A major component of the American Legislative Exchange Council’s agenda is shielding corporations from liability by removing consumer protections and limiting the people’s ability to seek justice in a court of law. At their meeting last week in Charlotte, N.C., ALEC’s Civil Justice Task Force considered legislation that would hamstring some of the mosteffective consumer advocates: state attorneys general.
Common Cause recently released some 4,000 of ALEC’s internal documents, including task force agendas, participants and model legislation. The documents revealed ALEC’s “Attorney General Authority Act” under consideration at the task force meeting, which seeks to limit state AGs from bringing suits against corporations. ALEC’s explanation of the bill reads in part:
Just as a private attorney cannot bring a suit on behalf of a client without the client agreeing and authorizing such action, and then only within the guidelines allowed by the client, so it should be with the attorney general. Rather than an attorney general deciding on his or her own what authority the office may have to bring a lawsuit, the authority should be defined by the state as reflected by the specific decisions of the legislature via statute. The legislature, not the attorney general, is best positioned to balance the competing concerns that go into the decision of whether to allow a cause of action and under what circumstances.
Put simply: this act would prohibit the attorney general from bringing a suit in the public’s interest unless the state legislature specifically authorizes it.
As the Minnesota Post astutely points out, a legislature that enacts such a provision to protect corporations is unlikely to subsequently grant the attorney general the authority to prosecute them. The consequences are significant: "This legislation would have prevented [an attorney general] from suing tobacco manufacturers in the ‘90s for tobacco-related health costs associated with the Medicaid program,” said Mike Dean, head of Common Cause of Minnesota. “It is easy to see why corporations would want to stop these types of lawsuits because tobacco manufacturer were forced to pay $6.1 billion in a settlement to the state of Minnesota."
This law doesn't just help ALEC-member corporations, it helps ALEC. After recently filing a whistleblower complaint with the IRS alleging that ALEC abused its tax-exempt status by failing to report lobbying activities, Common Cause is calling on state attorney generals to investigate ALEC for tax fraud in all 50 states. What better way to derail investigations into ALEC than by advocating for legislation that removes the attorney general’s ability to investigate ALEC?
“Stand By Your Ad” Law Would Shine Light on Super PAC Abuses
Hartford, CT. – A coalition of good government groups including Common Cause, People For the American Way, Public Citizen, Demos, Credo Action, Democracy 21 and the New Progressive Alliance are calling on Connecticut Governor Dannell Malloy to sign H.B. 5556, “Changes to Campaign Finance Laws and other Election Laws,” which just passed just passed the General Assembly. The bill would require public disclosure of major corporate and individual donors to Super PACs and other independent groups, bringing increased transparency and accountability to Connecticut’s elections.
The bill would strengthen existing “Stand By Your Ad” provisions, which require political ads to disclose the five top contributors. Additionally, individuals and corporations would no longer be able to use intermediaries to shield campaign contributions from public view.
“Since Citizens United opened the floodgates to massive amounts of undisclosed, unaccountable political spending, Connecticut has been on the forefront of the effort to limit the outsized influence that corporations and special interests have on our democracy,” said Cheri Quickmire, Executive Director of Common Cause Connecticut. “By signing H.B. 5556 into law, the Governor can help us take an important step toward fairer elections. This bill would protect our candidates from anonymous attacks and corrupting ads. No longer would wealthy special interests be able to take advantage of the system by using shadowy front groups to evade Connecticut law and hijack our democratic system.
“We need H.B. 5556 to take effect and strengthen Connecticut’s disclosure laws before the 2012 elections. Secretive political spending has already had a major impact on Connecticut’s citizens, so we must act now to protect the integrity of our elections.”
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.
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]
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.
PFAW joined members of Congress, state and local officials, advocacy organizations and concerned citizens for a Capitol Hill summit to amplify the call for a constitutional amendment to overturn Citizens United, the 2010 Supreme Court decision that helped usher in unprecedented levels of corporate spending to influence our elections.
