In a 1995 editorial cartoon, a man holds a sign with an arrow: “Access This Way.” That arrow points to a banner: “Government of the Corporate—Buy the Access for the Power.” Another banner contains an alphabet soup of acronyms: CSG, NCSL, NGA, WLC and ALEC.
Few politicians need to Google the letters. The acronyms stand for organizations whose mission is to bring corporations and lawmakers together. Ross Perot’s Utah newsletter, which ran the cartoon, was aiming at them.
In 1995, there was no catalyst like the Trayvon Martin killing in Florida, and the cries from Perot’s United We Stand newsletter were summarily ignored.
“We’ve been trying to get the state to pull out of these organizations forever,” says citizen activist Claire Geddes, who ran Perot’s Utah campaign. “These representatives don’t even see the problem with this. Our government has gone so far wrong that they believe this is right—and it’s fascism.
“Everyone talks about socialism, but we’re promoting corporations above the individual, and people ought to be horrified,” she says. Instead, Utah has put out the welcome mat for ALEC, the American Legislative Exchange Council, which is holding its 39th-annual meeting in Salt Lake City from July 25 to July 28.
ALEC was founded in 1973 by conservative kingmaker Paul Weyrich. Weyrich’s original goals were to flag issues for state legislators about abortion, the Equal Rights Amendment and D.C. voting rights. However, the interests of monied corporations soon took center field.
Under the Reagan administration, ALEC began as a “clearinghouse” of ideas, but developed task forces as stand-alone think tanks, and began actively soliciting input from the private sector. Today, that includes corporations like AT&T, Pfizer and Koch Companies Public Sector, to name just a few.
ALEC calls itself “a nonpartisan individual membership organization of state legislators which favors federalism and conservative public-policy solutions.” One of those conservative public-policy solutions was a bill modeled after Florida’s “Stand Your Ground” law, which neighborhood-watch volunteer George Zimmerman is citing in defense of the Martin shooting. Zimmerman maintains that he feared the hoodie-clad Trayvon Martin and ultimately had to shoot him to protect himself. Martin’s attorneys say Zimmerman stalked and provoked him.
Stand Your Ground is just one of perhaps 1,000 pieces of legislation modeled by corporations for state legislatures. They include bills on worker and consumer rights; privatizing schools; environment, energy and agriculture; and democracy, voting and federal regulations.
ALEC provides what they call “off-the-shelf” language for legislation. In other words, one state will offer up its law as a template for other states.
Some of the more notable laws besides “Stand Your Ground” include “Three strikes, you’re out,” which requires state courts to impose life sentences after three serious offenses; “mandatory minimums,” which limits judicial discretion in sentencing of certain crimes; “truth in sentencing,” which is intended to limit or abolish parole; “right to work,” which gives workers the right to choose whether or not they join a union (and to which Utah subscribes); and the “Animal & Ecological Terrorism Act,” which criminalizes violence or sabotage committed by activist groups.
In the wake of the Trayvon Martin shooting, ALEC decided to discontinue its law-enforcement task force. And 20 corporations and a handful of nonprofits have discontinued their affiliations. While bad PR is a powerful motivator, it’s not enough to dissuade ALEC’s enthusiastic Utah supporters.
Sen. Wayne Niederhauser, R-Sandy, is one of the state chairmen for ALEC. Appointed to the Legislature in 2006, he first got involved with the National Council of State Legislatures (NCSL). There are, in fact, three main legislative organizations in the country—NCSL, the Council of State Governments (CSG) and ALEC. Still influential, but less all-encompassing, are the Western Legislative Conference (WLC), sponsored by CSG, and the National Governors Association (NGA), which shares best practices among governors. By Niederhauser’s second year, he’d become an ALEC cheerleader.
Niederhauser, a CPA and real-estate developer, sits on ALEC’s tax- and fiscal-policy task force. “When I was chair of Revenue and Taxation, it helped me to understand concepts,” he says. One of the main issues now, especially since the Affordable Care Act was upheld, is how to solve the Medicaid problem. “It’s a main issue because it’s a budget buster,” he says. “It makes our life a lot easier to be able to go with a problem and a solution to hear how other states solve the Medicaid problem.”
Niederhauser is also interested in streamlined sales tax and worked on a resolution with Rep. Wayne Harper, R-Taylorsville, and Sen. Curtis Bramble, R-Provo, to solve the Internet sales-tax issue.
Not only did it fail in the Legislature, but the ALEC board also rejected the legislation, says Bramble, who’s on the boards of both ALEC and the Streamlined Sales Tax project. Niederhauser calls the issue “too nuclear,” but he and Bramble plan to bring it back.
