National Federation of Independent Business

The National Federation of Independent Business (NFIB) is a lobbying group that calls itself "the voice of small business." However, the group has been shown to lobby on issues that favor large corporate interests and run counter to the interests of small businesses. News reports have also found that NFIB, which claims to be non-partisan, engages in partisan politics, and receives millions in hidden contributions.

Small business owners run the gamut politically. For instance, 33 percent identify as Republicans, 32 percent as Democrats, and 29 percent as Independent. However, NFIB accepted a $3.7 million gift in 2010 from Crossroads GPS, a group affiliated with Republican political operative Karl Rove that overwhelmingly endorses and financially supports Republican candidates. According to new data compiled by the Center for Responsive Politics (CRP), in 2010 the NFIB Small Business Legal Center (SBLC) received $1.15 million from "conservative 501(c)(3) conduit group" Donors Trust, a major contributor to the Koch brothers' Americans for Prosperity Foundation. Other contributions include the Lynde and Harry Bradley Foundation, which gave to a wide range of conservative groups including the American Legislative Exchange Council (ALEC).

In June 2012, Congress launched an inquiry into NFIB’s hidden sources of funding, which include large individual donations of over $1 million. However, NFIB has refused to disclose its donors.

A 2006 report quoted NFIB members who said the group was inflating its membership size of 650,000. NFIB now claims 350,000 members.

While the average small business owner makes slightly over $100,000, NFIB filings with the IRS show that CEO Dan Danner’s salary in 2011 was $743,676.

Entities associated with NFIB include the SBLC, the Young Entrepreneur Foundation, NFIB Research Foundation, and the Political Action Committee SAFE Trust (Save America's Free Enterprise Trust).

Federal Lobbying Efforts
NFIB positions frequently run counter to the interests and priorities of small businesses. Scientifically-conducted national surveys of small business owners show that most small business owners support key provisions of the health care reform, favor ending special tax breaks for the wealthy, support protecting clean air in local communities, and believe in promoting workplace safety -- all issues NFIB has lobbied against.


 * Affordable Care Act: NFIB was the chief litigant against the 2010 federal health care reform bill, the Affordable Care Act (ACA). According to an IRS filing, NFIB spent $2.9 million in 2010 to litigate the Supreme Court lawsuit against the ACA. The U.S. Supreme Court upheld the health care law 5-4 on June 28, 2012, with Chief Justice John G. Roberts Jr. joining the court’s four more liberal members.


 * Taxation: According to federal lobby disclosure reports, NFIB had a $3 million lobbying budget last year. The top issues it pursued with those funds included opposing higher individual tax rates, fighting the "death tax," and supporting "business tax reform." As Mother Jones reports: "Few among the legions of small business owners that it represents will benefit from its lobbying. Only 3 percent of small businesses net more than $250,000 a year, the lowest income that would be affected by Obama's tax plan. This is one reason why a variety of rival small business groups now accuse the NFIB of doing exactly what it was founded to prevent: selling out small business owners to benefit the rich and powerful."


 * Paid Sick Leave: NFIB has spent an unknown, but significant, amount of money and institutional caché fighting common sense proposals to give workers the right to earn sick time. However, a recent small business survey by NFIB found that providing mandatory sick and family leave was not a critical concern of NFIB members. Mandatory sick leave did not fall into the top 10, top 20 or even the top 60 "critical concerns" of NFIB members. In fact, sick leave ranked 64th of 75 issues studied. Please see NFIB Opposition to Earned Sick Days for more.


 * Stop The HIT Coalition: NFIB also organizes separately branded coalitions to advance specific lobbying agendas. Examples include the "Stop the HIT" coalition, which seeks to repeal a fee on health insurance companies that is part of the Affordable Care Act.


 * Small Businesses for Sensible Regulations: The Small Businesses for Sensible Regulations coalition opposes environmental protections such as lead paint rules and new power plant emission standards.

