Jerry Kilgore

Welcome to the fourth season of the State AG Pulse. In this season we’re diving into the state and federal political landscape in the run-up to the  general election. We’re talking with our colleagues at Cozen Public Strategies to uncover information and insights to help business leaders make better decisions.

Chris Allen

I am Chris Allen. I think I’m a new voice this season, but hopefully not a new one for those of you who have listened before. I am a partner in Cozen O’Connor’s State Attorneys General practice, and today I am excited to be joined by Howard Schweitzer, the CEO of Cozen O’Connor Public Strategies, and Jerry Kilgore, the co-chair of our State Attorneys General practice. Jerry, Howard, welcome to the podcast.

Jerry Kilgore

Great to be with you.

Howard Schweitzer

Excited to be on. Thanks, Chris. Good to see you, Jerry.

Jerry Kilgore

Yeah. Good to see you Howard.

Chris Allen

What we’re doing this election season is a crossover between our state attorneys general podcast, the State AG Pulse, and Howard’s Beltway Briefing podcast. I’ve just gained a lot more understanding about the intersection between the world that Jerry and I live in, the state AG world and the world that you live in, Howard, mainly on the federal side. And so today we’re going to talk some more about two aspects of the overlap between our two worlds. One of those is the phenomenon that I know General Kilgore is particularly familiar with, of AGs seeking higher office, since as a former Virginia Attorney General, you ran for governor of your state. And another topic we’re going to touch on is a related overlapping topic, how state action overlaps and interacts with federal action, whether you’re talking about legislative priorities or regulatory priorities.

Jerry, it used to be that a state attorney general was a pretty insular job, but lately we have seen an explosion really over the last two or three decades of state AGs using that position to springboard to different or higher offices. And I was wondering if you could explain a little bit why you think that phenomenon has really picked up recently.

Jerry Kilgore

Well, I do think that it all goes back, as in most things in the AG world, all goes back to tobacco and the tobacco litigation. When state AGs figured out they had a lot of power, they could attack businesses, they could go after issues as a group and not individually and find some success, that led to the old adage that AG stands for aspiring governor as much as it does for attorney general. And you have a host of attorneys general that have become governors, but you also have attorneys general that had become president of the US, vice president of the United States – Kamala Harris was the attorney general of California

Chris Allen

And Howard, you have a number of senators that also used to be former attorneys general.

Howard Schweitzer

Yes. I think seven or eight members of the United States Senate used to be AGs. Look, I think Chris, the reason is they’re not different worlds. It’s all one world. This is the political world, and I think AGs have become among the most powerful political actors this country has. They have unitary authority. There aren’t the checks and balances on an AG that you have on let’s say the Speaker of a House, of a state legislature. It’s just different. They’re very powerful and they have not just political profile, but they have enforcement powers, different powers, obviously. It’s your world, you know, depending upon the particular AG, they can very quickly and very easily build their profile from a political point of view in a way that others can’t.

Chris Allen

Yeah, I think that’s a great point because I don’t think there’s a person in this country who follows current affairs, who doesn’t know who Letitia James is or who Ken Paxton is. And  years ago, I think that would’ve just been incredible to ask people, well, maybe Eliot Spitzer for various reasons, people knew who he was, some more notorious than others. But you’re right, it creates a platform for them, this power they have, the high profile matters they take on, to make it really easy, I think, to build a national profile instead of just a profile within their own states.

Jerry Kilgore

I’d like to say, Chris, that when I’m talking to business clients that they don’t have to get legislation passed as an attorney general to affect your business. They can issue a subpoena, they can issue what they call a CID, the Civil Investigative Demand, and it throws the company into disarray, if you will, to comply with that subpoena. But then as part of that process, they exact the terms in that settlement or in that lawsuit to get what they wanted, to get the business practice changed. Whether it’s dealing with financial services and dealing with interest rates or the way they make loans or the way they deal with their consumers, to other companies like tobacco companies and others and how they deal with minors or how businesses deal with veterans and the elderly. They can do all of this without going to their legislature, without having that threat of, “They didn’t pass the law, so I can’t enforce this” or having a governor veto it.

