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Launching West Coast Tour
Ralph Nader, Campaign 2000
Los Angeles Press Club Press Conference
March 1, 2000
Thank you Dan Hamburg and Sarah Amir. I'd like to illustrate the way this campaign is going to proceed. Most political candidates choose themselves to run, raise money, throw their hat in the ring and then parade in front of the people in their jurisdiction. Essentially they spend a lot of time raising money to get ads on TV that are ridden with slogans and other emotional imagery of minimal substance. This campaign is going to be running with the people. Not parading in front of the people.
There are many citizen groups all over the country who have been fighting for years, with some success, but against overwhelmingly increasing odds as the corporate government takes over the political government and closes our democratic opportunities for the people of this country and to have an influence on public policy. That is why people who have worked in the citizen arena on the political institutions now have to enter the political arena hearkening back to Thomas Jefferson who cautioned us again and again on the peril when representative government does not curb the excesses of monied interest. That is the way they referred to business interests over 200 years ago.
Indeed, the monied interests are everywhere. They're at the local, state and national level. They are buying and renting politicians. They are putting their own executives in key government positions for a few years of on-the-job training, servicing corporate interests before they go back into higher paying jobs in the corporate world. Every year it gets worse and worse.
There is no better example of that than here in California where, after many years, a man called Gray Davis was elected Governor of California, representing the Democratic party, and proceeded from the get-go to call up and demand all kinds of vested interests to contribute to his campaign treasury. There was a point where he was raising a million dollars a month, even though his next re-election campaign was four years away.
The issue here in California, of course, is that there is no campaign finance requirements. It is the wild west. Money has flown with a torrent of force into many of these political campaigns. Just recently, the press reported that Governor Davis had on a conference call called up business interests, including insurance and utility interests, and telling them that they better pour more money into the campaign against a very modest campaign finance reform initiative, Proposition 25.
This is just the latest example of the Governor, in effect, shaking down businesses with the implied caveat that if they don't give to his campaign, bad things will happen or good things will not happen. Governor Gray Davis is the King of the Cash-Register Politicians in the state of California. And for the Governor, there is no gray area for shaking down vested interests and providing them with implied quid pro quos.
What we need at the state and federal level is full public financing of public campaigns. Public campaigns should not be funded by beer companies, tobacco companies, auto companies, insurance companies, petroleum companies, and their executives. Public campaigns should be funded by public funds. The best investment that taxpayers could ever make, in terms of saving the money and getting cleaner, more responsive, and more innovative public services.
It is important to note that it doesn't have to be a tax, both at the state and federal level. There can be a well-promoted, voluntary check-off on the state tax return and the federal tax return for any taxpayers who choose to contribute up say $100 limit to go into a public fund to finance our public campaigns.
That is what the Green Party and other progressive groups are pressing for and will increasingly see the light of day, sooner or later. Because the public is fed up with corruption in politics. Indeed even the people who are corrupted in politics are fed up with spending so much of their time trying to beg for funds so they can further enrich the television stations and the radio stations toward which much of which the money goes.
I'm running for the Presidential Nomination of the Green Party for several important reasons:
First of all, for many years I have objected to the domination of the Republican/Democratic Parties who pass laws in the state legislature making it very, very difficult for small political starts to get underway. In some states, it is almost impossible to overcome these obstacles -- Texas, North Carolina, West Virginia, and Georgia being examples -- without having a lot of money to start with.
We know from Nature, that if Nature does not allow seeds to sprout, it destroys its own regeneration. Politics is no different. When the political system is controlled by a two party duopoly, essentially one corporate party with two heads wearing different make-up -- Republican and Democrat -- and then misuses the laws to make it impossible or very difficult for small political starts to get underway, then the process of regeneration is replaced by the process of degeneration. That is what we are seeing increasingly every four years.
Almost all observers, no matter what their political philosophy, have recognized that the problem of money, corrupting our political system, is getting worse by the year and more sophisticated by the year and more insidious by the year and more cash-register, down-payment, quid pro quo by the year.
I think it is also important that we pay attention to the huge numbers of citizens who don't vote. Many of them don't vote out of conviction. They don't vote because they don't want to participate in the charade as some of them have said. Or they won't vote because they don't think their vote counts. Indeed, what money does is to nullify the votes of citizens. A lot of these citizens just drop out of democracy. We want them to come back. Because now they have increasingly good people on the ballot for local, state and national level to vote for.
Here in California, you have many more good people to vote for who are starting to come forward and starting the drive to regenerate a more progressive politics in our country: Sarah Amir, Media Benjamin for the U.S. Senate, and others around the state.