State Lobbying Efforts
In addition, NFIB state operations work in close coordination with other business associations and corporations on multiple-state battles:


 * Minimum Wage: In 2007, NFIB joined the National Restaurant Association, McDonalds', and Outback Steakhouse in an effort to turn back minimum wage campaigns in state legislatures. The chairman of its New Jersey leadership council, Earl Hall, weighed in against family and medical leave in 2007, calling it "an inappropriate gift" and saying it would tempt employees "to find an excuse to be unproductive for one-fifth of the year by encouraging employees to reduce their availability for work," when in fact all evidence shows that workers do not abuse medical leave and that family leave promotes economic security, labor force attachment, and improved health outcomes.


 * Paid Sick Leave: NFIB has fought the right of employees to earn paid sick leave in multiple states and municipalities including Alabama, Alaska, California, Colorado, Connecticut, Hawaii, Illinois, Maine, Massachusetts (see below), Milwaukee (where it supported a lawsuit to overturn the law), Montana, New Hampshire, North Carolina, Ohio, Minnesota, Vermont, Washington state, and West Virginia. Please see NFIB Opposition to Earned Sick Days for more.


 * Collective Bargaining: In 2011, NFIB of Ohio joined with the Ohio Chamber of Commerce and the Ohio Business Roundtable in supporting a multimillion dollar campaign to defend the state’s controversial proposed law to restrict collective bargaining rights in the state. The bill was overturned in a state referendum.

NFIB began in 1944 as a vigorous proponent of small business concerns, such as broad federal action to combat big business concentration and to prosecute antitrust violations -- items which have completely disappeared from NFIB’s present agenda.

Philadelphia Paid Sick Leave
In March 2013, the Philadelphia City Council passed, by an 11 to 6 vote, a paid sick days bill that would have allowed employees without sick leave to earn up to four paid sick days per year. Over 180,000 workers in Philadelphia do not have access to paid sick days and would have benefited from this measure. However, major opponents of the paid sick leave bill, special interest groups aligned with the American Legislative Exchange Council (ALEC), successfully lobbied Mayor Nutter to veto it. The bill died when the council was unable to sway enough nay votes to override the mayoral veto; they needed just one more. These groups, the National Restaurant Association, the U.S. Chamber of Commerce, and the National Federation of Independent Business (NFIB) are all tied to ALEC. The case of Philadelphia was unique in "the participation of telecommunications giant Comcast, Philadelphia's highest grossing company and an ALEC member." The corporation spent over $108,000 on lobbying, most of which went towards opposition to the paid sick days bill.

More than 40 percent of the work force in the United States cannot take sick days without losing wages or possibly their jobs, according to the Bureau of Labor Statistics. Major cities such as Washington DC, San Francisco, Portland and Seattle, as well as the state of Connecticut, have put paid sick day laws on the books; New York City will soon follow suit. The initiative is quickly moving to cities across the country "and in each case, the state and local branches of the National Restaurant Association, the NFIB, and the Chamber are actively opposing it" as they did in Philadelphia. Philadelphia was not the first instance where these special interest groups came together to thwart this legislation. City of Milwaukee voters passed a paid sick days referendum with over 70 percent of the vote in 2008 but when Scott Walker became Wisconsin's governor in 2011, the state affiliate of the National Restaurant Association and the local Chamber lobbied Walker to back "a bill to overturn this expression of local democratic will and preempt any local paid sick day ordinance."

Crossroads GPS and Donors Trust
The year it launched the lawsuit against the health care law, NFIB received $3.7 million from Crossroads Grassroots Policy Strategies (better known as Crossroads GPS), a nonprofit group affiliated with Republican strategist Karl Rove. The grant from Crossroads GPS was part of a $16 million grant program that served as a "trial run" for what Crossroads President Steven Law dubbed "funding the right."

According to new data compiled by CRP, in 2010 the SBLC received $1.15 million from Donors Trust, a "conservative 501(c)(3) conduit group" and major donor to the Koch brothers' Americans for Prosperity Foundation (donating $7.65 million to AFP Foundation in 2010). This $1.15 million from Donors Trust accounted for more than half of the SBLC's revenue that year.

