Berman & Co.

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This article is part of the Tobacco portal on Sourcewatch funded from 2006 - 2009 by the American Legacy Foundation.

This article is part of the Center for Media & Democracy's spotlight on front groups and corporate spin.

Rick Berman

Berman & Co., a Washington, DC public affairs firm owned by lobbyist Rick Berman, represents the tobacco industry as well as hotels, beer distributors, taverns, and restaurant chains. Berman & Co. has lobbied for companies such as Cracker Barrel, Hooters, International House of Pancakes, Olive Garden, Outback Steakhouse, Red Lobster, Steak & Ale, TGI Friday's, Uno's Restaurants, and Wendy's.

Berman & Co. operates a network of dozens of front groups, attack-dog web sites, and alleged think tanks that work to counteract minimum wage campaigns, keep wages low for restaurant workers, and to block legislation on food safety, secondhand cigarette smoke, and drunk driving and more.[1] In 2013-14, Berman and his Employment Policy Institute "think tank," have led a national fight against campaigns to raise the minimum wage and to provide paid sick leave for workers with renewed attacks on proponents (including the Center for Media and Democracy, publisher of Sourcewatch), misleading reports, op-eds, TV and radio ads and more.[2]

Berman has also actively campaigned against any attempts to limit smoking in restaurants and bars. In testimony before the New York City Health Oversight Committee, Berman said, "The level of exposure to secondhand smoke for bartenders, waiters and waitresses is considerably lower than the federal air quality limits established by the federal government."[3]

Berman Heads Phony Think Tank, Employment Policy Institute

Rick Berman created EPI in 1991 to "argue the importance of minimum wage jobs for the poor and uneducated."[4] But in 2013-14, Berman and his Employment Policy Institute are leaders in a national campaign against the minimum wage, that includes TV ads, print ads, op-ed in state newspapers and more.[5]

Minimum Wage: Disappearing Jobs

The Employment Policies Institute (EPI) is headed by Richard Berman according to tax filings. It shares the same office as Berman's PR firm and it funnels money to the PR firm as the New York Times reported in a front page story in 2014: "the Employment Policies Institute has no employees of its own. Mr. Berman’s for-profit advertising firm, instead, “bills” the nonprofit institute for the services his employees provide to the institute. This arrangement effectively means that the nonprofit is a moneymaking venture for Mr. Berman, whose advertising firm was paid $1.1 million by the institute in 2012, according to its tax returns, or 44 percent of its total budget, with most of the rest of the money used to buy advertisements." [6]

In 2013-2014, EPI has become a primary industry attack dog, fighting minimum wage as dangerous to the economy, fighting living wages and advocating a low road economic development policy.

The Center for Media and Democracy outed EPI as a phony think tank in a Salon article in 2013 and critiqued media coverage of EPI, which consistently failed to note that EPI was run by a PR firm: [7] "We recently analyzed three years of newspaper stories from across the country that quoted from EPI or Michael Saltsman. In 83 percent of the stories we examined, reporters provided readers with no information about EPI’s relationship with Berman and Co. In most cases, journalists stated that EPI is a “Washington DC nonprofit” and called Saltsman a “research director.” In some instances, reporters took tentative steps in the right direction and called EPI “conservative” or “pro-business.” Only about 3 percent of the time did they correctly link EPI to Berman and Co." The Salon article prompted an amusing interview on MSNBC's Chris Hayes show where Hayes demanded to know how many economists EPI had on staff and the qualifications of its "Research Director" who has no training in economics: [8]

In February 2014, EPI ran a full-page ad in the New York Times attacking the over 600 economists who publicly favor raising the minimum wage to $10.10 an hour, who had been referenced by President Barack Obama, Sen. Tom Harkin (D-IA), and the New York Times editorial board. The ad said, "Many of the 600 economists you rely on are radical researchers or full-time employees working at union-backed groups. Of those who support a higher minimum wage, 45 percent don't specialize in labor economics."[9] An article published by Businessweek the same day pointed out, "The vast majority of the letter’s signers, organized by the labor-backed Economic Policy Institute, are in the mainstream of the profession. They include some of the most prominent living economists, including seven Nobel Prize winners and eight former presidents of the American Economic Association."[10]

Then in March 2014, EPI started running the commercial attacking the minimum wage. The group plans to spend between $500,000 and $1 million on an "educational campaign" on the minimum wage reports CNN. [11]

The Employment Policies Institute (EPI) calls itself a "non-profit research organization dedicated to studying public policy issues surrounding employment growth." In reality, EPI's mission is to oppose any increases in the minimum wage so that restaurants can continue to pay their workers as little as possible. [12]

EPI also owns the internet domain names to MinimumWage.com and LivingWage.com, a website that attempts to portray the idea of a living wage for workers as some kind of insidious conspiracy. "Living wage activists want nothing less than a national living wage," it warns.