Let me just conclude with some more recommendations we are going to be campaigning on. This will delight the television cameras I'm sure. The public airways belong to the people. We're the landlords. The television and radio stations are the tenants. They lease the space. They don't have to pay anything to the Federal Communications Commission for this very valuable free investment called the broadcast license.
It seems to me out of a sense of good citizenship, the people who run the broadcast industry should dedicate a certain amount of free time to all ballot-qualified candidates to local, state and national levels in the weeks before the election. That is the least they can do if they want to call themselves good corporate citizens. But if they don't do it voluntarily, it's quite clear that since the public airways are our property, we need to have legislation that will select out a certain amount of free time on radio and TV for political debates and discussions and statements of policy by ballot-qualified candidates. There has to be some self-imposed limit on turning the public airways into over 90% entertainment and advertising. The rest being fairly redundant staccato-like news.
Secondly, I favor a binding none-of-the-above on every ballot line. There is a proposition here in California that would have a non-binding none-of-the-above. That is pretty useless as Nevada's non-binding none-of-the-above has demonstrated over the years. A binding-none-of-the-above makes it quite clear to the dominant parties that they no longer can trade-off with one another conceding one district where one party has an entrenched incumbent and then conceding another district when the member of the other party has an entrenched position.
It may surprise some people to learn that about 90% of all the congressional districts in the U.S. Congress are not competitive. That is, they are either dominated by the Republican or the Democratic incumbents and the opposing major political party doesn't even field a candidate in about 70 of these districts, in 1996. In many of the other districts just a nominal candidate runs; some accountant who wants to embellish his resume, throws his hat in the ring and spends a few bucks and gets 30% of the vote.
That is not a two-party system. That is basically a massively entrenched one-party system. None-of-the-above will tend to break that up. Because right now people in this country cannot go to the polls and vote `no'. They can only vote `yes' for some person on the ballot. If they can go to the ballot and vote for none-of-the-above and if none-of-the-above gets more votes than the other candidates on the ballot, it cancels the election for that ballot-line and orders new elections in 30 to 45 days with new candidates.
I think that will tend to bring more people out to the polls because they won't be able to say they are staying home in order to protest. Staying home in order to protest doesn't mean a hill of beans to entrenched politicians. They don't care if only 10% of the people vote. The fewer people who vote, the fewer people they can saturate with their political television ads. Instead of staying home, a binding none-of-the-above brings them out.
The three campaign finance changes we are pressing for are: media access for ballot-qualified candidates, fully publicly financed campaigns to the limits of the constitutional judgements at the present time, and binding none-of-the-above.
I want to underscore one more point that is important. There is a lot of emphasis on money in politics. What we are going to try to do is not just raise the money that is needed to have organizers and others around the country. We are going to try to have hour raises or time raises. We want to show more and more people in this country that citizen volunteer time, well-organized and directed, can overcome the money of the vested interests. There will be fund-raisers and also time-raisers because everybody in this country, no matter what their level of income or wealth is, possesses 24-hours-a-day. They can all participate with their time in political campaigns. For those people who are turned-off to politics, I say the following. The more you turn off politics, the more politics will turn on you.
Dan Hamburg: We have some time to take some questions. We'd like the questions to come primarily and certainly at the beginning here from members of the press. Are there members of the press who would like to ask Mr. Nader a question?
Question: The Vice-President has made some overtures to the AFL/CIO suggesting that he may be departing somewhat from the Administration's historic free-trade position. But it is a little murky. How do you assess that and how do you assess your differences with what you perceive the Vice-President's position to be?
Ralph: I think Vice-President Gore knows that organized labor is critical to his campaign so he is giving them thin threads of hope that he will insist on labor and environmental committees attached to the WTO to take those two factors into consideration in establishing trade policy.
But Vice-President Gore had his chance to do that. Instead he took a stand in a debate against Ross Perot on NAFTA on the side of big business. He had his chance to do that when the GATT agreement was winding its way through Congress having come from the White House. He took his stand on the side of big business. Therefore, he's had knowledge. He's not innocent or unknowing in this area. For him to dangle this thin thread of hope is nothing more than a cheap campaign ploy to try to neutralize what could be a sizeable stay-at-home position by the members of the unions that make up the AFL/CIO. Just the way they stayed at home in 1994.
