Since the formation of the United States constitution, lobbying has been a vital part of our political system. The rise of the interest group has helped fill in gaps in representation of diverse interests in ways that the system of party politics cannot. However, there is one group that bypasses this organized system of interest group lobbying. The American Legislative Exchange Council (ALEC) takes the corporate entity and places them on the fast-track. Under ALEC, members of the private and public sector co-draft model legislation, which is then paid for by state legislatures and passed into law. There is no other nonprofit organization like them in American politics today.
For years, ALEC has stated its mission is to “promote education on the principles of free markets and federalism through its research and publications.” For this work, the Internal Revenue Service has provided the organization with 501(c) (3) status, which means that they are exempt from federal income taxes. A review of ALEC’s financial statements, past activities, and meeting minutes reveals a different story – one of the biggest direct lobbying powers in American politics. Seeking to avoid action on the part of the Internal Revenue Service (IRS) for tax violations, ALEC formed the Jeffersonian Project in 2013. The Internal Revenue Service is apparently satisfied by this move by the ALEC organization.
After a thorough examination of the tax code, the past activities of ALEC and the Jeffersonian Project, I think there is still more work to be done. ALEC is much more suited to be a lobbying firm and operate as a for-profit entity. There also needs to be more transparency with regards to reporting. Given ALEC’s critical influence on state lawmaking today, citizens deserve to know who is influencing policy and the motives behind them.
Link to full white paper: White Paper ALEC