Contact FreedomWorks

400 North Capitol Street, NW
Suite 765
Washington, DC 20001

  • Toll Free 1.888.564.6273
  • Local 202.783.3870
Corporate Astroturf and Civil Justice
null
http://d7.freedomworks.org.s3.amazonaws.com/styles/thumbnail/s3/te_social_media_share/fw_default_0.jpg?itok=mX_C44GW

Corporate Astroturf and Civil Justice

BY Carl Deal, Joanne Doroshow

FOR TEE LAST TWO DECADES, INSURANCE COMPANIES, manufacturers of dangerous products and chemicals, the tobacco industry and other major industries have been engaged in an effort to roll back the U.S. civil justice system. In nearly every state and in Congress, corporations and their insurers have waged a relentless campaign to change the laws that give sick and injured consumers the ability to hold their offenders responsible for the injuries they cause. While most of their legislative initiatives have been stymied at the federal level -- where corporations have sought national laws to override the rights that states grant to injured parties -- the corporate coalition has had enormous success in the states themselves. Going state by state, they have succeeded in obtaining liability caps, elimination of various causes of action, and procedural rules making it much harder to sue wrongdoers. The business-led effort to take away consumers' legal rights (called "tort reform" by its corporate proponents; "tort deform" by its pro-consumer opponents) has had at its helm the American Tort Reform Association (ATRA) located in Washington, D.C. In turn, ATRA has contracted with APCO & Associates, one of the nation's leading "grassroots" lobbying/PR firms. Because large corporations have found their message more effective when delivered by what appear to be citizen groups than when conveyed by business associations openly advancing their pecuniary interests, they have come to rely on a network of front groups, corporate-funded think tanks and industry-funded academics to articulate their message. Among the national groups representing the corporate interests are organizations like Citizens for a Sound Economy, the American Legislative Exchange Council, Americans for Job Security, the Center for Individual Rights, the Federalist Society, the Manhattan Institute, the Competitiveness Enterprise Institute and the Washington Legal Foundation. At the state level, more important has been a network of supposed grassroots organizations spontaneously formed to confront "lawsuit abuse." This network of local organizations was created by APCO. The groups euphemistically call themselves any number of names, typically: Citizens Against Lawsuit Abuse (CALA), Lawsuit Abuse Watch, Stop Lawsuit Abuse, or People for a FAIR Legal System (collectively referred to here as "CALAs.") Since 1991, "tort reform" advocates have set up dozens of tax-exempt groups in at least 18 states to plant their "lawsuit abuse" message in the media and the public consciousness, and to influence legislation, the judiciary and jurors. These groups claim to speak for average people and represent themselves as grassroots citizens groups determined to protect consumer interests. But their tax filings and funding sources indicate that they actually represent major corporations and industries seeking to escape liability for the harm they cause consumers -- whether it be from defective products, medical malpractice, securities scams, insurance fraud, employment discrimination or environmental pollution. The money trail from many of these groups leads directly to large corporate donors, including tobacco, insurance, oil and gas, chemical and pharmaceutical companies, medical associations and auto manufacturers. They are also funded by ATRA, as well as professional associations, local businesses and industries that also wish to be shielded from consumer lawsuits. The tobacco industry has been perhaps the leading supporter of the CALAs. The huge cache of documents made public during the state attorneys general litigation against the tobacco industry in the late 1990s reveals that Big Tobacco spent millions of dollars a year (and in at least one year $ 15 million) supporting ATRA, state CALAs and other activities to weaken tort laws in many states. For instance, in 1995, Big Tobacco allocated $ 5.5 million for ATRA, more than half of ATRA's budget. In some cases, CALAs, such as the one in Louisiana, were virtually created by the tobacco industry. Tobacco money has gone directly to ATRA, APCO and state organizations. "DAVID" AND THE VICE PRESIDENT In November 1990, the Rio Grande Valley Chamber of Commerce in Weslaco, Texas hired a political/marketing consultant named Jon Opelt to develop a program to counter a judicial climate it felt was too pro-consumer. The catalyst for the program was a $ 2.5 million jury award in September 1990 to two Mexican-American men who were illegally fired from a local sugar mill. The verdict, the Chamber said, could have shut down the mill and put hundreds of people out of work. It didn't. The mill settled the case, but the Chamber labeled it "lawsuit abuse" anyway and used the case to rally popular support for its agenda to limit people's rights to sue. Initial financing for the effort, which became the first Citizens Against Lawsuit Abuse group (Weslaco CALA), was provided by the Chamber, corporations doing business in the valley, and the local medical association seeking to stop medical malpractice lawsuits. Its chair, Gonzalo Sandoval, was an executive with Central Power and Light. The Weslaco CALA launched its first campaign in January 1991, leasing five billboards along the busiest roads in the Rio Grande Valley with such messages as, "Lawsuit Abuse: Guess Who Picks Up the Tab? You Do." "Lawsuit abuse" became the poll-tested solution to the dilemma faced by advocates of "tort reform" -- how to convey their agenda in terms average people could understand. The first "lawsuit abuse" television ad ran in 1991 as part of the Weslaco CALA's $ 20,000-a-month publicity program. The ad portrayed a gloomy business environment in south Texas, citing the "near closure" of the sugar mill that had wrongfully dismissed two workers. The Weslaco CALA also aggressively took on trial lawyers by posting ads that read: "Fairness Yes -- Greed No." "It was kind of like David versus Goliath," Opelt says. "We