Other affiliated organizations

In a February 2014 interview with NPR, New York Times reporter Eric Lipton explained how anonymous corporations and individuals funnel money to Berman & Co. through these nonprofit groups. "(The money) actually often it goes directly to the groups, and then it's paid back to the PR firm because the donations come through the nonprofit. But because you make a donation to the nonprofit, the IRS does not require that it be disclosed. So the nonprofits report...they have to report the total amount of donations they took in and the amount that they spent, and generally what they spend it on, but they don't have to disclose who their donors are."[13]

History

Rick Berman began his career as an attorney for the steel and automobile industries and became labor law director for the U.S. Chamber of Commerce before going to work for the Pillsbury Restaurant Group and Steak & Ale restaurant chain in the 1970s. In 1986, he launched his own public affairs firm, Berman & Co. He has maintained a friendly relationship, however, with Norman Brinker, CEO of Brinker International, Inc. (the former owner of Steak & Ale Restaurants and chairman of Pillsbury). In 1995, these ties figured in a House Ethics Committee investigation into allegations that House Speaker Newt Gingrich gave favorable treatment to Brinker and Berman in exchange for a $25,000 contribution.

In 1990, Berman lobbied on behalf of restaurant chains as they fought against the Pepper Commission, a blue-ribbon panel studying the problem of uninsured Americans which recommended that the federal government oblige restaurateurs and other employers to provide employees with medical insurance. His first front group, the Employment Policies Institute, was launched in 1991, around the time of the economic recession that led to the electoral defeat of then-president George Bush.

Berman continued to fight against mandated insurance in 1992 and 1993, when president-elect Bill Clinton attempted to make health care reform one of his first legislative priorities. Berman created yet another front group, called the "Partnership on Health Care & Employment," representing mostly large companies known for paying low wages and high worker turnover. It sponsored a study claiming that compulsory insurance for business would wipe out nine million jobs. During the health reform debate, Berman's study was cited in TV commercials sponsored by the Republican National Committee. The commercials continued to air even after Berman admitted that his study had actually been produced before the Clinton administration even formulated the details of its health plan.

Berman launched the Guest Choice Network in 1995, with funding, funded initially by the Philip Morris tobacco company.

In 1999, Berman continued to combine tobacco flackery with his role as a restaurant lobbyist, as his American Beverage Institute published a study titled "Effects of 1998 California Smoking Ban on Bars, Taverns and Night Clubs." The study surveyed bar owners and managers, asking whether business increased or decreased after January 1, 1998, the date the California bar ban went into effect. It claimed to find that business declined an average of 26.2%, but no hard numbers were used to arrive at this percentage. Rather than look at actual sales receipts, the ABI survey merely surveyed the opinions of bar owners. Numerous other studies have examined the effect of smoking bans on the hospitality industry, and studies that actually look at taxable sales receipts show no significant impact.

In September 1999, Berman launched another group, the Employment Roundtable, to "build on the successes" of the EPI and to "find solutions for problems such as social security and health care."

In May 2000, Berman launched cspinot.com, an attack website aimed at the Center for Science in the Public Interest (CSPI), which Berman accuses of anti-alcohol zealotry that "combines scare tactics and junk science to scold adult college students about alcohol consumption." In February 2003, however, he was forced to surrender the domain name following a successful legal appeal by CSPI. The Internet Corporation for Assigned Names and Numbers (ICANN), the body charged with regulating the Internet domain name system, ruled that Berman's front group had "attempted to create confusion among Internet users looking for [CSPI's] websites."

ActivistCash.com was launched in November 2001. In January 2002 the Guest Choice Network renamed itself as the Center for Consumer Freedom.

In a speech to the National Pork Forum in Dallas in May 2003, Berman said referring to activists pushing for changes to the meat industry. "People who are on the offense want to win, while people who are on the defense don't want to lose. There's a difference," he said.

Berman said the way for business to win against activist groups was a wage hard counter campaigns "to de-legitimize them in the eyes of the public." Such a campaign he said, delivering his business pitch, would require resources and strategies that "exceed the capabilities of the other side."[17]

According to a July 31, 2006, profile of Rick Berman in USA Today, Berman and Co. has 28 employees and takes in $10 million dollars a year, but "only Berman and his bookkeeper wife" know how much of the $10 million ends up in their own pockets.[18]

Controversy

In July 2007, presidential candidate John Edwards faced criticism after his campaign paid over $200,000 to a consulting firm with ties to the Center for Union Facts, a Berman front organization. The firm, LUC Media, was incorporated in Georgia and is headed by Christopher M. Werner, who is also CEO of a company called 1-2-1 Interactive Media, which bought advertising time for CUF. Both companies apparently share the same office and address. Werner insisted that "I have an interest from way back, but I don't do any work for [1-2-1 Interactive]." He added, "We're thrilled to be working for Senator Edwards."

