The American Legislative Exchange Council has long worked to improve government at the state level by limiting it to its proper roles and by preventing unions and other special interest groups from currying political favors. ALEC’s effectiveness may be seen in the fury with which certain senators and left-wing activists are now trying to harass the group’s donors, especially skittish corporations, and bankrupt ALEC.
Few conservative organizations have been more routinely smeared and unfairly attacked in the Obama era than the American Legislative Exchange Council (ALEC), based in Arlington, Virginia. ALEC is a membership organization of more than 2,000 legislators and corporations. Left-wing activists demonize the group because, quite simply, it is effective in advancing the cause of free markets, limited government, and federalism at the state level throughout America. ALEC is one of a handful of political groups in the country that tries to reverse the civic rot that has eaten away at the nation since the tumultuous 1960s. It seeks, in economist Milton Friedman’s words, to “develop alternatives to existing policies [and] keep them alive and available.”
Since President Johnson and Congress launched the “Great Society” welfare programs, tens of thousands of nonprofit advocacy groups have emerged. Most of these groups lean to port and promote more government programs and regulations in areas once considered the domain of families, charities, neighborhood associations, and other voluntary organizations. They argue it is the government’s responsibility to solve almost all of society’s problems and push big government solutions in education, the environment, and healthcare. With the help of the Left, government has increasingly supplanted the voluntary, community-based problem-solving that the great observer of early American society, Alexis de Tocqueville, recognized as a key to America’s thriving.
For ALEC’s efforts to restore the time-honored virtues of the American republic, leftists have rewarded the group with histrionics and slander. ALEC’s enemies have struggled to kill the group in recent years, savaging it for its principled positions on public policy issues of interest to conservatives and libertarians. ALEC’s story is a cautionary tale of what happens when left-wing, Saul Alinsky-inspired agitators target a conservative group for destruction.
Left-wing activists claimed ALEC was racist because its members in past years had supported voter ID laws and “stand your ground” self-defense laws like the Florida statute mentioned repeatedly by the media (but not by the defendant) during George Zimmerman’s murder trial earlier this year. Of course, most people of all races tell pollsters they support voter ID laws, and “stand your ground” laws have been signed into law by (now retired) Democratic governors like Jennifer Granholm of Michigan and Janet Napolitano (who later became Obama’s Secretary of Homeland Security).
The radicals campaigned aggressively against ALEC and also used their in-your-face tactics to target ALEC’s donors, in hopes of scaring away corporate donors and state legislators who belonged to ALEC. Under heavy fire from left-wing groups and their allies in the mainstream media, Wendy’s, Kraft, McDonald’s, Pepsi, and Coca-Cola, among others, soon bailed on ALEC (see Table 1).
“A lot of these organizations believe that ALEC has taken on so much prominence and they’re having such a positive effect, in my opinion, on issues like pension reform and issues like cutting taxing and cutting back government spending [that] they were looking for some way of going after” ALEC, said Stephen Moore of the Wall Street Journal (video interview on WSJ website, April 18, 2012). “If these groups like ALEC lose their corporate support it means the left-wing groups are going to get all the money and they’re going to have much more influence,” Moore added.
“This is a smear campaign,” he concluded. ”I don’t really believe this is about the opposition to voter ID laws. I think what this is really about is the unions and other left-wing organizations are so concerned about how successful that ALEC has been in getting legislation passed on economic issues that they’re calling ALEC a racist organization so the companies will withdraw.” If ALEC loses corporate support, “it won’t be able to support free market ideas.”
What exactly is ALEC?
ALEC grew out of a meeting of conservative activists in Chicago 40 years ago. It was September 1973, a bleak time for American conservatives. Wage and price controls were wreaking havoc with the American economy, and conservatives who had helped to make those Nixon policies possible by getting the 37th president elected and then re-elected were disillusioned. The Nixon administration turned out to be much more left-wing in its policies than conservatives, who had yearned for a savior since Barry Goldwater received the GOP presidential nod in 1964, would have preferred. Machiavellian non-conservative Henry Kissinger had started his job that month as U.S. Secretary of State, and just a few weeks earlier former White House aide Alexander Butterfield had informed a congressional committee that President Nixon had secretly recorded potentially incriminating White House conversations.