were David and the trial lawyers were Goliath." It turns out, however, that David had the vice president of the United States and an alliance of Fortune 500 companies on his side. The same year that Weslaco CALA ran its first ads, the White House Council on Competitiveness, headed by then Vice President Dan Quayle, embraced "tort reform" as a priority issue and assigned then-Solicitor General Ken Starr the task of developing a plan to overhaul the country's civil liability laws. Starr has represented tobacco companies and General Motors, among other clients, in products liability litigation. A "Starr report," not destined to receive as much attention as the subsequent Starr report on President Clinton's affair with Monica Lewinsky, was ready in August 1991, and presented 50 recommendations for "tort reform" which it said were necessary to "maintain America's competitiveness." President George Bush embraced the recommendations at an October White House ceremony in which he signed an Executive Order on Civil Justice Reform. In 1992, Quayle visited South Texas, where he met with Weslaco CAlA President Bill Summers. Quayle encouraged Summers to take the "lawsuit abuse" campaign statewide. Following the meeting between Quayle and Summers, similar campaigns were launched in San Antonio, Corpus Christi, Victoria and Beaumont. The right-wing Texas Public Policy Foundation and the Texas Chamber of Commerce were instrumental in helping to develop this statewide CALA network. Following that, CALAs started springing-up around the country. The Weslaco CALA had become the CALA blueprint, growing from a regional campaign in the South Texas oilfields into a nationwide crusade. THE ATRA/APCO CONNECTION The American Tort Reform Association (ATRA) was formed in 1986 to represent hundreds of U.S. and foreign corporations in their bid to overhaul civil liability laws at the state and national levels. By 1992, ATRA had hired a public relations firm to help it reach its "tort reform" goals by creating local "grassroots" front groups. The contract was with a subsidiary of public relations titan Grey Advertising called APCO & Associates, a company that had specialized in "tort reform" lobbying since the 1980s and had worked both for insurance companies, like State Farm, and the tobacco industry. APCO knew the issue well. Founded in 1984 by the beltway law firm, Arnold & Porter, and first known as the Arnold & Porter Consulting Group, APCO was later sold to Grey Advertising after having consulted for Philip Morris and other tobacco companies on civil justice issues for years. Indeed, an internal Philip Morris document indicates that APCO and Neal Cohen, its "principal account executive on the PM [Philip Morris] Family Tort Project" had been, since 1988, "assisting the PM Family [on] national and state tort coalitions and other tort reform advocates with political, communications and grassroots strategies and related programs." This concept of corporate "grassroots lobbying" in which APCO specializes is a relatively new public relations strategy, which the New York Times described as "a technique often used to camouflage an unpopular or unsympathetic client." One of the faster growing areas of corporate public relations, grassroots lobbying, which supplements legislative lobbying, involves forming a coalition on behalf of wealthy companies and trade associations and generating sympathy for legislation sought by the unsympathetic client. A memo from the now-closed Tobacco Institute highlights the importance of these "astroturf" efforts appearing to be independent "grassroots" initiatives. Describing the grassroots lobbying strategy long used by tobacco companies, the 1986 memo says, "The primary purpose of [grassroots lobbying] is to substantiate and support [the] Tobacco Institute position presented [to] Congress, state legislatures or local councils by our lobbyists. In order to be totally effective, the grassroots effort must appear to be spontaneous rather than a coordinated effort. The goals of the Committee should be set by the Tobacco Institute. Invite suggestions and discussion, however, steer the discussion so that it ends up at our predetermined objective. A 1996 campaign by the Louisiana GALA, which was created with the help of tobacco companies, illustrates how astroturf lobbying works. According to Louisiana CALA Executive Director Ron Gomez, a former state representative, the Louisiana CALA generated some 4,000 constituent calls, faxes or letters urging key legislators to vote for three "tort reform" bills pending in the state Senate that year. Drawing from a list of 18,000 names compiled from calls to toll-free numbers advertised on the GALA television, radio and billboard ads produced by APCO, the Louisiana GALA set up phone banks to coordinate calls and letters to legislators. "That's effective," he says. "I can tell you as a former legislator." In 1994, APCO's Cohen explained the GALA "grassroots" strategy in a speech before a gathering of corporate public affairs executives sponsored by the Public Affairs Council, an organization of some 500 corporations and trade associations. "Rule No. 1 for me is stay away from substance," Cohen said. "Don't talk about the details of legislation. ... Talk about ... frivolous lawsuits, lawsuit abuse, trial lawyer greed." He explained the need for front groups. "In a tort reform battle," he said, "if State Farm -- I think they're here, Nationwide -- is the leader of the coalition, you're not going to pass the bill. It's not credible, O.K., because it's so self-serving. Everybody knows the insurance companies would be one beneficiary of this." The APCO/CALAs grassroots campaign has been effective. At the 1994 seminar, Cohen showcased his CALA work with Mississippi for a Fair Legal System (M-FAIR), a GALA he had set up in Mississippi in 1993. APGO orchestrated a blitzkrieg public attack on trial lawyers, which included an 800-number on billboards, and TV ads. The idea was to use every campaign tactic we had in order to bring in as many people, and we made sure that it was typical people mixed in with large employers and political contributors." The coalition soon had over a thousand people who had responded to the "greedy trial lawyer" message. According to Cohen, "we have 1,500 Mississippians