ALEC in 2013: Rightwing Legislative Group Fuels Race to the Bottom in Wages and Worker Rights

At least 117 bills introduced in 2013 fuel a "race to the bottom" in wages, benefits, and worker rights and resemble "model" bills from the American Legislative Exchange Council (ALEC), according to a new analysis by the Center for Media and Democracy (CMD), publishers of ALECexposed.org.

As working Americans speak out for higher wages, better benefits, and respect in the workplace, a coordinated, nationwide campaign to silence them is mounting -- and ALEC is at the heart of it. ALEC corporations, right-wing think tanks, and monied interests like the Koch brothers are pushing legislation throughout the country designed to drive down wages; limit health care, pensions, and other benefits; and cripple working families' participation in the political and legislative process.

ALEC has pushed an anti-worker agenda since at least 1979, when it began striking out against "forced unionism" and for a "right to work," says a 1998 ALEC document. This "right to work" agenda does not create jobs or job security, but it does tilt the playing field against workers to give corporations more profits -- and CEOs more power -- in the workplace and in the political arena.

Emboldened ALEC Goes on the Offense

Shortly after the 2010 election in which Republicans won control of 26 state houses, ALEC welcomed hundreds of new members at its annual States and Nation Policy Summit in Washington, D.C. December 1-3. On the agenda: how to crush unions -- key funders of the Democratic Party. Wisconsin Senator Majority leader and ALEC state chair Scott Fitzgerald said of the meeting, "I was surprised about how much momentum there was in and around that discussion, like nothing I have ever seen before."

On February 11, 2011, ALEC legislators and Wisconsin Governor Scott Walker (a former state legislator and ALEC alum) sent shock waves through the state by introducing a "Budget Repair Bill" (Act 10) that effectively eliminated collective bargaining for 380,000 school teachers, snow plow drivers, prison guards, nurses, bus drivers, and more. A key aspect of the law, which prohibits government employers from using payroll deduction of union dues, reflects ALEC's so-called "paycheck protection" bills and the "Public Employer Payroll Deduction Policy Act."

The move generated massive protests, an 18-day occupation of the Capitol, and an attempted recall. Video of Walker talking to a billionaire campaign contributor surfaced in which he explained that the goal was to "divide and conquer" -- first going after public sector workers, then private sector. Another governor with deep ties to ALEC, Governor John Kasich of Ohio, and his ALEC legislators followed Wisconsin's lead when they attempted to strip some 350,000 workers of their collective bargaining rights, but the Ohioans succeeded in overturning the law by statewide referendum in November 2011.

ALEC's mallet of choice for private-sector workers is so-called "Right to Work" legislation. These laws were utilitized in Southern states before and after WWII to supresss wages and keep out unions like the CIO, which supported an end to Jim Crow laws and racial segregation. In the decades that followed, they made little headway in northern states. In 2012, however, Governor Mitch Daniels of Indiana rammed a "Right to Work" bill through the legislature. Next was the battle royale in Michigan. Governor Rick Snyder pushed "Right to Work" through a lame duck session in December 2012 right before a new, more worker-friendly legislature was sworn in. As CMD reported, it contained verbatim language from the ALEC bill.

In every instance, ALEC and the Kochs were there to cheer the radical policies on. Koch Industries has long been an ALEC funder, serving on ALEC's corporate "Private Enterprise" board, but the Kochs also exercise their power through Americans for Prosperity, a David Koch founded and funded political action group that spent millions on TV defending ALEC legislators and Scott Walker against recall and providing fake, astroturf support for the bills in Ohio and Michigan. It's not the first time the Koch family has come to the aid of union-busting bills. The Institute for Southern Studies points out that in 1958, Kansas passed a right-to-work law "with the support of Texas-born energy businessman Fred Koch, who viewed unions as vessels for communism and [racial] integration."

