The American Legislative Exchange Council (ALEC) is once again under fire from critics, including U.S. Rep. Jan Schakowsky (D-IL,9), following new revelations published Tuesday in The Guardian about the large conservative group.
The Guardian's report, based on a number of leaked ALEC documents, show that the group is reportedly creating a new 501(c)(4) social welfare organization called the "Jeffersonian Project." Critics say this new sister group is being formed in an attempt to skirt IRS rules that currently prevent ALEC from lobbying due to its 501(c)(3) charitable organization status. As a 501(c)(4) group, the Jeffersonian Project would be able to lobby, while also raking in anonymous donations.
U.S. Rep. Mark Pocan (D-WI,2), who spoke on an press call along with Schakowsky Wednesday about the recent ALEC news, argued that despite the group's current 501(c)(3) status, it's already one of largest lobbying organizations in the nation.
Here's why he, and other ALEC opponents, think so. ALEC is made up of mostly Republican state legislators from across the country and numerous corporate members who gather to craft and vote on legislation called “model” bills, some of which support privatized education, undermine environmental protections, oppose health insurance reform, diminish public sector unions and expand the use of guns. Nearly all of ALEC’s funding comes from corporations, corporate foundations and trade associations. Legislative ALEC members later introduce the pro-corporate "model" bills in their state. Check out Progress Illinois' full report on ALEC here.
The Guardian noted that House Speaker John Boehner (R-OH,8) and House Majority Leader Eric Cantor (R-VA,7) are alums of ALEC, which advocates for “Jeffersonian principles of free markets, limited government, federalism, and individual liberty,” according to its website.
But Pocan, who has attended some ALEC conferences to see what the group is all about, described the organization this way.
"ALEC is nothing more than a corporate-funded and dominated group that operates much like a dating service, only between legislators and special interests," he said. "It matches them up, helps build their relationships, culminates with the birth of special interest legislation and then ends happily ever after — that is, of course, for the corporate interest but not necessarily for the public."
As an example, Schakowsky pointed to one of ALEC's latest "model" bills that looks to roll back the Affordable Care Act (ACA) at the state level.
The "Healthcare Freedom Act," which ALEC adopted in August, would prohibit "health insurers from accepting federal subsidies under the Affordable Care Act that trigger the employer mandate." Under the proposed measure, insurers would see their licenses be suspended if they receive the federal subsidies.
Some ALEC members have said it's a way of "freeing employers" from the ACA's employer mandate, but their legal rationale for such a proposal is questionable, as reported by the Center for Media and Democracy's PR Watch.
But even so, the bill has been introduced in Ohio and Missouri thus far.
"This is the way they want to bully insurers ... have their licenses stripped so they wouldn't be able offer insurance if they were to take any of the subsides that enable lower-income people and middle-income people as well from being able to afford health insurance," Schakowsky said. "This is clearly not in the public interest and is an example of the kinds of legislation that ALEC is willing to do. I can't see how it's in the interest of the insurers either."
ALEC has also faced criticism over its involvement in pushing the controversial Stand Your Ground self-defense laws, which played a role in George Zimmerman’s acquittal in the Florida shooting death of unarmed African-American teen Trayvon Martin in February 2012.
The National Rifle Association (NRA) came up with Florida’s Stand Your Ground law in 2005 and then ALEC later promoted it. A similar version of the measure has been adopted in 24 states.
The negative public attention put on ALEC’s promotion of Stand Your Ground laws was a big reason why more than 60 large corporations such as Coca-Cola, McDonald's and Walmart ended their membership with the organization over the past two years, The Guardian reported. Nearly 400 legislators also cut ties with ALEC during that time. As such, ALEC's income has taken a hit. The organization was not able to pull in more than a third of its projected income in the first six months of this year, the leaked documents showed.
Now, ALEC is trying to get more than 40 of its previous corporate members back in what it calls the "Prodigal Son Project," according to the documents.
And that's where the Jeffersonian Project comes back into the picture.
According to The Guardian, ALEC is setting up the new organization to prevent "questions of ethical violations made by our critics and state ethics boards and provides further legal protection." Moreover, the documents show that “ALEC has been approached by donors who are willing to make sizable donations, but insist that the donations go to a section 501(c)(4) organization. Jeffersonian Project would provide a vehicle to accept such contributions.”
Critics say the corporations that backed away from ALEC, and others, that may want to support the group's lobbying efforts could now pour in massive amounts of anonymous donations to the Jeffersonian Project.
State Sen. Danielle Conrad of Nebraska, which has a nonpartisan state legislature, said the new documents provide an opportunity for "a call to action" from everyday citizens to "demand additional transparency from this shadowy group."
Also, corporations "need to demand that ALEC stop these activities, continue to withhold funding and encourage other corporate citizens to wake up to this dangerous level of activity and action," said Conrad, who was an ALEC member up until last year when she decided to leave the group because of the "radical" activities it pursues.
"[ALEC is] having dramatic, negative effects on our Democracy and our statutory infrastructure," Conrad stressed.