June,1999

SECTION: FEATURE

LENGTH: 4459 words

HEADLINE: Liddy Dole's Regulatory Ride
Her passion for Big Government and aversion to free-market solutions make her
the perfect presidential candidate. For the Democrats.

BYLINE: James Bovard. ;
James Bovard is the author, most recently, of Freedom in Chains:The Rise of
the State and the Demise of the Citizen (St. Martin's Press).

BODY:
Maybe it is my fault that Elizabeth Dole is famously terrified of "
unscripted" encounters with the press.
The American Spectator, June,1999

Ten years ago, researching an article on a federal job training program for
Reader's Digest, I asked for an interview with then-Secretary of Labor Dole. Her
press secretary put me off, first wanting to know whether the secretary's
picture would appear with the piece. (I told her that, since I was a mere
freelancer, such matters were out of my hands.) Finally, after much suspense, I
learned that a 30-minute meeting would be granted.

On October 12, 1989, Bill Schulz, the managing editor of Reader's Digest, and
I arrived for our appointment with Dole. We barely had time to enter her
palatial office suite and sit down before the secretary launched into a
filibuster about what the Job Training Partnership Act (JTPA) meant to her. She
picked up a framed photograph from her desk showing her hugging a black teenage
girl at a White House ceremony the previous July, and recalled: "She cried--and
I cried--and we hugged!" Dole kept talking rapidly, seemingly to run down the
clock.

I finally interrupted her in mid-sentence and asked, if JTPA was such a
well-run program, why had it given $3 million to finance a gay job-matching
network run by the Gay and Lesbian Service Center in Los Angeles?

Dole froze. After a pause, she said she did not know anything about that.
Schulz and I asked for her response to findings of the General Accounting
The American Spectator, June,1999

Office and the Labor Department's inspector general about deep structural flaws
in the program. Looking indignant, she declared that she had not expected to be
asked those kind of questions. She showed no awareness of any of the major
criticisms raised by the government's own auditors. About this time, I noticed
that the press secretary's knees were visibly shaking and I feared that the
young woman might faint at any moment. Dole soon made it clear that the
interview was over.

Elizabeth Dole is revered by moderates and much of the media, hailed as the
Republican answer to the gender gap, and treated as one of our most
distinguished public servants. In fact, during her tenures as Reagan's secretary
of transportation and Bush's secretary of labor--the most significant jobs in
her political career--Dole blundered blindly from one wrongheaded and costly
program to the next. Having helped open some of the worst public policy
Pandora's boxes of recent decades, she remains oblivious to the resulting
damage. Now touted as a realistic possibility for the Republican presidential
nomination, her record suggests that she would actually be more at home in the
pro-regulation, anti-business mainstream of the Democratic Party.

Jamming America's Brakes
The American Spectator, June,1999

Elizabeth Hanford started her political career working for North Carolina
Senator Everett Jordan and also volunteered for vice presidential candidate
Lyndon Johnson's 1960 campaign. After graduating from Harvard Law School, she
returned to Washington and eventually got a job in the Johnson White House. She
adjusted loyalties quickly enough in 1969 to stay on under Nixon, becoming a
vigorous advocate of consumer protection in his administration. In 1973, she was
appointed as a commissioner to the Federal Trade Commission. As she later
observed, "Washington was like a magnet to me."

In 1975, Hanford married Republican Senator Bob Dole and joined the GOP. When
Reagan won in 1980, Elizabeth Dole got a position in the White House public
liaison office. She was on the short list in mid-1981 for the Supreme Court
vacancy that went to Sandra Day O'Connor. When Drew Lewis resigned as secretary
of transportation in late 1982, Bob Dole lobbied the White House hard to give
his wife a promotion. As a result, Mrs. Dole became a cabinet secretary.