mixed in with who our clients were" and since Mississippi had "no reporting requirements, they [the trial lawyers] didn't really know who was at the heart of everything." In the end, they "caved in completely." The group was "instrumental" in the passage of H.B. 1270, Mississippi's 1993 "tort reform" legislation, according to ATRA. The Tobacco Institute was involved in the Mississippi effort as well, and several APGO documents documenting the M-FAIR strategy were uncovered in the Tobacco Institute's files. Other state lawmakers have undoubtedly been influenced by APCO/GALA grassroots lobbying efforts. In 1994, Liability Week reported that in addition to Mississippi, Neal Gohen and APCO had a "key role" in developing the system which resulted in substantial tort overhauls in Texas, North Dakota, Arizona and Michigan in 1993. Cohen also boasted in a 1995 interview published by the PR industry magazine, Reputation Management, that CALAs have helped pass significant "tort reform" bills at the state level in California, New Jersey, Texas, Mississippi and Michigan. In 1995, the Illinois Civil Justice League, which was the principal author and proponent of the state's Civil Justice Reform Amendments of 1995, organized an Illinois CALA. It used direct mail to collect contributions and build a list of names supporting "tort reform." This CALA was short-lived as the bill was signed into law in March of that year (though the law was declared unconstitutional two years later). As another example, weeks before the Ohio House considered a massive "tort reform" bill in 1996, Ohio Citizens Against Lawsuit Abuse (OCALA) appeared on the scene. The bill passed but it was later declared unconstitutional. As the Alabama state legislature was debating proposals in May 1999 to, among other things, cap punitive damages, Alabama Voters Against Lawsuit Abuse (AVALA) organized pro-business demonstrations outside the capitol in Montgomery, and sent out letters to its mailing list asking people to urge their legislator to vote for the package of tort restrictions. The legislation passed. 1-800-START-A-CALA At its first press conference in 1994, Los Angeles CALA's President, Bill Bloomfield, owner of a Redondo Beach company that loans washers and dryers to apartment buildings, unveiled television commercials and its first billboard with the message: "Help Stop Lawsuit Abuse. We All Lose. 1-800-293-CALA." Bloomfield said, "We are a group of citizens who have had enough of a system that makes us all victims." Similarly, when Ohio Citizens Against Lawsuit Abuse (OCALA) appeared on the scene in 1996, OCALA's chairman Jackie Fox, the chief financial officer and general manager of a company that runs beauty salons, stressed the group's local "grassroots" origins, saying OCALA "is relying on small business, grassroots donations to get started." Neither organization gave much hint of their extensive connection to the nationwide ATRA/APCO network (although OCALA did admit that three television commercials it previewed were prepared with ATRA.) In a 1996 memo originally obtained by the publications Counterpunch and PR Watch, Neal Cohen highlighted APGO's involvement in the formation of CALA groups. With regard to 0 CALA, for example, Cohen wrote, "In Ohio, we are working with the local business community to form a new citizens group focusing on lawsuit abuse." In Michigan, he said, "we are working with the local business community to form a new citizens group focusing on lawsuit abuse." He also said, "In California, we work with both a statewide group ... as well as six local CALA groups." And in Alabama, Cohen said, "we work with an extremely active statewide citizens coalition, Alabama Voters Against Lawsuit Abuse." In addition to these states, Cohen's memo mentioned a number of other states in which APCO was involved, including Louisiana, Minnesota, Mississippi, Texas and West Virginia. While ATRA/APCO have not advertised their role in creating the CALA movement, they do admit to supplying the groups with limited guidance. Likewise, in its own materials, ATRA admits to working with local groups to "set their legislative agenda and strategies," as well as provide them with "briefing materials, model bills, witnesses and speakers," and a "communications 'tool kit'" including "hard-hitting television ads and radio spots as well as billboard and information handouts." In 1997, ATRA spun off a foundation to provide funds of approximately $ 1 million annually to local groups for purposes of conducting public education programs and other consulting services that are pursuing the ATRA agenda. According to ATRA's newsletter and web site, one of the Foundation's top jobs will be "enhancing the communications tool kit that ATRA currently makes available to grassroots organizations across the country. This program, which includes award-winning television and radio commercials and other communications materials, helps to communicate the 'Stop Lawsuit Abuse' message in a way that avoids legalese and is understandable to the public." Indeed, widespread national coordination of message and strategy, focused on developing public scorn for the civil justice system, is evident in virtually every aspect of local CALAs' activities: * Starter grants and kits: ATRA provides funding to individuals or groups interested in starting a CALA, as well as starter kits. The initial filings with the Internal Revenue Service (IRS) by Western Maryland CALA, for example, included as an attachment what appears to be a portion of a generic starter kit consisting of detailed job descriptions, a fundraising manual and a media primer. Specifically, attached to the IRS filing was a job description for an "Executive Director," which was described in generic terms as being "responsible for executing and implementing policies adopted by the CALA steering committee on a day-to-day basis." The executive director, according to the document, is supposed to help draft op-ed articles and letters to the editor for placement, to "devote time to cultivating reporters, 'jumping on a story' that the stop lawsuit abuse theme can piggy-back onto, etc. (See CALA media primer)." Also, 40 percent of the executive director's time is to be spent on fundraising, and preparing an annual fundraising plan that