The speakers recounted the toll that Citizens United has taken on our democracy, as their colleagues must contend with the outsized influence that wealthy special interests hold over the political system, and how it is absolutely imperative for Congress to have the authority to regulate campaign contributions and require disclosure. While there are many approaches under consideration, it was clear to all that amending the Constitution is a necessary step to restore our democracy. So far, 13 constitutional amendments have been introduced in the current session.
It’s a long road to ratification, but there is a rapidly growing grassroots movement taking hold across the country to get this done. State Representatives and City Councilmen took to the podium to share their constituents’ enthusiasm for a constitutional amendment, and many states and cities across the country have already adopted resolutions calling for such an amendment.
The summit concluded with a call for public officials to sign the Declaration for Democracy, a simple statement of support for amending the Constitution “to protect the integrity of our elections and limit the corrosive influence of money in our democratic process.”
Here is a video and photos of the event.
PFAW’s Marge Baker opens the Summit as members of Congress, local and state officials and activists look on. “We the people means all the people, not just the powerful and privileged.”
PFAW’s Diallo Brooks introduces several local government officials as Representative Keith Ellison (D-MN) signs the Declaration for Democracy.
Maryland State Senator and PFAW Senior Fellow Jamie Raskin describes the Supreme Court’s flawed logic in the Citizens United decision. Quoting Justice White: “The state need not let its own creature [corporations] devour it.”
Rep. Keith Ellison watches as PFAW’s Marge Baker signs the Declaration.
The Declaration for Democracy: “I declare my support for amending the Constitution of the United States to restore the rights of the American people, undermined by Citizens United and related cases, to protect the integrity of our elections and limit the corrosive influence of money in our democratic process.”
FOR PLANNING PURPOSES
House and Senate Members to Host Activists and Advocacy Groups for Congressional Summit on Amending the Constitution
Washington, DC – On Wednesday, April 18, a number of United States Senate and House members will host People For the American Way (PFAW) and other advocacy organizations alongside local and state government representatives and citizen activists for a summit to explore the need for constitutional remedies to overturn Citizens United. As sponsors of proposed constitutional amendments, the Senators and Representatives are highlighting the growing grassroots movement to restore our democracy and amend the Constitution to overturn Citizens United and restore government by the people.
Senators Bernie Sanders (I-VT), Charles E. Schumer (D-NY) and Tom Udall (D-NM) will join Representatives Ted Deutch (D-FL), Donna F. Edwards (D-MD), Keith Ellison (D-MN), and Jim McGovern (D-MA) for the discussion. Other speakers include People For the American Way’s Executive Vice President Marge Baker and Maryland State Senator Jamie Raskin.
WHAT : Congressional Summit to Overturn Citizens United
Senator Bernie Sanders People For the American Way
Senator Charles E. Schumer Public Citizen
Senator Tom Udall Center for Media and Democracy
Representative Ted Deutch Common Cause
Representative Keith Ellison Communication Workers of America
Representative Donna F. Edwards Move to Amend
Representative Jim McGovern American Sustainable Business Council
Free Speech for People
WHEN : Wednesday, April 18, 2012
11:00 a.m. – 12:00 p.m.
WHERE : Capitol Visitors Center, HVC 215
RSVP : Please click here to RSVP.
Updated Report Documents Intensified Influence of American Legislative Exchange Council and its Out-of-State Corporate Donors
PHOENIX -- Legislators in Arizona continue to advance extremist legislation inspired by the American Legislative Exchange Council (ALEC) and its out-of-state corporate backers, according to a new analysis by People For the American Way Foundation, Common Cause, the Center for Media and Democracy and Progress Now. This report shines a new light on the Arizona Legislature’s unprecedented ties to the secretive organization, which recently drew nationwide fire for its role in implementing radical policies across the country like “Shoot First” laws and voter suppression laws, and anti-worker measures. ALEC’s extreme agenda has recently led companies such as Pepsi, Coca-Cola, McDonalds, Wendy’s, KRAFT and Intuit to withdraw from the organization. The Bill and Melinda Gates Foundation on Monday also withdrew its support from ALEC.
The comprehensive report found that Arizona’s large concentration of ALEC-member legislators, working hand-in-hand with the corporate leaders who make up ALEC’s membership, are continuing to endorse special interest legislation that harms ordinary people by limiting consumers’ rights, privatizing education and dismantling unions.
