Powerful U.S. corporations have been writing bills themselves and giving them to state assemblies to rubber-stamp
The scandal of paid news in India, whereby politicians, private businesses, and perhaps others, buy space in newspapers to publish material which appears to have been written by the papers, has rightly attracted much critical comment, but the United States appears to be well ahead of India, with nothing less than a form of paid law. Powerful U.S. corporations have been writing bills themselves and giving them to state legislators — whose election campaigns they often fund as well — to rubber-stamp and pass on to governors for signature into law.
Main lobbying body
The main lobbying body behind this is the American Legislative Exchange Council (ALEC), which has existed for over 40 years. It numbers about 300 corporations, including oil majors Exxon Mobil and Shell Oil, the Koch energy conglomerate, IT firms Microsoft, Hewlett-Packard and Dell, carmakers General Motors, pharmaceuticals producers Eli Lilly, GlaxoSmithKline, and Pfizer, the cigarette firm Philip Morris, the drinks giant Diageo, and the mammoth retailer Wal-Mart. Nearly 2,000 state legislators are also members.
ALEC now tracks all legislation in all 50 states; Mike McIntire, writing in the New York Times, adds that over 1,000 state bills a year are based on its models, and that about 17 per cent of these become law. ALEC itself says its mission is to “promote free markets, limited government, and federalism throughout the states”, but the evidence reveals much more than that.
As Ari Berman points out in Rolling Stone, ALEC's agenda is highly systematic and covers several key areas, starting with an orchestrated campaign to ‘disrupt voting rights'; in 2011, no fewer than 38 states introduced ALEC-inspired legislation which will impede voting. The restrictions include the need to prove citizenship before registering to vote, obstacles for campaigning groups which help people register, the abolition of election-day registration, reductions in early voting, the disenfranchisement of convicts who have served their sentence, and the requirement for government-issued identification at the polling booth. More than 10 per cent of U.S. citizens have no such ID, but the figures rise to 25 per cent among African-Americans and 18 per cent among young voters respectively; university students will also be excluded by residence conditions such as those in new Wisconsin law. African-Americans and younger voters tend to vote Democrat. Claims that the restrictive measures prevent voter fraud are absurdly exaggerated; U.S. voter fraud is almost zero, and strenuous Republican attempts to prove that it is widespread have all failed.
A second front is the attack on renewable energy sources, or renewable portfolio standards (RPS). ALEC claims that these, like curbs on greenhouse-gas emissions, harm the economy and have no environmental benefits, but Maria Gallucci of Inside Climate News notes (in an article reproduced by the online journal Truthout) that the $48.1 billion invested in clean energy technologies in 2011 constitutes a 40 per cent increase on the previous year. In addition, claims that RPS drives electricity prices up are countered by published evidence that RPS policies slowed the rate of price rises in 12 states; the introduction of the new technology has also helped create jobs.
Needless to say, environmental issues pose ALEC some of its toughest challenges. Exxon Mobil has helped design state laws that enable energy companies not to name chemicals used in fracking for access to oil, claiming that the chemicals are trade secrets; keeping such secrets, however, makes a nonsense of ALEC's own ideology, which is that consumers are free to make their own informed decisions in a market system.
This evasion of accountability extends to shielding firms which receive substantial public monies despite overwhelming evidence of failure. Zaid Jilani and David Halperin, writing separately in Republic Report, detail how the for-profit education company Kaplan International, which is owned by the Washington Post Company and was an ALEC member for a year until August 2011, has a 68 per cent dropout rate — the worst among the top 10 recipients of post 9/11 education funding for military veterans — but its former CEO received a golden handshake worth $76 million when he left. Bridgepoint Education spent $2000 per student on recruitment in 2009 but only $700 on instruction, and Corinthian College has the worst default rate, 36 per cent within three years, on student loans.
Such private colleges can get 90 per cent of their money, totalling over $30 billion a year, from federal funds, and also charge students very high fees. Only 11 per cent of eligible students attend such institutions, but they account for 44 per cent of all student loan defaults; the colleges concerned have also been exposed for deceptive and predatory recruiting practices, but have used expensive lobbyists and consultants to escape being called to account. Even the Chair of the Virginia Democratic Party, Brian Moran, lobbies for them.
ALEC, for its part, has also tried a form of indirect intimidation against analysts like Professor William Cronon, but the body has been severely embarrassed by other revelations. In particular, its then Criminal Justice Task Force, which Wal-Mart co-chaired at that time, was behind the so-called Stand Your Ground law, which allows people to attack others if they believe they themselves are in danger; under this law they do not have to retreat. The measure, enthusiastically championed by ALEC, has been passed by 24 states and has led to a 300 per cent increase in “justifiable homicide” verdicts since 2005, when Florida, overriding law enforcers' doubts, became the first state to adopt it. ALEC's involvement hit the headlines when George Zimmerman, a Florida resident, admitted shooting dead an unarmed teenager, Trayvon Martin, on February 26, and police seemed initially to interpret the law as allowing them not to arrest Zimmerman (who has since been charged with second-degree murder). In the ensuing controversy, ALEC disbanded the committee concerned.
It is highly significant that the revelation of ALEC's involvement did not occur by itself. A whistleblower passed on details of 800 model bills, including some explicitly intended to restrict trade union rights, to the Center for Media and Democracy, a campaigning group which then put the bills on a dedicated website and has published its own investigations into ALEC. This level of public exposure quickly caused a dozen corporations to leave ALEC; among them are Coca-Cola, Kraft Foods, Procter & Gamble, McDonald's, PepsiCo, and the Bill and Melinda Gates Foundation. Mark Engler notes in Dissent that other departures include Blue Cross Blue Shield and Yum! Brands, which also owns Pizza Hut and KFC. By May 21, 2012, 51 state legislators, mainly Democrats, had also cancelled their memberships; earlier, ALEC had removed the model bills from its main website.
Those companies which have jumped overboard may confirm the truth of the head of Monsanto's remark to the then President Bill Clinton that corporates fear consumer backlash more than anything else, but the rapid departures raise questions about why ALEC has not defended its conduct more robustly. ALEC will of course find other ways to ensure that legislators draft the kinds of law it wants, particularly over regulatory matters and corporate taxation, but it could well face yet more problems, because its charitable status prohibits it from lobbying — which it has apparently been doing since its inception.
Wider issues also arise here, which are highly pertinent in view of the collapse of neoliberalism and the increasingly public global scepticism about austerity policies. For example, ALEC's recent problems show the kinds of tensions which are inherent in the relation between the mainly economic-liberal corporates and the political and moral conservatives who favour the free market but whose social agenda in the U.S. has been documented as aiming to restrict, for example, minority voting rights and women's rights, and as seeking to promote measures like the Stand Your Ground legislation. Nevertheless, the fact remains that with the recent exposure of ALEC's activities, U.S. citizens could well have to face the possibility that their country looks not like the mixed-economy system the political scientists called a corporate state in the 1950s and 1960s, but more like a like a corporate-puppet state.