Episode 14: State Capture (with Alexander Hertel-Fernandez)

Hello and welcome to episode. I think this is going to be 14 of the Policy Agendas podcast. I am E.J.

Fagan and today I am joined by the manager of the Policy Agendas Project, Brooke Shannon. Hi. Thanks for having me.

And we are joined by Professor Alex Fertel Fernandez. He is an assistant professor

of politics for political science at Columbia’s School of International and Public Affairs and the author of the book

State Capture How Conservative A Conservative Activists, Big Business and Wealthy Donors Reshaped

the American States and the Nation. Alex, welcome to the podcast. Thanks so much. I’m looking

forward to our conversation. Yeah, this is this is a wonderful book. And really the the the really

the result of years of effort. I’ve been following all of your papers of that as they’ve been published.

And I really love how this this comes together in the book. Can you can you explain before we go into

the details, just the overall kind of big picture argument of state capture?

Sure. And thank you for those kind words. It’s certainly a book that draws on many different pieces of evidence

that took a while to assemble, I think, as we’ll get into in our discussion. There’s no one piece of evidence that can

pin down the reasons why organizations of all of the way that they do, where their impact on politics.

And that hints at some of the broader arguments that I hope to make in the book. So the book really has three parts

to it. The first part asks, how is it that conservatives. And here I’m talking

about individual donors, philanthropy’s advocacy groups and individual activists

work together with private sector businesses to build cross state networks to try and reshape

state policy. And so this is very much an inward looking story within these organizations asking

how they manage tensions within each of the parts of this coalition, how they came up with

political strategies and how they changed over time. The second part of the book asks,

well, what effect have those cross-state networks had on state policy and politics? And that’s

more outward looking. It’s looking at the effect that these organizations have had on specific pieces of legislation

and also the broader political terrain in the states. The third part of the book asks, well,

if conservatives had been so successful at building up these networks that operate across states,

why haven’t liberals responded in kind? And why does it seem as though Democrats

and the left have really struggled to take advantage of state policy and politics in the same way as conservatives?

And let’s start by talking about the first big organization that makes up about the first half of the book,

the American Legislative Exchange Council. So tell us a little bit about what ALEC is just kind of kind

of briefly for anybody who hasn’t heard of him. Sure. As you alluded to, I

look at three organizations in the book, I dubbed them the right wing troika. Although now I’m somewhat

regretting using the Russian shorthand for that given everything that’s happening in this country. But there we

are. And so the troika consists of ALEC, the group that you mentioned, Americans for Prosperity

and the State Policy Network. And in the first part of the book, I focus on ALEC because it is the oldest

of the organizations and in some way forms the backbone of the coalitions that I’m looking at. But I want to be clear that

the book focuses on on this broader set of organizations as well. So Alec got started

in the 1970s and it was formed very much in a reaction to

what conservatives perceived to be liberal dominance in the states and the liberal

dominance in national politics more generally. And this sort of fits well with some of the conversations that you’ve had

on the podcast before. I’m thinking in particular about that. The book, The Great Broadening,

talking about the broader liberalizing trends in policy at the national level that you saw

in the United States in the 1970s. And these conservative activists were very much reacting

to that at the state level, pointing out how states were increasing spending in a number of areas,

passing new regulations. And so they said, you know, if we want to retain our strength

and have any chance of rebuilding strength at the state level, we have to get together organizations of

our own. And that can provide resources to state lawmakers, ideas for those state lawmakers

for the bills that they should pass and an agenda for doing that. Alec

is a bit of an odd organization, the way that it’s structured. So when I before I read this book

to me, I understood Alec as a corporate organization too, to influence public policy

in the states for for the benefit of the corporation to our members of it. But it’s a little more

complicated than that, right? That’s right. And I’m guessing that many of your listeners may have

heard about Alec in the news. It’s come under repeated controversy in recent years and it often

gets described by political journalists or pundits on the left as a corporate bill mill,

a chance for companies to write legislation that goes off to the states and state lawmakers enact it

wholesale. And there’s a portion of that. That’s true. Companies are a major supporter of ALEC.

They participate in the groups task forces, and they certainly have a heavy hand in writing legislation.

