It was well over a decade ago when I became aware of and interested in the ill-effects of the lobbying efforts of the American legislation for Economic Change (ALEC) and the United States Chamber of Commerce (AmCham) have had on our democracy. These two organizations have not let borders stop them from introducing de-regulation and untethered capitalism outside of the U.S. either.
The following is an article I wrote while living in Dublin in 2013. It is a good primer if you are not familiar with the aggressive tactics these organizations use to deregulate industry to feed corporate greed.
The Trans-Atlantic Trade and Investment Partnership (TTIP) mentioned in the paper fell apart in 2016 after opposition from several European Union (EU) Member States.
So Long Regulations: Lobbying and the Convergence of Two Great Economies
Introduction
The United States Chamber of Commerce is an immensely powerful lobbying organization, not only in the United States, but within the European Union as well. This paper demonstrates that due to pressures applied by the Chamber and other “Business Organizations”, the institutional structures of the European Union and that of the United States of America are converging (Frege, 12) into a single model. This convergence theory of the “Neoliberal” model of capitalism emerging from the global partnership between the U.S. and the E.U. is exactly what Joseph Stiglitz referred to when he called it “market fundamentalism” (Bockman, 14) and as Johanna Bockman claims, “Neoliberalism increases inequalities, newly excluded populations, superficial democracy, and widespread unemployment.” (Bockman, 15) The goals of business organizations are simple and straight to the point: enable “free” markets so that corporations can reap all available rewards while the people of the United States and the European Union, not only carry all risks, but are also responsible for paying when deals go bad.
The European Union and the United States have just completed the second set of negotiations regarding the Transatlantic Trade and Investment Partnership (TTIP) and the transcripts from the meetings, as well as papers written by the United States Chamber of Commerce are eerily reminiscent of the American Legislation for Economic Change (ALEC) that has hi-jacked the legislative process in the United States.
Much like ALEC, the United States Chamber of Commerce (AmCham) and Business Europe have written extensively on the issue of regulations, or rather deregulation, and how to implement strategies that will benefit the “stakeholder”, in this case the corporation is the stakeholder. In their paper, Regulatory Cooperation in the EU-US Economic Agreement, the two entities discuss how “It will have a “proactive requirement”, establishing ways to change. The partnership should “put stakeholders at the table with regulators to essentially co-write regulation.” (Corporate Europe, 4) This is exactly how ALEC operates. Who are these lobbyist organizations and how have they been successful at undermining the rights of workers, as well as destroying the regulations that protect the public from the harmful effects of industry? This paper delves into the inner workings of ALEC and the similar initiatives of Amcham and its cohorts in the EU Social Partnership (Business Europe), that link to the convergence of these two economies.
The Players
American Legislative Exchange Council
Beginning back in 1981, under Ronald Reagan’s first term as President of the United States, ALEC had access to the key administrators in the country and they worked with the administration to develop policy that benefited their own corporate agenda. ALEC has no qualms stating who they are, “ALEC’s far-reaching national network of state legislators that crosses geographic and political boundaries, and affects all levels of government, is without equal. No other organization in America today can claim as many valuable assets – both people and ideas – that have influence on as many key decision-making centers.” (ALEC, History) Even more frightening than the thought of this corporate lobbying association writing the actual legislation that is passed into law, is the arrogant way in which they present themselves – they are quite proud of what they have accomplished, “To date, ALEC’s Task Forces have considered, written and approved hundreds of model bills on a wide range of issues, model legislation that will frame the debate today and far into the future. Each year, close to 1,000 bills, based at least in part on ALEC Model Legislation, are introduced in the states. Of these, an average of 20 percent become law.” (ALEC, Formula for Success) As stated before, the interests of workers and the public are not being taken into consideration when lawmakers pass the legislation written by ALEC.