Critics worry that solutions are being hammered out in private, since ALEC is a private-membership organization. But Rep. Ken Ivory, R-West Jordan, dismisses the criticism.
“Ridiculous,” says Ivory, who’s the second state chair for ALEC. ALEC is a think tank, he says, and all think tanks require money to pursue their aims. Whatever the genesis of a bill, it must go through the public process of the Legislature, he says. That includes committee hearings, floor debate and, ultimately, the governor’s signature.
And yet ALEC’s influence is indisputable, its motivations suspect. Ivory draws a straight line from the model legislation of ALEC to the halls of the Capitol; he’s apparently not enough of a conspiracy theorist to see all the arterial paths.
In contrast, Mike Elk, contributing editor at The Nation magazine, knows how to connect the dots. For instance, ALEC has model legislation promoting private prisons. Elk believes the goal is to put massive numbers of people in prison. In the ’80s, ALEC forged a partnership with the Corrections Corporation of America, after which the prison population quadrupled to what it is now.
That, in turn, created a ready-made workforce of prisoners working for private corporations. Prison labor provided corporate profits and was cheaper than sending jobs to China, Elk maintains.
An unintended consequence, though, was concern over the cost of housing all these inmates.
“ALEC found another sponsor that could make money off of getting prisoners out of prison. So what ALEC wants to do now is reform the parole system in this country, privatize it. So now, prisoners have to put up bond with private bail-bond companies that are owned by big Wall Street firms, where they have to pay outrageous fees in order to get out of prison,” Elk says.
And ALEC worked with Arizona on its immigration bill, which coincidentally increased the prison population and thus the demand for more prisons. That, according to The Nation, was just what the Corrections Corporation of America wanted.
After all, this is the way businesses work: See a need, fill a need—and sometimes, when business is big enough, it could be: create a need.
Instead of conspiracy, Ivory looks at ALEC as a philosophical ally. The council was founded on the pillars of limited government, free markets and federalism “on which our nation was established,” Ivory says.
In the 2012 session, Ivory sponsored and passed House Bill 148, the Transfer of Public Lands Act. The bill orders the federal government to turn over to the state most public lands, except national parks, by 2014. The bill set aside $3 million for current and future lawsuits.
Ivory simply believes the federal government reneged on a promise to Western states. Federal lands were supposed to be ceded to states upon admission to the union.
So, it goes without saying that Ivory found himself on ALEC’s federalism task force. It’s the best place to trade ideas on getting the feds out of the states’ hair and, given the success of Ivory’s bill, his legislation is likely to become an ALEC model.
“It’s the duty of states to be an external check of unrestrained government,” Ivory says. “It was never intended that Congress, by itself, would restrain itself.”
Indeed, most Americans think of the executive, legislative and judicial systems as being the ultimate check-and-balance for government. ALEC, Ivory and the conservatives are here to remind you that the states are in this, too, and they play a bigger part than Congress itself.
“Congress is supreme only in the powers delegated to it; the states are supreme in all else,” Ivory says.
This new federalism has no love lost for Congress, which gets wrapped up in fear and loathing as the federal behemoth.
Ivory even has an interesting take on Chief Justice John Roberts’ recent health-care opinion. What the public is missing, he says, is Roberts’ admonition to the states, almost daring them not to comply with federal mandates. “In his opinion, he said, in our system, the states have the prerogative of refusing to comply,” Ivory says.
To Geddes, that sounds a lot like a parallel government. “Everybody thinks it’s about states’ rights, so they’ve formed this other organization that’s running parallel to the government,” she says.
THE PRIVATE ROAD TO TRANSPARENCY
Niederhauser, for one, stands proud and loud as an ALEC devotee. He recently wrote an op-ed column for The Deseret News, explaining his stand. “The role ALEC plays facilitating the conversation around pro-growth, limited government principles and developing model legislation that advance free-market ideals has never been needed more than today,” he wrote. “We are at a crossroads and more attention needs to be paid to policies that will generate jobs and lower taxes for citizens. … The economic policies supported by ALEC have kept Utah competitive, creating and keeping jobs in our state and serving as a model for other states to follow.”
That’s not to say that the National Council of State Legislatures and the Council of State Governments don’t provide model legislation, too. But in both cases, their legislation is staff-driven. ALEC passes around laws from state to state, with the helping hands of corporate America. The state will pay for a legislator’s travel to one of the three organizations every year.
Legislators themselves pay only $50 a year to join ALEC, whose revenues come primarily from for-profit corporations. According to the anti-ALEC website ALEC Exposed, 98.6 percent of ALEC’s $6.3 million in revenues come from sources other than legislators. ALEC representatives would not return calls for this article. CBS News reports that the 300 companies sponsoring ALEC contribute most of its operating costs.
