The Great Debate

Everyone knows that small businesses hate President Obama’s historic healthcare reform law, right? At least that’s what the nation’s leading small-business advocacy group would have you believe.

Joining 26 states, the National Federation of Independent Business challenged the law all the way to the U.S. Supreme Court in March. It claimed the “individual mandate” is unconstitutional and would bankrupt small businesses with unnecessary costs.

Yet while the NFIB claims its multimillion-dollar lawsuit is on behalf of job creators and small businesses everywhere, it’s unclear whether small businesses genuinely support the NFIB position. A close look at its record suggests that the NFIB uses the politically valuable mantle of small business to pursue an agenda that may take its cues from elsewhere.

For one thing, many of its 340,000 members, most of whom employ 20 or fewer workers, have already benefited from the law. According to a March report in the Wall Street Journal, members have seen costs go down thanks to tax credits that were built into the law. Small firms in industries like advertising have also been able to compete with large national companies for talented employees. As one member told the WSJ: “[The NFIB is] doing a very big disservice to their members” by opposing the healthcare law.

For another, the NFIB has a record of lobbying for issues that benefit big businesses, not necessarily small ones. Consider a widespread state tax loophole that lets big-box retailers like Wal-Mart and Home Depot transfer income to out-of-state subsidiaries. This loophole often allows the chain retailers to pay no state income tax, while small businesses do. Yet the NFIB has fought against closing such loopholes.

For many years, the American Legislative Exchange Council (ALEC) has been a particularly influential organization that has promoted the agenda of corporate America and the political right in state legislatures nationwide, but about which the public has known little. ALEC’s members, who work together to draft model bills, consist of state legislators, who pay little to join, and corporations and trade associations, who pay hefty membership fees. These fees purchase influence over ALEC’s agenda and access to lawmakers. Because ALEC’s issue-areas are quite broad – voter IDs, consumer protection, healthcare, education, the environment and guns, to name a few – not every ALEC bill connects to a particular company’s financial interests. Until now, associating with ALEC’s range of issues seems not to have been much of a problem for most companies, well worth the payoff of having their favored bills promoted. That’s why the stream of recent defections of some of ALEC’s highest-profile corporate members – McDonald’s, Wendy’s, Mars, Coca-Cola, Pepsi, Intuit and Kraft – has been so extraordinary.

The principal trigger, of course, has been the taint surrounding ALEC’S “Stand Your Ground” laws, the statute at the heart of the controversy over George Zimmerman’s killing of Trayvon Martin. The business downside of associating with an organization pushing a law that seemingly turns a criminal perpetrator into a lawful executioner has apparently become too much for these companies, thanks to pressure from the civil rights and consumer community. That’s a good thing. But as we focus on Stand Your Ground laws, we shouldn’t lose sight of the breadth of ALEC’s damage around the country. In fact, some of the wider harm can be found in other parts of this very statute. This law does not just protect perpetrators. It is also a direct assault on crime victims themselves. Specifically, buried in ALEC’s Stand Your Ground laws – on the books in some form in about half the states in the U.S. – is a chilling measure that confers absolute civil immunity on perpetrators who successfully avoid arrest and prosecution under this law, stripping crime victims of their legal rights and access to the courts. This is important, because often in cases where the criminal justice system fails, families turn to the civil courts for help by bringing a civil suit against the perpetrators directly. This law blatantly tears away their constitutional rights.

In fact, preventing access to the civil courts for everyday Americans is a pervasive theme that runs through ALEC’s entire, corporate-backed agenda. ALEC has an entire division devoted just to preventing injured people from holding wrongdoers accountable in court. Its very active Civil Justice Task Force is co-chaired by Victor Schwartz, general counsel of the American Tort Reform Association, a corporate group seeking to limit the liability of its corporate members. The legislation generated by this task force has been nothing short of a gift to our nation’s most negligent companies, many of which have been successfully sued over and over for recklessly causing death and injury to their customers. In my conversation with the Florida Justice Association this week, I learned that Florida itself has over 18 such ALEC “tort reform” laws already on its books, with many more under consideration.

By Jack Abramoff
The opinions expressed are his own.

Last week, Republican presidential candidate Newt Gingrich romanced the Tea Party activists, who demand that the corrupt swamp of Washington be drained. His intrepid spokesman, R.C. Hammond, had a more arduous task: convincing the world that the former Speaker was not swimming in that same swamp. As facts emerged revealing that Gingrich took almost $2 million in “consulting” fees from the beleaguered Freddie Mac, Hammond delivered proof that the Gingrich operation was master of the inside-the-Washington-beltway game. Spinning Gingrich’s perfidious (yet legal) trip through the infamous revolving door to post public service riches, Hammond posited that taking millions in consulting fees was actually a positive: since Newt now understood “why the system is broken,” he now knew “how it could be fixed.” In other words, now that he had participated in legal corruption, he was more qualified to be our President.

By that metric, I should be announcing my cabinet choices any day now. After all, in 2004, my lobbying activities became the basis for the biggest corruption scandal to hit Washington since Watergate. Gingrich’s candidacy may or may not survive these revelations, but there is a bigger issue to consider than whether this late-night-talk show hosts’ dream politician makes it to the Oval Office.

America is sick of its political leaders raking in millions of dollars in fees from special interests. At a time when the average American can barely afford enough gasoline to get to work, our politicians are converting their elected positions into major paydays. Newt is not the first and won’t be the last to do this. He just has the bad luck to be surging in the polls. But the problem with this latest round of “shoot the leading Republican candidate” is that it deflects attention from the need to change the system. Every time one of these “gotcha” attacks becomes personal, it loses its capacity to engender real reform.

– Bernd Debusmann is a Reuters columnist. The opinions expressed are his own. –

Can any U.S. administration avoid the fate spelled out in the following 12 words? “We were elected to change Washington and we let Washington change us.”

Thus spoke John McCain when he formally accepted the Republican party’s nomination for president last September. He then listed a number of reasons why the party had lost the trust of the American people, including that “some Republicans gave in to the temptations of corruption”.