Dole sold herself as "Secretary of Safety," and was praised in the press for
helping the Reagan administration overcome its fear of government regulation. As
transportation secretary, Dole consistently sought to maximize federal power
both over citizens and state governments.
The American Spectator, June,1999

Take speed limits, for instance. In his 1980 presidential campaign Ronald
Reagan attacked the 55 mph speed limit, which Congress had imposed on all
interstate highways in 1974. However, as transportation secretary Dole fought
all attempts to allow states to raise speed limits. Dole was the first secretary
of transportation to penalize state governments for failure to ticket enough
speeding drivers. Even the New York Times editorial page was more moderate on
the issue; a June 28, 1985 editorial urged her to give the three states targeted
for fines more time to comply.

After Dole cut highway funding to several states, Congress moved to end the
55 mph speed limit. Dole urged that the limit be lifted only for a small number
of rural roads--a far less extensive deregulation than Congress eventually
enacted.

The higher speed limits quickly proved to be safer. Economists Charles Lave
and Patrick Elias examined the consequences and concluded that allowing people
"to drive faster reallocates traffic from side roads to the safer interstate
highways, and a higher speed limit permits highway patrols to shift manpower
from speed enforcement to other safety activities." Lave and Elias concluded
that "the fatality rate dropped by 3.4%-5.1% following the speed limit increase"
in states with higher speed limits. Dole's successful fight to delay raising the
speed limit probably resulted in hundreds of additional auto accident
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fatalities.

Dashboard Bombs for Safety

In her stump speeches, Dole brags about her role in mandating airbags in
cars. Yet few issues better symbolize the deadly irresponsibility of modern
paternalism.

In 1977 the Carter administration decreed that new cars must have passive
restraints by 1982. Ronald Reagan quickly canceled this edict upon taking
office. Insurance companies sued; the case went all the way to the Supreme
Court. One week before the court was to hear oral argument on the case, the
Washington Post ran a big headline: "Dole Touts Air Bags As U.S. Fights Them."
The article described Dole's wiggling: "Asked if she is comfortable with the
administration's position on air bags, Dole said that because the case is to be
argued before the Supreme Court she is 'not comfortable discussing it.' Asked if
she thinks the bag is a good idea, she said, 'Yes, I do, I do.'" As Sam Kazman,
a Competitive Enterprise Institute lawyer who has fought airbag mandates for
twenty years, observed, "I can't think of a more effective way to sabotage the
Reagan administration than this."
The American Spectator, June,1999

The Supreme Court struck down the Reagan revocation of the Carter air-bag
mandate on grounds that the administration had failed to consider the safety
effects of its policy reversal. But Dole displayed no curiosity about the main
drawback of airbags, which is that these exploding devices can kill innocent
children and smaller women. Over 100 children and female adults have been killed
by the bags, and over 300,000 people are injured by them each year, according to
the Transportation Department. Thousands of elderly Americans have suffered
sight or hearing losses because of the federally mandated exploding bags. A
Harvard University study concluded that there was no proof the devices had saved
the life of a single child.

Unfortunately, Dole's bureaucratic contortions on the airbag issue led to
more nuisance laws across the nation. In a deal cut with the auto industry, Dole
decreed that if states with two-thirds of the population would enact laws to
criminalize not wearing seat belts, mandatory air bags would not be necessary.
Offered this deal, the auto companies reversed themselves overnight and became
fervent advocates of seat-belt laws. Jim Baxter of the National Motorist
Association observed, "The auto manufacturers spent close to 100 million dollars
on the state-by-state campaign to pass belt laws." Largely as a result of Dole's
stratagem, almost all states enacted such laws. But a federal court in 1986
struck down the substitution of seat-belt laws for mandatory airbags.
The American Spectator, June,1999

Axing the Eighteenth Amendment

Shortly after becoming transportation secretary, Dole declared war on drunk
drivers. On October 6, 1983, she proclaimed: "It's a war we don't intend to
fight with rubber bullets or mere words of outrage." When Dole called for
raising the drinking age to 21, the Reagan administration temporarily reined her
in, but at a June 1984 rally by Mothers Against Drunk Driving on the steps of
the Capitol she called for Congress to inflict the higher drinking age on state
governments.