NCSL has a general fund of $16.8 million, and in 2010, legislatures accounted for $10 million of that. Utah pays dues for every person in the Legislature, amounting to some $130,000 a year, Niederhauser says. NCSL is so important, he says, that Utah’s legislative Research and General Counsel staff often seek it out for information.
ALEC, on the other hand, doesn’t have a lot of research to cull from, Niederhauser says, but it is probably the most prolific in creating model legislation—legislation formulated by task forces, from which the public is barred.
That makes his transparency bill, modeled from a 2007 Kansas concept, just a bit ironic. Kansas took its bill to ALEC, which made it model legislation. Niederhauser used that model, along with research from NCSL, to draft financial-transparency legislation in 2008. Niederhauser’s bill created the Utah Public Finance Website, which posts public financial information provided by state entities. “Now you can see where all the tax dollars are going,” he says.
THIS COUNTRY WAS BUILT ON CAPITALISM
Utah is at the forefront of ALEC model legislation, for good reason. Their values collide.
Bill Barton was elected to the Utah Senate in 1978, and within a few years embraced his conservative leanings and a fledgling organization called ALEC. ALEC sent out information to state legislators asking them to join, but it was slow going.
“No other member of our Legislature wanted to join, so I became state chair to get other members involved,” he says. The first ALEC convention brought in about 300 people, and Barton was responsible for bringing 45 of the then-105 legislators into the fold.
This year, there could be as many as 3,000 ALEC supporters at the Grand America Hotel in late July.
In 1989, ALEC asked Barton to join the national board. He found it all quite interesting. “We would sit in a committee with the private sectors and try to solve problems without government,” Barton says.
All this goes back to the founding of the country, he says. “What really built it? It was not the government that built it, but people in search of profit and things people wanted to buy from them that fueled economic growth.”
Profit is indeed what it’s all about, and Barton is troubled by all the negative reaction. He went on to the Deseret News website just to offer some positive reinforcement to Niederhauser, whose editorial was getting summarily slammed in comments—things like, “ALEC is a front group for billionaires,” and “It is a worrisome marriage of corporations and politicians, which seems to normalize a kind of corruption of the legislative process.”
The positive comments? “It becomes more clear why almost half of the American voting public still support President Obama and his failed policies,” and “Do liberals not realize that wealthy people have to have businesses that provide jobs so that they can remain wealthy?”
PAINTING A PRETTY PICTURE
With all the acrimony comes an expectation of protest outside the upcoming conference. Barton hopes it’s civil. Ivory says he recalls two or three “dressed in unusual outfits” protesting at a North Carolina conference.
But Salt Lake City’s ALEC “Welcoming Committee”—a coalition of detractors, including the Revolutionary Students Union, United for Social Justice, Peaceful Uprising, Utah Tar Sands Resistance and some Occupiers—is gearing up for something more. At 7 p.m. on Wednesday, July 18, the committee’s Raphael Cordray will present her take on ALEC in a PowerPoint presentation at the Salt Lake City Main Library, Conference Room C.
“We’ve ID’d all the members in Utah and the task forces—the different areas of democracy they attack,” she says. There are at least 20 representatives and 15 senators who belong.
Meanwhile, ALEC delegates will be treated to a special performance by the Mormon Tabernacle Choir, a reception at the new Natural History Museum of Utah and a peculiar “cigar reception,” not to mention a speech by the National Journal’s Charlie Cook. Gov. Gary Herbert will also welcome ALEC to Utah.
Cordray thinks the red-carpet treatment is a “subtle way to get people from around the country to see Mormonism in a flattering light—to help Romney.” Religion has been an underlying issue in Romney’s campaign, and Cordray believes it’s important for Utah to “paint a pretty picture.”
She first became interested in ALEC through her environmental activism. She found the group’s model legislation to weaken the Environmental Protection Agency in its focus on usurping rules for fracking and polluting water and its support of big fossil-fuel industries. “I quickly saw they’re also pushing legislation to question global warming,” she says.
ALEC is nothing if not flexible. Once a friend of tobacco interests, ALEC could no longer deny the cancer link and instead took to global warming as a new cause to support. “They switched over to another false science,” Cordray says.
ALEC has come under fire nationally for its efforts to stifle voting, most specifically through voter I.D. laws. Utah now requires a photo I.D. to cast a ballot and halts voter registration 30 days prior to an election. The national and state League of Women Voters have fought attempts to limit voting. MSNBC recently aired a telling video of Pennsylvania House Majority Leader Mike Turzai saying that a just-passed voter I.D. law in his state “would allow Gov. [Mitt] Romney to win Pennsylvania.”