But as I discuss in the book, companies are only one part of the ALEC coalition and it includes

social conservative groups, philanthropy’s individual wealthy donors and state think tanks

and national think tanks as well. And so over the years, ALEC has had to come up with ways of

balancing the different interests that each of these actors have. You know, the companies might want to focus

just on bills that lower their tax burden, raise regulatory requirements

on their competitors to shut out competition in markets or weaken labor unions.

Whereas social conservatives in the group cared about more hot button social issues like gay marriage,

the Equal Rights Amendment or abortion or gun rights. Why did

corporate America or that is the subgroup of corporations that were involved with ALEC?

Why did they make this this kind of formal alliance in an organization with social

conservatives and conservative activists more broadly? So in the book,

I am clear that I think there are a number of different processes going into this, part of this is a more general tendency

of businesses to get mobilized in politics starting in the nineteen seventies and really

accelerated in the nineteen eighties. And they are very much responding to the wave of this new legislation

at the state and federal level, new regulation that crossed old sectoral boundaries.

You had the creation of a bevy of new agencies like OSHA for occupational

safety, the EPA for environmental regulation, consumer protection

agencies and companies were really worried about this. And so they felt like they had a bigger stake

in policy and politics and had to get involved. So that’s sort of a more general background to what’s happening in ALEC.

But a more specific thing that is happening is that political entrepreneurs,

politicians and activists within ALEC that helped to start the group began making the case to companies

that if they really wanted to have an impact on state policy, that they should be working through ALEC

instead of hiring lobbyists in each and every state capital, companies could go to ALEC

and work with the organization to produce model legislation that would then go out across the entire

network that ALEC had assembled. So it was in many ways a sort of utility that businesses

can take advantage of and a shortcut for trying to lobby across the states. But then why?

Why? I can imagine, you know, the textbook you know,

the textbook version of businesses working together to lobby would be they would form a business

group. So why did why do you all of a sudden have the kind of this alliance with

gun rights groups and social and social conservatives and very unvisited issues

that businesses are either ambivalent about or maybe even India? When when pressed would even oppose

some of these these policy changes? Yeah, it’s a fascinating question. And I have

some really great quotes from government affairs officers at companies. And Alex, early years

talking about how they were a little uncomfortable working with an organization that was so active on social

issues. But Alec had an edge that it could offer that other organizations couldn’t,

in that it had already started to assemble a network of conservative lawmakers from both parties,

from Republican legislatures, from Democratic legislatures all across the country. And so

they managed to carve out a niche that they could offer that, you know, the Chamber of Commerce couldn’t or that other

associations couldn’t do. And it would have taken substantial effort for companies to try and reproduce that

on their own. And so even though companies may not have liked it originally, Alec had this utility

that was valuable to them, of course, over time, as companies gained the upper hand in

Alec’s management. They managed to push down or tamp down Alec’s focus on social

issues. And throughout the 1990s in particular, you saw Alec focused mainly on

sort of bottom line corporate issues. But that changed over time and I am more than happy

to get into that. If if that’s something you’d like to discuss. I’d like to also

to pivot to some of the other just kind of general findings about Alec’s activities. Can you explain? You mentioned that they’re

there. They were had a reputation as being a bill farm. Can you explain some of your model bill findings?

Yeah. So I think this is an important finding for understanding how state politics

works. And then also as a methodological approach for trying to measure influence,

because that’s something that political scientists have been struggling with for for decades to understand whether

or not a particular interest group actually changes the content of policy.

So ALEC produces model bills, as many other interest groups do, and is as is

a time honored tactic in American politics. But what Alec does is it doesn’t just produce these model bills.

It also offers a host of other services to help state lawmakers

pass those model bills, giving lawmakers research reports, ideas

for who they should invite to bill hearings to testify on behalf of that legislation, polling

and talking points they can use in support of that model legislation. And it turns out that that’s really valuable

because in many states, lawmakers simply don’t have the time or the staff

help to really consider and introduce legislation on their own. Although there are several

states that have what we call in political science, a fairly professionalized legislatures like my current

home state of New York, but also California and Pennsylvania. Those tend to be full time, full

year legislatures that are that pay their lawmakers well enough that, you know, you pretty much

only work as a lawmaker. And they also give you a great number of staff to lawmakers

in most states. It doesn’t look like New York or California. You might be lucky if you have one or two staffers working

part time or staffers that you share with other members. And your legislature probably

only needs a couple of months a year. And indeed, there are there are some legislatures like yours

in Texas that don’t meet every year. So that doesn’t give us once every two years. Right. Exactly.