reports potential contributors. The job description continued, "examples: physicians for $ 50K, auto dealers for $ 25K, etc. See CALA fundraising manual for more specifics." Finally, the memo directs the executive director to spend 25 percent of his or her time on administrative/management tasks. * "Public education" materials and activities: The slogans, brochures, websites, activities, billboards and other advertising used by CALAs nationwide are evidence of widespread national coordination. For example, the "Stop Lawsuit Abuse" stop sign logo is ubiquitous throughout the CALA network, used by, among others: Alabama Voters Against Lawsuit Abuse (AVALA); Bay Area CALA (Texas); Central California CALA; Central Texans Against Lawsuit Abuse; Los Angeles CALA; Louisiana CALA; Michigan Lawsuit Abuse Watch; San Diego Citizens Against Lawsuit Abuse; Silicon Valley CALA; Southern West Virginia CALA; Texans Against Lawsuit Abuse; and Weslaco (Texas) CALA. The slogan "Lawsuit Abuse: We All Pay, We All Lose" has been used by numerous CALAs, as has the slogan "Fairness, yes -- Greed, no." Since 1996, several active CALAs, including those in Texas, California, Ohio, West Virginia and Maryland, have designated the third week of September as "Lawsuit Abuse Awareness Week." This week is sometimes accompanied by a so-called "wacky warning label contest" ostensibly to show how lawsuits lead to silly resuLts. At the same time each year, these CALAs obtain endorsements from sympathetic political officials, ranging from conservative Republican governors, to local mayors and legislative bodies, to members of Congress. * Paid advertising: Since 1991, when the first Texas CALA became the testing ground for ATRA's ad campaign, CALA groups have heavily relied on APCO to develop, or assist them in developing, television, radio, print and billboard advertising, as well as messages, signs and slogans and PR materials. By 1996, APCO had said that the ad campaigns it developed had "changed the nature of the debate from a technical intangible concept to a concept more easily understood by the general public." * Influencing juries: Consumer advocates and trial lawyers say the CALAs' massive publicity campaigns are not targeted only at legislators -- they aim to influence juries as well. Lawyers point to CALA billboards near courthouses, and TV and radio ads that spike during particularly high-profile cases. The purpose, they believe, is to make jurors more suspicious of victims and the civil justice system. SHOW ME THE MONEY CALAs are incorporated locally as non-profit, tax-exempt organizations. As with other non-profit groups, a CALA is not required to disclose its funders. And they choose not to. CALAs work to maintain the appearance of local citizen groups -- a spontaneous, folksy backlash by ordinary citizens against a legal system that is "out of control." A typical story is the one Bill Bloomfield told the Sacramento Bee, about the founding of the Los Angeles CALA. Bloomfield said the group came into being after "organizing some friends including two attorneys, a teacher and a sheriff's detective" and then "passing the hat to raise funds." However, for CALAs for which financial information is publicly available, the evidence shows they are sustained by local industries, large corporations or trade associations, which are generally represented on their boards, and/or support them with financial or in-kind contributions. CALAs are also often backed by the tobacco and insurance industries. For example: * Founded in 1992 primarily with the help of the tobacco industry, the Louisiana CALA has also received financial support from Louisiana Power & Light, Freeport-McMoran, Pfizer, Abbott Laboratories, Union Pacific, Georgia Pacific, Texaco and local businesses. * Minnesota Lawsuit Abuse Watch was incorporated in 1996. Its initial supporters, donating more than $ 100,000 in its first six months, included the Independent Business Association of Minnesota, the National Federation of Independent Business (NFIB) Minnesota, the Minnesota Civil Justice Coalition and the Minnesota Chamber of Commerce. * In 1995, Oklahoma CALA, formed a year earlier, ran a statewide initiative campaign to put tort restrictions on the ballot. By March, it had raised $ 2 million, but not from average Oklahoma citizens. Oklahoma CALA's supporters who contributed or pledged at least $ 50,000 each to this effort were: CITGO Petroleum Corporation of Tulsa, Phillips Petroleum Company of Bartlesville, the Oklahoma Publishing Company, publisher of The Oklahoman, Southwestern Bell Telephone, Boatmen's First National Bank of Oklahoma, American Fidelity Group, Kerr-McGee Corporation and State Bank & Trust Company. In addition to the financial and public relations support they receive from corporate-backed ATRA and APCO, CALAs are often run not by citizen activists, but by hired public relations or marketing consultants. Texans Against Lawsuit Abuse (TALA), which is operated by ROSS Communications, a company with which APCO is formally partnered, is one such example. But they are not alone. In papers filed with the IRS, Alabama Voters Against Lawsuit Abuse says, "AVALA's activities ... will be conducted in the state of Alabama by independent consultants and professional research and polling firms retained and paid by AVALA." In addition, several CALAs have been run by individuals who are in and out of the PR world. CALAS: CARVED IN THE LANDSCAPE While some of the CALAs have had a fleeting existence, appearing just before major legislative fights and disappearing just as quickly thereafter, the nationwide CALA phenomenon is now a permanent part of the national political landscape. And some of the CALAs, with ongoing infusion of corporate funding, have shown significant staying power. The Texas CALAs continue to function more than a decade after starting the national trend. In February, the network of Texas CALAs emerged as the public Lace of a corporate-driven effort to rewrite again the state's tort laws and further restrict consumer and injured party rights in Texas. Speaking straight from the text of a decade earlier, Jon Opelt, still the Houston Executive Director of CALA, told the Dallas Morning News, "this bill provides a far-reaching fix to the state's lawsuit abuse problem."