NFIB failed to disclose the sources of these and other large donations amounting to over $10 million in undisclosed six-figure contributions from 2010 to 2011. These include donations of $2.04 million, $1.65 million, and $1.2 million, amounts unlikely to have been donated by small business owners who, as NFIB itself acknowledges, often run shoestring operations.

The SBLC also received a $100,000 contribution from the Lynde and Harry Bradley Foundation in 2010, explicitly marked in the Bradley Foundation's IRS filings "to support health-care litigation efforts." The Bradley Foundation gave to a range of conservative groups in 2010, including $500,000 to Americans for Prosperity Foundation and $95,000 to ALEC.

In contrast, in 2009, before NFIB launched its health care lawsuit, the biggest contribution to NFIB from an outside source was $21,000, and the biggest to the SBLC was $7,500. Please see NFIB's Legal Arm for more.

AHIP Health Insurance Lobby
The nation's leading healthcare insurance industry lobby, America’s Health Insurance Plans (AHIP), contributed $850,000 to NFIB in 2011 to repeal a provision of President Obama's healthcare legislation. By routing this difficult-to-trace funding through NFIB, AHIP was able to re-frame the issue away from big insurance, allowing their more politically popular ally to frame the provision as an attack on small business owners, according to The National Journal.

"Some in Washington call this message-laundering," wrote Businessweek. "Americans hold small business in higher regard than any institution other than the military. Groups with a small business pedigree make attractive mouthpieces for messages that lawmakers and the public would be skeptical about hearing from, say, big insurance companies."

The donation "underscores how deeply the small business group has allied itself with the industry and special interest groups that seek to weaken the Affordable Care Act," the Huffington Post noted.

The targeted healthcare provision would impose a tax on healthcare premiums as of 2014, costing the insurance industry approximately $100 billion over the next decade. The NFIB's opposition to the provision included lobbying legislators on the state and federal levels, and to push state legislators to pass resolutions opposing the tax.

AHIP and the NFIB announced a collaboration in 2011 to fight the tax on healthcare premiums, stating they were "partnering to get out the facts about the impact the premium tax will have on the cost of coverage and to build bipartisan support to prevent it from going into effect in 2014."

AHIP made a similar backdoor contribution to the U.S. Chamber of Commerce when President Obama's healthcare reform was being considered, The $100 million contribution "allowed insurers to publicly stake out a pro-reform position while privately funding the leading antireform lobbying group in Washington," The National Journal wrote.

NFIB's Partisan Politics in 2012
In July of 2012, NFIB announced a campaign in nine states against what it calls a "tidal wave" of regulations slated to take effect in 2013. The campaign is described as an issue education campaign, but the states -- Colorado, Florida, Iowa, Missouri, North Carolina, Nevada, Ohio, Pennsylvania, and Virginia -- are all presidential battleground states, and many have hotly contested Senate races.

In August of 2012, NFIB announced a $2 million ad campaign to aid eight Republican House candidates in tight congressional races. They ran an ad in Nevada thanking Sen. Dean Heller and Rep. Joe Heck for "doing big things for small business", which you can listen to here. They also ran similar ads in: IL-­17 (Bobby Schilling); IA­-03 (Tom Latham); NY­-19 (Chris Gibson); CA­-07 (Dan Lungren); NC­-08 (attacking Larry Kissell to aid Richard Hudson); Maine­-02 (attacking Mike Michaud to aid Kevin Raye); and OH­-16 (Jim Renacci).

In February 2012, Politico reported on NFIB's formation of "NFIB, The Voice of Free Enterprise, Inc," a new entity that "allows individuals and groups - who are not small businesses - to join its lobbying effort." On October 8, 2012, NFIB's new Voice of Free Enterprise group disclosed spending $95,914 on mailings in 9 Senate races, including $10,453 for mailings opposing Claire McCaskill in the Missouri Senate race between McCaskill and Todd Akin. The other mailings were in Montana (supporting Denny Rehberg), Virginia (supporting George Allen), North Dakota (supporting Rick Berg), Connecticut (opposing Christopher S. Murphy), Wisconsin (opposing Tammy Baldwin), Ohio (supporting Josh Mandel), Florida (supporting Connie Mack), and Michigan (opposing Debbie Stabenow).