My position on the WTO and NAFTA is for the U.S. Government to initiate the six-month notice for withdrawal. That will set the stage for renegotiation of those trade agreements so they are pull-up trade agreements, pull-up standards around the world, not pull-down trade agreements which they are now pulling our standards and our labor and our environmental and our consumer standards down.
There is no reforming the WTO or NAFTA. First of all we only have one vote among 130 nations and all nations have one vote. There is no veto. There is no equivalence or security counsel. Little countries in the Caribbean with 70,000 people has the same vote as the United States has. You can't change that from within. It has to be replaced with trade agreements that represent the interests, first and foremost, of people not multi-national corporations.
Q: I'd like to know a little about you personally. I remember reading years ago that you lived in a boarding house and I guess, took little Sally, I gather you were unmarried. I don't even know if you had a car. What are you circumstances now?
Ralph: I raise funds for a lot of our projects through writing and lecturing. I don't have time to spend much money. And I don't own a car. That's important in Southern California.
Q: Your last campaign was criticized as being a half-hearted attempt. Are you going to have any advertising this time?
Ralph: We are going to do the best kind of advertising which is working with established and emerging citizen groups, whether they are neighborhood groups in inner city or whether they are anti-sprawl groups or pro-mass transit groups or environmental or consumer groups or civil rights groups. That has not been done before.
I think that this idea of not having a political campaign turn into a parade but have it turn into a melding of civic efforts and political efforts is the way to avoid this frenzied reliance on trying to eke out every last campaign contribution so you can pay $10,000 for a minute ad on Los Angeles TV or whatever it costs these days.
Years ago the head of this big advertising firm -- Foote, Cohen and Belding in New York -- wrote a book called The Trouble With Advertizing. He had a page saying that if he was in charge he would ban political advertizing on the media that is under five minutes. Because, as an expert advertizing specialist that he was, he didn't think that you can get across anything other than emotional imagery and that debased the political process. He came to this conclusion because he did work for the Nixon campaign earlier.
Q: In you last campaign you talked about how many of the views held by the people who supported you were majoratarian views. You didn't run that theory in the campaign. It seems like you were trying to say what you believed rather than worry about getting votes. Are you turning it around this time and going to focus on those views that you believe are truly majoratarian or can you elaborate on that?
Ralph: I don't have to change at all. I think what we've been advocating for almost 40 years are majoratarian views that transcend many of the so-called conservative or liberal progressive distinctions. Regardless of where you are coming from, you don't want to drive a dangerous car. You want it to be recalled. You don't want to buy prescription drugs that are going to have devastating side effects. You don't want to have an HMO deny you or your family member the right to have medical care.
There is a fundamental unifying effort when you raise the issue of dominant corporate power over our society; over our political institutions, market place, work place, environment, educational institutions, and even over our children who are increasingly being trapped in this addictive violent entertainment matrix that makes selling to children and exploiting them big business these days. I found in a lot of these areas, you have conservative families who are really upset about this and families who call themselves liberals or progressives upset about it.
The central contention of politics should be the distribution of power. That is where a political campaign should be first and foremost. The most important question that a candidate can ask the people during the campaign is, "Do you want to be more powerful as a voter, citizen, consumer, worker, taxpayer, and small saver-investor? Or do you want to continue to be rolled and dominated and manipulated by the concentration of power and wealth in too few hands who then establish the supremacy of the political economy over the majority of the people in this country?"
That is really the question. Because if the people in this country do not want to be more powerful as they interact in the workplace, the marketplace, the environment, their communities, their legislatures, their courts, their executive branch agencies, the corporations, through the various stakeholder rights that they should be given, then no political leaders, no political parties are going to be able to do anything more than promise what they cannot deliver. That is the fundamental point: That even if you look at political candidates around the country and say, I think these candidates are well-intentioned, I think that they are sincere in their promises. If they win without the people being mobilized, if they happen to beat their opponent in the usual parade election style, they will not be able to deliver whether as Governor, Senator, Representative or President.
That's the key message to convey to people: If they want to stop this disconnect between enormous economic growth, corporate profits and stock market prices on the one hand, and a stagnation or a decline in the state of workers and others in the economy as the disparities of wealth become so enormous; if they want to stop that, if they want a rising tide lifting all boats instead of a rising tide lifting all yachts, then they have to strengthen themselves in those five key roles that they play in our political economy: Voter-citizen, worker, consumer, taxpayer, and small saver-investor.
Q: So that millions of people might make the quantum leap in this society, what is your position on reparations to the African-American community?
