Big businesses have never been reluctant to spend large sums of
money on California ballot measures that figured to feather their
nests.
Big businesses have never been reluctant to spend large sums of money on California ballot measures that figured to feather their nests.
But it’s likely they’ll spend more than ever before this fall. Expect major corporations led by McDonald’s, Macy’s West, Nike and others to put out well over $50 million to beat back one law they fear and pass another they badly want.
Their ongoing efforts may even surpass 1998, when utility companies spent about $90 million to defeat a proposition that would have ended the state’s experiment with electric deregulation, which later proved disastrous, and the almost $70 million tobacco companies spent in an unsuccessful 1994 attempt to get rid of local laws limiting smoking in stores and other workplaces.
Those mixed results indicate big money doesn’t always produce big electoral results.
Undaunted by that history, big business is swarming to back twin propositions spearheaded this fall by the state Chamber of Commerce. One is an attempt to beat back a health insurance law enacted last year, shortly before the recall of ex-Gov. Gray Davis. If it takes effect, this law will require all businesses with 20 or more employees to provide them with health insurance, or pay the state a fee comparable to the cost of coverage. The law has been in abeyance since the chamber formally filed papers to run a referendum on it – now on the ballot as Proposition 72.
If the no-on-72 side prevails, this would be the first successful referendum since 1982, repealing a law passed by the Legislature.
The other measure big business craves is Proposition 64, designed to weaken the state’s existing unfair business competition law, preventing consumer groups and private citizens from suing companies for fraud or other misdeeds unless they have actually been harmed by those actions. In short, consumer groups would no longer be able to sue polluters until after the pollution’s harm was done and visible. They would not be able to stop false advertising campaigns until after lots of folks had been victimized. And on and on.
Many legal scholars believe the change business seeks would have prevented the historic tobacco industry settlements, which now provide billions of dollars each year to this state’s cities and counties, helping to soften serious budget problems.
Plus, one analysis by the state’s non-partisan legislative analyst and another by the state Dept. of Finance both concluded that Proposition 64 would impose indirect costs on local governments by increasing what they must spend on health care due to lessened enforcement of public health and safety laws.
The chamber notes that while individuals and consumer groups would lose much of their standing to sue, the state attorney general and local district attorneys could still move against offending companies. But attorneys general in this state long have made a habit of enforcing laws they and their backers like, while generally ignoring those they dislike. D.A.s don’t usually deal in business-practice issues. Filling that gap, consumer groups have often stepped in fruitfully where law enforcement failed to tread.
Meanwhile, it’s obvious why outfits like McDonald’s and Macy’s are dead-set against the now-stymied health insurance law: Their stores pay many workers minimum wages or not much more and they fear any added expense. McDonald’s, in fact, has mounted an effort to get individual franchise holders to put up donations – and about 200 ponied up in the first quarter of this year alone, while petitions to qualify the referendum for the ballot were still circulating on the streets. McDonald’s is far from the only restaurant firm involved: Carl’s Jr., Darden’s Restaurants (Red Lobster and Olive Garden stores), Wendy’s and Outback Steakhouses are among the others.
Nordstrom, Target, Sears and Office Depot join Macy’s in the retail category. And the California Building Industry Assn. last month asked its members to put up between $6 million and $10 million for the pro-64 side, hoping to eliminate most threats of lawsuits against them for alleged patterns of shoddy work or using questionable contracts.
The chamber maintains the health care requirement would cost companies with 200 or more employees $5,718 per worker each year and smaller firms about $2,200 for each covered employee.
The basic argument of the chamber and its member companies is that this is not a good way to solve the health insurance crisis, which sees about 7 million Californians now without coverage.
Responds one official of the California Medical Assn., which has backed the health care law from the start: “We’ve said to the business community that if they have a better idea, we’re open to it. They have nothing to offer.”
In both cases, big business figures to outspend its opponents by margins of at least 3-1, which ordinarily means victory. But maybe not this time, on issues as popular as health care and fighting fraud and pollution.
Tom Elias is a syndicated columnist who writes about issues in our state. His column appears Wednesdays in the Hollister Free Lance. Reach him at [email protected].