State legislators, including then-Illinois State Rep. Henry Hyde, Heritage Foundation co-founder Paul Weyrich, and Lou Barnett, a veteran of then-California Gov. Ronald Reagan’s 1968 presidential campaign, launched the group that now describes itself as a “nonpartisan membership association for conservative state lawmakers who share a common belief in limited government, free markets, federalism, and individual liberty.” They created a “voluntary membership association for state lawmakers who believed that government closest to the people was fundamentally more effective, more just, and a better guarantor of freedom than the distant, bloated federal government in Washington, D.C.”
In the group’s early years, some of the active members included men who would go on to higher office, including the future U.S. Sen. Robert Kasten of Wisconsin, and future Michigan Gov. John Engler, Iowa Gov. Terry Branstad, Wisconsin Gov. Tommy Thompson, and Ohio Gov. John Kasich. Congressional members who were active during this same period included Sens. James L. Buckley of New York and the late Jesse Helms of North Carolina, and Reps. Phil Crane of Illinois and the late Jack Kemp of New York.
Sen. Buckley is the older brother of the late William F. Buckley Jr. and was the lead plaintiff in the landmark U.S. Supreme Court case Buckley v. Valeo, a 1976 ruling that established the parameters of modern campaign finance law. Buckley challenged the constitutionality of a federal law that limited campaign spending in congressional races, and the high court largely agreed with his arguments, striking down some of the spending restrictions. Today the freedom of everyone, including businesses, to give to political candidates of their choosing—an issue at the heart of the First Amendment—remains a policy priority of ALEC and goes far to explain why the Left, which desperately wants to control politics in ways that will help it amass power, despises ALEC so passionately.
A nonprofit entity recognized under section 501(c)(3) of the tax code, ALEC receives little financial support from foundations and no government grants whatsoever, according to its publicly available tax filings. By contrast, its more left-wing counterpart, the National Conference of State Legislatures (NCSL), relies heavily on taxpayer funding.
How many members?’
ALEC has more than 2,000 state lawmakers among its members. As of 2011, there were also about 300 private-sector members, including trade groups, corporations, policy organizations, and nonprofits, according to an ALEC spokesman.
ALEC’s latest published count shows 82 former members of the group now sitting in the U.S. House of Representatives and 11 former members in the U.S. Senate. Some of the more prominent House lawmakers are Ways and Means Committee chairman David Camp (R-Mich.), Majority Leader Eric Cantor (R-Va.), Republican Conference chairman Cathy McMorris Rodgers (R-Wash.), Joe Wilson (R-S.C.), Spencer Bachus (R-Ala.), Steve King (R-Iowa), Raul Labrador (R-Idaho), Kristi Noem (R-S.D.), Justin Amash (R-Mich.), and Don Young (R-Alaska).
Some of the former ALEC members in the Senate are Joe Manchin (D-W.Va.), James Inhofe (R-Okla.), Tim Scott (R-S.C.), Deb Fischer (R-Neb.), Lindsey Graham (R-S.C.), Richard Shelby (R-Ala.), and Marco Rubio (R-Fla.). ALEC also has an international “delegation.” The most prominent member is Daniel Hannan (Conservative Party), the outspoken Member of European Parliament representing South East England.
Pro-free market representatives from the business community sit on ALEC’s Private Enterprise Advisory Council. Its chairman is Steve Seale of SAP America. Other council members include Jeff Bond, a senior vice president at PhRMA; Robert J. Jones of Pfizer Inc.; Billy Leahy of AT&T; Cynthia Bergman of ExxonMobil Corp.; and Roland Spies of State Farm Insurance Companies.
ALEC has a relatively modest budget. In 2011, it spent $7,105,525, after taking in $9,218,069. In its two leanest recent years, 2008 and 2009, it ran deficits. In 2008 the group spent $7,437,632, after taking in only $6,975,222. In 2009, it spent $6,610,562, after receiving just $6,271,633.