The report, ALEC in Arizona: The Voice of Corporate Special Interests in the Halls of Arizona’s Legislature, updated for the Fiftieth Legislature, second regular session is available here.
“Recent polling shows that Arizonans are appalled by the out-of-touch and extremist agenda at their State Legislature. This report shows that agenda is no accident,” said John Loredo, a member of Arizona Working Families and a former Arizona House Minority Leader. “Unfortunately, Arizona has one of the highest concentrations of ALEC legislators in the country, and that makes us a petri dish for anti-worker legislation and a host of other bad ideas.”
“ALEC-member legislators are unabashedly continuing to push legislation straight from corporate headquarters to Arizona’s lawbooks,” said Marge Baker, Executive Vice President at People For the American Way Foundation. “Well-heeled special interests are circumventing the democratic system and bypassing Arizona’s citizens, who can’t match the level of access that ALEC provides. As a result, Arizonans are facing an endless assault from laws that serve the interests of the rich and powerful instead of everyday people.”
“The more Arizonans learn about ALEC, its agenda, and its tactics in advancing that agenda, the more they wonder why their elected representatives and leading corporate citizens would be associated with such an organization,” said Bob Edgar, president of Common Cause. “No business has a legitimate interest in limiting the right to vote or in undermining public education; no legislator can reasonably defend laws that protect the manufacturers of dangerous or defective products. In embracing ALEC, lawmakers and business people embrace these and other policies that betray the public interest.”
"ALEC' state chair, Rep. Debbie Lesko, has claimed she gives equal access to ALEC corporation as Arizona citizens about changing the law, but this report shows how special interests outside of Arizona are crafting massive changes to the rights of state citizens behind closed doors," said Lisa Graves, Executive Director of the Center for Media and Democracy/ALECexposed.org, adding "Public records also document that Rep. Lesko raises funds from ALEC corporations to distribute to ALEC legislators that help advance ALEC's agenda so they can go on resort trips where politicians secretly vote on model bills such as these with corporate lobbyists voting as equals. This is distorting the law in ways that harm Arizona families and should be stopped."
The updated report demonstrates the scope of ALEC’s policymaking influence with a side-by-side comparison of ALEC “model bills” with recently-submitted Arizona legislation, including:
• Anti-worker legislation designed to limit the freedom of public employees to voice their views by making it more difficult to collect professional association and union dues and blocking members from participating in professional association and union functions;
• Bills that make it easier for corporations to get away with wrongdoing and restricting consumers’ ability to seek justice in a court of law; and
• Attacks on public education by replacing real teachers with private, for profit, “virtual classrooms.”
ALEC Exposed, a project of the Center for Media and Democracy, has uncovered and analyzed approximately 800 ALEC “model” bills secretly voted on by corporations and politicians in an effort to reveal the undue influence major corporations hold, with the help of ALEC, in our democracy. Click here for more information.
State Farm, Johnson & Johnson, McDonald’s targeted by coalition
Washington, D.C -- A coalition of civil rights and government watchdog groups with members in all 50 states elevated the ongoing campaign to pressure corporations to withdraw from the American Legislative Exchange Council (ALEC) by calling today on three prominent companies to join the list of firms departing ALEC.
Color of Change, Common Cause, People for the American Way Foundation, Progress Now, the Center for Media and Democracy, and CREDO said their members will be petitioning State Farm Insurance, Johnson & Johnson, McDonald’s – all of whom play a prominent leadership role in ALEC to leave the organization immediately.
“Corporate membership in ALEC isn’t just destructive to democracy, it’s also bad for business. Corporations that currently support ALEC have a choice to make: they can continue to underwrite reckless assaults on our rights and wellbeing, or they can stand up for their customers by leaving ALEC immediately,” said Michael Keegan, President of People for the American Way Foundation.
“It’s increasingly clear that ALEC applies the economic clout of some of our country’s largest corporations on behalf of public policies that limit voting rights, undermine our public schools, assault collective bargaining and weaken laws protecting our environment,” said Bob Edgar, president of Common Cause. “This is neither good business nor responsible corporate citizenship.”
