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By letterhead | February 11, 2008
While watching Rudy Giuliani’s concession speech a couple of weeks ago, I perked up when I heard one of the key planks in his “pro-growth” platform… an enthusiastic wish for:
“Less lawsuits! Please, less lawsuits!”
(Let’s leave aside for a moment that what he really wants are “fewer” lawsuits.)
A “ping” went off inside my head, which quickly connected to two other “pings” that hit the radar screen lately. And for you non-PR folks, connecting the little glowing dots provides an abject lesson in how stealth PR is currently used to affect your world… it’s also a Rorschach test for PR people about just how far we are willing to go to win for our clients. Here are the other “pings”:
1) A recent ad on the liberal e-paper Huffington Post touted a group called “I Am Lawsuit Abuse.Org.” The website has no identification or mission statement, only stories of small business owners who were subjected to “frivolous” lawsuits. Upon closer inspection, one finds that it’s a “project of the U.S. Chamber [of Commerce] Institute for Legal Reform.”
2) Strumpette recently posted a story on the Supreme Court’s decision to extend protections against lawsuits to advisers and suppliers of companies accused of securities fraud. A big win for the “tort reform” movement.
These blips on “tort reform” got me thinking. Even while it appears that big business is winning on the issue, the spin machine seems like its going into overdrive.
To be sure, tort reform has been the Holy Grail of BIG business for decades. But the “small-business” spin is a new twist, launched in December 2007 by the Institute for Legal Reform (itself an arm of the U.S. Chamber of Commerce). In the press announcement it is billed as a “public awareness campaign.”
But if we dissect the components of this “awareness campaign” and disperse the PR fog, it looks like pretty much like big business advocates trying to hide their identities and agendas to fool people into seeing them as benefactors of the Average Joe.
Disclaimer: This is not an anti-business screed. It’s concerned exclusively with a specific set of actions and intentions, not value judgments about capitalism or the right of corporations to exist. Please let’s not get distracted.
Peek-a-boo: Who Are You Really???
Is the U.S. Chamber of Commerce a “small business” group? Depends on how you look at it. Their website claims that 96% of their 3 million members “encompasses businesses with fewer than 100 employees.”
But who gives the Chamber most of its $150+ million budget? The Chamber is notoriously secretive (a bit ironic given its fight for transparency in government and the courts). The closest indication we get is from a Washington Post article from 2005 in which the Chamber acknowledges that in the previous year $90 million came from its “largest corporate members,” called the President’s Advisory Group. (One assumes that these “largest corporate members” are among the 4% of companies – approx. 120,000 of them – with more than 100 employees.)
So, let’s see: they got about 60% of their funding from less than 4% of their membership. Hmmm… you think it’s a safe bet that those are the folks are calling the shots at the Chamber? So, let’s ask again: is it a “small business” organization? Highly unlikely. Then why the small-business angle on their tort-reform agenda?
Simple: It plays in Peoria. And grassroots pressure works to create political change. All you have to do is convince the little people in Peoria that they’re under threat, hence the “awareness campaign.” But are they under threat? That’s debatable too, and digging into the question yields a couple of interesting points:
- The approach is skewed. Most stats in the Chambers’ opinion survey are related to business owners’ perception about lawsuits, not the actual quantitative impact of lawsuits. Even if we accept that business owners make decisions based on fear of lawsuits, what if their fear is unfounded? Or worse yet, manufactured?
- Most of the tort cost statistics on the site, and in their commissioned research, simply replay Tillinghast Towers-Perrin’s study on the “tort tax,” which has been thoroughly debunked as a PR gimmick. (No doubt a plank in the consultancy’s “thought leadership” marketing platform.)
The Chamber’s own facts are unreliable. For example, their press release and website quote this figure: “three-quarters of all small business owners in America are concerned they might be the target of a frivolous or unfair lawsuit.”
But in the survey results, that figure is nowhere to be found. In fact, on the first page – buried and never referred to again – is this figure: “48% of small business owners or managers are very or somewhat concerned that they may be sued in a frivolous or unfair lawsuit.”
Head scratch: if you flip it around, that means that…. yes, even Business Week (that bastion of liberal reporting) ferreted out the meaning behind the numbers: “more than half of small-business owners said they were ‘not too concerned’ or ‘not at all concerned’ about getting sued.”
How does that square with the purposefully alarming “three-quarters” are scared to death line touted by the Chamber? It doesn’t. Moreover, the Business Week article cited this statistic:
“…in 2006 members of the National Association of Manufacturers ranked fear of litigation last on a list of 10 factors hurting their businesses.”
But the money quote in the piece comes from Jeff Milchen, cofounder of the American Independent Business Alliance:
“Any time anyone that represents major corporations is trying to advance their agenda, they’re not going to come out and say this is what we want as a global corporation. They’re going to try to use independent business owners to try to change policy.”