In the 2012 election cycle overall, NFIB spent a total of $4,063,021 in outside spending, including $1,983,385 through its new "Voice of Free Enterprise" 501(c)(4) entity. Every dollar of its independent expenditures was spent either in support of Republican candidates ($2,583,943) or against Democratic candidates ($1,479,078).

NFIB’s Lopsided Political Giving
Despite NFIB’s pattern of political giving that overwhelmingly favors Republican candidates, small business owners themselves do not follow an ideological or partisan skew. In a 2008 survey of small-business owners by American Express OPEN, 33 percent of the respondents identified themselves as Republicans, 32 percent as Democrats, and 29 percent as independent or claimed no party affiliation.

NFIB’s political giving has not been dispersed in a representative way.

In nine of the last ten election cycles, NFIB has given 90 percent or more of its political contributions to Republican candidates. In the 2012 election cycle, it gave $670,543 to Republican candidates and $11,000 to Democratic candidates, a 98 percent to 2 percent split.

This skew toward the GOP is longstanding. On the CRP's "Heavy Hitters" list of top all-time political donors since 1989, NFIB ranked third in terms of the percentage of contributions given to Republican candidates. Ninety-three percent of its contributions went to Republican candidates over this period. NFIB’s contributions are even more lopsided than the political spending of other well-known, well-funded lobbies, including Koch Industries (91 percent to Republican candidates), Exxon Mobil (86 percent to Republican candidates), and the National Rifle Association (82 percent to Republican candidates).

Bloomberg reported that: "NFIB reported spending more than $1 million on ads to help elect Republicans in 2010, as well as another $1.5 million that it kept hidden and said was exempt from requirements that it disclose campaign spending."

In a 2006 report by a newspaper in the group’s hometown of Nashville, Tennessee, NFIB members criticized the group for GOP partisanship.

NFIB Leadership
NFIB’s President is Dan Danner. Nothing in Danner’s bio suggests he has ever been a small business owner. Rather, he has strong corporate and political credentials. He began his career as a lobbyist for the steel industry. Danner joined NFIB in 1993 and was appointed chief lobbyist in 1995. He assumed the leadership of NFIB in February 2009.

As NFIB's top lobbyist, Danner has attended meetings with Republican leaders at least twice a month for 12 years, according to the Washington Post, and Danner was called "the go-to guy for the House Republican leadership" by a congressional staffer in 2005.

According to NFIB’s IRS filings, Danner made $743,676 in 2011. Tax data show that 97 percent of small business owners earn less than $250,000 a year in take-home income or close to just a third of what Danner earns as NFIB’s President.

At the beginning of 2012, the group retained Mark Warren, former chief counsel for the Senate Republican Policy Committee, as a lobbyist. The lobbying team does not appear to include a formerly Democratic lobbyist.

For more of Danner's right-wing ties, as well as those of its DC staff like Susan Eckerly, Stephen P. Woods, and Jean Card, please see NFIB's Right Wing Ties.

Congressional Inquiry
In June 2012, the Progressive Caucus in the U.S. House of Representatives sent a letter to NFIB President Dan Danner questioning the group’s ties to "'corporate-funded activist groups,' rather than small firms."

Congressman Raul Grijalva later sent a letter to the IRS asking them to investigate NFIB’s tax-exempt status. "Secrecy is not a small business value, nor is it in the interests of political integrity," Grijalva wrote. "If NFIB is determined not to say where its money comes from or who its members are, we must ask what the group is hiding."

NFIB has refused to disclose its hidden donors to Congress.

Controversy over Membership Size
In the mid-2000s, NFIB claimed 600,000 members, a number disputed by former NFIB leaders, who said the group inflated its size to maintain clout with Congress.

Today, NFIB claims 350,000 members.

