Sunday, November 04, 2012

Powell and Corporate Blueprints

By Gary Berg-Cross At the Nov. 3rd talk on Democratizing Society by Margaret Flowers and Kevin Zeese, co-directors of, at WASH MDC Justice Louis Powell’s  40 year old confidential memo to the Chamber of Commerce  was mentioned. Since it seemed unfamiliar and relates to my recent blog article on winner take all society as well as the argument in Q &A following the presentation on the separation of corporations and government, the role of regulation and whether corporate-conservative efforts are based on long range blueprint plans for influence and power. I thought a small summary on the Powell (a former tobacco lawyer/lobbyist) memo history might help inform that discussion. It is useful to understand the context for Powell and friend Eugene Sydnor’s (then-chairman of the Chamber of commerce’s education committee) belief that transforming the Chamber into a powerful political force was necessary to counter what they saw as an ongoing “attack on the American free enterprise system.” (Source)

One historical source on the memo is from Winner-Take-All Politics: “How Washington Made the Rich Richer--and Turned Its Back on the Middle Class”.  Quotes from this book were covered in the Bill Moyer’s show: The Powell Memo: A Call-to-Arms for Corporations and a portion is reproduced below:

the Powell Memorandum, a call-to-arms for American corporations written by Virginia lawyer (and future U.S. Supreme Court justice) Lewis Powell to a neighbor working with the U.S. Chamber of Commerce.
In the fall of 1972, the venerable National Association of Manufacturers (NAM) made a surprising announcement: It planned to move its main offices from New York to Washington, D.C. As its chief, Burt Raynes, observed:

We have been in New York since before the turn of the century, because
we regarded this city as the center of business and industry.
But the thing that affects business most today is government. The
interrelationship of business with business is no longer so important
as the interrelationship of business with government. In the last several
years, that has become very apparent to us.[ National Journal, 1974, 14.]

To be more precise, what had become very apparent to the business community was that it was getting its clock cleaned. Used to having broad sway, employers faced a series of surprising defeats in the 1960s and early 1970s. As we have seen, these defeats continued unabated when Richard Nixon won the White House. Despite electoral setbacks, the liberalism of the Great Society had surprising political momentum. “From 1969 to 1972,” as the political scientist David Vogel summarizes in one of the best books on the political role of business, “virtually the entire American business community experienced a series of political setbacks without parallel in the postwar period.” In particular, Washington undertook a vast expansion of its regulatory power, introducing tough and extensive restrictions and requirements on business in areas from the environment to occupational safety to consumer protection.
[ David Vogel, Fluctuating Fortunes: The Political Power of Business in America (New York: Basic Books, 1989), 59; R. Shep Melnick, “From Tax-and-Spend to Mandate-and-Sue: Liberalism After the Great Society,” in The Great Society and the High Tide of Liberalism, Sidney Milkis and Jerome Mileur, eds. (Amherst, MA: University of Massachusetts Press, 2005).]

In corporate circles, this pronounced and sustained shift was met with disbelief and then alarm. By 1971, future Supreme Court justice Lewis Powell felt compelled to assert, in a memo that was to help galvanize business circles, that the “American economic system is under broad attack.” This attack, Powell maintained, required mobilization for political combat: “Business must learn the lesson . . . that political power is necessary; that such power must be assiduously cultivated; and that when necessary, it must be used aggressively and with determination—without embarrassment and without the reluctance which has been so characteristic of American business.”

As mentioned at the talk by  Kevin Zeese what followed this activation of the Chamber was it doubling in size within a year. The Chamber’s board of directors formed a task force of 40 business executives (from U.S. Steel, GE, ABC, GM, CBS, 3M, Phillips Petroleum, Amway and numerous other companies) to review Powell’s memo and draft a list of specific proposals to “improve understanding of business and the private enterprise system,” which the board adopted on November 8, 1973.

Another consequence was the founding of conservative institutions like CATO, AEI and ALEC.  Sort of an activist approach to government-corporate relations. So I guess Powell was sort of a hidden activist judge, but then appointing a tobacco lawyer does suggest something on how the game of appointments is played.


  1. American Enterprise:
  2. Powell Memo:
  3. Winner-Take-All Politics

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