The United States Chamber of Commerce (AmCham)
Formed in 1912, AmCham was an organization formed by seven hundred delegates from businesses, chambers, and associations throughout the country assemble at the request of U.S. President William Howard Taft. The President kept his remarks brief, but quite to the point:
“We want your assistance in carrying on the government in reference to those matters that affect the business and the business welfare of the country, and we do not wish to limit your discretion in that matter. We wish that your advice should be as free and unrestricted as possible, but we need your assistance, and we ask for it.” (AmCham, History)
The Chamber’s website lists accomplishments on their site that define their goals directly:
“The Chamber strongly opposed legislation by Sen. Robert Wagner (D-NY) that would strengthen the ability of labor unions to organize workers.
In the 1930s, the Chamber vigorously opposed the drift toward increased federal intervention and control and reinforced its traditional position that "the relation of government to industry is primarily that of preserving equality of opportunity for all.” (AmCham History)
Over the last thirty plus years, trade union density, especially in the private sector, has been reduced to a single digit percentage of workers and the public sector is not doing much better. The Chamber of Commerce, along with ALEC, has written legislation in over twenty states to make it difficult to unionize. These so-called “Right to Work” laws are nothing short of union-busting efforts of big business. On top of that, the conservative right-wing politicians refused to approve President Obama’s nominees to the National Labor Relations Board. It was a political ploy to disarm the powers of the National Labor Relations Act – without a quorum on the Board; no decisions could be made on pending labor cases. The Senate finally approved nominees during the late summer of 2103, but the damage has been done.
Thomas J. Donohue, President, and CEO of the U.S. Chamber of Commerce, has been quite vocal regarding his view of regulations and regulators:
“Regulation has the “capacity to tie the economy in knots,” says Donohue, who adds that the U.S. Chamber of Commerce sues the U.S. government about 150 times per year. NEW YORK— Nothing worries the CEO of the U.S. Chamber of Commerce more than increased regulation. (Property Casual 360)
Regulators are “taking the joint over,” Thomas J. Donohue, President, and CEO of the U.S. Chamber of Commerce, told insurance-industry executives at the Property/Casualty Joint Industry Forum at the Waldorf-Astoria Hotel in New York.” (Property Casual 360)
Whether the government is trying to place regulations on pollution, wages, or tariffs, the U.S. Chamber of Commerce is going to fight against them – and, they have the money to do it.
BusinessEurope
Via its website, BusinessEurope’s mission is to play a crucial role in Europe as the main horizontal business organization at the EU level. Through its forty-one member federations, BUSINESSEUROPE represents more than twenty million companies from thirty-five countries. Its main task is to ensure that companies' interests are represented and defended vis-à-vis the European institutions with the principal aim of preserving and strengthening corporate competitiveness. BusinessEurope is active in the European social dialogue to promote the smooth functioning of labor markets. (BusinessEurope)
Interestingly enough, BusinessEurope conducted a presentation in conjunction with the U.S. Chamber of Commerce in Washington D.C. with the goal of introducing the TTIP to American business representatives. They “highlighted various economic benefits of liberalizing trade and investment across the Atlantic, emphasizing several issues such as industrial trade, regulatory convergence, services, investment, intellectual property rights and public procurement. A transatlantic economic and trade pact would generate substantial economic benefits for both the EU and the USA in terms of growth and jobs. This should encourage leaders to take bold steps and start negotiations to liberalize trade and investment between our economies.” (BusinessEurope) This organization is beginning to sound remarkably familiar.
Finally, the thickest bond between ALEC, AmCham, and BusinessEurope, is their quest to limit regulations wherever they can. BusinessEurope’s website states that one of the top goals of the organization is the “Application of better regulation tools is essential for minimizing burdens and devising smart regulation that contributes to growth and jobs.” (BusinessEurope, Policy) That sounds like it could have been written by ALEC or AmCham.
Game Changers and the High Stakes at Hand
It is impossible to know exactly what is included in the TTIP, mainly because the governments involved will not publish draft texts of the document. The TTIP broaches issues from intellectual property and labor rights to regulations regarding energy and the environment. One issue is the labelling of products that are produced by GMOs, as well as food treated with antibiotics and hormones. These products are freely sold in the USA without having to alert consumers as to what they are ingesting – although the American people have been fighting to have these products labeled as such. As it stands right now, many European countries, including Ireland, do not allow GMO products or foods from animals that have been shot full of antibiotics.
