States Step Up To The Plate

Much has been made in recent years about the increasing role of state government in the regulation of the telemarketing/teleservices industry. Every year, more and more legislation is introduced in state houses around the country, all supposedly in an effort to curtail the fly-by-night thieves who taint this industry's image. State initiatives are calling for registration of telemarketers, creating state run do-not-call lists, and requiring additional disclosures.

What has not gotten a lot of coverage, however, is the state legislatures have become this hotbed of activity for telemarketers. The reasons and timing of this shift to state regulation are open to many interpretations. But it is clear that no matter how many explanations there are, one giant engine is driving the train in that direction.

That engine is the near complete shift from the U.S. Congress to the states of the role of government protector. Alan Ehrenhalt wrote in a recent article in Governing magazine, “Over the past decade, without ever quite admitting it, we (the American people) have ceased to rely on Congress, or the federal government for that matter, to deal with our most serious public problems.” These days, rather, when faced with the challenges of our times, the American people look much closer to home for solutions.

For example, in 1997, the federal government rewrote the nation's welfare laws by ordering each state legislature to craft its own. The grand edicts that now come from Washington rarely contain step-by-step blueprints of what must be done. Rather they provide broad outlines and mandates of goals and leave it to the states to fill in the particulars. As a result, state legislatures have become very good at studying issues and designing detailed legislative solutions.

The only problem with this model is that the overwhelming majority of state legislatures are still part-time bodies, meeting for only a few months each year. Unlike Congress, which was designed by the founding fathers to be a very deliberative and slow moving branch of government, state legislatures move at a dizzying pace. Often times, legislation is introduced, studied and passed in a matter of weeks. That, combined with the great number of bills that are introduced and the relatively small number of staff available, places most state legislators in dire need of information. While this short time frame can put a great burden on the telemarketing/teleservices industry, it also presents a unique opportunity. This is where the industry can put an end to the damaging and false rhetoric that haunts its public image.

Unlike our federal legislators, whose daily calendars are full of meetings with well-connected lobbyists and powerful special interest groups, state legislative lobbying can often be accomplished in a more informal manner. Many a state bill has had its fate decided by a handful of legislators and concerned citizens meeting in the cafeteria in the basement of the state capitol. The vast majority of these legislators are genuinely interested in learning the substance of the issues they are voting on. Their days are compressed into very tight schedules, but they will almost always find the time to sit down with a constituent or business owner to talk through the impact of proposed legislation.

The story the telemarketing/teleservices industry has to tell is exactly the kind of story state legislators want to hear. Job growth that outpaces the national job growth average by more that three to one; employment opportunities for those who may not be able to hold down a 9-to-5 job because of disability or day care necessities; and an economic boost that may help fill government coffers at the end of the year. These are the issues that drive state legislatures to act, and the telemarketing/teleservices industry is on the right side of all of them.

It should be noted that despite this shift of regulatory authority, the old ways of Washington are not yet dead. Congress is still discussing issues that affect the industry, and regulators from the FTC and other federal bodies are still on the lookout for the bad apples. However, the days of Washington being the sole problem solver for the nation are over. Whether it has been thrust upon them from Congress or demanded of them by their citizens, state legislatures have taken the lead in addressing the issues of our day. The more issues they deal with successfully, the more they will be expected to handle in the future.

This devolution of power from Washington to the states has been taking place for several years and will most likely continue throughout the next decade. Thus the states will continue to be the battleground for quite some time. This shift poses a great opportunity for the telemarketing/teleservices industry to step forward and put its story of job growth and economic opportunity on display. The time has come. The telemarketing/teleservices industry must band together to ensure that their story is heard. Because the states are willing to listen.

C. Tyler Prochnow is an attorney in the Kansas City office of Lathrop & Gage, L.C.

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