Chris Allen

Yeah. And I think Howard, that may explain why you’re seeing not just AGs moving from the AG’s office into the Senate, for example, but now you’re seeing an increasing number of members of Congress actually moving into the AG’s office. And I think Jerry is onto something. Because given the current state of the Congress, it’s got to be attractive if you really want to effect your political will or get your policy priorities passed to go to an AG’s office where you do have, as you were saying, unique discretion, almost unchecked discretion to accomplish what you want.

Howard Schweitzer

No offense to the many members of Congress that I know, but there’s a big difference between being one of  and one of , or one of one.

Chris Allen

I was about to say. Yeah.

Howard Schweitzer

That’s a state by state basis. And it’s a world of difference, a member of Congress, a rank and file member of Congress does not have nearly the power of a state attorney general, period.

Chris Allen

And so for example, you have Dan Bishop who’s leaving Congress to go run in North Carolina. AG Landry, who is now Governor Landry, was also a member of Congress. Todd Rakita out in Indiana was a member of Congress. And so it’s really interesting to see this interplay, this moving. Like you said, it is one world, it’s the political world. But to watch the evolution of a state attorneys general as they increase in their profile, move around and take these different jobs. Jerry, do you think there’s a different approach for somebody who came from a legislative background who runs for AG than somebody who may have come out of private practice or some other arm of the government?

Jerry Kilgore

I do. I think those that come out of the legislative process feel an allegiance, if you will, to the legislators and they still consider themselves more of a legislator at the beginning than an attorney general. So they want to work with and have an agenda, have a legislative package, versus someone that comes out of the business world or someone that even comes back from Congress to run for AG. They treat it more as the managing partner of a law firm that comes in with a public policy agenda where they get out and do the PR and do all the stuff that’s necessary to put the AG’s office on the front page of the paper every morning.

Howard Schweitzer

In terms of, Jerry, you and I have spent a lot of time talking about this, in terms of our public policy practice at the firm, I’m just talking now about Public Strategies, it’s federal, state, and local. Very intentionally, because different levels of government are much more connected than they ever have been. And that’s true as it relates to the state attorney generals, the overlap between what happens in Washington and state capitals and city government and state attorneys general. To me, it’s all just much more connected than it ever has been and I think that’s why we see so much back and forth.

Chris Allen

Yeah, Jerry, I was thinking of our friend Mike Turpin, former Oklahoma Attorney General, who always used to say about state attorneys general, “You should know before you need them.” He gave that as advice to clients because if you know an attorney general and they have an issue or they think they have an issue with you, they might come and talk to you instead of shooting off a subpoena or a CID. But Howard brings up a point that there’s another side to that, right? “Know them before you need them.” Know the AG when they’re an AG, and then you’ll know them when they’re senator or cabinet secretary or Vice President of the United States.

Jerry Kilgore

Oh, that’s exactly right. It’s important to… I tell the business clients that, “You know this person is going to run for higher office eventually, and you will need them, whether it’s at the state level, the governor, or whether they go on to Congress or the U.S. Senate or even further than that. Get to know them now and you’ll know them for their political lifetime, if you will.”

Howard Schweitzer

Everybody comes from somewhere.

Chris Allen

Yeah, absolutely.

Howard Schweitzer

Everybody comes from somewhere, but you’re much better off knowing them where they come from than just where they are today as it relates to Washington. You want to know them from back home. And so I think building those relationships with state AGs that intend to seek higher office makes all the sense in the world on multiple levels.

Chris Allen

And it’s not just knowing the person, right? It’s knowing what their priorities are. It’s knowing what their interests are. It’s engaging them over a long time in really a dialogue and a relationship rather than a transaction if you’re going in there to ask them for something or ask them about something, right?

Howard Schweitzer

It’s a relationship. Politics just isn’t that transactional, it’s relational. And if you want people to be invested, figuratively speaking in helping you navigate through whatever issue you have that’s in front of them, you have to have a relationship with them. You have to know them. You have to understand what makes them tick. That doesn’t mean you have to agree with them on everything. That doesn’t mean you can’t have spirited disagreement, but you have to have a relationship with give-and-take.