Right-leaning foundations that have funded ALEC include Searle Freedom Trust ($735,000 since 2000), Allegheny Foundation ($500,000 since 2001), Claude R. Lambe Charitable Foundation ($480,000 since 2002), Charles G. Koch Charitable Foundation ($248,858 since 1999), Milton and Rose D. Friedman Foundation Inc. ($220,500 since 2004), and the Lynde and Harry Bradley Foundation ($220,000 since 2009).
ALEC has had a handful of left-leaning philanthropies as donors, notably Pew Charitable Trusts ($206,640 since 2011) and the Bill & Melinda Gates Foundation (one grant in 2011 for $245,008). Support has also come from Lumina Foundation for Education Inc. ($595,000 since 2008), UPS Foundation ($380,000 since 2002), ExxonMobil Foundation ($248,858 since 2000), and General Motors Foundation Inc. ($145,000 since 2003).
The Left routinely targets ALEC’s elected leadership. The national chairman for 2013, John Piscopo, is Senior Republican Whip in the Connecticut House of Representatives. Piscopo has been assailed by left-wing groups for daring to educate himself about energy policy. He was pilloried by progressives for visiting the tar sands, an important energy development in Alberta, Canada. He has also been attacked for opposing health insurance mandates and advocating that English be made the official language.
Linda Upmeyer (R), House Majority Leader for the Iowa General Assembly, is first vice chairman of ALEC. A nurse practitioner by profession, Upmeyer champions fiscal responsibility, so naturally, she’s an outspoken opponent of Obamacare, which has opened her up to attacks by the Left.
Left-wing attempts to stigmatize ALEC have led state legislators, both Republicans and Democrats, to quit the organization. For example, Progress Texas gloated in August 2012 that left-wing agitation forced 12 Texas state lawmakers (9 Republicans and 3 Democrats) to leave ALEC. “These legislators have shown the courage of their convictions by standing up to a corporate bill factory and declaring their support for the people of Texas above all else,” exulted Matt Glazer, executive director of Progress Texas. Progress Texas is a 501(c)(4) nonprofit and a member of the ProgressNow network. ProgressNow is funded by, among others, the Tides Foundation ($555,000 since 2005).
ALEC’s Board of Scholars Program “honors those whose distinguished work and dedication to market-based policy innovations have been, and continue to be, invaluable to ALEC and its membership.” Members include distinguished economists Arthur B. Laffer and Richard Vedder, tort expert Victor Schwartz, and Evergreen Freedom Foundation founder Bob Williams.
As ALEC’s executive director since 2010, Ron Scheberle runs the group’s day-to-day operations. He is chairman emeritus of ALEC’s Private Enterprise Advisory Council and has been an active private sector member of ALEC for over 25 years, serving as Private Enterprise Board National Chairman from 1988 to 1994 and as a member of ALEC’s Private Enterprise Board of Directors continuously since.
Why the Left hates ALEC
Why do left-wing groups feel such animosity toward ALEC? Because ALEC gets things done. The group states accurately on its website that “since its founding, ALEC has amassed an unmatched record of achieving ground-breaking changes in public policy. Policies such as teacher competency testing, pension reform, and Enterprise Zones represent just a handful of ALEC’s victories in the states.”
ALEC’s “model legislation” program is the Left’s real target. The program evolved out of “task forces” that the group formed back in 1981, the first year of Ronald Reagan’s presidency. The first task force was modeled after Reagan’s national Task Force on Federalism, which was headed by U.S. Sen. Paul Laxalt (R-Nev.).
Major task forces from the Reagan era focused on ways of decentralizing government so that policymaking and political responsibilities would shift from the federal to the state level. One task force laid the blame for the nation’s educational decline squarely on centralization, declining values, and an increasingly liberal social agenda that had dominated schools since the 1960s. To counter this decline, the task force advanced ideas such as school vouchers to let families choose where to educate their children, merit pay for teachers, and higher academic and behavioral standards for students. Other task forces tackled high-tech innovation in telecommunications, the explosion in frivolous litigation, the HIV/AIDS crisis, and medical savings accounts.
