As More Corporations Flee ALEC, What Exactly Are They Running From?

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May 31, 2012; Source: Washington Post (Associated Press)

With the recent announcement that Amazon is dropping its membership in the American Legislative Exchange Council (ALEC) and the subsequent notice that Wal-Mart is also withdrawing from ALEC, two related questions arise.

First, is it fair to hold corporations to account for their memberships in political nonprofits for the broad range of positions the nonprofits might take? Wal-Mart’s contention is that ALEC’s agenda has drifted “from its core mission to advance the Jeffersonian principles of free markets.”  This is a none-too-subtle allusion to ALEC’s recent flirtation with voter ID laws and the “Stand Your Ground” self-defense laws that may have contributed to the death of Florida teenager Trayvon Martin. Amazon decamped from ALEC, it said, “because of positions that group took on issues unrelated to our business.”

Pointing out where ALEC stands on a number of issues and asking its business sponsors whether this is what they support—or if they realize that their memberships end up supporting—seems to be a legitimate activity calling corporations to account. This is especially true since their corporate coffers pay for lobbying, image-building, and advertising that are politically different from what they are purportedly paying a group like ALEC for. It’s a matter, we think, of corporate accountability to the public, especially since corporations have so much in the way of wherewithal to camouflage what they believe and promote on Capitol Hill.

The second question concerns confidentiality. Although most of the corporations targeted by activists in the ALEC campaign have been self-identified and listed as ALEC members, there may be contributors to ALEC (which claims to be a 501(c)(3) public charity) who take advantage of the legal confidentiality afforded to contributors to public charities by choosing not to reveal themselves. Because Wal-Mart and Amazon were identified as members, they attracted pressure and protests to disassociate from ALEC.

Had they not been disclosed, they might have been able to escape these pressures. Is this a reason to give corporate donations exemption from disclosure as corporate grantmakers? Is this a reason to resist pressures on 501(c)(3)s and 501(c)(4)s to disclose, because disclosure would subject donors to the kinds of pressures that several of ALEC’s formerly supportive corporate members have endured?

The resources available to a mammoth corporate entity like Wal-Mart or Amazon cannot be compared to the situations of small, individual donors to public charities. If corporations, particularly public corporations, are exercising their political and financial muscle to shape the public agenda through roles hidden by the confidentiality firewall of a 501(c)(3) public charity, the public ought to be able to know, and certainly their shareholders should have the opportunity to learn. The influence wielded by the Walton family or Jeff Bezos in no way compares to the small, local donor. Why don’t the corporate members of ALEC and others simply stand up and declare their fealty to the ALEC agenda?

This is the benefit of disclosure. These corporations and other corporations might have simply stood up for and stuck by ALEC, defending its political agenda, were it not for ALEC’s engagement in voter ID and Stand Your Ground laws and the disclosure of these corporations’ support. Come on, some of the corporations heading for the hills were not just ALEC members, but members of its elite “Private Enterprise Board,” as was Wal-Mart’s Maggie Sans, who is listed as treasurer of ALEC’s board.

No, ALEC’s corporate members might not have been surprised that ALEC was dabbling in voter ID stuff. Rather, the spotlight of attention on ALEC revealed the way ALEC operates, as a think tank drafting bills (and according to Common Cause, lobbying for bills) for legislative members on behalf of its corporate members. The corporate embarrassment isn’t ALEC’s position on voter ID and Stand Your Ground; it’s that ALEC’s behind-the-scenes corporate advocacy and lobbying was laid bare for the public to see.—Rick Cohen