Since 1984 was an election year, politicians wanted to appear to be doing
something useful. The Senate voted to enact the National Minimum Drinking Age
Act as an add-on to a highway subsidies bill, and Dole justified the act with
studies showing that 18- to 21-year-olds have the highest rate of alcohol-
related traffic fatalities. When an interviewer on CBS's "Face the Nation"
pointed out that the same statistics showed that the accident fatality rate for
21- to 24-year-olds was almost as high, Dole replied that the federal ban on
drinking alcohol "could be extended" to 24-year-olds.

The act withheld 10 percent of federal highway construction funds from states
that refused to raise their drinking age to 21. Sen. Daniel Patrick Moynihan
(D-N.Y.) denounced this measure as "nothing short of coercion and blackmail by
The American Spectator, June,1999

the central government in Washington. I believe it to be repugnant to the
Constitution, inconsistent with sound principles of federalism." One state even
sued the U.S. government over the law.

The case of South Dakota v. Dole became another landmark in the destruction
of American federalism. Though the 21st Amendment explicitly specified that the
power to regulate alcohol is vested in the states, Chief Justice Rehnquist and
colleagues upheld the law, declaring that it was merely a " relatively mild
encouragement to the states to enact a higher minimum drinking age than they
would otherwise choose." Failure to raise the drinking age would have cost South
Dakota $12 million a year in highway funds, and would have cost Texas $100
million, the kind of "mild encouragement" that most people consider oppressive.
Justice O'Connor dissented, warning that upholding the law meant empowering
Congress to "effectively regulate almost any area of a State's social,
political, or economic life on the theory that use of the interstate
transportation system is somehow enhanced." Dole proclaimed that the ruling
"reaffirms the administration's commitment to eradicate blood borders and rid
our highways of drunk drivers."

What the 1984 law really did was create an "epidemic" of underage drinking.
Over the next five years, the number of college students who drank to get drunk
rose by 60 percent among men, and 240 percent among women (see also pp.
The American Spectator, June,1999

69-71). The politicians must have realized that 18-, 19-, and 20-year olds would
not suddenly change their habits and abstain from alcohol. Congress and Dole
chose to turn millions of people into scofflaws by enacting a law that deserved
to be scoffed.

Jobbing the Poor

Dole resigned as transportation secretary in late 1987 to work full-time for
her husband's presidential campaign. After the bruising primary fight for the
Republican nomination, newly elected President George Bush sought to appease his
former opponent, Senate Minority Leader Bob Dole. The result was another nice
job for Dole's wife, this time secretary of labor.

At the time Dole took over the agency, the Job Training Partnership Act,
enacted in 1982 as a more private-sector-oriented replacement for the
discredited Comprehensive Employment and Training Act (CETA), was the Labor
Department's flagship program. At a White House ceremony on July 25, 1989, Dole
called JTPA "the most successful job-training program in history with a
68-percent placement rate."

In fact, JTPA was spending thousands of federal tax dollars on expanding an
Indiana circus museum and teaching Washington taxi cab drivers to smile. JTPA
The American Spectator, June,1999

bribes for relocating businesses were leading to "move-a-factory-a-day" madness.
And the training itself was often of abysmal quality for low-level jobs. A
national survey by the General Accounting Office found that the position most
frequently obtained by JTPA trainees was that of janitor.

Like the federal job training programs that preceded it, JTPA hid its
failures with statistical shams. The method used to calculate the number of
placements varied from locality to locality, which made the national placement
statistics meaningless. And if a person who spent six months in a
JTPA-subsidized training program held a job for a single day, many localities
claimed he was successfully placed. Other programs skewed their numbers by
disregarding any trainees who did not get a job, thus achieving perfect 100-
percent placement records. A 1988 inspector general report found that the
percentage of young JTPA "trainees" receiving food stamps and general assistance
was twice as high after JTPA involvement than before, since the " training"
process included instruction in applying for welfare benefits.