After Reagan left office, the task forces gradually became more like clearinghouses of ideas “submitted by ALEC members into freestanding think tanks and model bill movers,” according to an ALEC-provided historical account. Members of the group “began to actively solicit more input from private sector members, seizing upon ALEC’s long-time philosophy that the private sector should be an ally rather than an adversary in developing sound public policy.”
Model state legislation
To date, ALEC’s task forces have considered, written, and approved hundreds of model bills on a wide range of issues. This model legislation helps to frame the debate. “Each year, close to 1,000 bills, based at least in part on ALEC Model Legislation, are introduced in the states,” according to ALEC’s website. “Of these, an average of 20 percent become law.”
The Left hates having to fight again for ground that it has already conquered, so its activists attack with vitriol efforts like ALEC’s model legislation program that seek to roll back or mitigate the most harmful aspects of Great Society programs such as the failed “War on Poverty.” Although leftist groups protest the model legislation program in hyperbolic terms, denouncing it as a threat to democracy, liberal groups have adopted the same approach. Left-wing groups like Progressive States Network write their own model legislation and push it at the state level on issues such as the myth of manmade global warming and other environmentalist priorities. Recently the Left even created an explicit ALEC clone named ALICE (American Legislative and Issue Campaign Exchange).
A common refrain among liberal groups is that ALEC is a “corporate bill mill.” This is a ridiculous claim, since large corporations in modern-day America are often hostile to free markets and limited government. The same corporations take a very short-term view and often give donations to left-wing groups in the hope they will be left alone. It doesn’t work; it only encourages the progressive hordes to be more demanding, as Capital Research Center found out the hard way.
CRC used to track corporate donations, but it gave up trying to do so a decade ago. The findings were published each year in a volume called Patterns of Corporate Philanthropy. Apparently, many large corporations didn’t like their gifts to left-wing causes being scrutinized. The businesses stopped filling out surveys that CRC researchers would send every year, and the publication was discontinued.
ALEC’s model legislation is aimed at reducing the reach of government in order to empower civil society. If ALEC were really the assemblage of crony capitalists that liberals and progressives claim, it would support fatter subsidies of industry and pork-barrel projects, including so-called public-private partnerships like sports stadiums and “green” energy companies, but in fact such issues are absent from its agenda. ALEC is about making government smaller, and it accepts donations from the dwindling number of large U.S. corporations that share that view of America.
Big businesses too often prefer to fund politicians like Barack Obama and Democratic candidates such as Virginia Governor-elect Terry McAuliffe, a Clinton administration operative and former Democratic National Committee chairman, because they know they can rely on the politicians’ corporatist instincts and can count on favors to be returned. ALEC, on the other hand, doesn’t allow its allegiance to be sold to the highest bidder. It stands up for limited-government principles, which makes ALEC dangerous in the eyes of left-wing political players.
Major model legislation campaigns and “accountability”
ALEC sprang into action after President Obama signed the Affordable Care Act (a.k.a., Obamacare) into law in March 2010. The group’s members drafted model legislation aimed at blocking states from enforcing the new health insurance monstrosity. Model legislation was reportedly enacted in 10 states, including Missouri and Virginia.
The Missouri measure sought a referendum to insert language into the state’s constitution to prevent any “law or rule” that would “compel, directly or indirectly, any person, employer, or health care provider to participate in any health care system.” The Louisiana version of the legislation contained similar wording.
Efforts aimed at frustrating Obamacare are one thing; efforts at ensuring honest elections are another thing altogether. ALEC’s campaign to enact voter identification requirements at the state level caused left-wing activists to blow a gasket. The Left bitterly opposes all reasonable measures aimed at preventing voter fraud because some progressive politicians hope such fraud will help them stay in office. A coalition of left-wing groups banded together to attack ALEC over its electoral integrity efforts, knowing full well that false accusations of racism are usually enough to make large corporations and Republican operatives run for cover.
In this case, the silliness of the racism claim was especially stark, given that 13 of the 22 companies and trade groups that are on ALEC’s private enterprise board also gave at least $2 million to the Congressional Black Caucus Foundation, as Bloomberg News reported.
