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Employment Policies Institute

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

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

The Employment Policies Institute (EPI) is one of several front groups created by Berman & Co., a Washington, DC public affairs firm owned by Rick Berman, who lobbies for the restaurant, hotel, alcoholic beverage and tobacco industries. While most commonly referred to as EPI, it is registered as a 501(c)(3) tax-exempt organization under the name of "Employment Policies Institute Foundation." In its annual Internal Revenue Service return, EPI states that it "shares office space with Berman & Company on a cost pass through basis". [1]

Berman Non-Profit Groups

In a February 2014 interview with NPR, New York Times reporter Eric Lipton detailed his visit to the EPI, saying "I didn't see any evidence at all that there was an Employment Policies Institute office. And in fact when I started to interview the people there, they explained that there are no employees at the Employment Policies Institute and that all the staff there works for Berman and Company, and then they sometimes are just detailed to the various think-tanks and various consumer groups that he operates out of his office."[2]

A November 1, 2012 article in Bloomberg shows CCF in the following chart of non-profits created by Berman & Co. at the center of an IRS complaint filed in 2012 (used with permission):

11022012 Berman-kr-01.png

Creation of "Rethink Reform"

In 2009, EPI created a group called Committee to Rethink Reform and started running television, print, and radio advertisements to mobilize opposition to the Democrats' health care reform legislation. The group is a 501 (c)4 organization and subsequently not required to disclose its donors--one of the hallmarks of a Rick Berman-operated group. The group has its own Web site and Facebook page. Here, among other things, are some of their claims, which have been repeated in anti-reform politicians' talking points:

"When it comes to reforming the health care system, Congress is trying to do too much, too fast. Not everyone agrees that we need reform of America’s health care system. Unfortunately, Congressional leaders are cutting backroom deals with special interest groups and writing bills that will lead to higher taxes, higher insurance premiums and fewer health care choices. The solution is not more government intrusion into the health care system, but less. It’s time for Congress to rethink health care reform, focusing on: Increasing health care choices; Reining in health care costs; and Controlling the growth of government to avoid escalating the national debt."

Committee to Rethink Reform ad

In 2010, they launched another print and TV advertising campaign against health care reform. The group faced controversy in March 2010 when it ran an advertisement in The Cincinnati Enquirer featuring a large picture of Representative Steven Driehaus (D-OH) and his two daughters. According to his spokesman, Driehaus was upset by the ad: "Rep. Driehaus thought the ad was outrageous, said the spokesman, Tim Mulvey. "He can take more than his fair share of political attacks, but this one crossed the line" [1]. Committee spokeswoman Sarah Longwell said showing the children was a mistake and that the group was taking out another ad to apologize: "...Politicians' children should bot be involved in public political debates and we deeply regret this mistake." Longwell said the committee already apologized directly to Driehaus. The Committee to Rethink Reform reported its apology on its Web site, while stating it would continue to urge Driehaus to oppose the bill [2].

The Center for Media and Democracy, which publishes SourceWatch.org, is looking into the nature of the claims they are making and their funding.

They have also spent substantial funds on ads in other right-wing campaigns, as described below.

Advertising against ACORN

In October 2008, as Republicans were accusing ACORN, which organizes in low-income communities, of "voter fraud," EPI took out a full-page ad in the New York Times that directed readers to www.RottenAcorn.com. The ad accused "ACORN of a list of abuses that suggest hypocrisy on some of the group's signature issues: intimidating and firing its own employees if they try to unionize, misappropriating millions of dollars from taxpayer-funded government grants and advocating minimum wage hides while paying its own employees less than minimum wage," reported ProPublica. EPI and Center for Consumer Freedom spokesperson Tim Miller said they placed the ad because after the election, "a lot of the coverage of ACORN is going to go away, but they are going to continue the same corrupt and fraudulent practices." [3]

For years, EPI had fought "ACORN's efforts to increase the minimum wage at the state and federal levels." ACORN says the charges in EPI's are untrue. For example, the group "pledged complete neutrality" when one of its offices "wanted to form a union," explained ACORN's Steve Kest. The employees eventually "decided not to pursue [the union], so nothing came of it." [3]

Against raising the minimum wage

EPI mobile billboard in Washington, DC in April 2014. The billboard reads: “Caution! Lost Jobs Ahead. Nonpartisan government economists estimate up to 1 million jobs will be lost if the minimum wage is hiked to $10.10. Tell Big Labor to hit the road.”

Rick Berman created EPI in 1991 to "argue the importance of minimum wage jobs for the poor and uneducated."[4]

In April 2014, EPI began an ad campaign in Washington, DC against the proposed minimum wage increase.[5] It includes a TV ad with a fortune teller who tells an actor portraying President Obama that “It doesn’t take a fortune teller to know what happens when you raise the minimum wage,” a radio commercial, and a mobile billboard on Pennsylvania Avenue between the Capitol and White House.