Ralph: There are so many areas of excessive exploitation. The one area that we have worked on is best described as `the poor pay more.' The exploitation in almost every field of interaction with the marketplace is really staggering. It has been documented by the National Consumer Law Center of Boston, Massachussetts. Whether it is payday loans or whether it is discriminatory lack of health care, whether it is landlord abuses, whether it is inadequate municipal services like police and fire in the poorer areas of the cities, whether it is rip-offs by auto dealers, whether it is home equity frauds, whether it is bank red-lining, no candidates are even mentioning this. It is bad enough that minorities have lower income, by-and-large, in this country. And when the income they do bring home, is looted and eroded and repressed by these consumer frauds, you end up with a much worse standard of living than the normal median income statistics would lead you to believe. That is just for starters.
Q: What is your position? What would you do about this?
Ralph: First of all we have to provide adequate law enforcement. Law and order against corporate crime, fraud and abuse. Very few prosecutorial sources are devoted in this area. Second, we have to give people full civil action rights in courts, class actions and others, to sue directly. Third, and most important, is to have publicly-funded organizers mobilizing people and neighborhoods and communities to defend their interest.
It is really interesting that the taxpayer is asked in the hundreds of billions of dollars to subsidize corporations, which we call corporate welfare. When it is really not the business of government to do most of that. But it is the business of government to facilitate the organized, political energies of its citizens, affirmatively. That should be done.
Q: It seems to me there is a lot of unfinished business out of Nader 103, the insurance reform initiative created here in Los Angeles. Even though it passed, it remained in the courts for at least a decade and it seems that probably half of those who were insured and possibly entitled to a refund under 103, never received one. That begs the question. Are we really powerful when we pass a law or do something to better the body politic?
In light of that, the FTC also seems powerless. For instance, to stop mergers that are enormous and inobviously highly consolidated industries in the economic sectors. If the laws we pass can't be validated in our courts then how can we really hope that anyone will ever get a handle on this kind of consolidation?
Ralph: Because the laws are enforced in accordance with the will-power of the elected officials who control the appropriations and who develop the policy as to whether you are going to have a tough anti-trust enforcement or not. So the public servants are there at the direction of the people who run for office and get elected. That is why we need a progressive political movement in this country. 100 years ago when your predecessor could have asked exactly the same question, the farmers mobilized a progressive political party that took their candidates to the state legislature and to Congress and they almost won the Presidency.
Q: Robert LaFollete?
Ralph: That was the second wave. The first wave started in east Texas in 1887. As far as 103 goes, [California Insurance Commissioner Chuck] Quackenbush has not been very eager to enforce it. But here is what we've seen. Number one, there have been about $2 billion in refunds. And most important, the rate of increase of auto insurance premiums has almost been frozen since 1988, saving $14 billion for insurance consumers in this state. When Prop 103 was on the ballot, California was I think the fourth fastest rising auto insurance premiums state in the country. Since then, it's down in the forties. In other words, most states have increased their auto insurance premiums. I think the latest average is about 37% in that period. Whereas, California consumers have witnessed maybe a one or two percent increase as of 1998.
So the one thing that 103 did was really provide a climate against the constant escalation of rates. Because it brought regulation to these rates and the insurance companies had to open their books and justify rate increases. Since they were making enormous profits, they couldn't very well do that. So it had a freezing effect. But there is still a considerable amount of money yet to be refunded including from State Farm which has fought this regularly.
Q: Regarding the labor movement, some of them said to you, We love what you're doing with WTO and what you've done over the years. But from our point of view, for all his imperfections, Al Gore is still better than George W. Bush and we are concerned that you're candidacy might elect Bush. Have you heard any of that from people you work with in other spheres?
Ralph: Yes. That is why they endorse Al Gore who has never uttered a word against Taft-Hartley a strangle-hold law of almost 50 years preventing labor union organizing. He has never demanded that OSHA be adequately funded even when President Clinton's appointee who heads OSHA told us in August that OSHA's budget should be twenty times what it is now, in order to it's job to prevent the widespread death, injury and disease in the workplace, the factories, the lines, and other areas. So, why are they doing this? Because they are succumbing to the least of the worst.
And of course, every four years both get worse. i think that is a mistake for organized labor. Especially since they never ask for any change of policy. They just give Clinton and Gore the endorsement and never say, "Would you give an effort to repeal Taft-Hartley? Would you make an effort to strengthen the labor laws? Would you make and effort to crack down on occupational health and safety violations?"