After my expos? of the program appeared in Reader's Digest, the Labor
Department launched a major effort to destroy its credibility. A confidential
March 1990 internal Labor Department memo described that offensive in part as
follows:
The American Spectator, June,1999

(W)e are developing a strategy for handling this issue in the following ways:
by arranging briefings for key congressional staff members; preparing letters
for the Secretary's signature to key Committee members outlining our concerns
about the article and providing a balanced view of the situation; special
letters are being prepared for the Secretary's signature to Vice President
Quayle and Senator Edward Kennedy assuring them that the article is inaccurate
and that we are dealing with the issues raised; briefings will be held for
public interest groups involved in JTPA....

The memo attempted to justify many of the contracts and grants awarded by
JTPA. It described the JTPA-subsidized trip to Japan taken by a small-town mayor
and his son as "an appropriate employment generating activity under JTPA" and
added that "the son's expenses were justified because he is fluent in Japanese."
The memo also defended the Marion Barry Youth Leadership Institute's use of JTPA
funds to hold classes on "government/politics" in the District of Columbia. (The
Institute was closely linked to the mayor; it held election eve rallies to
encourage young people to vote.)

Shortly after Dole resigned as labor secretary in 1990, a six-year Labor
Department-financed study revealed that young males enrolled in JTPA programs
had 10-percent lower earnings than a control group who did not participate in
JTPA; the report concluded that federal training "actually reduced the
The American Spectator, June,1999

earnings of male out-of-school youths." A 1993 federally funded study found that
JTPA training had no positive effects at all on the wages or employment of
female trainees.

Congress finally deep-sixed JTPA last year and replaced it with a new job
training system--the Workforce Investment Act.

Sanctioning Domestic Terrorism

A 1989-90 strike by the United Mine Workers of America (UMWA) against the
Pittston Coal company resulted in over 3,000 assaults, explosions, and burned
vehicles in Virginia and West Virginia. A Richmond Times-Dispatch editorial
noted, "Many of the incidents of violence have been life-threatening, such as
the cutoff of power to mining sites, which means those working below the surface
are robbed of breathing air. ... Homes have been burned, livestock and pets
poisoned, personal vehicles shot up." Circuit Court Judge Donald McGlothlin
ruled: "The Court finds beyond reasonable doubt that not only has.. . UMWA
International ratified the acts of the various persons who were committing
violence but that they have encouraged and organized ... those activities as
well."
The American Spectator, June,1999

On October 13, 1989, Dole went to the site where UMWA strikers had illegally
seized a Pittston mine and proclaimed: "It's time to start the healing process."
Neither then, nor at any subsequent time, did Dole ever publicly criticize the
UMWA campaign of mass violence or intimidation. Dole appointed a special
mediator (which, as labor secretary, she had no legal authority to do). UMWA
violence continued after her visit to the strikers.

On New Year's Day 1990, Dole called a press conference to announce a strike
settlement that she called "a very special holiday gift." As part of the
agreement that Dole helped broker, Pittston was successfully pressured into
requesting the waiver of the $65 million in court fines for UMWA violence and
violation of injunctions. The union also received the rights to jobs at certain
Pittston operations, which meant that the company had to fire non- union
employees who had been hired during the strike. Though UMWA chief Richard Trumka
had done little to curb his union members' exuberance during the strike, Dole
treated him as if he were Abraham Lincoln working to free the slaves. For Dole,
it seems, one photo opportunity was apparently more important than hundreds of
bombings and shootings.

At the press conference, Dole defined the issues of the strike solely in
terms of the union's views, as if pensions and health benefits for retirees were
the only significant issues on the table. Dole declared that the issue of
The American Spectator, June,1999

those benefits "is larger than this particular dispute, and I am committed to
addressing it, to help fashion a solution in an informed and deliberate way.
Therefore, I'll soon appoint a secretarial commission..."

