Money and the Public Interest

With the ascendancy of corporate power in America came the rise of its primary countervailing force--citizen activism and a vibrant public interest movement. Citizens organized to fight the myriad ills inflicted on society by corporate power--from pollution and corruption, to child labor and consumer fraud.

But some of those once vibrant citizen institutions have now morphed into unresponsive bureaucracies. Worse yet, many have been corrupted by corporate funders. No wonder corporate America gets away with its ongoing wave of crime and violence: much of the opposition has been neutralized.

Take the Greenlining Institute as a case in point.

Based in California, the Greenlining Institute is considered by many to be a major public interest group that fights insurance company and bank redlining--thus its name. But in fact, a big chunk of the group's funding comes from those same giant corporations the Greenlining Institute was set up to counter. Over 80 percent of the Institute's $1.1 million budget in 1997, for example, came from major corporations, according to the group's most recent financial disclosure statement filed with the Attorney General of California.

In 1997, Union Bank gave $235,000. Southern California Edison gave $114,494, Merrill Lynch $88,489. And on down the list. And on big bread and butter issues that affect the masses of California consumers, the Institute has pulled its punches and sided with its industry funders.

In 1998, in the most problematic case, the Institute sided with the utility industry to defeat Proposition 9, an initiative that would have rolled back a taxpayer funded bailout of the utility companies for bad nuclear investments, among others.

Another case in point: Last month, three consumer groups--Consumer Action, Gray Panthers, and the National Consumers League--held a press conference in Washington, D.C., announcing the launch of a "nationwide education campaign for seniors considering HMOs." And where exactly did the $150,000 come from to fund this campaign? PacifiCare Health Systems Inc., the nation's fifth largest managed care company and operator of the country's largest Medicare HMO, Secure Horizons.

This kind of corporate funding is apparently new for Gray Panthers. But it is nothing new for the National Consumers League, an organization that was started at the turn of the century to eliminate child labor, but has morphed into a budding accounts receivable for corporate funders.

Nor is it new for Consumer Action. According to editorial director Linda Sherry, two years ago, the group was 100 percent funded by corporations. Currently, Consumer Action gets money from both big corporations and big government. Pacific Bell recently gave $100,000 to fund a Consumer Action project on telephone fraud.

Earlier this month, the League of United Latin American Citizens (LULAC), the country's largest and oldest Hispanic organization, endorsed the proposed merger between Bell Atlantic and GTE. There was no mention in LULAC's press release that both GTE and Bell Atlantic are yearly contributors to LULAC. GTE gives $25,000 a year, and Bell Atlantic gives $35,000 a year. LULAC executive director Brent Wilkes said that in July 1998, the companies asked LULAC to support the merger. LULAC president Rick Dovalina met with the CEOs of both companies to work out the agreement. Wilkes said that during the meetings, LULAC demanded specific "assurances and deliverables."

"We were looking for companies that would be spun off," Wilkes said. "GTE is selling some of their companies in Texas and in the Southwest. They have specifically held one of their telephone companies out of the normal auction process. And we helped select an Hispanic owned business partnership that would take that company."

When asked whether he was concerned about appearances of impropriety, Wilkes said "we are not."

"We have never tied support from the companies to our policy decisions," he said. When asked why the companies would want LULAC's support, Wilkes said: "to help with their regulatory process." Wilkes said he believes the merger will benefit consumers.

But more independent consumer groups, including the Washington, D.C.-based Consumer Project on Technology (CPT), disagree. "We don't want the merger to go through," said CPT's Jamie Love. "GTE was in a position to compete against Bell Atlantic. Now, they won't be."

There are independent consumer groups who refuse to take money, or be influenced by, big corporations. But increasingly, bigger wads of money are being waved in front of weak-kneed advocates seeking some green comfort. Consumers beware.

-- Russell Mokhiber and Robert Weissman

Russell Mokhiber is editor of the Washington, D.C.-based Corporate Crime Reporter. Robert Weissman is editor of the Washington, D.C.-based Multinational Monitor. They are co-authors of Corporate Predators (Monroe, Maine: Common Courage Press; see http://www.corporatepredators.org). To subscribe to weekly corp-focus e-mail service, send an e-mail message to listproc@essential.org with the following all in one line: subscribe corp-focus -your name- (no period).