Another disturbing element likely to be included in the TTIP agreement is the investor-state dispute resolution (ISDR). According to Karen Hansen-Kuhn and Dr. Steve Suppan of the Institute for Agriculture and Trade Policy, “The ISDR, gives investors the right to sue governments for compensation over rules that affect their expected profits, and will be included in the TTIP as well, despite the fact that there is no doubt that the U.S. and EU legal systems are entirely up to the task of resolving such complaints by foreign investors without resort to a trade mechanism.” (Hansen-Kuhn) If a clause such as the ISDR is in the TTIP and it is signed into law, that one piece of the agreement could have devastating effects on any future regulatory decisions. For example, if the EU decided at some point to pass regulations on a product that had caused serious safety issues for the workers or the public, the investor could then turn around and sue the EU for the losses they would incur due to the inability to sell their product. In this situation it is unclear if the governing body would choose to protect its workers/population and risk being sued by a powerful corporation, or not. However, as fast as corporations will opt to sue a government, according to the October 2013 release of the Chamber’s Institute for Legal Reform report, the Chamber does not believe that most corporations should be sued for any reason, even for producing unsafe food or unsafe drugs, defrauding investors, or health care customers, or even defrauding bank or energy customers. (Institute for Legal Reform)
Trade agreements and other such pieces of legislation that have the potential to have enormous consequences for a population should not be discussed in private meetings. On November 25, 2013, a document from a European Commission meeting regarding the TTIP was “leaked” to the media. This secret informal meeting between the European Commission and representatives from Member States was called to discuss issues regarding the TTIP. The most problematic symptom linking the TTIP to the convergence between the U.S. and the E.U. is the fact that the European Commission was even holding this meeting.
The European Commission should be a neutral party in the Social Partnership and the very nature of this meeting is anything but neutral. Regarding one of the main challenges, the Commission writes:
“Making sure that the broad public in each of the EU Member States has a general understanding of what TTIP is (i.e. an initiative that aims at delivering growth and jobs) and what it is not (i.e. an effort to undermine regulation and existing levels of protection in areas like health, safety, and the environment).” (EU Commission, 1)
And it only gets worse as the Commission discusses key issues to watch out for:
“Anxiety around the potential impact on the European social model and approach to regulation: We need proactive, early, and widespread communication on the reality of what is under discussion in sensitive areas and on the EU's strong record in international negotiations. While still respecting the confidentiality required for the negotiations to succeed, the process also needs to be transparent enough to reduce fears and avoid a mushrooming of doubts before the deal is even concluded. This messaging needs to be accompanied by clear communication about the benefits of the TTIP.” (EU Commission, 1)
The lobbyist, whether they are in the form of AmCham, Business Europe, or the American Legislative Exchange Council (ALEC), have only the best interest of the “Corporation” at heart, not the health and wellbeing of the public. The European Union must keep its Social Partnership intact and refrain from falling prey to the Corporations who have undermined the employee protections of the American Worker, as well as the health and safety standards of the products used by the American public.
Conclusion
BusinessEurope has found itself in the company of enormously powerful organizations who have worked diligently over the last thirty plus years to perfect the art of dismantling trade unions, privatizing public works, and changing laws to benefit their own interests.
ALEC, the powerful lobbying arm of the conservative right-wing politico, has no shame in saying that they are responsible for writing the actual legislation that is enacted into law by state legislatures. Legislators are supposed to write and enact laws that benefit the greater good of the people – that is what democracy is all about. Democracy is not about enacting laws that benefit just the wealthiest citizens and or corporations.