Dole thus started the process at the federal level that led to the enactment
of a law so obviously unfair that even the Supreme Court recognized its
injustice.

The commission that Dole appointed presented a report in late 1991, which
congressmen allied to the union seized upon to justify new taxes that would pay
for union benefits. In 1992, Congress decreed that any company, or corporate
successor of a company, that had hired any UMWA member for even a single day
since 1950 must pay into a health and pension fund for UMWA retirees and their
dependents and descendants until the year 2043. According to the UMWA, the
findings of the Dole Commission were "the basis of the 1992 act."

This was kleptocracy, plain and simple--congressmen plundering the coffers of
relatively defenseless businesses. Davis H. Elliott Co., an electrical
contractor of Roanoke, Virginia, was hit with a 50-year, $2,200-per-year
quasi-tax assessment because it had employed a UMWA member for the single day of
September 11, 1951. Alan Law, president of the Mountain Laurel Resources Co. of
Mount Hope, West Virginia, was forced into bankruptcy by the law. When he
The American Spectator, June,1999

bought the company in 1987, it had only six employees, none of whom were miners,
and was developing recreational sites in West Virginia. In 1993, Law was
informed that the federal government had assigned the health care costs of over
2,000 miners and dependents to his company and demanded over $5 million a year
in payments. Law's company's annual revenue was only $1 million a year, so he
folded. The IRS went through the Appalachian states, threatening companies with
$100-a-day fines for each assigned beneficiary until the company bowed to the
government's demands. Sen. Thad Cochran (R- Miss.) observed, "Congress harmed
all of these (companies targeted for retroactive assessments), devastated many
and ruined others. The tax has caused perhaps irreparable damage to many small
and family-owned businesses."

In a 5-4 decision in 1998, the Supreme Court struck down the law. Justice
O'Connor wrote that the act "operates retroactively, divesting (a company) of
property long after the company believed its liabilities...to have been settled.
And the extent of...retroactive liability is substantial and particularly
far-reaching."

Throwing Teenagers Out of Work

As Labor Secretary, Dole helped pioneer the playing of the "children's card.
"

The American Spectator, June,1999

On March 8, 1990, Dole cast Burger King into public relations hell, accusing
the fast food chain of thousands of violations of the Fair Labor Standards Act
restrictions on child labor. Burger King's "crimes" consisted largely of
allowing 14- and 15-year-olds to do certain cooking and baking tasks and to work
past seven p.m. on school nights. (A single minute of work after the federally
dictated deadline can cost a restaurant a thousand-dollar fine.)

On March 15, 1990--the day before a House committee had a hearing scheduled
to look at Labor's failure to enforce child labor laws--Dole upped the ante. At
a press conference she announced that, in the preceding three days, 500 federal
investigators had conducted over 3,400 investigations of businesses and
uncovered an estimated 7,000 minors working under conditions that violated
federal law. Dole proclaimed: "Protecting our children, America's future, from
exploitation in the workplace is a fundamental duty of the Labor Department.
Through Operation Child Watch, I want to deliver a clear message to employers,
parents, and youth that this Department is ready and willing to carry out that
responsibility. The cop is on the beat. Violations, whether motivated by greed
or ignorance, will not be tolerated."

Dole's grandiloquence left no doubts about how she felt. Alas, the press
conference necessarily entailed questions from journalists, the first being why
none of the guilty businesses had been named. Dole could not name even one
The American Spectator, June,1999

specific violator. Nor could she relate the size of the under-17 labor force. It
soon became clear that, after a three-day binge of ticket-writing, the Labor
Department had no idea how much of a "child labor" problem actually existed. Nor
did Dole offer any evidence that any of the illegally employed teens at places
ticketed in the crackdown had been harmed on the job.