03/01/2003
Bush Admin. Just Says “No” to Tax Increase
null
http://d7.freedomworks.org.s3.amazonaws.com/styles/thumbnail/s3/te_social_media_share/fw_default_0.jpg?itok=mX_C44GW
Press Release

Bush Admin. Just Says “No” to Tax Increase

Citizens for a Sound Economy (CSE) applauds the Bush Administration’s rejection of an Interagency Committee for Smoking and Health (ICSH) proposal to increase federal excise taxes on tobacco by $2. Appearing before the House Budget Committee, Department of Health and Human Services Secretary Tommy Thompson emphatically stated, “…this administration does not raise taxes,” when pressed about the administration’s stance on the ICSH proposal. CSE President Paul Beckner had these comments:

02/27/2003
Getting On Board
null
http://d7.freedomworks.org.s3.amazonaws.com/styles/thumbnail/s3/te_social_media_share/fw_default_0.jpg?itok=mX_C44GW

Getting On Board

BY Charlie Mitchell

"You're either with us or you're against us." The Bush administration has delivered that message to the Europeans, the United Nations and -- even more successfully -- to the K Street community, where the issue is not war and peace but tax cuts, specifically dividend tax cuts. House Ways and Means Chairman Thomas is ready to introduce President Bush's economic growth bill this week, and industry groups are lining up like small, Eastern European countries to pledge their support to the president. "The wind is turning to the back of the dividend proposal, from having a very strong wind in its face," said Dirk Van Dongen, president of the National Association of Wholesaler-Distributors and a leader of the Tax Relief Coalition. "The administration has made it abundantly clear that this is the cornerstone of the package -- it's not designed to deflect blows from other parts of the package." There is no shortage of talk about the "add-ons" that various trade associations would like the Ways and Means Committee to attach to the bill later this month, including accelerated depreciation proposals tailored to a variety of industries. But discussion -- at least open discussion -- of chipping away at the $388 billion set aside for dividend relief to fund other tax cuts has "ebbed," in the words of GOP lobbyist Ed Gillespie. "Remember," said Ken Kies of the Federal Policy Group, "the 2001 [tax-cut] bill as enacted was pretty much the president's proposal. Politically, he's in a stronger position than he was two year ago -- I don't expect the administration to show much flexibility in terms of what they see as the right way to do this." Business groups are anxious to demonstrate what they have been doing to push the Bush plan forward. The TRC this week is circulating a memo to its thousand-plus member companies and trade groups highlighting recent grassroots and media efforts by Citizens for a Sound Economy, the Business Roundtable, the Securities Industry Association, the U.S. Chamber of Commerce, the Edison Electric Institute, the American Forest and Paper Association and the Seniors Coalition. The TRC recently formed a Committee on Dividend Benefits, headed by BRT president John Castellani and CSE president Paul Beckner, which meets every Thursday, includes over 40 members and has its own Web site (www.trcdividendbenefits.org). The TRC is beginning a run of print ads trumpeting the dividend plan this week, and the BRT will begin its own ad run next week, according to Castellani. "From the BRT standpoint, any economic growth package should restore consumer confidence and restore investor confidence," Castellani told CongressDaily. "From our members' perspective, [the Bush approach] is the best way to do it." Beckner said CSE contacted 40 House members and about 18 senators over the Presidents' Day recess in support of the proposal. "A fairly broad cross section of the business community is working to make dividends a viable part of the package," he said. Separately, Gillespie has put together what he calls a coalition of the "dividend faithful" -- about 30 companies that already pay out dividends and are "true believers" in the plan. "We're working in tandem with the TRC, on a parallel track," Gillespie said. "We're working on lobbying strategy, grassroots and sharing targets." Meanwhile, the loyal opposition has its doubts about the sincerity of some of the president's allies. "I think they're being good soldiers," said Roger Hickey of the liberal Campaign for America's Future (www.ourfuture.org), which is helping to organize grassroots opposition to the president's proposal. "The business community is falling in line and lobbying for their president, but there doesn't seem to be a lot of energy there. I question how much in resources they'll put into it." Hickey's group -- a charter member of the Fair Taxes Coalition, which includes several hundred public interest groups and labor unions -- is churning out e-mails to activists throughout the country, as well as holding events in state capitals to dramatize the state-by-state impacts of the Bush plan. For instance, Sen. Mark Dayton, D-Minn., joined the community group ACORN in Minneapolis recently to release a report claiming the proposal would worsen Minnesota's budget crisis by $110 million and cost the state jobs over the next decade. The Fair Taxes Coalition is targeting the usual list of Senate moderates, "grabbing senators in their state while also fighting here in Washington," Hickey said. Right now, it is a shoestring operation, but Hickey said the opposition will make itself heard in the coming months with the help of the unions and some wealthy benefactors. "This is a coalition that doesn't have a lot of money, but when things heat up, money does tend to become available," he noted.

