ALEC wants to privatize it all

August 6, 2013

Postal worker Melissa Rakestraw reports on the American Legislative Exchange Council's assault on working-class living standards.

THE MARCH on Washington for Freedom and Jobs culminated with Dr. Martin Luther King's, "I Have a Dream," speech on August 28, 1963. This seminal moment in the civil rights movement connected the need for equality with the need for jobs. Fifty years later we still see stark reminders of the need for jobs and the need for equality in our society.

Income inequality in our country is at its most extreme since 1928, the age of the robber barons. It took a militant labor movement in the 1930s to establish rudimentary rights for workers, gains that expanded over the next four decades. Since the early 1970s, we have seen a steady decline in union density and a vast increase of the wealth of the 1 Percent.

This has not been an accident. There have been very well-coordinated attacks by corporate forces to roll back the gains of the labor and civil rights movements.

ONE OF the groups leading this charge to rollback union protections, voting rights, environmental safeguards and all number of shields for society from greed-fueled corporations is a group called ALEC. The American Legislative Exchange Council (ALEC) is a Koch Brothers/corporate-funded cabal that brings together money and politicians in order to corrupt our democracy.

Protesters demanding justice for Trayvon Martin call out ALEC for its role in promoting Stand Your Ground laws
Protesters demanding justice for Trayvon Martin call out ALEC for its role in promoting Stand Your Ground laws

Corporate lobbyists are joined with legislators so that "model legislation" written by the corporations themselves can be placed in the opportunistic open hands of politicians looking to serve the interests of the 1 Percent.

ALEC sponsored legislation has served to establish "Stand Your Ground" laws to enrich gun manufacturers, anti-immigration "papers please" laws to benefit private prisons, as well as anti-union legislation that has targeted in particular public sector unions, and laws that gut the social safety net, destroy our environment, criminalize poverty and privatize services for the public good.

ALEC is a leading driver behind the current budget "crisis" facing the U.S. Postal Service (USPS). ALEC was behind the 2006 Postal Accountability and Enhancement Act (PAEA), which required that USPS pre-fund retiree health care benefits 75 years in advance.

UPS has a representative on the board of ALEC, and so does FedEx. PAEA was introduced in the House by former Rep. John McHugh (R-N.Y.) an ALEC alum who upon becoming a member of Congress began working to advance this "postal reform," which has generated over 80 percent of the USPS losses in the last six years.

What you can do

Join activists in Chicago protesting the American Legislative Exchange Council's 40th Anniversary Conference, August 8, noon, outside the Palmer House Hilton Hotel, 17 E. Monroe. For more information, visit the Facebook event page.

This burden generated a false fiscal crisis, particularly once the economy entered a recession and is currently being used to promote further privatization measures. The $65 billion generated annually by USPS is an attractive revenue stream for private corporations looking to grow their corporate coffers at the expense of living-wage jobs.

BEFORE MCHUGH introduced PAEA, members of the ALEC/Koch cabal published numerous papers attempting to laud the "benefits" of privatizing USPS.

The Cato Institute's Tad DeHaven wrote on behalf of the National Taxpayers Union (receiver of Koch funding) for the Econ Journal Watch: "We could go on at length as to the potential benefits from privatization of the USPS and creation of USPS INC." Simultaneously, Cato published "Downsized Federal Government," by Chris Edwards, arguing:

Privatization of the USPS and repeal of its monopoly would bring major innovation to the mail industry, just as the 1980s breakup of AT&T brought innovation to the telecomm industry...

The federal government operates numerous business enterprises that could be converted into publicly traded corporations including USPS, Amtrak and a number of electricity utilities. The way ahead is to privatize the USPS and repeal the mail monopoly that it holds.

Reason Foundation's Annual Privatization Report argues in regards to USPS:

Moving forward calls for privatizing and repealing the first-class mail monopoly that it holds. The USPS suffers from a high-wage premium. It pays an estimated 21 percent to 37 percent more than would a comparable private-sector employer which represent 12 to 20 percent of total costs.

Heritage, CATO, the National Taxpayers Union and Reason all promoted the idea that USPS is a government-run monopoly, giving it the negative label of "monopoly" to justify their pro-privatization schemes. Once the seeds were planted that USPS was "bad" for consumers, because of course a "monopoly" hurts the people, they then enacted actual legislation to bankrupt USPS by forcing them to "pre-fund" pension benefits.

This transfer of $5.5 billion annually from the USPS revenue stream into the U.S. Treasury prevents USPS from having access to these funds and allows the federal government to loot and plunder the account.

We saw this happen recently when Treasury Secretary Jack Lew authorized the federal government to borrow money from the USPS retiree health care benefit account in order to continue making payments on the national debt and avoid default. Meanwhile USPS has no access to these funds to cover revenue shortfalls brought on by the recession or funds for infrastructure upgrades.

The ALEC-orchestrated attack on USPS isn't unique. ALEC has attempted to privatize public services such as schools and prisons on a massive scale in order to privatize the profits generated and transfer costs and losses onto taxpayers. This type of attack has been commonly referred to as "disaster capitalism" and neoliberal austerity economics.

ALEC's schemes have been progressing over the last 40 years, and it will take a coordinated fightback from workers on a massive scale comparable to previous civil rights and labor movements to combat them. ALEC has vast financial resources while workers have the power of the people.

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