1. 1 Business Influence on Government and Public Policy Business and Society: Ethics and Stakeholder Management, 7e Carroll & Buchholtz Copyright ©2009 by South-Western, a division of Cengage Learning. All rights reserved Prepared by Deborah Baker Texas Christian University Chapter 12

2. 2 Quote for the day  Politics is supposed to be the second-oldest profession. I have come to realize that it bears a very close resemblance to the first. --Ronald Reagan  Congress is furious. They want to know how oil company profits are so high, but their money under the table has remained the same. ---Jay Leno

3. 3 Corporate Political Participation Lobbying PACs Coalition Building Political Strategy The process of influencing public officials to promote or secure passage or defeat of legislation Instruments through which business uses financial resources to influence government Business and other groups joining forces to achieve common goals To secure position of advantage regarding a given regulation or piece of legislation

4. 4 The Purposes of Lobbying  Gain legislative support or institutional approval for some objective  Obtain reinforcement of established policy or the defeat of proposed policy shifts  Targets the election or defeat of national, state, and local legislators

5. 5 Organizational Levels of Lobbying Umbrella Organizations Trade Associations Company-Level Lobbying Broad Midrange Narrow/ Specific Narrow/ Specific Representation Chamber of Commerce of the US National Association ofManufacturers Chamber of Commerce of the US National Association ofManufacturers National Automobile Dealers Assn National Association of Realtors National Automobile Dealers Assn National Association of Realtors Washington and State Capital Offices Law firms Public affairs specialists PACs Grassroots lobbying Washington and State Capital Offices Law firms Public affairs specialists PACs Grassroots lobbying Examples Figure 12-1

6. 6 What Business Lobbyists Do for Clients  Get access to key legislators  Monitor legislation  Establish communication channels with regulatory bodies  Protect firms against surprise legislation  Draft legislation, slick ad campaigns, direct-mail campaigns  Provide issue papers on anticipated effects of legislative activity  Communicate sentiments of client on key issues  Influence outcome of legislation  Assist companies in coalition building around issues  Help members of Congress get reelected  Organize grassroots efforts Figure 12-3

7. 7 Grassroots Lobbying Mobilizing the “grassroots”—individual citizens who might bemost directly affected by legislativeactivity—to political action Cyberadvocacy Using the Internet to amassgrassroots support, and enablegrassroots supporters tocontact their legislators

8. 8 Coalition Building 1. Manage the sequence in which issues are addressed 2. Increase the visibility of certain issues 3. Unbundle issues into smaller subissues