That’s not a lot of time to consider all of the things that states need to be. On when you think about all

of the responsibilities that they have under those conditions, it’s really valuable for a group like Alec

to come in and provide exactly the ideas and research and support that you might

might not have otherwise. So in the book, I use a tactic I call policy plagiarism

detection, basically using text analysis to figure out where lawmakers have

copied and pasted bills from Alec’s library and introduce them as their

own. And I look at the state level first and I show that it tends to be states that

have lower levels of legislative professionalism, so fewer staffers, shorter sessions

and lower salaries for lawmakers that rely most heavily on ALEC. And that remains true, even if

I look at regression models that control for the partisan balance within state legislatures

and look at variation within states over time and then within legislative chambers, it tends

to be the most junior members who are most likely to copy and paste and plagiarize their bills, if you will,

from ALEC. And so that’s a nice test of the interest group influence that Alec is having at sort of a smoking

gun test, because we can be sure that those lawmakers relied on ALEC. And it also

teaches us something important about the how state legislatures work, which is to say

they need a lot of ideas and resources because they currently don’t get them from their own

staff or don’t have the capacity to do it. And so interest groups that do that, provide those resources

can be quite valuable. Right. So like you said earlier and throughout the book, this is

really clear that the corporations are really dictating a lot of a lot of the

interests and preferences of the corporations are really what comes through in a lot of these

bills at the state level and throughout the country. So

one of the interesting things about corporate interest in particular is that you mentioned a

lot the fragmentation of that corporate interests. And do you see this

fragmentation in a specific any specific issue area like in any

policy issues? And does this also happen to other coalition

partners? Maybe the the social, socially conservative interest

groups that are partnering with with the corporations, things like that. It’s a great question

because many political scientists writing before on business government relations have

emphasized how difficult it is to get businesses to cooperate within trade associations that

span sector lines and even within sectors, because there are many cases where businesses want to

undermine their competitors or want different things from governments. And so it took ALEC. Trial and

error in order to come up with a structure that let businesses basically settle

their disputes. And Alec’s model that it arrived at. Was a bidding system. If you bid boorda Alec,

you would get to write the model bills, even if your opponents within the organization

disagreed with you. And I think one nice example of that comes from the battles over electricity deregulation

in the 1990s. This was a battle set of battles where Koch Industries and Enron,

probably companies that are that maybe quite familiar to your listeners, particularly in Texas,

may be familiar with. And in this battle on Enron and Coke, industries

were pushing against local state utilities that were against deregulation

and Coke industries and Enron were supportive of it. And ultimately, Enron was willing to bid more

to ALEC to write. The model bill on electricity markets. And so it did it actually

paid so much that it sponsored an entire annual meeting that ALEC had for state lawmakers. And

it turns out that ALEC model bill and and research support that it offered to lawmakers was an important

factor in driving state deregulation of electrical markets during that period.

Another another issue that you raised was how businesses cooperate or or not

with the social partners, our social issue groups within ALEC. And here I think

ALEC has done a nice job of pushing issues and teaching the different

actors and its coalition the importance of pushing what I call power building

policies. Those are public good policies that benefit all conservative actors.

So, for instance, if you weaken labor unions, that’s not just good materially for businesses that are

most affected by labor unions. You also make it harder for Democrats to win elected

office and to pass progressive policy, and that benefits all of the other social issue groups

as well. And so that’s why you see groups like the NRA

and religious right groups within ALEC backing measures to weaken public sector labor unions.

That might seem initially a little bit surprising. What does the NRA care how powerful teacher’s unions

are? But within this coalition, I think ALEC is making a case to its lawmakers and its

members that if you push this policy, you pave the way for future conservative victories

on all of your other issues. Right. Thereby capturing the state legislators

attention. Right. And all these different areas. That’s right. A key theme of the book is that

if you can change the organizational balance within states, you can have a big enduring effect

on state politics. In the years to come. And I think union laws is one great example

of this. We’ve seen a number of states pass cutbacks to collective bargaining rights and and

and unions abilities to charge dues and fees to members and nonmembers. And, you know, that’s had a big effect

on on politics as well. Did did did Republicans in these states need Alec to tell them that

right to work law would be a good thing for Republicans? That’s a good question. So

exactly how much did ALEC contribute versus the broader conservative movement versus what these lawmakers

are? I want to give the counterfactual where Alec isn’t there. You know, how much how much different do we see? Do we

see the same policy, maybe proceed slower or do we see a different set of policy preferences?