It’s Not Third-Party Opinion If You Own It
The Chamber takes bait-and-switch to a whole ‘nother level with its media advocacy campaign. And if the “small-business” reframing does not raise your hackles, try this one: the Chamber launched its own legal newspaper a few years back, the Madison St. Cloud Record (IL) as a stealth media/propaganda vehicle for advocating tort reform (WaPo article here).
If you go to the Record website, it looks like a plain ole independent news outlet covering the local legal scene; there is no mention anywhere of an affiliation with the Chamber.
The wonderfully dishy legal blog Tortellini has been covering the U.S. Chamber’s antics for years, reporting that the Chamber’s Record newspaper chain has expanded to West Virginia and now Texas. In April of last year, a lawyer in Texas trying an asbestos case caught Record employees giving potential jurors copies of anti-lawsuit editorials from the Chamber’s faux news outlet. The attorney petitioned the judge for jury tampering charges in the case.
So here is the PR plan in a nutshell: You’ve gotten as much as you can by going at it straight, so you need a new angle. Create panic and then point to people’s fear as proof of a threat – the very one you’ve been harping about with limited success. Be a hero by proposing to neutralize the threat, with a solution that just happens to match what you wanted from the beginning. Rinse and repeat.
Philosophically Speaking, It’s No Small Point
So what’s going on here? This kind of stuff is what gives PR a bad name, even though it’s not, strictly speaking, PR. It is propaganda: the purpose of a program like this is subvert debate in the interest of victory. And it’s unethical, especially the part about buying newspapers and hiding your ownership.
The Chamber is making a calculated attempt to re-frame a public policy issue in a way that delivers a specific result to its sponsors – regardless of whether the re-framing is accurate, or the results are desirable for the very people who’s alliance and support is being solicited. Indeed, Mr. Milchen observes that:
“Very often it’s small companies being harmed by larger corporations and needing to seek redress through the civil justice system.”
This is often the case when monied interests set their sights on a public policy outcome. Little people everywhere, from Peoria to Platsburgh, are the worse off for it, even though they have been scammed into thinking that the policy is designed to help them. And make no mistake, these interests represent big-time money: In the last six years the Chamber has spent over $118 million in lobbying its tort reform issues – and that’s just the lobbying budget for the Institute for Legal Reform. It does not include the Chamber itself or its surrogates; nor does it include PR or advertising.
That’s no small business venture. And ultimately it’s more than a bit hypocritical. After all, it’s conservatives like Donahue and other Chamber leaders who are our most vocal patriots, trumpeting America’s greatness – chief among them that we are a nation of laws. George Bush says so. American conservative idol Mitt Romney says so. Even a Catholic archbishop says so.
And it’s no small point, philosophically speaking.
We are not… say… India, where one of the country’s largest banks was fined for hiring pipe-wielding thugs to beat up delinquent borrowers. We have dispensed with pistol duels and never were much for jousting. We have the courts. And when the courts are your sole recourse for settling disputes, it should be no surprise that people sue each other. (Abuses on both sides notwithstanding, equal access to the courts is a basic tenet of American democracy.)
Tortellini leads with this quote from John Adams:
“Representative government and trial by jury are the heart and lungs of liberty. Without them we have no other fortification against being ridden like horses, fleeced like sheep, worked like cattle, and fed and clothed like swine and hounds.”
But in the name of saving big member companies lots of money – PWC’s $225mm payment in the Tyco fraud case comes to mind – the Chamber wants to dismantle David’s right to sue Goliath. And if the Chamber gets its way, the people most likely to be left resource-less are the victims of securities fraud, or product liability, or price collusion, or any of the other myriad sins of big business, which hurt proportionally more people than the sins of small business. The small business owners who are actually being solicited to join the Chamber’s team – through this PR campaign – are the kind of upstanding Average Joes who are more likely to be losers, not winners.
It’s a testament to the success of the Chamber’s PR program that they have managed to strike a populist pose while pursuing a big-business agenda. A recent Harris poll showed them to be the fifth most trusted independent organization of those active in Washington politics.
Effective Yes: But Is it Ethical?
In a foreward to the Chamber’s latest project – a code of conduct for State Attorneys General – they complained that State AGs did not want to respond their questionnaire. The AGs refused to believe that the Chamber wasn’t running a “gotcha” program. (Is it any wonder lawyers mistrust them?)
So with this question on the table – Is their PR program ethical? – I conclude with a snarky quote from the Chamber, which takes State AGs to task for non-cooperation. The Chamber complained: “…the problem is, sometimes when you want to find out something, people don’t want to let you know.”
Your thoughts and ideas are welcomed.