Other high-profile ALEC fights include battles over "paycheck protection" in Alabama, Arizona, Florida, and Missouri. In 2012, Californians battled an ALEC-style "paycheck protection" bill, disguised as campaign finance reform. Prop 32 was defeated at the polls in November 2012, but not until millions had been spent on both sides. Opponents were right to be worried. New numbers from the Milwaukee Journal Sentinel show that Wisconsin's Act 10, which crippled unions' ability to negotiate for better pay and benefits, cut union membership in half and forced workers to pay thousands more in benefits.

While ALEC and its supporters frame their actions as fiscally responsible and pro-worker, it is clear that this is a deeply political agenda. An analysis by the Economic Policy Institute (EPI) shows that, on the whole, these types of bills don't create new rights for employees but "significantly tilt the political playing field by enabling unlimited corporate political spending while restricting political spending of organized workers." Fox News reporter Shepard Smith put it even more bluntly. He noted that of the top 10 political donors in the United States, only three donated to Democrats -- all unions. "Bust the unions, and it's over" for the Democrats, he said.

ALEC's Attack on Wages, Benefits, and Unions Harms All Workers

ALEC's wage suppression agenda also targets non-union workers in the low-wage sectors that are forming the core of the U.S. economy.In an issue brief called "The Politics of Wage Suppression: Inside ALEC's Legislative Campaign Against Low-Paid Workers," the National Employment Law Project counted 67 bills sponsored or co-sponsored by ALEC politicians in 2011-12 that eroded wages and labor standards.

Gordon Lafer, a political economist at the University of Oregon's Labor Education and Research Center and a research associate at the Economic Policy Institute (EPI), told CMD, "ALEC's efforts against the minimum wage, prevailing and living wage, paid sick leave, etc. are an across the board attempt both to worsen any kind of labor standard and also to undermine any institutional or legal basis through which workers exercise some control over the workplace in the labor market."

As Lafer notes, the fate of union workers and non-union workers are inextricably linked: "Unions help raise standards for non-union workers. In places with unionized workers, that increases the pressure on employers of non-unionized workers to reach and meet similar standards." To cite just one example, ALEC's "Right to Work" law alone depresses wages for both union and non-union workers by an average of $1,500 a year, according to an EPI study.

The video below, produced by University of Iowa historian Colin Gordon for EPI, graphically illustrates how as union membership declined from 1979 to 2009, income inequality increased (a static version of the chart is available here).

But you won't see these statistics at ALEC. In an annual propagandistic ritual, ALEC "scholars" rank states' economic outlook based on how well states are following ALEC policy prescriptions. While Wisconsin under Scott Walker has consistently ranked amongst the worst in the country in job growth and economic performance even by groups like the U.S. Chamber of Commerce, in ALEC's world, Walker's state is 15th in economic outlook.

ALEC Bills Attack Working Families

ALEC specializes in bill names that only a master propagandist would love:

• ALEC's so-called "Right to Work Act" bill (introduced in 15 states in 2013) does nothing to create jobs or job security, but it does shred the fabric of unions by preventing them from requiring each employee who benefits from the terms of a contract to pay his or her share of the costs of administering it. While unions can exist in "Right to Work" states, they are in a much weaker position. When a state can't pass a proposal as radical as "Right to Work," ALEC has provided dozens of other options.

• ALEC's so-called "Paycheck Protection" bill (introduced in six states in 2013) requires that unions establish separate segregated funds for political activities, and prohibits the collection of union dues for those activities without the express authorization of the employee. The "Public Employee Paycheck Protection Act" (introduced in four states in 2013) forces employees to approve union payroll deductions each year. The "Political Funding Reform Act" (introduced in five states in 2013) prohibits payroll deductions for any funds that might be used for political purposes. The more extreme "Public Employer Payroll Deduction Policy Act" (introduced in five states in 2013) prohibits deduction of all union dues. All these bills are attempts to dismantle unions in the guise of worker freedom. For federal electoral spending, unions already have segregated funding requirements. At the state level, the U.S. Supreme Court long ago gave protections to any worker who does not want their union dues to go to politics. Unions have had opt-out systems in place for decades.