Many companies, including Burger King and Hardee's, responded to the Labor
Department's national crackdown by ceasing to hire or employ anyone under the
age of 16. The crackdown contributed to one million fewer teenagers holding jobs
between 1988 and 1990. Critics pointed out that fast-food restaurants had
offered many of these teens an alternative to selling drugs on the street. As
Tim Ferguson observed in the Wall Street Journal: "According to 1988 Census
data, 90,000 youths age 15 and under have dropped out of school. This is the
cohort of youngsters subject to the tightest child-labor restrictions. Among 16-
and 17-year- olds...the dropout total is about half a million."

Dole's aides later bragged to the New York Times that she had been collecting
more and larger fines for worker safety and child labor violations than had any
of her predecessors.

Smashing Ceilings
The American Spectator, June,1999

As secretary of labor, Dole set policy for the Office of Federal Contract
Compliance Programs (OFCCP), which has jurisdiction over the pay and personnel
policies of all federal contractors, who employ over 25 million Americans.
Because there is no effective judicial oversight or political control over the
Department of Labor, its bureaucrats can act according to whatever fashionable
legal theories they choose. (See also my "Here Comes the Goon Squad" in the July
1996 TAS.)

In the summer of 1990, Dole declared that invisible ceilings in corporate
suites were holding down women and minorities across the land. That October she
announced: "We're surveying corporations with qualified women and minorities to
see if these workers are in training programs, what their reward schedules are
and if they are on rotational assignments." Dole did not specify how much
rotating she felt women employees needed.

In her last weeks in office, Dole issued a statement: "I have made this
(glass ceiling) issue a top priority....For me, it is a matter of fairness and
equity, born out of personal experience." This was ironic, considering that
Dole's "personal experience" over the previous decades had consisted of
receiving cabinet level appointments largely because of her gender. Yet she
complained to the Chicago Tribune: "In 25 years...nothing has changed. It's
taken longer than we thought for women and minorities to move ahead." In
The American Spectator, June,1999

claiming that nothing had changed over a quarter-century, Dole displayed
ignorance of basic American history, not to mention the record of crack-downs by
the Equal Employment Opportunity Commission.

Dole insisted that she was not for "quotas." But a high-ranking Labor
Department official, explaining the new policy to the Washington Times, said
that the agency would decide whether to investigate companies for glass- ceiling
violations based on "the share or lack of those people (women and minorities) at
the top corporate level." Labor Department officials stated that they planned to
devote more attention "to the manifestations of discrimination than to the
causes." By invoking the image of glass ceilings, Dole encouraged millions of
women to consider themselves victims in need of rescue by the state.

As usual, the nonsense started by a Republican administration is raised to
new levels of absurdities when the Democrats recapture power. DOL officials are
proud that the agency can proclaim half of the corporations it investigates
guilty of glass-ceiling violations. A 1998 OFCCP press release explained that
the glass ceiling reviews "study the invisible, artificial and attitudinal
barriers which keep minorities and women from upward mobility in upper
management levels."
The American Spectator, June,1999

OFCCP audits mean giving government clerks dictatorial power to judge the
supposed attitudes of private employees. OFCCP officials often disregard
differences in experience and job performance between employees of different
genders--thus making it easy to accuse a company of unfair pay differentials. It
is extremely difficult to battle the OFCCP--especially since a company can be
debarred from all federal contracts while the fight goes on. Thus, some
companies face the choice of paying what they perceive as a nuisance fine versus
risking being financially destroyed, as well as suffering a deluge of negative
media as the government labels them sexist and/or racist pigs.

In this, as in her other major initiatives, Elizabeth Dole epitomizes the
uncritical paternalism of the contemporary Leviathan state. As long as a program
claims good intentions, it seems not to matter to her how many people get
killed, or ticketed, or arrested, or thrown out of work, or beaten up by union
thugs as a consequence. Were Dole to win the Republican nomination for president
in 2000, it would mean the repudiation of all that the party has stood for since
Ronald Reagan.