Unlike their collective bargaining with employers, the AFL is selling itself pretty cheaply. However, they are going to have to realize that a growing Green Party is going to determine the margin of victory or defeat for the Democrats in race after race around the country. And this party is not going to give any attention to the least-of-the-worst syndrome that has been on a downhill slide for all of these years. I think that Vice-President Gore is going to have to start worrying about his margin being taken away in this year's campaign.
Q: Do you think it will be a positive or a negative if the California none-of-the-above initiative was approved?
Ralph: I think it would probably be a negative. You would have to wait for a few years to see that it didn't mean anything because it wasn't binding and then maybe another initiative would come on to make it binding. But on the other hand there is an argument that you hold hopes up for it and they don't materialize so people will get disillusioned with that reform and don't want to pay any more attention to it. So it could cut either way.
Q: Is there an initiative you would like to propose currently in California?
Ralph: The one we have worked on is Proposition 30, the bad faith auto insurance initiative that is on the ballot. It's strange -- it was put on by the insurance industry spending $40 million, and they want a No vote. Because they want to repeal the existing law. So we think the right vote is a Yes vote. And technically it is not an initiative, it is a referendum.
For those of you who are counting, if Buchanan gets the nomination for the Reform Party, he's going to take a way a lot of Republican votes in his own right. It is really a very, very unpredictable year in terms how it is going to end up in the mix of which smaller party affects which major party the most.
In a strange way, I was told by one pollster that in 1996, I pulled six Democratic votes for every four Republican votes. The main point is will the media cooperate? Of course, no progressive movement should ever have to rely on the commercial media for anything. Because eventually it will have it's own media in addition to the Internet. For the time being, we do hope that the level of interminable trivialization of the major television stations will impose upon itself a moratorium so that they get a little serious and start discussing more serious issues in the sliver of time that they accord to these subjects.
Q: Can you think of a way to address the issue of Internet privacy without excessive regulation of the net?
Ralph: That we will be talking about in due time. There is some easy things to do, but because it's everywhere around the world, you have got to have a global jurisdictional authority to deal with this. It is very serious invasions of the self. This is not traditional invasions of privacy. You get deep into the health area, deep into kids' talking about their families and being exploited that way and it could lead to some pretty bad situations for vulnerable people who find themselves in these situations on the net. Our campaign net, by the way, is votenader.com. It will have a refreshing variety of materials placed on it in the coming weeks.
Q: Ron Uns (sp?) put out an e-mail today in which he said he thought you would be endorsing Prop 25 pretty much here and now. Was he getting ahead of the game?
Ralph: I don't like to use the word `endorse.' Right now you have no campaign finance controls. I am for full public financing with an amount of free media with the qualified ballot candidates, as I said. Prop 25 is very modest reform. It breaks the ice a little bit on the public financing and media access. It bans corporate contributions. And It requires the disclosure of who is paying people who come on to the TV ads supporting or opposing a proposition.
We had the experience on Prop 9 with the electricity deregulation where David Horowitz was brought on to oppose it and nobody knew that he was paid very substantial sums for that. On the other hand, it doesn't go far enough. It is not very good for small parties. But I think if it breaks the ice we'll get a better reform later. It's like getting to first base when we've got to go all around to home plate.
Q: Could you please repeat the statistic from your '96 polling results? The results you said that a pollster told you that you got six Democrat votes for every something Republicans?
Ralph: Six Democrat votes for every four Republicans. That came to me from Dick Morris. You ever hear of him? He was doing polling in those days. But I do know that in the little write-in in '92 in New Hampshire it broke 51-49, Republican. That started getting me worried.
A: A member of your own party has objected to your position on none-of-the-above because they feel like traditionally the Green Party, Peace-and-Freedom Party, the other smaller parties have all benefitted from dissatisfaction with major parties and have been the recipients of the equivalent of none-of-the-above votes. Will this position not threaten their ballot status?
Ralph: I don't think it threatens their ballot status. There were explicit supports in '92 in the Green Party in California. They actually had a none-of-the-above line to show the way on their ballot space. But there are others in the Green Party here who are against it. I don't think they should fear it at all. I think they are very capable of turning their own party line into a none-of-the-above for those who are uninitiated into the Green Party agenda. But you've got to realize that the two parties control the access to the ballot to such a degree that they are demoralizing people and keeping them home. Anything that brings them to the voting booth can give them the opportunity to divert away from the two parties to other alternatives, like the Green Party.
Q: In the last election we saw some pretty odd financial contributions from the Chinese Army to the President and a lot of other odd Indonesian and other things. Do you have a clear sense what that money was intended to achieve? As a second question, Do you believe, as now, people who are permanent residents in the country but not citizens ought to be able to contribute to campaigns. And if so, why shouldn't they vote?