02/26/2003
Social Security's Junk Mail
null
http://d7.freedomworks.org.s3.amazonaws.com/styles/thumbnail/s3/te_social_media_share/fw_default_0.jpg?itok=mX_C44GW
Press Release

Social Security's Junk Mail

I think I need to contact the postal inspector to report a case of mail fraud.

02/26/2003
Don’t Forget the Death Tax
null
http://d7.freedomworks.org.s3.amazonaws.com/styles/thumbnail/s3/te_social_media_share/fw_default_0.jpg?itok=mX_C44GW
Press Release

Don’t Forget the Death Tax

The White House has submitted its budget to Congress, unveiling a $674 billion economic growth plan as well as new Lifetime Savings Accounts and Retirement Savings Accounts. President Bush has filled the void of domestic policy with one of the deepest tax cuts in recent years. Debate over the expansive plan has already begun and is expected to dominate much of Washington through the spring. Notable by its absence is the repeal of the death tax, an inefficient and unfair tax that should be stricken from the tax code.

02/26/2003
This Week on the Hill
null
http://d7.freedomworks.org.s3.amazonaws.com/styles/thumbnail/s3/te_social_media_share/fw_default_0.jpg?itok=mX_C44GW
Press Release

This Week on the Hill

Miguel Estrada The new news on this story is that Bill Nelson, the junior Democratic senator from Florida, will break from his party and vote to end debate and to confirm Miguel Estrada to the U.S. Court of Appeals for the D.C. Circuit if and when a vote is scheduled. Essentially, the debate is stuck in a parliamentary quagmire. The Senate is technically debating the nomination; in actuality, the Democrats are filibustering.

02/26/2003
Legislators Consider Changes in Civil Justice System
null
http://d7.freedomworks.org.s3.amazonaws.com/styles/thumbnail/s3/te_social_media_share/fw_default_0.jpg?itok=mX_C44GW

Legislators Consider Changes in Civil Justice System

BY Kelley Shannon

Yvonne Moran and her 6-year-old daughter spend many a night crying over the loss of Moran's husband a few days before Christmas in 1996. Bart Moran's minivan was broadsided and his seat belt failed, throwing him to his death, said Yvonne Moran of Sinton. She later won a $6.7 million civil court judgment. The defendants are appealing. On Wednesday, Moran traveled to the Capitol to speak out against a bill she contends would make lawsuits like hers against the car maker and seat belt manufacturer more difficult, if not impossible. "My message would be: Please don't quiet our voices. The law is all we have," Moran said. Plenty of others appearing before the House Civil Practices Committee took a different view. They said the bill by Rep. Joe Nixon, R-Houston, would crack down on frivolous lawsuits and restore balance in the Texas civil justice system. "Among the fuels that feed the fires of litigiousness are the many hit-the-jackpot jury verdicts that occur with increasing frequency," said Richard J. Trabulsi Jr., president of Texans For Lawsuit Reform, who spoke in favor of the bill in a jam-packed hearing room. Trabulsi said his group isn't "anti-lawsuit" or "anti-lawyer." But he said an unfair legal system costs jobs and passes businesses' legal costs on to consumers. Among the proposals in Nixon's bill are: -Delaying class-action lawsuits until plaintiffs exhaust administrative remedies through any applicable state agency. -Requiring the plaintiff to pay the defendant's legal fees if the plaintiff rejects a settlement offer and later wins a lower monetary verdict in court. -Allowing an immediate pre-trial appeal of a venue ruling when there are several plaintiffs. Nixon says this would prevent "courthouse forum shopping." Rep. Yvonne Davis, D-Dallas, a member of the committee, asked Nixon what sort of financial impact his bill would have on state agencies if they must handle more administrative cases. Nixon said he didn't think there would be any extra fiscal impact because those avenues are already available. Major changes to the state's civil justice laws were last made in 1995, when George W. Bush was governor. Among other things, the Legislature limited punitive damages, limited where civil lawsuits can be filed and limited the percentage of fault in a claim involving multiple defendants. Nixon said the system still needs changing because of high jury verdicts. Since then there have been $10.5 billion in jury verdicts in Texas cases with awards of $10 million or higher, he said. Nixon has filed a separate bill dealing specifically with limits on medical malpractice lawsuits. Other groups showing up in favor of Nixon's omnibus civil justice bill Wednesday were Citizens for a Sound Economy, Citizens Against Lawsuit Abuse and economist Ray Perryman. "Judicial reform is one of those rare issues where the economic evidence is straightforward, concrete and incontrovertible," Perryman said in his prepared remarks. Changes that would be brought about by Nixon's bill would result in lower insurance rates and create a stronger climate for investment and business expansion, Perryman said. But for plaintiffs like Yvonne Moran, 38, a driving examiner for the Texas Department of Public Safety and now a widow and single mother, the proposed law is seen as a barrier - one that would make it difficult to shed light on a product's malfunction and one that could prevent some monetary recovery for the loss of a loved one. Her daughter, Autumn, now in first grade, was only an infant when her father died. She's getting to know him through homemade videotapes that Yvonne is so glad they made. "She never knew him," her mother said, "but she certainly misses him."