As an observation, the European Union has a Social Partnership for exceptionally good reasons; sound decisions can be made in a tripartite social dialogue. These negotiations are based on the exchange of information between representatives of business, workers, and the government. There is absolutely nothing wrong with wanting decisions based on the needs of those you represent, and if all parties agree that that decision is a sound one, it can be accomplished. However, if one of these parties is not at the table when negotiations are being held, the social partnership is not working. It is important that independent and strong organizations interact to be able to understand the issues at hand and then negotiate an agreement that will allow the economy to function smoothly.
It is also important to note that the United States Chamber of Commerce is not just interested in deregulating certain products to allow the trade of these products to flow easily between the European Union and the United States, they are for deregulating everything, even if it means sending sick people to work. Enekah Wilce of the Center for Media and Democracy wrote recently of a law AmCham and ALEC were able to get overturned:
“In Wisconsin, a local representative of the US Chamber of Commerce called the Metropolitan Milwaukee Association of Commerce lobbied together with the Wisconsin Restaurant Association for the adoption of Senate Bill 23, which overturned a local ordinance requiring paid sick leave for workers. The law "specified that paid sick leave could be used if a worker is ill, needs to care for a sick child, or obtain counseling if raped or battered, for example. The law also barred companies from penalizing workers for exercising their rights and from erecting unreasonable barriers to impede the fair use of sick leave.” (Wilce, PRWatch)
It is critical that the people of the European Union stay informed on the negotiations being conducted in Brussels to make sure that their interests are being represented. They should start by demanding to know exactly what is included in the Transatlantic Trade and Investment Partnership being discussed behind closed doors. The people of the EU need to also make sure that the Social Partnership is effective by demanding that all parties are at the table during the negotiations.
I hope you found this primer helpful. Please subscribe to continue receiving the Model Bill Legislation Newsletter. I will be listing the model bills these lobbying organizations will be championing in 2023.
References:
American Legislative Exchange Council; Web accessed November 19, 2013: http://www.alec.org/about-alec/history/
Bockman, Johanna; Sage Journals: Neoliberalism; Contexts 2013 12:14; DOI: 10.1177/1536504213499873; http://ctx.sagepub.com/content/12/3/14
BusinessEurope: Jobs and Growth – Through a Transatlantic Economic and Trade Partnership: Web accessed, November 27, 2013; http://www.businesseurope.eu/Content/Default.asp?PageID=659
Corporate Europe Observatory: November 25, 2013 http://corporateeurope.org/trade/2013/11/leaked-european-commission-pr-strategy-communicating-ttip
Corporate Europe Organisation: Web accessed November 17, 2013: Regulatory Cooperation in the EU-US Economic Agreement, http://corporateeurope.org/sites/default/files/businesseurope-uschamber-paper.pdf
Hansen-Kuhn, Karen: Suppan, Steven: The Promises and Perils of the TTIP – Negotiating a Transatlantic Agricultural Market : Institute for Agriculture and Trade Policy: Web Accessed November 23, 2013 http://www.iatp.org/documents/promises-and-perils-of-the-ttip-negotiating-a-transatlantic-agricultural-market
Frege, Carola and Kelly, John (Editors) (2013) Comparative Employment Relations in
the Global Economy. Oxford, London and New York. Routledge Taylor and Francis
Group. ISBN 978-0-415-68663-1.
National Underwriters: Property Casual 360: Web Accessed, November 26, 2013:
http://www.propertycasualty360.com/2013/01/16/regulators-are-taking-over-the-joint-us-chamber-of
U.S. Chamber Institute for Legal Reform: The New Lawsuit Ecosystem: Web Accessed, November 26, 2013: http://www.instituteforlegalreform.com/uploads/sites/1/The_New_Lawsuit_Ecosystem_pages_web.pdf
United States Chamber of Commerce: History and Timeline: http://www.uschamber.com/timeline/index.html
Wilce, Ebekah; Center for Media and Democracy; Flu-Burger-ALEC Wants Sick People Serving You Food;
Web Accessed, November 23, 2013; http://www.prwatch.org/news/2011/10/11079/flu-burger-alec-wants-sick-people-serving-you-food