Funding

As a private company, Berman & Co. is not required to disclose its finances. However, two of its front groups - the Center for Consumer Freedom and the Employment Policies Institute Foundation - are registered as tax-exempt nonprofit organizations, and they are required to disclose some financial information to the Internal Revenue Service which is publicly available by inspecting their IRS Form 990s.

Although Berman refuses to disclose the identity of its anonymous funders, the following companies have been linked to Berman & Co. in news reports and other public documents:

  • American Restaurant Group, Inc.
  • Anheuser-Busch
  • Arby's
  • Brinker International, Inc.
  • Burger King
  • Carson Restaurants Worldwide
  • Chili's
  • Chi-Chi's
  • Cracker Barrel
  • El Torito
  • Empire State Restaurant and Tavern Association
  • Hard Rock Café
  • Hooters of America, Inc.
  • Houston's Restaurants, Inc.
  • International House of Pancakes
  • Jack-in-the-Box
  • KKR Enterprises, Inc.
  • Luby's, Inc.
  • Marie Callender Pie Shops, Inc.
  • Marriott Corp.
  • Metromedia Restaurant Group
  • Olive Garden
  • Outback Steakhouse, Inc.
  • Panda Management Company, Inc.
  • Perkins Family Restaurants, L.P.
  • Philip Morris
  • Rare Hospitality International
  • Red Lobster
  • Shoney's, Inc.
  • Sizzler
  • Steak & Ale
  • TGI Friday's
  • Uno Restaurant Corp.
  • Vicorp Restaurants, Inc.
  • Wendy's

Personnel

Richard Berman is listed as president and his wife Dixie is listed as secretary/treasurer of Berman & Co.

Rick Berman, Dubbed "Dr. Evil" by 60 Minutes

Although Berman used to fly under the media radar, by now he is well-known and widely regarded as an industry shill, having been the subject of a 60 Minutes piece in 2007[19] that dubbed him “Dr. Evil,” a public takedown on the Rachel Maddow Show,[20] and years of research[21] documenting his close ties to industries looking for a well paid hired gun to defend the indefensible.[22] He has attacked respected scientists and scholars, food safety experts, and even Mothers Against Drunk Driving (MADD).

Despite this documented lack of credibility, Berman continues to work through a variety of research-for-hire front groups to remain relevant by creating a façade of academic respectability for extreme policies that many mainstream companies, scientists, and voters have rejected.

Berman has raised millions of dollars from companies, trade associations and individuals[23], but refuses to name them. According to the National Journal, the Employment Policies Institute was started “by a group of restaurant companies” that at the time (1995) got “95% of its budget from corporate sources—primarily restaurateurs and retailers.”[24] Several years ago an unnamed former Berman employee revealed a list of Berman’s 2001-2002 corporate funders, including Coca-Cola, Cargill, Monsanto, Tyson Foods, Wendy’s, Outback Steakhouse and Applebee’s.

“We always have a knife in our teeth,” Berman has said[25], and his approach is “to shoot the messenger.” Restaurant industry spokespeople have praised his “outstanding work as an industry Doberman.”[26] 60 Minutes called him “the booze and food industries’ weapon of mass destruction.”[27]

Meet Dr. Evil, (60 Minutes)
Watch the whole clip here.

Before striking out in 1986 with his own consulting company, Berman worked as a lawyer for Bethlehem Steel and Dana Corporation (1967-72), as labor law director for the U.S. Chamber of Commerce (1972-74), and for the late Norman Brinker’s restaurant empire (Steak and Ale and the Pillsbury Restaurant Group, 1975-86). Berman & Company now has about 30 employees and runs the Employment Policies Institute and a number of other industry-backed secretive front groups such as the Center for Consumer Freedom, Center for Union Facts, and American Beverage Institute.

Berman has had a long association with the National Restaurant Association[28], and frequently worked together with its former lobbyist Lee Culpepper in the 1990s.[29]

Other Personnel

A number of employees and associates of Berman & Co. also double as representatives of its various front groups:

Other individuals who have worked with Berman & Co. include lobbyist Ann Eppard (formerly a top aide to House Transportation Committee Chairman Bud Shuster); Kevin Lang of Boston University (who has authored a study sponsored by EPI); and Mark Gorman of the National Restaurant Association. John Doyle was communications director for Berman & Co., and also served as a spokesman for the Center for Consumer Freedom, the Employment Policies Institute and the American Beverage Institute. In late 2006 he joined the Washington D.C. office of the PR firm, Ruder Finn.