Jerry Kilgore

I do feel like AGs, just like other political leaders are looking to our community, if you will, those of us that work with them to be honest brokers, and to give them the down-and-dirty on the legislation or on the policy, but to give them both sides of it. And I think that’s what I try to do so that these AGs understand that I’m being upfront with… I may represent a client, but I’m being upfront with them about what this policy involves, what this particular matter involves, so that we can reach some agreeable resolution.

Chris Allen

And that’s got to be especially important these days because Howard, as we were talking when we were preparing for this podcast, you pointed out that the red states are getting redder and the blue states are getting bluer. And so now you have a challenge because if you’re in a position like an attorney general, and you can have an impact on policy, some of the loudest voices may not be those who are disagreeing with you, but they may be the ones that are saying, “You’re not doing enough.” or “You’re not doing it right.” And it’s creating a really interesting dynamic within the states.

Howard Schweitzer

Within the states for sure. You have single-party government basically in most states. There’s very little divided government at the state level. And yes, I think the red states are getting redder and the blue states are getting bluer. I was just talking to somebody about the state of Indiana. One of their chambers was still blue  years ago, flipped  years ago. That’s unthinkable today that you would have a blue chamber in a red state like Indiana, right?

Jerry Kilgore

Well, and just a couple years ago you had the split Houses in Michigan and Wisconsin, and they just got bluer as well over the past few years.

Chris Allen

Well, and obviously another impact of the states getting redder and redder and bluer and bluer, which segues I guess into our next topic, is that the states traditionally have been laboratories of democracy. I think the states are diverging more and more in terms of how they use their authority, their sovereignty, to experiment within their own borders. And I think you’re seeing that filter up into the federal level too. One of my favorite examples is that the states are and have been the leaders on data privacy in the U.S. Congress has been trying for umpteen million years to pass a data privacy bill. But in the absence of that, you’ve seen states like California, Florida, New York, Texas, Illinois, and even smaller states really take the lead in this area and in others like consumer financial protection being another one.

Howard Schweitzer

Washington is, obviously it’s cliche almost to say it at this point, but more divided than ever, more closely divided than ever. And that doesn’t appear to be changing anytime soon, constantly flipping back and forth. And you may control a chamber, but look at the Republican majority in the house right now, it’s a sliver. And effectively they don’t have control of their own chamber because the margin is so thin. The Democrats have the Senate by a hair, that’s going to continue. So, because there’s sometimes some stagnation in Washington, I think there’s breathing room for state and local government to pick up the mantle and legislate and regulate in a way and they’re relatively unfettered in their ability to do so. Because again, it’s generally single party rule.

And so in cities like New York and Chicago and San Francisco and Los Angeles and Seattle, you’ve got very hyper-aggressive, progressive city councils passing very aggressive legislation. You talked about the privacy act, privacy bills, Chris. State legislatures can actually come together and pass privacy legislation. It’s a priority everywhere, but the political obstacles to doing so at the state level don’t exist that exist at the federal level. And so as hard as the issues are, you remove those political obstacles and they’re able to get things done. So they have been the laboratories of democracy. And then one state does something, one city does something, and that gets exported around the country.

Jerry Kilgore

And what we are seeing I submit, from the business community’s perspective, is this tension now between the blue states and the red states, and they’re requiring very different policies and approaches in our business community. So what does your business do? The California law is going to be very much more progressive versus say, an Alabama law, which will be very much red state-oriented. And these businesses deal with nationwide people so if there are reporting requirements, if there is mandated use of electric vehicles, on and on, businesses are caught in the crosshairs between the red states and the blue states, and it’s folks like us that have to get in there and try to sort it out.

Chris Allen

You have states like California being the big gorilla in the room, right? California does something, and because businesses want to operate in California, that necessarily has an impact all the way down the line to their national operations. And in some of these cases, you have states that basically by virtue of being able to act in their own state, essentially you’re creating extraterritorial impacts all over the country. I’m thinking most clearly of California’s pork law, which the Supreme Court actually upheld and Massachusetts has its own version of that. But the entire meat industry was watching that very, very carefully because that impacts how you raise pork throughout the entire country.