BAD FOR BUSINESS
Certainly, there is no end to suspicion of ALEC and its partners’ motives. ALEC is well aware of the fallout, as at least 10 corporations (Walmart, Kraft, Pepsi and Coca-Cola, Intuit, the Gates Foundation, McDonald’s, Wendy’s, Arizona Public Service, Mars Inc., American Traffic Solutions and Reed Elsevier, according to ALEC Exposed) have left. ALEC is attempting to staunch the bleeding.
ALEC posted a letter—“Statement by ALEC on the Coordinated Intimidation Campaign Against its Members”—from its executive director, Ron Scheberle, on its website on April 11, 2012.
“ALEC is an organization that supports pro-growth, pro-jobs policies and the vigorous exchange of ideas between the public and private sector to develop state-based solutions,” it reads. “Today, we find ourselves the focus of a well-funded, expertly coordinated intimidation campaign.
“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.”
On April 12, Scheberle posted another letter about the outpouring of support for ALEC. “First, the people now attacking ALEC and its members are the same people who have always pushed for big-government solutions. Our support for free markets and limited government stands in stark contrast to their state-dependent utopia. This is not about one piece of legislation. This is an attempt to silence our organization, and it has been going on for more than a year.
“Second, ALEC is one of America’s premier ideas laboratories when it comes to advocating free- market reforms. We are a target because our opponents believe they have the opportunity to attack an effective, successful organization that promotes free-market, limited-government policies that they disagree with. We work to promote the Freedom of Choice in Health Care initiative against ObamaCare’s individual mandate. We support fair tax policies and tort reform. This is an all-out intimidation campaign designed to promote government-based solutions rather than the free-market principles that we have seen work.”
Cordray counters that ALEC is a target because it has been carrying on the public’s business in private and facilitating money transfers from large corporations to state legislators.
For instance, Provo Sen. Bramble, who’s another ALEC co-chair, received $90,000 in ALEC-related campaign contributions, according to the website ALEC Exposed. That includes $4,000 from U.S. Smokeless Tobacco.
While not a particular problem in Utah, smokeless tobacco is big news in Germany, where the ALEC international-relations committee would like to see a ban lifted. The European Union is striving toward a tobacco-free Europe, a step that’s obviously bad for business.
Bramble, however, says he has no idea which of his donors are ALEC supporters, and he has no interest in German politics. As an example, he says he took money from tobacco interests, but then sponsored a bill to raise the tobacco tax. He took money from breweries, and yet sponsored a bill to ban alcopops in Utah grocery stores.
“These groups like the Alliance for a Better Utah—their agenda is they don’t like conservative philosophies and they’re trying to connect dots that don’t connect,” Bramble says. “It’s just not there.”
On ALEC’s Salt Lake City conference agenda are committees involved in commerce and taxation; energy; public-pension reform; commerce, insurance and economic development; fiscal policy; health-insurance exchanges; communication and technology; social-media training; international relations; national security; and, of course, federalism.
ALEC protesters, aka the ALEC “Welcoming Committee” (ALECWC.org), have planned a series of events from July 23 to July 28 on the west side of Washington Square. But that’s not all. The committee has filed a “demand” with the Utah Attorney General’s office, the Utah Division of Consumer Affairs and the lieutenant governor to investigate the group’s tax-exempt, 501(c)3 status and its failure to register in Utah as a lobbyist.
“Despite prohibitions against lobbying for 501(c)3 organizations, ALEC brags that its model legislation that is provided to lawmakers has become state law in all 50 states,” the complaint says. “ALEC has even bragged in the past that 21 percent of its model legislation eventually becomes law. This rampant illegal behavior, the ALEC Welcoming Committee believes, continues because ALEC has powerful and wealthy backers, including the largest corporations in the country.”
Says Cordray, “It’s criminal for the Legislature and the governor to be meeting with the corporate elite in a five-star hotel in secret, and claim to be a charity.”
Several groups around the country are also challenging ALEC’s tax-exempt status. Common Cause has filed a complaint, as has CLERGY Voice. “The clergy’s complaint goes beyond allegations of improper lobbying, claiming that ALEC exists for the ‘private benefit’ of its members rather than for charitable, educational or other exempt purposes that serve the public interest and deserve special tax treatment,” writes the Center for Public Integrity. The clergy maintains that ALEC “deliberately and repeatedly failed to comply with some of the most fundamental federal tax requirements applicable to public charities.”
Ivory sees the United States on an unsustainable path. “We have a nation without a balance, with debt and overspending,” he says. “Nothing we do at this point will come easy.”
And that is an understatement.
ALEC 39th-annual meeting
Grand America Hotel, Salt Lake City