I think it’s a great question. I think if you ask most conservative lawmakers now or even several,

several decades ago when Alec ways, we’re just getting started. You know, they would probably say it’s

a good thing to weaken unions that there our opponents. And obviously that’s going to have

benefits. But I think where Alec has an effect isn’t helping set the agenda,

saying not only is this important and it’s going to be good for conservatives, but you should put it first, because if you

do this, then it paves the way for these other priorities and really getting lawmakers

and its and its member groups to think in terms of power building in this way. And I think we can learn a little bit more about

the counterfactual counterfactual by looking at what happens on the left and on the left as

a document in the book. There have just been far fewer organizations that are trying to coordinate

priorities in the same way as the troika and particularly ALEC at the state level.

And I think that’s why you haven’t seen progressive lawmakers or Democratic lawmakers

thinking about policy in the same way has reconfiguring power. And it explains why

it’s until recently you haven’t seen Democrat Democratically controlled legislatures

or governors really taking early and big steps to bolster, say, labor.

In terms of issue capture, I think there’s a large literature about this

in political science, right, about issue ownership between parties and liberal versus conservative.

Throughout the book, in policies that are both proposed and enacted, the policy issue

areas that really are strongest in ALEC in terms of just the numbers of policies

that are both both proposed and enacted are in education and health care. And

then for another member of the troika, the state policy network, you have tax reform to that,

but specifically for education and health care. These are two issues that we really don’t think about being captured

by conservatives or Republicans. Was that surprising to you in in your

research? It’s a great question. So how how does the trick as success vary

by issue area and how should we think of this as being aligned or not with the the

policy images and repeat end ownership by the two party coalitions?

Know on one level, it may be surprising that a conservative organization like this is so involved in these areas.

But if you think about it another way, it makes a lot of sense given that when you look at state budgets

and what state governments do, most of it is health care and education. It’s

Medicaid. This federal state program to cover low income, disabled

and other vulnerable populations and then K-through-12 education and higher education.

And so it makes sense that these are the issues that Alec was. When you look at the total sheer number of

model bills, that’s where a lot of the energy is is being directed. Those are also areas

where ALEC has managed to find common cause with Democrats most frequently. And so I

think it makes sense that when you look at just the sheer number of enactments, you’re more likely to see enactments

where ALEC priorities align with both Republican and Democratic legislative

agendas. And so I would just point out a couple examples here. You know, especially when it comes to education, one of

the most successful areas, you know, for a while and up until very recently, there was

a large set of forces within the Democratic Party that were supportive of alternatives

to public schools like charter schools or vouchers. And that was supportive of introducing

more evaluation measures of teachers than I think the teachers

unions were historically comfortable with. And those were areas where Alec was able to cross party lines and work

with between Democrats and Republicans. Mm hmm. Fascinating.

I’d like to move on and talk a little more briefly about the other two members of the troika, the State Policy Network and

Americans for Prosperity. Can you just briefly explain who they are and really how they differ in their activities

from ALEC? Sure. So the state policy network was

created in the nineteen eighties and it was a loose coalition in its early years of state level

conservative free market think tanks. And it became more formalized as the years went on,

particularly after the early 2000s. And it now counts affiliates

in nearly every state. And these think tanks produce research reports, testimony. They

participate in media coverage of policy debates. They sometimes do polling and litigation.

But typically it’s in service of many of the same priorities that ALEC pursues. And that’s no coincidence

because in its early years, one of Alec’s early executive directors

invited the State Policy Network to start participating in ALEC task forces and help

them raise money, because he recognized, I think correctly, that ALEC would be more successful if there

were forces outside of the state legislature that were pushing for ALEC model bills.