• Multiple bills attacking prevailing wage, living wages, and minimum wages have been introduced across the country (in at least 14 states). ALEC is on record as being against these measures that not only put an upward pressure on wages in a region but also set a very low floor (a full-time worker earning minimum wage earns $15,080 a year, which is not much for a family of four to live on) below which not even the Koch brothers are allowed to pay. Experts at the National Employment Law Project say that ALEC's "wage suppression agenda" serves as a significant counterforce to fights across the nation at the state and local level for better wages and workplace standards.

• ALEC advances privatization and outsourcing of public services to workers with fewer credentials, lower salaries and fewer benefits, with model bills such as the Council On Efficient Government Act (introduced in four states), which establishes a committee to assess how for-profit corporations can capture taxpayer dollars by operating public services.

• Michigan's Mackinac Center -- an ALEC member and a member of the network of right-wing state-based think tanks the State Policy Network that works closely with ALEC -- brought three new bills limiting workers' rights to ALEC's Commerce, Insurance, and Economic Development Task Force in 2012: "The Election Accountability for Municipal Employee Union Representatives Act" (introduced in Idaho) would require public sector employees to vote on unionization every three to five years (a majority of all eligible members -- not just voting members -- would be required to maintain union representation); "The Decertification Elections Act" (introduced in Arizona) would make it easier for both public and private employees to decertify their union; and "The Financial Accountability for Public Employee Unions Act" (introduced in Montana; passed Michigan in 2012) would require public sector unions to publish audits of their financial activities.

• Ten states introduced proposals to dramatically alter pensions for teachers and other public employees by moving towards the elimination of defined benefit pension plans (which guarantee a certain level of benefits), to be replaced by defined contribution plans (which leave the payout to market forces). These bills reflect the principles in the ALEC "Public Employees' Portable Retirement Option (PRO) Act" and the ALEC "Statement of Principles on State and Local Government Pension and Other Post Employment Benefits Plans." These proposals are backed by big Wall Street firms, which earn money by extracting millions of dollars in fees and administration costs from privately-managed retirement plans. It is worth noting that ALEC also supports the privatization of Social Security, with its "Resolution Urging Congress To Modernize the Social Security System With Personal Retirement Accounts (PRA's)" (introduced in Arizona this year).

ALEC Corporations Reap the Rewards

All ALEC firms benefit from ALEC's efforts to advance a low-road for wages and working conditions in America, but some firms have special culpability for this agenda:

• Software company SAP America, the American Bail Coalition, Pfizer Inc. and the pharmaceutical trade association PhRMA, Exxon Mobil Corporation, Energy Future Holdings, and the coal company Peabody Energy, the alcohol giant Diageo North America, Inc., AT&T, State Farm Insurance, and UPS are on ALEC's corporate "Private Enterprise" board. Anheuser-Busch, LoanMax, Cracker Barrel Old Country Store, Texas Roadhouse, FedEx, John Deere, and Visa are on the commerce task force (more corporations and groups on this task force can be found here). Although ALEC doesn't make public the roll call for each vote, it is clear that the majority of these firms have backed this agenda with their votes and with their funding and continued support for ALEC. At least 49 corporations have decided to take another path, responding to consumer pressure to cut ties with the organization.

• Koch Industries, a representative of the lobbying arm of Koch Industries has served on ALEC's governing "Private Enterprise" board for many years, funding and approving ALEC's race-to-the-bottom agenda on worker rights. Safety violations at some of Koch plants have lead to fines and other penalties from the Occupational Safety and Health Administration (OSHA), and in some cases workers have died.

• Cintra, based in Spain, and Macquarie and TransUrban, both Australian corporations (together, the world's largest developers of privatized infrastructure, particularly toll roads), are members of the ALEC Commerce, Insurance, and Economic Development Task Force, which approves bills limiting worker rights. Cintra and Macquarie have teamed up to cut multi-billion dollar deals to take control of highways in places like Indiana and Illinois, basically granting companies a monopoly to help state government raise quick revenue in the short term, but in the long-term saddling consumers with high fees and the state with lost revenue.

