An inside job: How big business stacked the deck

An inside job: How big business stacked the deck

Valley Center : CA : USA | Sep 24, 2012 at 12:19 PM PDT
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Mythology is alive and well in the American psyche. Ancient myths serve as entertainment and cautionary tales for our children. Along with our cherished old myths, we cling to recently crafted political myths that influence beliefs and votes across the nation. As with all mythology, many of the current political myths have little factual basis but are an accumulation of believable stories that support an ideology.

So it is with many of the political myths sustaining our beliefs about government, corporations and the role of each in American society. One currently fashionable political myth is the one claiming privatization of government jobs almost always provides better service for less money. There is historical and statistical evidence to the contrary. Yet, we believe.

Belief in the myth that privatization of government jobs has a net positive outcome for Americans has held consequences for the American public. The top 1 percent of the population now owns over one-third of the country’s wealth. Half of Americans own only 2.5 percent of the wealth. Between 1979 and 2003 the rich got richer and the poor got poorer in about equal amounts. That is quite a wealth distribution program. It has been very lucrative for the top 1 percent, not so lucrative for the rest of America.

The privatization myth has been perpetrated and advanced by the very people who benefit: corporate executives and legislators who support their agenda. It is a happy “you scratch my back, I’ll scratch yours” circle. Corporate representatives and legislators secretly write public policy behind closed doors. Big business profits from the new law, and friendly legislators are rewarded with hefty contributions. The only ones left out are the American public.

Big business realized the cash value of public sector jobs early on. By the 1970s, convinced the best way to maximize returns was to open up new (public sector) markets by privatization of government jobs, deregulation and tax cuts, corporations started at the top. They wooed legislators in both parties to pass laws that benefited corporate interests, finally settling on conservative legislators as the best investment.

According to, in September 1973 conservative state legislators, conservative activists and Lou Barnett, a veteran of then-Gov. Ronald Reagan’s 1968 presidential campaign, started an organization patriotically named The American Legislative Exchange Council (ALEC). The ALEC website describes ALEC as being, “A nonpartisan membership association for conservative state lawmakers.”

The Center for Media and Democracy states that ALEC’s membership is made up of conservative legislators (almost all Republicans) who pay $100 for a two-year membership and corporate members who pay as much as $35,000. ALEC is underwritten by international corporations and was, until exposed, a secret collaboration between big business and conservative politicians to “ghostwrite model bills.” The ALEC website proudly declares that ALEC has written hundreds of pieces of “model legislation” and approved hundreds of “model bills.”

ALEC claims it is not a lobbying group and therefore does not need to disclose gifts to legislators. ALEC’s coverage of state legislators’ (and their families’) air fare, rooms at resorts where ALEC functions are held (three a year, so I understand), entertainment, food and drink are not considered gifts but are part of ALEC’s “scholarship program.” ALEC claims it is “educating” politicians, not “lobbying” them.

According to the ALEC website, in 1981 President Reagan formed the National Task Force on Federalism and appointed ALEC National Chairman Tom Stivers of Idaho as a member. Reagan quickly elevated more ALEC members to positions of great trust. Soon, ALEC was submitting detailed reports on methods for decentralizing government. In 1982 ALEC began developing its first health care initiatives. In 1983, ALEC produced “A Nation at Risk,” a study on education which proposed a voucher system, merit pay for teachers and higher academic and behavioral standards for students as a solution to the nation’s perceived educational decline. Sound familiar? A quick review of the 2012 GOP platform confirms ALEC’s “solutions” are alive and well.

Until recently, ALEC operated quietly behind closed doors. On July 13, 2012, the Center for Media and Democracy and The Nation revealed over 800 “model bills” and resolutions secretly voted on by corporations and politicians through ALEC. These bills reveal corporate collaboration which has reshaped our democracy, state by state. ALEC bills, which largely benefit ALEC corporate members, have been introduced in every state legislature—without disclosing corporations had drafted or voted on them through ALEC.

Since the secret activities of ALEC have been revealed, many corporations have removed their support from the group due to public disapproval. But ALEC legislation lives on. According to, voter identification law, anti-immigration law, “shoot to kill” law (made infamous during the Trayvon Martin tragedy) and state deregulation for regional greenhouse gas initiatives all trace their beginnings to the behind closed door “bill mills” of ALEC.

Alecexposed points to the fact that many of the separate state bills contain the exact, or nearly exact, language of ALEC’s “model bills.” Those who question the ethical nature of corporations writing public policy say ALEC model bill language has benefited corporate interests by rolling back voter’s rights, advocating broader interpretation of Second Amendment rights and concealed weapons permits, outlawing abortion, privatizing education, eliminating collective bargaining and removing regulations on corporations.

According to a document titled “Who Is Writing Maine’s Laws?”: “Comprehensive analysis of legislation introduced in the 125th Maine legislature shows at least 20 bills share language and/or intent with approved ALEC model legislation.” The goal of all the bills, according to the paper, is to serve big business with interests in the state of Maine.

ALEC “model bills” introduced to the Arizona legislature include: measures encouraging the privatization of state prisons, voter suppression bills, attacks on collective bargaining, the elimination of public employment through outsourcing and privatizing of government functions, attacks on public education through private school voucher programs, measures to prevent implementation of healthcare reform and attacks on federal environmental regulation. Detractors claim all the legislation benefits corporations with interests in Arizona.

Ronald Utt of the Heritage Foundation and other proponents of privatization claim “for profit” private industry is more efficient than “not for profit” government. Even though the private sector must figure profit into the bottom line, they say, privatization almost always costs the taxpayer less money and produces better results. The claims are controversial. While the public has been convinced in the myth that privatization always results in lower cost and better value, studies show whole sale privatization does not always produce the best results.

According to, in a white paper by Ellen J. Dannin, the author summarizes findings from Cornell University’s Hebdon Report. The report finds privatization of government jobs results in diminished quality and access to services, lower employee morale, lower productivity, less training, worker exploitation through lower wages and benefits, increased discrimination against minorities and women, loss of government control and sovereignty, lost constitutional and other legal rights, decreased efficiency, loss of accountability and control, lost infrastructure, increased corruption, higher direct costs or hidden costs, increased conflict and arbitrations. A Wisconsin Audit Bureau report shows 60 percent of outsourced jobs in the Wisconsin Department of Transportation could have been done at lower cost by state workers.

For years, ALEC corporate members have met secretly with conservative legislators to pen “model bills” and advance public policy under which corporations and big business flourish. ALEC law and policy have resulted in redistribution of public wealth to the private sector. This has not served the American public nearly as well as it has big business. All is not lost, however. We have all been entertained by the wonderfully fun political myth that privatization is good and government is bad.

Political mythology is alive and well, influencing our beliefs and votes. William James said, "There's nothing so absurd that if you repeat it often enough, people will believe it." Well, I guess he was right, we sure like to believe those political myths, even when they are glaringly untrue.

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CarolynMcGraw is based in Valley Center, California, United States of America, and is an Anchor on Allvoices.
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