And then Americans for Prosperity is the most recent addition to the troika. But in many ways has grown to

be one of the one of the largest in scope. And it is part of the

Coke political network created by Charles and the late David Coke of

Coke Industries. And it is it’s a funny beast in some ways. It looks like a political party. It’s

a federated organization that has local offices in counties, state offices, regional

offices, national offices. And it has grassroots volunteers who are signed up to participate

in activities like canvasing or participating in rallies or lobbying state legislatures.

But then it also has a large campaign war chest that’s directed by its national team in

the Washington, D.C. area. And RFP is involved in both elections. So it’s involved

in city council races, state legislative races and congressional and even presidential

races. And then it’s also involved on the lobbying side, too. And in many cases, when you have the most

high profile battles over ALEC model bills, a F.P. is marshaling its grassroots

volunteers and it’s sort of media campaigns to push for that legislation.

And you saw this, for instance, in the high profile battles over Medicaid expansion in the states and

efforts to cut back union rights. And so while ALEC is actually quite small, it really punches above its weight

to 10 million. An organization at its peak, American for Prosperity is one hundred million dollar

organization. This is a they’re operating on very different scales. That’s right. And

I think that reflects the different costs that are involved with producing legislative

supports and and mobilizing a large grassroots network

that in some ways is meant to replicate a party structure, of

course, working within the Republican Party largely. Right, we’d like to transition to just

kinds of more big picture questions, so I’ll I’ll start off here. Whether the later

chapters of the book focuses on the Democratic Party and the Democratic Party’s delayed response

in creating similar structures or trying to create similar structures and not doing so

very successfully. Just just to make the conservative argument here would be that,

well, you know, Democrats had labor unions in 50 states and had environmental groups in

that generally moves government policy to the left. And so Democrats don’t actually

need an equivalent to these groups. Is is

that is that correct or is there something something that Democrats are really missing? Yeah,

I’m glad that you mentioned labor unions, because really, as it as I mentioned in the discussion about Alec’s origins,

it was the rise of public sector labor movements in many states in the

dominance in the states. They saw, you know, teachers that were politically mobilized at a state level lobbying for

greater spending, promote higher taxes, greater labor market regulations. And for a while,

I think public sector labor unions, in part because they were so well organized at the state level and part of federation

so they could move resources and ideas across state lines that public sector labor unions

did form an important backbone of liberal cross-state strength. But as we’ve seen

in recent years, public sector labor unions are declining in strength, in part because

of conservative successes at the state level in passing right to work laws, cutbacks to collective

bargaining rights. And at the federal level, through the judiciary, through the Janša Supreme Court

decision, for instance, that applied right to work across the entire public sector. So I think public sector labor

unions really can’t offer that same cross-state clout that they once did.

You mentioned that there are a number of other interest groups and actors within states. And I think that’s definitely true.

Environmental groups, reproductive rights groups, universities sometimes providing policy

ideas and support to lawmakers. But what’s special and different about the troika are that

they are multi-issue and they’re cross state networks. So it’s not just within state actors.

It’s the idea of having networks that have a presence in each state. But they can pool resources nationally

and set agendas in strategic ways, recognizing, for instance, that now might be a good time to push for a bill

in Michigan and and drawing on the lessons from a battle that just happened, say,

in Indiana. And so that’s something that in-state actors lack, is having that cross state

picture and cross state resources. It matters that their multi-issue in that these organizations

on the right, the troika, can really help set agendas in productive ways. They can say, well,

we are going to push for this bill first, followed by that bill and then a third bill. I think what happens

all too frequently in a fragmented liberal in state infrastructure is that

you you get a whole bunch of actors who are pushing for environmental policy, reproductive rights policy,

labor market policy. And there’s no clear prioritization of what what should be pushed first.

And that substantially weakens, I think, Democrats and progressives abilities

to move state politics in the same way as conservatives. Not only are there

a lot of different types of policies being pushed at the states and that the states

take care of it. But the fact is that a lot of the policies that Alec puts

forward are not super popular, especially with public opinion. There’s

a quote that’s in the book that’s quite famous from, I think, the president of ALEC when he said, like, it’s best for

us if the majority of people don’t vote. So we’re wondering, is there

any Democratic accountability? Like is there a backlash to enacting unpopular

policies that are ALEC supported or ALEC

sort of the copy and paste policies, the plagiarized policies that you say? Do

these lawmakers sort of pull back once they experience negative feedback?