02/26/2003
NJ Manufacturers Gets Relief from Issuing Auto Quotes
null
http://d7.freedomworks.org.s3.amazonaws.com/styles/thumbnail/s3/te_social_media_share/fw_default_0.jpg?itok=mX_C44GW

NJ Manufacturers Gets Relief from Issuing Auto Quotes

The state's insurance crisis took yet another turn for the worse today when the New Jersey Department of Banking and Insurance allowed New Jersey Manufacturers Insurance Group, the state's largest insurer, a respite from quoting rates to drivers seeking coverage from its subsidiary, New Jersey Re-Insurance Company. The move dramatically increases the already serious difficulties drivers have in obtaining auto insurance. New Jersey Re-Insurance Company writes about 2,000 new auto insurance policies monthly. According to John Friedman, chairman of the Coalition for Auto Insurance Competition, the move is further evidence that New Jersey's auto insurance laws and regulation require immediate reform. "The state's auto insurance marketplace is unstable and dysfunctional, requiring immediate reform that instills more company competition and more choices for consumers," said Friedman. New Jersey Manufacturers says it was left with little choice after a deluge of callers, many lacking coverage after their previous companies left the state market, overwhelmed the company's offices. The heavy demand from drivers seeking auto insurance coverage interrupted the company's regular day-to-day operations, forcing the insurer to apologize for service delays to its 700,000 policyholders. The company says it will take 56 days to clear up the backlog for quotes. "Today's announcement underscores the immediate need to address the state's excessive regulation of the auto insurance industry, which is pushing companies out of New Jersey and continues to threaten the stability and sustainability of New Jersey's auto insurance market," Friedman said. "Insurers are either leaving the state, paying other companies to take their New Jersey business or asking the state to be exempted from existing rules. Consumers and companies alike are finding themselves in a 'perfect storm' of marketplace failure. It is imperative that we move forward with legislation to restore competition to New Jersey's auto insurance market." The state's decision is the latest in a series of events that have restricted the ability of drivers to obtain coverage. In the past year, seven auto insurers have stopped doing business in New Jersey. Twenty-six companies have withdrawn from the state during last decade. Last summer, State Farm, once the state's largest insurer, obtained approval to non-renew 4,000 policies a month for the next three years as part of that company's withdrawal from the state. The Robert Plan ceased writing policies in September, and in January of this year two more insurers, Central Mutual and Merchants Insurance, announced they were leaving the state. "Good intentions have led us down the wrong path," continued Friedman. "We need a regulatory system that doesn't force auto insurers from our state or into insolvency, but rather permits companies to compete in an active market." The Department of Banking and Insurance has placed 19 other auto insurance companies under close monitoring due to their poor financial condition. Together these companies are responsible for 28 percent of all auto policies in the state. Today's decision will place even greater pressure on these firms, increasing the chances that more will abandon the market, further stressing an already damaged industry. The collapse of the state auto insurance system, predicted for years by industry specialists, has become a serious possibility. "With comparatively few auto insurers remaining in New Jersey, the loss of any others will add pressure on an industry near the breaking point," said Friedman. "Many companies are already straining their capacity of policyholders." Although Governor James E. McGreevey called for auto insurance reform in his State of the State address, the legislature has yet to act on S-1999 or A-2625, the New Jersey Automobile Insurance Competition and Choice Act. New Jersey officials must act now, before the industry is further crippled, and more drivers frustrated. "Drivers need a regulatory system that promotes competition, encourages companies to sell auto insurance, and creates a stable market that offers more choices for consumers. Every day that goes by without legislative action is a day where the state risks further deterioration and, ultimately, collapse of the auto insurance market," Friedman concluded. The Coalition welcomes the participation of consumers, businesses, and associations who seek to work together to bring about meaningful and responsible auto insurance reform. Members include the National Association of Independent Insurers, Insurance Council of New Jersey, American Insurance Association, New Jersey Chamber of Commerce, Independent Insurance Agents of New Jersey, Citizens for a Sound Economy, National Association of Mutual Insurance Companies, New Jersey Association of REALTORS, Professional Insurance Agents of New Jersey, New Jersey Food Council, New Jersey Retail Merchants Association, NJ SEED (Society for Environmental, Economic Development), Somerset County Chamber of Commerce, Latino Chamber of Commerce of Mercer County and the Commerce and Industry Association of New Jersey.