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."[6] 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."[7]

Minimum Wage: Disappearing Jobs

EPI has has been widely quoted in news stories regarding minimum wage issues, and although a few of those stories have correctly described it as a "think tank financed by business," most stories fail to provide any identification that would enable readers to identify the vested interests behind its pronouncements. Instead, it is usually described exactly the way it describes itself, as a "non-profit research organization dedicated to studying public policy issues surrounding employment growth" that "focuses on issues that affect entry-level employment." In reality, EPI's mission is to keep the minimum wage low so Berman's clients can continue to pay their workers as little as possible.

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 livingwage," it warns (as though there is something wrong with paying employees enough that they can afford to eat and pay rent).

In March 2013, EPI started running the commercial attacking the minimum wage. The commercial opposing President Obama's effort to hike the minimum wage touts the report by the Congressional Budget Office released Tuesday, saying "up to one million jobs will disappear" if the minimum wage increases. The group plans to spend between $500,000 and $1 million on an "educational campaign" on the minimum wage. [8]

History

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. EPI deliberately attempted to create confusion in the eyes of journalists and the general public by adopting a name which closely resembles the Economic Policy Institute, a much older, progressive think tank with ties to organized labor. In addition to imitating the name and acronym of the Economic Policy Institute, Berman's outfit even used the same typeface for its logo. In reality, the two groups have dramatically different public policy agendas. The Economic Policy supports a living wage and mandated health benefits for workers. Berman's organization opposes both and in fact opposes any minimum wage whatsoever.

In 1992, Los Angeles Times business columnist Harry Bernstein noted that EPI was using "misleading studies" to help put a positive spin on rising unemployment. "The conservative EPI, financed mostly by low-wage companies such as hotels and restaurants, is issuing reports the titles of which alone could help put a bright face on the miserable job scene," Bernstein wrote. "The latest one is 'The Value of Part-Time Workers to the American Economy.' It hails as a great thing the distressing growth of part-time jobs because they offer 'flexibility' in economic planning for both workers and companies, and say that flexibility is vital 'in the growing and increasingly competitive global economy.' Tell that nonsense to the more than 6.5 million workers forced to take part-time jobs because nothing else is available. That is an increase of more than 1.5 million involuntary part-timers since 1990, the Bureau of Labor Statistics says." EPI has been doing more or less the same thing ever since, sponsoring cooked studies and issuing tendentious sound bytes whenever attempts are made to establish healthcare or better wages for workers.

Then, as now, fast-food employees were the largest group of low-paid workers in the United States. One-quarter of the workers in the restaurant industry are estimated to earn the minimum wage--a higher proportion than in any other U.S. industry. This is the real reason why EPI appears on the scene whenever federal or local governments consider a proposal to increase the minimum wage. Its standard tactic is to trot out a study using contrived statistics designed to show that hundreds of thousands of jobs will be lost if the wage is raised. (In reality, studies by labor economists show that the job-loss effect of increasing the minimum wage is either small or nonexistent and that its benefits to low-wage workers and their families far outweigh the costs. Even the Food Institute Report, an industry trade publication, admitted in 1995 that "the weight of the empirical evidence suggests that the effects [on the number of available jobs] of a moderate raise from its current level are likely to be negligible.")

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 and Employment, representing mostly large companies known for paying low wages and high worker turnover. It sponsored a study in 1992 claiming that compulsory insurance for business would wipe out nine million jobs. During the health reform debate in 1994, the Employment Policies Institute issued its own "study," claiming that the Clinton plan would wipe out 3.1 million jobs. The EPI study was cited in TV commercials sponsored by the Republican National Committee, which 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.

In 1995, EPI lashed out at Princeton University professors David Card and Alan Krueger, after they published a survey of fast-food restaurants which found no loss in the number of jobs in New Jersey after implementing an increase in the state's minimum wage. Berman accused Card and Krueger of using bad data, citing contrary figures that his own institute had collected from some of the same restaurants. But whereas Card and Krueger had surveyed 410 restaurants, Berman's outfit only collected data from 71 restaurants and has refused to make its data publicly available so that other researchers can assess whether it "cherry-picked" restaurants to create a sample that would support its predetermined conclusions.

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." However, the Employment Roundtable has done nothing public of note.

The Employment Policies Institute in tobacco industry documents

The Employment Policies Institute, in a 1994 R.J. Reynolds-drafted press release, predicted the loss of 2-3 million jobs if the Clinton Healthcare plan was enacted. The Clinton plan was to be funded through an additional federal tax on cigarettes.[9]

A 1997 internal Philip Morris presentation called indicates PM planned to "sponsor and participate" in the Employment Policies Institute to gain the organization's help in promoting PM's Accommodation Program, a strategy the company designed to fight smoking bans and preserve smoking in public places.[10]

Personnel

Staff

Directors and Officers

The EPI's 2011 return to the IRS lists the groups officers and directors as comprising:

Former Directors and Staff

Other individuals previously associated with EPI include:

Funding

EPI reported $1,629,930 in total revenue for 2011, and $2,103,896 in total expenses.[13] This is a significant drop from the previous year, when it reported $5,910,092 in total revenue and $7,054,260 in 2010.[14]

It paid Richard Berman & Company, Inc. $1,165,601 in compensation in 2011,[15] for "daily monitoring/analysis on a worldwide basis on issues important to the organization, advertising, public and media relations, program management and promotion of information to the public," amongst others. Richard Berman and Company was paid $1,630,104 in 2010 by EPI.