Ties to the American Legislative Exchange Council
NFIB is a private-sector member of ALEC and has had representatives on ALEC's Civil Justice Task Force, Health and Human Services Task Force, and Tax and Fiscal Policy Task Force.

Other NFIB-ALEC Connections

 * In August 2011, NFIB's Massachusetts state director, William B. Vernon, received ALEC's "Private Sector Member of the Year" award.


 * The head of NFIB’s Alabama chapter, Rosemary Elebash, is also the Alabama private sector chair for ALEC.


 * Jean Card, NFIB's Vice President of Media and Communications, was a Task Force Director at ALEC from 1994 to 1996.


 * When NFIB President Dan Danner was working for George Mason University, he was caught up in a controversy over funneling federal grant money to ALEC founder Paul Weyrich’s Free Congress Research and Education Foundation. Weyrich co-founded the American Legislative Exchange Council (ALEC) and the Heritage Foundation in 1973.


 * ALEC's Civil Justice Task Force legal adviser, Mark Behrens of Shook, Hardy and Bacon, is also on the advisory board of the NFIB SBLC.

ALEC has recently come under scrutiny and lost many of its corporate and non-profit members. NFIB has not unaffiliated itself with ALEC.

Other Right Wing Ties
NFIB has a 14-member board of directors composed primarily of small and medium sized business executives, but the heart of NFIB’s political operation is its DC office. NFIB's staff is headed by its president and CEO “Dan” Danner (whose background is discussed in detail above); Susan Eckerly, Senior Vice President for Federal Public Policy; Stephen P. Woods, senior vice president for state operations; and Jean Card, vice president for media and communications. Danner, Eckerly, and Card have multiple ties to various right wing groups. Please see NFIB's Right Wing Ties for more.

NFIB's Legal Arm
NFIB's legal arm, the SBLC, spearheads the NFIB's legal assault on the Affordable Care Act ("Obamacare"). It is one of its three 501(c)(3) foundation arms. Please see NFIB's Legal Arm for more.

NFIB Opposition to Earned Sick Days
In addition to direct lobbying of lawmakers (see above), other NFIB anti-paid sick day campaign tactics include grassroots lobbying via email blasts to members encouraging them to contact lawmakers, legislative updates, economic reports -- in Colorado, Illinois, Massachusetts, and other states -- and earned media outreach. Please see NFIB Opposition to Earned Sick Days for more.

Board of Directors
NFIB's board members, as of September 2012, are:


 * David M. Guernsey, Chair
 * Timothy Clayton
 * Maria Coakley David
 * Dan Danner
 * Nevin J. Groce
 * James M. Herr
 * A. June Lennon
 * Betty Neighbors
 * Thomas Michael Nobis
 * Ruth Lopez Novodor
 * W. Bruce O'Donoghue
 * Jeff Ready
 * Steve Schramm
 * Kurt E. Summers

National Staff
NFIB's national leadership, as of September 2012, consists of:


 * Dan Danner, President and Chief Executive Officer
 * Mary Blasinsky, Senior Vice President, Chief of Staff
 * Tammy Boehms. Senior Vice President and Chief Financial Officer
 * John Casella, Senior Vice President, Sales
 * Susan Eckerly, Senior Vice President, Federal Public Policy
 * Mark Garzone, Senior Vice President, Marketing
 * Steve Woods, Senior Vice President, State Operations
 * Jean Card, Vice President, Media and Communications
 * Janet Connor, Vice President, Human Resources

Contact Information
National Federation of Independent Business 53 Century Blvd, Suite 250 Nashville, TN 37214 Toll-Free: (800) 634-2669 Direct: (615) 872-5800 Web Form: http://www.nfib.com/contact-us Web: http://www.nfib.com/

Related SourceWatch Articles

 * NFIB's Right Wing Ties
 * NFIB's Legal Arm
 * NFIB Opposition to Earned Sick Days
 * American Legislative Exchange Council
 * Lynde and Harry Bradley Foundation
 * Donors Trust