenda.
These entities have bid ALEC adieu, and more are sure to follow:
PFAW and other advocacy organizations have launched a petition calling for the remaining companies to leave ALEC, putting increasing pressure on companies like State Farm and Johnson & Johnson to stop funding the organization responsible for so many attacks against workers, public education, the right to vote and so many other fundamental issues.
However, the member-corporations are only one part of the ALEC equation. Slowly but surely, ALEC-member state legislators are beginning to understand that ALEC’s toxic policies are not in the best interests of their constituents, and are backing out of the organization as well:
The American Legislative Exchange Council (ALEC) is not the innocuous, bipartisan organization it purports to be. Their agenda is radical and wrong for Missouri. I was a member and saw firsthand the sort of extreme legislation they push on state legislators around the country. I disagree with ALEC's extremist agenda and encourage my colleagues in the Missouri General Assembly to end their affiliations with the group. If ALEC is too extreme for Coke, Pepsi, McDonald's, Kraft, Wendy's, Intuit and the Gates Foundation, it's too extreme for me and the people of Missouri.
As a legislator, I value the input that non-partisan organizations contribute to various issues. However, I do not believe that the American Legislative Exchange Council is a non-partisan organization. Due to the legislation that ALEC has been involved in forming and promoting, I will not be renewing my membership. I value and listen to all opinions, but ALEC's agenda has become harmful to my constituents, and the people of the State of Texas.
There’s much more work to be done, but the ALEC house of cards is beginning to crumble.
Facing unprecedented public scrutiny and the beginnings of a mass corporate exodus, the American Legislative Exchange Council is on defense. This morning, the organization issued a statement explaining that they are a “pro-growth, pro-jobs” policy organization, and really can’t see what all the fuss is about. Here’s a snippet:
"For years, ALEC has partnered with legislators to research and develop better, more effective public policies – legislation that creates a more transparent, accountable government, policies that place a priority on free enterprise and consumer choice, and tax policies that are fair, simple and that spur the kind of competiveness that puts Americans back to work.
"At a time when job creation, real solutions and improved dialogue among political leaders is needed most, ALEC’s mission has never been more important. This is why we are redoubling our commitment to these essential priorities. We are not and will not be defined by ideological special interests who would like to eliminate discourse that leads to economic vitality, jobs and fiscal stability for the states."
Unfortunately for ALEC, these defenses simply don’t hold water. If ALEC’s idea of “discourse” means putting corporate lawyers together with state lawmakers at secret conferences to draft pro-corporate legislation; and “economic vitality” and “jobs” means suppressing the vote, locking up immigrants, busting unions and wrecking the environment – all measures designed to funnel money into the coffers of ALEC’s corporate members regardless of the damage to others – then there’s a lot more fuss headed their way. Here’s part of PFAW Foundation president Michael Keegan’s response:
“ALEC’s statement would have us believe that their policies promote ‘economic vitality,’ but it is difficult to see how policies that disenfranchise thousands of voters, create irrational gun laws like ‘Shoot First,’ promote fast tracks to prison for immigrants and endanger our health and safety by gutting environmental protections make any American better off. The true economic consequences of the ALEC agenda – which includes privatizing public resources such as schools and prisons, dismantling unions and stacking the deck against average people who try to seek justice in a court of law – is that wealthy special interests get even richer while the rest of us are left in the dust. ALEC believes in job creation – unless job elimination is better for the bottom line of a few corporations."
The full statement is available here.