Leading the charge against ALEC on this issue was Color of Change, a far-left race-baiting group whose views are largely indistinguishable from those held by the Rev. Al Sharpton. Color of Change tries to stir up racial antagonism in order to promote a socialist agenda. It was co-founded by Van Jones, President Obama’s controversial former green jobs czar and a self-described “rowdy black nationalist” and “communist.” Color of Change also enjoyed some success in getting Glenn Beck kicked off the Fox News Channel by using a pressure campaign against the program’s advertisers.
As the Left’s corporate character assassination campaign pounded away at ALEC last year, Jones called ALEC “the Death Star,” and noted that it was co-founded by Paul Weyrich, whom he described as “one of the worst of the conservatives.” Jones said it is possible to draw a direct line from right-of-center funders to “ALEC and nobody had ever heard of this group before and yet they are driving the worst policies in America.”
Jones bragged to MSNBC’s Ed Schultz (April 5, 2012) about the damage his fellow activists would be able to do to ALEC. ALEC “is not pro-business,” he said. “This is anti-American.”
Color of Change engaged in a species of activism that the Left calls “accountability,” an Orwellian euphemism. Accountability, as leftists use the term, is not about transparency or good government. Perhaps partly inspired by Herbert Marcuse, the father of the New Left, who was in favor of silencing non-leftists, “accountability” actions focus on harassing and intimidating political enemies, forcing them to waste their resources to deal with activists’ provocations. Left-wingers aiming to hurt ALEC want to frighten prospective donors into not writing checks. They send letters warning donors who may be considering giving to ALEC that such donations will lead to legal problems, public ridicule, and having activists sift through their garbage cans for incriminating information.
Color of Change generated petitions and boycotts galore and smeared corporations that gave money to ALEC as racist for supporting voter ID laws. Another one of Color of Change’s co-founders, James Rucker, is a former MoveOn organizer. He is also a co-founder of the Secretary of State Project, the group that helped to elect Minnesota Secretary of State Mark Ritchie. Ritchie, a former community organizer who has worked hand in hand with ACORN, helped set the stage for Sen. Al Franken (D-Minn.) to win the recount of his 2008 Senate election in Minnesota by dubious means.
The adverse publicity over voter ID laws and “Stand Your Ground” policies caused weak-kneed corporations to flee the group and proved to be too much for ALEC. In April last year the group disbanded the task force that had been responsible for drafting model voter ID and “Stand Your Ground” laws.
The radical Nation magazine gloated over the Left’s victory, describing the abolished task force as “the prime vehicle for proposing and advancing what critics describe as voter-suppression and anti-democratic initiatives—not just restrictive Voter ID laws but also plans to limit the ability of citizens to petition for referendums and constitutional changes that favor workers and communities.”
Leftist standard-bearer Common Cause, the influential left-of-center political blog Think Progress, and radical magazine Mother Jones also played a major role in getting ALEC out of the electoral integrity arena.
Common Cause, incidentally, has also used other means to hurt ALEC. Last year Common Cause’s lawyers sued under the Tax Whistleblower Act, claiming that ALEC violated its tax-exempt status by “massive[ly] underreporting” its lobbying activities. The group claimed that training state legislators to be more effective in their jobs somehow constitutes lobbying.
Common Cause is heavily funded by left-wing foundations. Arca Foundation, which used to be run by Rep. Donna Edwards (D-Md.), has given the group $1,395,000 since 2000. George Soros’ Open Society Institute has given Common Cause $2,025,000 since 2000 and Soros’ Foundation to Promote Open Society has given the group $600,000 since 2009. Other foundations that have given money to Common Cause are Carnegie Corp. of New York ($1,810,000 since 2001), Joyce Foundation ($1,480,000 since 2003), San Francisco-based James Irvine Foundation ($1,375,000 since 2005), Ford Foundation ($685,000 since 2000), Fidelity Investments Charitable Gift Fund ($579,500 since 2003), Vanguard Charitable Endowment Program ($506,500 since 2006), and Robert Wood Johnson Foundation ($309,093 since 2002).
The Center for American Progress Action Fund, which runs Think Progress, the high-profile leftist blog that provided helpful misinformation against ALEC, has received limited support from foundations. CAP Action has received $238,000 from the Annie E. Casey Foundation since 2008 and $86,000 from Rockefeller Philanthropy Advisors Inc. since 2004.