In 1994 Berman scored a coup when he managed to hire Candy Lightner to lobby on behalf of the American Beverage Institute. Lightner was best known as the founder of Mothers Against Drunk Driving but was fired as the group's executive director in 1985 over disagreements including her request for a $10,000 bonus on top of her $76,000 annual salary. As an ABI lobbyist, Lightner fought MADD's call for lowering the legal blood-alcohol limit for drivers from 0.10 percent to 0.08 percent. Criticized as a traitor to the movement she helped launch, Lightner left her job with Berman after less than a year.

Contact

The Center for Consumer Freedom, ActivistCash.com, the Employment Policies Institute and the American Beverage Institute all share office space with Berman & Co., at the following address:

Berman & Co.
1775 Pennsylvania Ave. NW, Suite 1200
Washington, DC 20006
Phone: (202) 463-7110
FAX: (202) 463-7107
Email: rberman@new-reality.com
Website: http://www.bermanco.com/

Berman Websites:

Articles and Resources

SourceWatch articles

Other Berman Front Groups

External resources

External articles

References

  1. Cite error: Invalid <ref> tag; no text was provided for refs named PRW
  2. Eric Lipton, "Fight Over Minimum Wage Illustrates Web of Industry Ties," New York Times, February 9, 2014.
  3. Tobacco Library, Secondhand Smoke in Bars and Restaurants Falls Well Below OSHA Standards, ABI Testifies Group Cites New Research from Oak Ridge National Labs, PR Newswire, February 23, 2003, accessed May 24, 2013.
  4. Richard B. Berman Richard B. Berman Resume'. January 1995. Philip Morris Bates No. 2072148764
  5. Eric Lipton, "Fight Over Minimum Wage Illustrates Web of Industry Ties," New York Times, February 9, 2014.
  6. Eric Lipton, "Fight Over Minimum Wage Illustrates Web of Industry Ties," New York Times, February 9, 2014.
  7. Lisa Graves, Corporate America’s new scam: Industry P.R. firm poses as think tank!," Salon.com, November 13, 2013.
  8. Arturo Garcia, Chris Hayes clashes with conservative ‘think tank’ member: ‘How many economists do you have on staff?’," The Raw Story, November 14, 2014.
  9. Employment Policies Institute, Heard about all those economists who support raising the minimum wage?, New York Times full-page ad, February 27, 2014.
  10. Peter Coy, Pssst: Some Economists Favoring $10.10 an Hour Are Marxists, BusinessWeek, February 27, 2014.
  11. Jennifer Liberto, "Big business hits back on minimum wage," CNNMoney, February 21, 2014.
  12. Jennifer Liberto, "Big business hits back on minimum wage," CNNMoney, February 21, 2014.
  13. 13.0 13.1 13.2 13.3 National Public Radio, "A Closer Look At How Corporations Influence Congress," NPR.org, February 13, 2014.
  14. Peter Hillman with David Madison, Ph.D., Supreme Court Rulings on Race and Retribution: Implications for the Workplace, The Five O'Clock Club, November 2003, accessed May 28, 2013.
  15. ActivistCash.com, "About Us," organization website, accessed April 24, 2014.
  16. Teachers Union Exposed, "About," organization website, accessed April 24, 2014.
  17. Feedstuffs Daily Update, Feedstuffs, May 21, 2003.
  18. Jayne O'Donnell, [usatoday30.usatoday.com/money/companies/2006-07-31-lobbyist-usat_x.htm Got a nasty fight? Here's your man], USA Today, July 31, 2006.
  19. 60 Minutes, Meet Dr. Evil, CBS News, September 19, 2007.
  20. The Rachel Maddow Show, Confronting Rick Berman, MSNBC, accessed April 2, 2013.
  21. Citizens for Responsibility and Ethics in Washington, Berman Exposed, organizational website, accessed April 2, 2013.
  22. Ian T. Shearn, Investigative Report: CCF's Richard Berman, The Humane Society of the United States, accessed April 2, 2013.
  23. Anti-Union Group's Ads Attack Organized Labor, Los Angeles Times, February 14, 2006.
  24. Louis Jacobson, "Tanks on the Roll," National Journal, July 8, 1995, p. 1767.
  25. Sheldon Rampton and John Stauber, Berman & Co.: "Nonprofit" Hustlers for the Food and Booze Biz, PRWatch, first quarter 2001, Volume 8, No. 1.
  26. Foodservice Blog, Who's gonna make us?, Nation's Restaurant News, September 16, 2007.
  27. Elizabeth Flock, PETA and Humane Society attacked by reports - are they real?, The Washington Post, February 27, 2012.
  28. Campaign for a Healthy Denver and Restaurant Opportunities Centers United, The National Restaurant Association: Behind the Fight Against Working Families and an Economy that Works for All, organizational report, October 2011.
  29. Marcus Kabel, Wal-Mart denies critics' claim that retail giant backs anti-union group, The Seattle Times, March 26, 2006.
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