In 2010, EPI gave $257,548 to the Center For Union Facts[16] for "educational issues regarding unionization of employees."

Previous Funding:

The IRS Form 990 for the year for the 2005 calendar year for the Employment Policies Institute Foundation states that its total revenue was $1,801,371. Of this $870,616 went to Berman & Company for "management services". The bulk of the group's expenses in 2005 were for PR related activities. $699,572 was spent on "media and message promotion", $229,069 on "marketing" and $324,618 on "issue research". [17] The same year, EPI gave $307,995 by way of grants to the FirstJobs Institute, which it describes as an "economic literacy program". [18]

The group's 2000 IRS return stated that the group received $1,163,248 in income for the year, most of which ($940,593) came from 17 anonymous donors. Of that amount, $717,812 went to Berman & Co. for "management services," and another $165,766 in salary and benefits went personally to Rick Berman. Comparable figures appear in EPI's Form 990 for previous years.

According to the Right Guide, funders of EPI have included the John M. Olin Foundation and the Claude R. Lamb Charitable Foundation.

Affiliated organizations

In its 2005 IRS return, EPI lists the FirstJobs Institute as an organisation it is directly or indirectly affiliated with. (FirstJobs is designated as a 501(c)(6) organization by the IRS). In statement 15 of its IRS return, EPI describes the relationship as being for a "joint educational project, 'Econ4u'". Elsewhere it states that that EPI and the 'Institute' "shared free common office space and overhead expenses provided under the management agreement with Berman and Company". It also states that the Institute "solicited funds for the educational portion of the joint project on employment Policies Institute Foundation's behalf." [19]

Contact information

Like other Berman & Co. front groups, EPI is headquartered at the following address:

Berman & Co.
1775 Pennsylvania Ave. NW, Suite 1200
Washington, DC 20006
Phone: 202 463 7650
FAX: (202) 463-7107
Email: rberman AT new-reality.com
Main website: http://www.epionline.org

  • EPI's previous phone number, (202) 463-7110, was the same as for other Berman front groups such as the Center for Consumer Freedom.
  • search google for above fax# "(202) 463-7107" [5]

Other websites

In its 2011 IRS return, EPI lists these websites as including:

In its 2005 IRS return EPI lists other websites other than its main website as including (see statement 1):

Articles and Resources

Related PRWatch Articles

Related SourceWatch Articles

Other Berman Front Groups

External Resources

External Articles

References

  1. Employment Policies Institute Foundation, "Return of Organization Exempt from Income Tax", 2005, Statement 12.
  2. Terry Gross, A Closer Look At How Corporations Influence Congress, National Public Radio, February 13, 2014.
  3. 3.0 3.1 Mosi Secret, "[http://www.propublica.org/article/rotten-acorn-ad-funded-by-anti-minimum-wage-group/ 'Rotten' ACORN Ad Funded by Anti-Minimum Wage Group]," ProPublica, October 29, 2008.
  4. Richard B. Berman Richard B. Berman Resume'. January 1995. Philip Morris Bates No. 2072148764
  5. Employment Policies Institute, "New EPI Ad Campaign Highlights Consequences of $10.10 Wage Hike Ahead of Senate Vote," organization website, April 29, 2014.
  6. Employment Policies Institute, Heard about all those economists who support raising the minimum wage?, New York Times full-page ad, February 27, 2014.
  7. Peter Coy, Pssst: Some Economists Favoring $10.10 an Hour Are Marxists, BusinessWeek, February 27, 2014.
  8. Jennifer Liberto, "Big business hits back on minimum wage," CNNMoney, February 21, 2014.
  9. Peaceful Times. Local smoking bans backfire, hurt restaurants R.J. Reynolds. July 15, 1994. Bates No. 511413918/3923
  10. Our Presentation is About: A A Philip Morris internal presentation; January 1997. Bates No. 2070258088/8114
  11. http://www.madison.com/tct/opinion/letter/269278
  12. http://dispatch.com/live/content/editorials/stories/2008/02/05/Kreutzer_ART_02-05-08_A8_9697TN1.html?sid=101
  13. Employment Policy Institute, 2011 Form 990, company document on file with IRS, accessed April 11, 2013
  14. Employment Policy Institute, 2010 Form 990, company document on file with IRS, accessed April 11, 2013
  15. Employment Policy Institute, 2011 Form 990, company document on file with IRS, accessed April 11, 2013
  16. Employment Policy Institute, 2010 Form 990, company document on file with IRS, accessed April 11, 2013
  17. Employment Policies Institute Foundation, "Return of Organization Exempt from Income Tax", 2005, Statement 2.
  18. Employment Policies Institute Foundation, "Return of Organization Exempt from Income Tax", 2005, Statement 4.
  19. Employment Policies Institute Foundation, "Return of Organization Exempt from Income Tax", 2005, Statement 14.