It’s a great question and one that really gets to the heart of a lot of political science work. How accountable are lawmakers

for the ideas and the bills and the policies that they put forward? Unfortunately, the research from other folks

who have looked into this at the state level is there is not a lot of accountability. There is

great work by political scientists. Steven Rogers looking at whether or not lawmakers who

take votes that are out of step with their state legislative districts

face backlash in subsequent elections. And the best evidence is there. There’s not a great

deal of accountability for that. And I think there are reasons to think that state lawmakers have

even less accountability than they once did, given the nationalization of politics on the

one hand, which means that people are increasingly casting their votes for state legislature.

Wars or governors on the basis of the National Party’s national issues rather than on

what those state lawmakers are actually voting on. So that’s one trend that I think is worrisome. The

other trend that’s worrisome is the decline in media coverage of state house

legislating and politics. The Pew Research Center has documented, for instance, a really

precipitous decline in over even over the two thousands of full time reporters covering

state House policy and politics. And that means that it’s harder for people to figure out what their state

and state lawmakers are voting on. So I think in both of these ways, it’s less likely that politicians

that pass ALEC model bills that are very unpopular are going to be punished. That said,

I think we have seen some cases where ALEC backed politicians take it back. Politicians

have gone so far that there is public backlash and counter mobilization.

I think about the case of Kansas, for instance, where the legislature

passed very large tax cuts that ended up causing backlash

even from Republicans in the state who are worried about the provision of public finances.

And then I also think about cases where the teachers have risen up a

last year, for instance, in a number of states to protest cuts to public education spending, the

spread of charter schools and vouchers and cuts and taxes that that

disadvantage the children that they teach. So I think in in both of these cases, we see some pretty high profile

efforts by people to check the the unpopular nature of trade legislation.

All right, so we’re going to begin to wrap up here a little bit. Just one one question where

we’re asking for a friend. This book is done an excellent job of

synthesizing together a lot of political science information in a way that is

readable and I think appeals to both political scientist and people beyond

that. How do you do it? How did you approach writing this book after, like I mentioned,

the beginning of the show, really, you know, releasing quite a few papers showing

individual elements of the story. Well, how do you bring it together? Yeah.

And I’m happy you mentioned that and I appreciate the reading of the book, because

that was my goal was to create a product that would be accessible not only to political science audience

readers, but also folks who are just interested in state policy and politics more broadly.

And I would say my two strategies have been to find books by authors

who are doing this already and trying to figure out what works in their writing and then also

editing and anything that I do. You know, I think it takes a while to take ideas that you have

originally crafted and and framed for a technical academic audience

and then think about ways of preserving the argument that you’re making and the nuance while also making

it more accessible. So we always ask at the end of our of our podcasts

for reading recommendations. So if somebody has listened to this podcast and would like to continue

reading something, not by you on the subject, what should they go read?

So I guess I would mention two books that come to mind that I think are

nice complements. One of them is Matt Grossman, a political scientist at Michigan State University,

has a nice new book out called Red State Blues that looks at how

the conservative takeover of many states, in his view, has actually not

produced very large policy gains. And I think it makes for a nice complement to

state capture, because we’re we’re both looking at the same phenomenon and reaching slightly different conclusions

in some parts because we’re looking at different outcomes in some parts because we sort of have different

definitions of what it means to be successful. So I think that would be a nice a nice

compliment to state capture. I would also add Jamila Michener, a political scientist

at Cornell’s new book, Fragmented Democracy, looking at the political

consequences of state by state variation in Medicaid policy. And she does a

great job of showing how these state level policies can have enormous variation even

within states, and also have big impacts on how people experience

their political lives, the ways in which they think about government and the role that it plays

in their day to day activities. So I think that’s a nice reminder of the ways in which these decisions that we’re talking about

in state legislatures actually get translated into the experiences of their

everyday individuals that their book may be down any 50 state. Very simple data

and policy outputs because they’re so heterogeneous. Alex,

thank you for joining us. Thanks so much for having me on. And Brooke, you have to Brooke myself. And we’d

also like to thank the liberal arts instructional technology crew here at the University of Texas in Austin.

This has been your Policy Agendas podcast.