• Tobacco companies Altria (formerly Philip Morris) and Reynolds American both sit on ALEC's corporate "Private Enterprise" board. According to the Farm Labor Organizing Committee of the AFL-CIO, Reynolds American's and Altria's human rights abuses of workers at the bottom of its supply chain have included sub-minimum wages, child labor, heat stroke, pesticide and nicotine poisoning, green tobacco sickness, lack of water and breaks during work, and worker fatalities.

Average Americans Pay the Price

Eleven states have introduced bills in 2013 to override or prevent local paid sick leave ordinances. At least eight of these were sponsored by ALEC members, and this is no accident. Although ALEC has not adopted such a bill as an official "model," ALEC member the National Restaurant Association (NRA) brought a bill to override local paid sick leave ordinances to ALEC in 2011, as CMD has reported.

The commerce task force's Labor and Business Regulation Subcommittee took up "paid family medical leave" as the sole topic of discussion at the ALEC 2011 Annual Meeting in Louisiana. Subcommittee meeting attendees were given complete copies of Wisconsin's 2011 Senate Bill 23 (now Wisconsin Act 16). They were also handed a target list and map of state and local paid sick leave policies prepared by the NRA. Since then, Louisiana enacted a similar law in 2012, and 2013 has seen the introduction of a spate of similar bills, with Mississippi, Kansas, Tennessee, and Florida signing the measures into law.

Forty percent of American workers have no access to paid sick leave. Family Values @ Work, a non-profit network of 21 state coalitions working for family-friendly workplace polices, has documented some of the impact on workers and the economy in its brochure, "Sick and Fired." Among other facts, it notes that 23 percent of workers have been fired or threatened with dismissal after taking time to care for themselves or their family members.

Wisconsin Act 16 overrode Milwaukee's popular paid sick leave ordinance that was passed in November 2008 by referendum with nearly 70 percent of the popular vote. In 2011, while the Capitol was surrounded by protesters and Democratic Senators were out of state, the Wisconsin Legislature moved to override the measure.

Ellen Bravo, head of Family Values @ Work told CMD, "People were elated when they won the right to paid sick days in Milwaukee, and outraged when that right was stolen from them by the state legislature in that incredibly underhanded way."

Flora Anaya worked at Palermo's Pizza in Milwaukee for five years. She and her co-workers decided to take action against the company because of its harsh paid sick day policy. Anaya told CMD:

"Getting any type of day off for being sick was extremely hard. Palermo's sick day policy was absolutely inhumane. If you missed three days within six months, you would lose your job, even if you brought a doctor's excuse. And if you were one minute late to work, it was treated as an absence for the entire day.

"In 2009, I was pregnant and in pain. One day it was so bad, I asked for permission to leave to go to the emergency room. I told one supervisor, but that supervisor didn't relay it to my line supervisor, and they stopped me from leaving. This happened all the time, to so many of us."

Conclusion

ALEC has been a historic force in suppressing wages and workers' rights and continues to exert its influence in states across the country in 2013. Where is the bottom in ALEC's race to the bottom for America's workers?

Charles Koch made the agenda of the Koch's, ALEC and their allies very clear in a recent interview with the Wichita Eagle. He laid out his vision of "economic freedom" for America. Key to this freedom for the Koch's is the repeal of the "avalanche of regulations" that creates a "culture of dependency" in the United States.

Top of the list of burdensome regulations needing repeal? "The minimum wage,"opines Koch.

Koch's "economic freedom" and ALEC's legislative agenda may not leave much of an economy for the rest of us.

Harold Schaitberger, General President of the International Association of Fire Fighters, put it best when he told CMD, "The sole purpose of ALEC has been to develop the most anti-middle class, pro-corporation policies, legislation, and agenda in history. They've been waiting for just the right moment to reverse the progress of the American middle class and drive everyone to the bottom, to the lowest wages, the weakest benefits, no job security, and no retirement to speak of. We may not have the billions of dollars of the Koch brothers. But we have each other and we must stick together and fight ALEC's cynical and un-American agenda."

View the full list of 2013 ALEC worker rights bills here.

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