(Update, 9/25: This piece was updated to include comment from Yahoo and remove a reference to the Natural Resources Defense Council.)
Five tech giants have dropped or are expected to drop their membership in the American Legislative Exchange Council, a free-market, state-focused group that has become a target of the left in recent years.
The group, which maintains a library of model state legislation and connects businesses and nonprofits with a substantial share of state lawmakers, has come under fire in recent years for its support of what liberal groups say are conservative social and fiscal policies. Most recently, nonprofits and shareholders have aligned to pressure corporations — who pay at least $7,000 to $25,000 for ALEC membership — to dump the organization over its environmental policies.
Several technology companies have recently announced that they have dropped or expect to drop their membership, but their reasons differ. Yahoo, Yelp and Facebook are the latest to issue statements about their involvement with ALEC, following announcements by Google earlier in the week and Microsoft this summer.
Late Wednesday, Yahoo announced that it had dropped its membership of ALEC, saying in a statement “we periodically review our membership in organizations and, at this time, we will no longer participate in the ALEC Task Force on Communications and Technology.” The announcement came hours after Yelp issued a statement acknowledging that it had allowed its membership to lapse several months ago after a year with the organization. In a statement, a spokesman for the review site said the decision was made only because the company had achieved what it joined ALEC to do: promote legislation that makes it harder for businesses to sue individuals over negative reviews.
“We found ALEC provided a unique forum to bring a good idea to the table,” Director of Public Policy Luther Lowe said in the statement. “Our approach was not without irony and it invited a backlash, yet to ALEC’s credit, our model bill passed unanimously.” Such legislation, known as anti-SLAPP laws, are often championed by First Amendment advocates.
Yelp’s membership was criticized from the start, and the company encouraged ALEC leadership to be more transparent about its dealings, suggesting it allow C-SPAN to broadcast its meetings to show “that providing a forum for policy makers and industry leaders to collaborate can result in consumer benefit (as was our experience),” Lowe said.
Facebook hasn’t dropped its membership, but said in a Wednesday statement that it very well may. “While we have tried to work within ALEC to bring that organization closer to our view on some key issues, it seems unlikely that we will make sufficient progress so we are not likely to renew our membership in 2015,” a spokesman said in an e-mailed statement, first cited by The San Francisco Chronicle and confirmed to The Washington Post. He would not elaborate on what was meant by “key issues.”
Whatever the reason, the recent spate of announcements comes as the organization is seeking to recover from a wave of departures following the killing of Trayvon Martin. At the time, it weathered criticism over its initial support of Stand Your Ground laws. Such policies, invoked in the discussion over the killing, offer protections to individuals who use deadly force when they have a reasonable fear of imminent danger. ALEC has since refocused away from such social policies and worked to become more transparent, posting more and more information on its Web site, including all of its model legislation, and expanding access to its workshops to reporters. The group claims roughly 1 in 4 state lawmakers nationwide as members, but has lost several corporate members in recent years.
In a Monday interview on NPR, Google Executive Chairman Eric Schmidt said his company was dropping its membership over ALEC’s environmental policies. Microsoft dropped its membership with ALEC and eight other nonprofits on July 16, said ALEC spokesman Bill Meierling. The next day, the company announced plans to cut up to 18,000 jobs. “Our trade association memberships are determined annually on a case by case basis and are based on a number of factors, including evolving policy priorities, business needs and available budgets,” Microsoft said in a statement.
Though Schmidt portrayed ALEC as climate-skeptics, Meierling takes issue with the characterization.
“We patently disagree with the accusation. We are not climate-change deniers, we’re not anything of the sort,” he said. “We do have serious reservations about how implementation is being done by the government.” In a letter to 11 top Google executives on Wednesday, ALEC and 156 state legislators said the company’s departure was “based on misinformation.”
ALEC has hosted workshops on EPA regulatory overreach and the impact of the Endangered Species Act on energy development. Its policy library includes a resolution in opposition to carbon taxes, and a model bill urging the withdrawal of states from regional climate initiatives for restraining local governments. The group has also been criticized for its resolution on net-metering, a practice that allows customers to recoup costs for funneling unused renewable energy back into the grid. ALEC’s model resolution contends that such customers should be charged a fee to recoup the fixed costs incurred by business maintaining the grid.
The group has come under fire not only from liberal groups, but also from activist investors in companies with ties to the organization.
Walden Asset Management, which manages $3 billion in investor money, has asked dozens of companies — including Google and Facebook as well as Comcast, eBay, Yahoo, Exxon-Mobil and UPS — to provide more information about and to reassess their involvement with ALEC and other organizations, said Senior Vice President Tim Smith. The inquiry is part of a broad push to force companies to reconsider their political spending and lobbying, he said. While some defend their ALEC membership as getting access to policymakers, Walden generally views membership negatively, especially when it comes to renewable energy.
“We think that the company’s reputation is hurt by the relationship, we think that they’re supporting a very, very partisan political agenda and it is actually an unwise use of shareholder money,” Smith said. In part, he said, the harm is the result of ALEC’s recent negative media coverage, he said.
Two nonprofits in particular have scrutinized ALEC for years: Common Cause — which describes itself as a “citizens’ lobby” — and the Center for Media and Democracy, a progressive watchdog group. In an ongoing whistleblower complaint filed with the IRS, Common Cause alleges that ALEC is “masquerading as a public charity” and engages in “a near textbook definition of lobbying.” The Center for Media and Democracy maintains ALEC Exposed, an online encyclopedia about the organization featuring hundreds of documents. Other progressive groups, including Greenpeace, Sierra Club, People for the American Way, Public Citizen, Color of Change and Forecast the Facts, have also campaigned against ALEC.
“What ALEC sells is access to state legislators and the opportunity to buy influence with them,” said Brendan Fischer, general counsel at the Center for Media and Democracy. But ALEC’s lawmaker members disagree. Businesses play a vital role in crafting economic policy and, as such, deserve a seat at the table, they said.
All the ire has frustrated ALEC, even as it seeks to promote measures with bipartisan support and become increasingly transparent, Meierling said.
“If we turn left, they’re going to start hating left, if we turn right, they’re going to start hating right. If we climb a mountain, they’re going to start hating mountains,” he said.