Mother Jones, the magazine that helped to sink Mitt Romney’s presidential campaign last year by producing a videotape of Romney’s ill-received “47 percent” comments, produced a slew of news stories that helped to drive ALEC away from the voter ID issue. The magazine’s 501(c)(3) nonprofit, Foundation for National Progress, has received funding through Soros’ philanthropies, Open Society Institute ($225,000 since 2008) and Foundation to Promote Open Society ($100,000 since 2010).
Left-wing activists abhor the famous 2010 Supreme Court ruling in Citizens United v. Federal Election Commission so much that they’re willing to repeal the free speech protections of the First Amendment in order to overrule it. The idea that corporations should be able to spend freely on political campaigns drives them to apoplexy, which helps to explain why there is a serious movement afoot on the progressive Left to amend the U.S. Constitution to bar corporations from contributing to political candidates.
So it’s not surprising that one of ALEC’s most significant adversaries in Congress, Senate Majority Whip Richard Durbin (D-Ill.), is looking for ways to hurt the group. The Alinskyite lawmaker held committee hearings in October, ostensibly to investigate “stand your ground” laws in the wake of the Trayvon Martin trial earlier this year, even though that law was not invoked by George Zimmerman in his defense. (As a Common Cause activist admitted to Businessweek, ALEC’s enemies had long planned an attack and were just awaiting the right news hook: “The Trayvon Martin thing was like a gift.”)
Durbin’s hearings came on the heel of a brass knuckles-style letter Durbin sent out to hundreds of organizations supposedly connected to ALEC, demanding to know their position on “stand your ground” laws and giving them an opportunity to confess to donating money to ALEC.
Durbin claimed he was acting in the public interest, but conservatives weren’t fooled. After all, he’s one of the key lawmakers who wrote the IRS in 2010, asking it to scrutinize conservative groups’ applications for tax-exempt status, which as this year’s scandals revealed, the IRS was happy to do.
Durbin has millions more reasons to attack ALEC, namely, the more than $4 million in campaign contributions he’s received from the trial lawyers, as OpenSecrets.org reports. The wealthy tort bar is appalled at the number of states that have adopted ALEC’s tort law reforms. Similarly, government employee unions despise ALEC’s reforms for public pensions and collective bargaining. “Government unions,” concludes Kimberly Strassel of the Wall Street Journal, “are relying on Mr. Durbin to put ALEC out of business” (Oct. 31, 2013).
The Left, of course, never sleeps. If you wonder what group will be attacked next, consider that the Center for Media and Democracy, which joined in the attack on ALEC, has just unveiled a new offensive—this time against the State Policy Network (SPN), which is a sort of trade association representing mostly state-level conservative and libertarian think tanks. The Center labels SPN and other conservative organizations “stink tanks.” The George Soros-funded slander shop Media Matters for America has already weighed in with a helpful website headline screaming, “Shadowy Right-Wing Group Generates Media Coverage For Conservative Policy From Coast To Coast.” According to Media Matters, SPN is dangerous because its “research has been cited far and wide in the media, from the national level down to local newspapers and blogs.”
SPN must be destroyed, Media Matters reasons, because it supports low taxes, right to work legislation, and school testing standards. “In addition, Darcy Olsen, president of the Goldwater Institute (an SPN affiliate) has appeared at least seven times over the last year on Fox’s [show] ‘Stossel,’ attacking public education and promoting the privatization of municipal services.”
We can only hope that SPN will look upon the ALEC saga as a cautionary tale and prepare accordingly.
Matthew Vadum is editor of Organization Trends and Foundation Watch at the Capital Research Center. This post was originally published by Labor Watch, a project of the Capitol Research Center, and is published here with permission.
The Exodus from ALEC
According to Common Cause, the following corporations have left ALEC as of July 26, 2012:
American Traffic Solutions
Arizona Public Service
Blue Cross Blue Shield
John Deere & Company
Johnson & Johnson
Procter & Gamble
Reckitt Benckiser Group
Lumina Foundation for Education
National Board for Professional Teaching Standards
National Association of Charter School Authorizers