9. 9 How an idea becomes law  A bill, the most common type of measure, is a proposal for a law. All statutes, except those initiated by the people or referred to the people by the Legislative Assembly, must be enacted through a bill.  The path of a bill, from the time it is just an idea to the time it arrives at the Governor's desk for approval, is paved with many detours. In order for a bill to become law, it must be passed by both houses in the identical form. A bill may be introduced in either the Senate or the House with the exception of revenue bills which must originate in the House.This is achieved through the following step-by-step process, using the House of Representatives, for example, as the house of origin.  An idea to change, amend or create a new law is presented to a Representative.  The Representative decides to sponsor the bill and introduce it to the House of Representatives, and requests that the attorneys in the Legislative Counsels office draft the bill in the proper legal language.  The bill is then presented to the Chief Clerk of the House, who assigns the bill a number and sends it back to the Legislative Counsel's office to verify it is in proper legal form and style.  The bill is then sent to the State Printing Division, where it is printed and returned to House of Representatives for its first reading.first reading.  After the bill's first reading, the Speaker refers it to a committee. The bill is also forwarded to the Legislative Fiscal Officer and Legislative Revenue Officer for determination of fiscal or revenue impact the measure might have.fiscalrevenue impact  The committee reviews the bill, holds public hearings and work sessions.work sessions  In order for the bill to go to the House floor for a final vote, or be reported out of committee, a committee report is signed by the committee chair and delivered back to the Chief Clerk.  Any amendments to the bill are printed and the bill may be reprinted to include the amendments (engrossed bill).engrossed bill  The bill, now back in the house of origin (House), has its second reading.  The measure then has its third reading, which is its final recitation before the vote. This is the time the body debates the measure. To pass, the bill must receive aye votes of a majority of members (31 in the House, 16 in the Senate). third reading  If the bill is passed by a majority of the House members, it is sent to the Senate.  The bill is read for the first time and the Senate President assigns it to committee. The committee reports the bill back to the Senate where the bill is given the second and third readings.  If the bill is passed in the Senate without changes, it is sent back to the House for enrolling.enrolling  If the bill is amended in the Senate by even one word, it must be sent back to the House for concurrence. If the House does not concur with the amendments, the presiding officers of each body appoint a conference committee to resolve the differences between the two versions of the bill.conference committee  After the bill has passed both houses in the identical form, it is signed by three officers: the Speaker of the House, the Senate President, and the Chief Clerk of the House or Secretary of the Senate, depending on where the bill originated.  The enrolled bill is then sent to the Governor who has five days to take action. If the Legislative Assembly is adjourned the Governor has 30 days to consider it.  If the Governor chooses to sign the bill, it will become law on the prescribed effective date. The Governor may allow a bill to become law without his/her signature, or the Governor may decide to veto the bill. The Governor's veto may be overridden by a two-thirds vote of both houses.Governor's veto  The signed enrolled bill, or act, is then filed with the Secretary of State, who assigns it an Oregon Laws chapter number.  Staff in the Legislative Counsel's office insert the text of the new laws into the existing Oregon Revised Statutes in the appropriate locations and make any other necessary code changes.  Effective Date of Legislation  In 1999, the Legislative Assembly adopted ORS 171.022, which reads, "Except as otherwise provided in the Act, an Act of the Legislative Assembly takes effect on January 1 of the year after passage of the Act."  Some bills contain a clause which specify a particular effective date. Still others may have emergency, sunset, or referendum clauses attached.emergencysunsetreferendum clauses

10. 10 Golden Rule of Politics: “He who has the gold, rules.” Political Action Committees (PACs) are groups of like-minded businesses using financial resources to influence government. Political Action Committees

11. 11 PACs expect something in return other than good government and this can lead to differing treatment for those who give and those who cannot, such as the poor. PACs are a reasonable means that business may use to organize their contributions to candidates for office. Arguments For PACs Arguments Against PACs Political Action Committees

12. 12 Political Action Committees Issues Concerning PAC’s  Magnitude of activity  Vote buying  Campaign financing  Soft money  www.opensecrets.org www.opensecrets.org  http://www.opensecrets.org/industries/mems.php  www.fundrace.org/neighbors.php www.fundrace.org/neighbors.php

13. 13 Political Action Committees Conditions Needed for Effective PAC Contributions 1.When the issue is less visible 2.During the early stages of the legislative process 3.When the issue is narrow, specialized, or unopposed 4.When PAC’s are allied 5.When PAC’s adapt lobbying techniques to their contribution strategies

14. 14 Soft Money The Hard Facts About Soft Money  A contribution made to political parties instead of political candidates  The Bipartisan Campaign Reform Act of 2002 was a sweeping change of U.S. campaign finance The BCRA removed the influence of soft money on candidates running for national office

15. 15 Political Action Committees Strategies for Political Activism  Containment Strategy Keeps an issue off the public agenda and out of the limelight Helps to define an issue  Regulatory Life Cycle Approach Formation, formulation, implementation, administration and modification of a firm’s political strategy

16. 16 Contingency Approach Contingency approach considers variables of: 1.The number of salient issues in a legislative district 2.The amount of information a legislator possesses concerning voter preferences After considering the above, then determine: 1.The salience of the issue to the legislator’s constituency 2.The identification of the expected position of voters on the issue

17. 17 Strategies for Political Activism The political activities are contingent on: 1. Modes of corporate responses Defensive Accommodative Positive activism 2. Internal corporate conditions 3. Anticipated political risks