02/26/2003
Getting On Board
null
http://d7.freedomworks.org.s3.amazonaws.com/styles/thumbnail/s3/te_social_media_share/fw_default_0.jpg?itok=mX_C44GW

Getting On Board

BY Charlie Mitchell

"You're either with us or you're against us." The Bush administration has delivered that message to the Europeans, the United Nations and -- even more successfully -- to the K Street community, where the issue is not war and peace but tax cuts, specifically dividend tax cuts. House Ways and Means Chairman Thomas is ready to introduce President Bush's economic growth bill this week, and industry groups are lining up like small, Eastern European countries to pledge their support to the president. "The wind is turning to the back of the dividend proposal, from having a very strong wind in its face," said Dirk Van Dongen, president of the National Association of Wholesaler-Distributors and a leader of the Tax Relief Coalition. "The administration has made it abundantly clear that this is the cornerstone of the package -- it's not designed to deflect blows from other parts of the package." There is no shortage of talk about the "add-ons" that various trade associations would like the Ways and Means Committee to attach to the bill later this month, including accelerated depreciation proposals tailored to a variety of industries. But discussion -- at least open discussion -- of chipping away at the $388 billion set aside for dividend relief to fund other tax cuts has "ebbed," in the words of GOP lobbyist Ed Gillespie. "Remember," said Ken Kies of the Federal Policy Group, "the 2001 [tax-cut] bill as enacted was pretty much the president's proposal. Politically, he's in a stronger position than he was two year ago -- I don't expect the administration to show much flexibility in terms of what they see as the right way to do this." Business groups are anxious to demonstrate what they have been doing to push the Bush plan forward. The TRC this week is circulating a memo to its thousand-plus member companies and trade groups highlighting recent grassroots and media efforts by Citizens for a Sound Economy, the Business Roundtable, the Securities Industry Association, the U.S. Chamber of Commerce, the Edison Electric Institute, the American Forest and Paper Association and the Seniors Coalition. The TRC recently formed a Committee on Dividend Benefits, headed by BRT president John Castellani and CSE president Paul Beckner, which meets every Thursday, includes over 40 members and has its own Web site (www.trcdividendbenefits.org). The TRC is beginning a run of print ads trumpeting the dividend plan this week, and the BRT will begin its own ad run next week, according to Castellani. "From the BRT standpoint, any economic growth package should restore consumer confidence and restore investor confidence," Castellani told CongressDaily. "From our members' perspective, [the Bush approach] is the best way to do it." Beckner said CSE contacted 40 House members and about 18 senators over the Presidents' Day recess in support of the proposal. "A fairly broad cross section of the business community is working to make dividends a viable part of the package," he said. Separately, Gillespie has put together what he calls a coalition of the "dividend faithful" -- about 30 companies that already pay out dividends and are "true believers" in the plan. "We're working in tandem with the TRC, on a parallel track," Gillespie said. "We're working on lobbying strategy, grassroots and sharing targets." Meanwhile, the loyal opposition has its doubts about the sincerity of some of the president's allies. "I think they're being good soldiers," said Roger Hickey of the liberal Campaign for America's Future (www.ourfuture.org), which is helping to organize grassroots opposition to the president's proposal. "The business community is falling in line and lobbying for their president, but there doesn't seem to be a lot of energy there. I question how much in resources they'll put into it." Hickey's group -- a charter member of the Fair Taxes Coalition, which includes several hundred public interest groups and labor unions -- is churning out e-mails to activists throughout the country, as well as holding events in state capitals to dramatize the state-by-state impacts of the Bush plan. For instance, Sen. Mark Dayton, D-Minn., joined the community group ACORN in Minneapolis recently to release a report claiming the proposal would worsen Minnesota's budget crisis by $110 million and cost the state jobs over the next decade. The Fair Taxes Coalition is targeting the usual list of Senate moderates, "grabbing senators in their state while also fighting here in Washington," Hickey said. Right now, it is a shoestring operation, but Hickey said the opposition will make itself heard in the coming months with the help of the unions and some wealthy benefactors. "This is a coalition that doesn't have a lot of money, but when things heat up, money does tend to become available," he noted.

02/26/2003
Enterprise Zones of Choice
null
http://d7.freedomworks.org.s3.amazonaws.com/styles/thumbnail/s3/te_social_media_share/fw_default_0.jpg?itok=mX_C44GW
Press Release

Enterprise Zones of Choice

© 2002 Copley News Service, 2/25/2003 In 1981, Congress enacted the Kemp-Roth 25-percent-across-the-board tax rate reductions (aka the Reagan tax cuts), which made a significant improvement to the tax code and helped free the economy from "stagflation" (simultaneously rising inflation and unemployment). The top tax rate was then 70 percent, and the lowest rate was 20 percent.

02/25/2003

Pages