Wal-Mart Joins Companies Cutting Ties With ’Free-Market’ Group

Wal-Mart Stores Inc. (WMT) is the latest company to withdraw from the American Legislative Exchange Council, a corporate-funded public policy group under attack for pushing voter-ID and “Stand Your Ground” state laws.

About a dozen companies, including Coca-Cola Inc. (KO) and Kraft Foods Inc. (KFT), previously ended their membership in the group under pressure from ALEC opponents.

“Historically, we found value in working with ALEC and its legislative members on issues related to tax, commerce, and economic development,” Maggie Sans, a Wal-Mart vice president, said in a letter to ALEC.

“Previously, we expressed our concerns about ALEC’s decision to weigh in on issues that stray from its core mission ’to advance the Jeffersonian principles of free markets,’” Sans said. “We feel that the divide between these activities and our purpose as a business has become too wide. To that end, we are suspending our membership in ALEC.”

An ALEC spokeswoman, Kaitlyn Buss, said yesterday the group was disappointed in Wal-Mart’s decision.

“ALEC companies are being targeted with smear campaigns that produce manufactured outrage and the façade of grassroots support,” Buss said in a statement. “In reality, these groups are bankrolled by extreme liberal front groups and union leaders and their goal is to simply demonize anyone who rejects their big-government agenda. ALEC will not be silenced because our free market, limited government ideas are needed more than ever and are at the core of every well-run state in the country.”

Working through ALEC, corporate representatives belonging to the group have helped state lawmakers draft bills that the legislators then try to enact.

Voter ID Laws

ALEC has been under fire for its support of state laws such as requiring voters to show photo IDs before casting ballots and the so-called Stand Your Ground measures that allow individuals to use deadly force if they feel threatened.

George Zimmerman, a community watch volunteer who shot and killed unarmed teenager Trayvon Martin in Florida earlier this year, has claimed self-defense under such a law. He is charged with second-degree murder.

Corporate membership in ALEC costs up to $25,000 a year. Sans was secretary of ALEC’s Private Enterprise Board, whose members work for 21 companies or trade associations. Exxon Mobil Corp. (XOM) and AT&T Inc. (T) are among the companies with representatives on the board.

Tax-Exempt Status

Washington-based Common Cause, an advocacy group, has asked the Internal Revenue Service to investigate whether ALEC was entitled to its tax-exempt status, charging that it has functioned as a lobbying organization.

“ALEC and its corporate backers have built an extremely successful lobbying shop under false pretenses,” Common Cause President Bob Edgar, a former Democratic U.S. representative from Pennsylvania, said in a statement yesterday.

“They wine and dine and write legislation for our elected officials behind closed doors at posh resorts and guide that legislation into law in the statehouses,” Edgar said. “Then they call themselves a charity and ask the taxpayers to subsidize their work by bestowing a tax exemption.

He praised Wal-Mart for making “a smart decision to end its involvement in this charade.”

Bentonville, Arkansas-based Wal-Mart was one of several companies funding both ALEC and the Congressional Black Caucus Foundation.

Black Caucus

Members of the black caucus have said voter-ID laws suppress minority voting. The Brennan Center for Justice at New York University said 25 percent of voting-age blacks, 16 percent of voting-age Hispanics and 15 percent of voting-age Americans in households earning less than $35,000 lack the sort of approved IDs required by the laws.

In April, ALEC announced it was disbanding the task force that dealt with voter-ID and gun rights measures and would focus exclusively on economic issues.

To contact the reporter on this story: Jonathan D. Salant in Washington at jsalant@bloomberg.net.

To contact the editor responsible for this story: Jeanne Cummings at jcummings21@bloomberg.net.

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