Many Americans have learned about ALEC in recent weeks through news stories detailing its role in the proliferation of “Stand Your Ground” laws similar to the Florida statute at issue in the death of 17-year-old Trayvon Martin.
"Major corporations like Pepsi, Coca-Cola, and Kraft understand that supporting voter suppression efforts and dangerous 'Stand Your Ground' legislation puts their brands at great risk in the Black community," said Rashad Robinson, Executive Director of ColorOfChange.org. "We hope that McDonald's, Johnson and Johnson, and State Farm also get that message. Today, our members are flooding these companies with phone calls to demand that they stop supporting ALEC."
"The funding of these and other corporations makes ALEC's operations and agenda possible, including closed door meetings where corporate and special interest lobbyists actually vote as equals with elected officials on 'model' bills to change gun laws and make it more difficult for American citizens to vote," said Lisa Graves, Executive Director of the Center for Media and Democracy/ALECexposed.org, adding "The American people have a right to know about this corporate bill mill and a right to hold the corporations and politicians to account."
“ALEC’s companies and lobbyists wine-and-dine our elected officials at expense-paid ‘seminars,’ write legislation for them and then fade quietly into the background as that legislation is introduced and passed in statehouses across the country,” said Anna Scholl of Progress Virginia. “People we elect to represent all of us end up representing just a few, driven by their pursuit of profit and/or a radical ideological agenda.” Progress Virginia recently released a report detailing ALEC’s undue influence in the Commonwealth.
"If you're a consumer who believes in civil rights you don't want to give your money to companies that fund the organization leading the attack on voting rights," said Becky Bond, Political Director of CREDO Action. "Our members are prepared to hold companies accountable if they continue funding ALEC."
Coca-Cola, Kraft Foods, PepsiCo and Intuit confirmed last week that they’ve already withdrawn from ALEC. On Monday, the Bill and Melinda Gates Foundation announced that they will no longer be making grants to ALEC.
People For the American Way Foundation is dedicated to making the promise of America real for every American: Equality. Freedom of speech. Freedom of religion. The right to seek justice in a court of law. The right to cast a vote that counts. The American Way.
The American Legislative Exchange Council (ALEC) strategy of corporations enact favorable legislation at the state level across the country by wining and dining state legislators at fancy conferences and then presenting them with model bills to shepherd into law is well documented. Apparently, ALEC also sees value in currying favor at the federal level as well.
Common Cause’s Nick Surgey reports that ALEC gave a cash award of $1,350 to Rep. Eric Cantor (R-VA) in 2009 as part of their Thomas Jefferson Freedom Award, according to an investigation of ALEC’s tax filings. This presents a potential breach of ethics because House members are prohibited by law from receiving any cash gift.
While ALEC’s main focus is on pro-corporate state legislation, common cause notes that ALEC’s influence extends far into the realm of the federal government:
Although ALEC’s primary focus is in promoting corporate-friendly state legislation, the group also has a clear federal agenda. A 2005 ALEC document obtained by Common Cause outlines 42 distinct ALEC model bills that attempt to influence federal policy. Those bills include resolutions calling for lower corporate taxes and supporting construction of the controversial Keystone XL pipeline. In effect, corporations working through ALEC are using state legislators to lobby Congress on their behalf. ALEC boasts of the 91 “ALEC alumni” currently serving in the US House, including both Eric Cantor (R-VA) and House Speaker John Boehner (R-OH).
As Rep. Cantor graciously accepts his award in this 2009 video, it’s not difficult to imagine how flattery and cash gifts can go a long way in winning the favor of powerful people.
Rep. Cantor’s office subsequently released a statement denying that he took the cash and that the engraved bust he received was legal. This still doesn’t explain, as Common Cause notes, why ALEC considered the bust to be a cash gift on their tax filings, unless the value of the bust was high enough that disclosure was required.
Regardless, it smells fishy.
Ohioans Harmed By ALEC “Model Bills” Speak Out Against Undue Corporate Influence in Democratic Process
New Report Documents Influence of American Legislative Exchange Council in the Ohio Statehouse