Ralph: I think if you have a green card you can contribute. I'm not sure what the state requirements are -- they may differ on that.
Press: The state requirements differ, but the federal code requires that you be a permanent resident in order to contribute to the campaign. But other kinds -- for instance people with visas -- can't contribute.
Ralph: Sarah, do you want to talk about that?
Sarah Amir: I believe the State requirement is the same. You have to be a legal resident in order to contribute to campaigns. To answer your question, I think that legal residents in California should be able to vote on local issues. Maybe not Federal issues. But with state and local issues -- that I agree with.
Question: As to what the money from the Chinese Generals was trying to achieve? Do you have some sense of that?
Ralph: Everybody has suspicions but almost all of them have to do with trade and investment deals; trying to get certain advantages over some competitors; trying to get past certain restrictions. A lot of this is the judgement of Executive Branch agencies. They can go one way or the other. That is what was involved. Part of it also was trying to get China into the WTO, which China has been trying to do for a long time.
Q: Regarding week-long rains and flooding, then droughts. We don't want to correlate that with fossil fuels and conspicuous consumption. Can't we sue the public airwaves? Like you said, these are our airwaves. Why can't we sue the print and the media moguls to report responsibly and make people aware. Most people are good people. They are simply not aware of what is really going on.
Ralph: Well no longer because in 1987 under Ronald Reagan's Administration, the Federal Communications Commission announced it would no longer enforce the Fairness Doctrine. The Fairness Doctrine was rooted in the 1934 Communications Act which said that all Radio and TV stations had to respond to the "public interest necessity and convenience." And that fairness doctrine meant that if they covered an issue, they had to give balanced coverage to issues of significance and controversy.
So for example, that means that if they report a lot about oil and coal they would have to provide balanced coverage about renewables and energy efficiency. But that has been abandoned and the Democrats, including Clinton-Gore, have made no attempt to get it back. That was the one hook that viewers or citizen groups had to file a complaint before the Federal Communications Commission saying that, say a TV station in Syracuse, New York, has been giving one-sided reporting on nuclear power and has not been providing an outlet for balanced views on the other side.
So, the answer to your question is, another example of how our democracy is constricting and how it is declining. We don't even have the access that we had 15 or 20 years ago.
I'm sure the Green Party is going to have the best renewable energy policy of any party, even better than it had in prior years. And it will be a luminous contrast to the Clinton-Gore Administration who have pretty much ignored the need to reverse the Reagan-Bush years and stop subsidizing oil, gas, coal, and nuclear and start supporting the expansion of wind power and photovoltaics and solar, thermal, etc.
It is interesting that Gore wrote about this in his book in 1992. No one knew more about it as an elected official than Gore. However he has not made a single statement on solar energy in over seven years in office. That's an example of someone who knows, but is unwilling to act because of who his pay-masters are in the political sphere.
Thank you very much.
- For more on voting systems see: Voting Methods from The Center for Voting and Democracy:
- For more on The Taft-Hartley Act of 1947 see:
- Taft-Hartley Act from USA, 1840-1960, Trade Unionism, Spartacus Internet Encyclopedia
- The impact of the Taft-Hartley Act on the balance of power in industrial relations, American Business Law Journal, Spring 1996. Quoting the fourth paragraph of this lengthly article:In order to estimate the effect of any amendment to U.S. labor laws on the balance of power in Industry Relations (IR), it would be helpful to have an estimate of the effect of a previous amendment to those laws. This article is an attempt to quantify the impact of the Taft-Hartley Act on the balance of power in IR by investigating the change in stock prices (profits) associated with the Act's passage. The hypothesis is that the Act increased the power of management relative to unions; empirically, that increase will be reflected by a sample of firms likely to have benefited from the Act by having higher stock prices given the law's passage than they would have had absent the law. The relationship between the effect of the Taft-Hartley Act on stock prices (profits) and the impact of the Act on the balance of power in labor relations is the following: The reduction in profits due to unionism and events associated with unions is greatest when the power of unions is greatest. It is the unions' power that is the source of their ability to induce the events that have been shown to reduce firm profits. If, as is hypothesized, the Taft-Hartley Act decreased unions' ability to reduce firm profits, that is essentially the same as saying that it decreased union power while increasing management power. This decrease in union power and increase in management power would be reflected by an increase in the stock prices (profits) of firms affected by unions at the time the Act was passed.
- Taft-Hartley Act - Britannica.com