The Volokh Conspiracy - Conservatives for Rent

Fed-Ex and UPS are embroiled in a nasty political fight. In short, UPS is seeking legislative changes that will increase FedEx's regulatory and labor costs. Specifically, UPS wants to force FedEx to be covered by the National Labor Relations Act, as UPS is, rather than than the Railway Labor Act. FedEx is currently under the latter because it primarily relies upon air shipping. UPS is primarily a ground carrier, so it falls under the NLRA. Unions also support the shift, as it would likely increase unionization within FedEx.

Many conservatives have been critical of UPS' campaign (see here and here). At least one conservative group, the American Conservative Union, also appears to have sought support for a campaign in support of FedEx, only to shift sides when its request was turned down. According to The Politico, ACU sent met with FedEx officials and sent them a letter seeking over $2 million to fund a "grassroots" campaign against the so-called "Brown Bailout." "We have reviewed your concerns regarding the NLRB and we believe we could strongly support your position," the letter said.

Apparently FedEx wasn't buying. So the ACU jsut turned its energies to other important issues, right? Within weeks of seeking money from FedEx for the anti-UPS effort, ACU Chairman David Keene joined other conservative activists signing a letter bearing the ACU logo that attacked FedEx for calling the pro-UPS policy proposal the "Brown Bailout." Labeling what UPS seeks as a "bailout" is improper, the second letter said, because "UPS was not seeking any taxpayer funds — only regulatory reform that would insure equal treatment of both companies under our nationʼs labor laws."

Bailout, shmailout. Whatever one calls it, UPS is engaging in special interest rent-seeking. While they don't seek tax dollars, their desired reforms would increase shipping costs for consumers, so we'd still be stuck paying for it. If UPS really wants "equal treatment," they should seek regulatory relief, perhaps a shift of UPS from NLRA to RLA jurisdiction, instead of asking the government to knee-cap a competitor.

As for ACU, it's one thing for activist organizations to seek support from organizations with common interests. So, for instance, there is nothing wrong with an anti-tax organization seeking money from corporations to fight increased taxes that could harm those corporations' interests. To the extent that such organizations can raise funds to support some campaigns and not others, this will inevitably influence a group's priorities, but does not necessarily compromise its principles. What is so unseemly here is ACU's apparent about face, from eagerly supporting FedEx's position to attacking the company's clever PR campaign, just after it failed to secure financial support. This sort of thing damages a group's credibility, and rightly so.

UPDATE: ACU has issued a press release disputing the Politico story, and claiming that the organization is still opposed to extending NLRA jurisdiction to cover FedEx. It reads in part: "ACU stands with the policy that FedEx should not be placed under the NLRB. This was ACU policy - before and after - any letters in question were drafted." It also claims that ACU did not endorse the letter attacking use of the "Brown bailout" slogan signed by David Keene and bearing the ACU logo.

Note: This morning, before publishing this post, I searched the ACU website for any indication the organization opposed extending NLRA jurisdiction to cover FedEx, and found nothing. I have just repeated my searches, and the only relevant document that comes up is today's press release.

	[Jonathan Adler, July 17, 2009 at 10:08am] Trackbacks Conservatives for Rent - "Brown Bailout" Edition: Fed-Ex and UPS are embroiled in a nasty political fight. In short, UPS is seeking legislative changes that will increase FedEx's regulatory and labor costs. Specifically, UPS wants to force FedEx to be covered by the National Labor Relations Act, as UPS is, rather than than the Railway Labor Act. FedEx is currently under the latter because it primarily relies upon air shipping. UPS is primarily a ground carrier, so it falls under the NLRA. Unions also support the shift, as it would likely increase unionization within FedEx. Many conservatives have been critical of UPS' campaign (see here and here). At least one conservative group, the American Conservative Union, also appears to have sought support for a campaign in support of FedEx, only to shift sides when its request was turned down. According to The Politico, ACU sent met with FedEx officials and sent them a letter seeking over $2 million to fund a "grassroots" campaign against the so-called "Brown Bailout." "We have reviewed your concerns regarding the NLRB and we believe we could strongly support your position," the letter said. Apparently FedEx wasn't buying. So the ACU jsut turned its energies to other important issues, right? Within weeks of seeking money from FedEx for the anti-UPS effort, ACU Chairman David Keene joined other conservative activists signing a letter bearing the ACU logo that attacked FedEx for calling the pro-UPS policy proposal the "Brown Bailout." Labeling what UPS seeks as a "bailout" is improper, the second letter said, because "UPS was not seeking any taxpayer funds — only regulatory reform that would insure equal treatment of both companies under our nationʼs labor laws." Bailout, shmailout. Whatever one calls it, UPS is engaging in special interest rent-seeking. While they don't seek tax dollars, their desired reforms would increase shipping costs for consumers, so we'd still be stuck paying for it. If UPS really wants "equal treatment," they should seek regulatory relief, perhaps a shift of UPS from NLRA to RLA jurisdiction, instead of asking the government to knee-cap a competitor. As for ACU, it's one thing for activist organizations to seek support from organizations with common interests. So, for instance, there is nothing wrong with an anti-tax organization seeking money from corporations to fight increased taxes that could harm those corporations' interests. To the extent that such organizations can raise funds to support some campaigns and not others, this will inevitably influence a group's priorities, but does not necessarily compromise its principles. What is so unseemly here is ACU's apparent about face, from eagerly supporting FedEx's position to attacking the company's clever PR campaign, just after it failed to secure financial support. This sort of thing damages a group's credibility, and rightly so. UPDATE: ACU has issued a press release disputing the Politico story, and claiming that the organization is still opposed to extending NLRA jurisdiction to cover FedEx. It reads in part: "ACU stands with the policy that FedEx should not be placed under the NLRB. This was ACU policy - before and after - any letters in question were drafted." It also claims that ACU did not endorse the letter attacking use of the "Brown bailout" slogan signed by David Keene and bearing the ACU logo. Note: This morning, before publishing this post, I searched the ACU website for any indication the organization opposed extending NLRA jurisdiction to cover FedEx, and found nothing. I have just repeated my searches, and the only relevant document that comes up is today's press release.