Jerry Kilgore

And you’re seeing this growing tension among the states. I predict there’ll be more litigation state-versus-state on various… where they consider California overreaches or California considers Texas has overreached on a particular issue or requiring a business to operate in a very specified manner.

Chris Allen

Howard, does that create an opportunity for Congress to regulate even more, maybe, or pass more legislation under its Commerce Clause power to stop the states from fighting each other?

Jerry Kilgore

The word preemption, Chris, does that come to mind?

Chris Allen

Yeah. Well, I’m thinking again of the California example, and I know that there are bills in Congress basically designed to roll that back, and many, many state AGs weighed in on that. And ironically, not only from Republican states, but from blue states also because agriculture is an important industry for everybody. But you can very easily see, like Jerry said, if the states are getting annoyed with each other and they’re going so far as to litigate against each other, somebody’s got to be the referee. It seems like it creates a whole really interesting opportunity, maybe, to break deadlocks. If you have one state that’s really acting up, there might be a bipartisan consensus, at least in some areas to rein that in.

Howard Schweitzer

It does, but then again, as you pointed out, Congress hasn’t passed privacy legislation in the dozen plus years they’ve been working on it and working hard. Spending lots of staff time trying to come up with legislative approaches. It’s not that they don’t want to, it’s that they can’t. And I think lots is being regulated on a -state basis. Look at sports betting, look at cannabis, look at privacy. It’s not unique to one area. Look, there’s plenty that still happens in the nation’s capital. You’ve got the administration, especially the current administration, that’s very progressive and aggressive from a regulatory point of view. But legislatively, with the margins being what they are, it’s hard to get there. It’s just hard to get there.

Chris Allen

And Howard, for us, with the AGs, it’s useful that there are organizations and meetings that we can go to and see several AGs at the same time, we can hear what they’re talking about. We do that all the time for our clients. How do you guide clients through the challenges of having to deal with such a fragmented regulatory environment at the state and local level?

Howard Schweitzer

Well, I think you have leaders and followers, jurisdictionally speaking. So California, New York, New Jersey, some of the more, I’ll call them activist states. You have your leader states and your follower states. You have your leader cities and your follower cities. And when issues come up, you have to be very tuned into what’s happening, at where there are potential threats or opportunities. And you have to concentrate your resources on the leaders and take that kind of an approach to stemming the tide of anything you’re concerned about. Because it’s not going to happen everywhere, it’s going to happen a couple of places and then begin to move around.

Chris Allen

Right. So if you’re watching closely and you’re watching smartly, you can start to discern trends and see around the corners, if you will.

Howard Schweitzer

Yeah, you have to be really tuned in to what’s happening locally. You have to have your antenna… You don’t have to go to work in  states at once, but you better go to work where it’s an issue because otherwise everybody else is going to follow.

Chris Allen

On that topic, that idea about how the states impact the federal government and vice versa, either of y’all have any final thoughts you want to throw out or…

Jerry Kilgore

No. I would just say that the state AGs have been very leery of the creation of the administrative state that both parties have created here in Washington. Whether it was the Trump administration who had state AGs from blue states suing almost daily on removing regulations or proposing regulations that would be more conservative in nature. And now in the Biden administration, you have the state AGs filing lawsuits on the Title IX issue, on student loan forgiveness, on immigration policy, on privacy policies. Right down the line, energy policies, state AGs are suing the administrative state, if you will, over the proposed regulations. And that again demonstrates the power of the state attorney general. And they don’t file the suit in the Ninth Circuit, they find a favorable circuit like the Fifth Circuit, where you’ll find most of these red state AGs are filing their lawsuits because it’s a favorable circuit for action against the Biden administration.

Howard Schweitzer

Jerry, that’s interesting. Even in this climate, people think there’s this massive gulf between the way the parties operate when they’re in power. But fundamentally, I think the states, they don’t want issues decided for them by Washington. I don’t care whether you’re a Republican or a Democrat, generally want to be self-determinative. And so that makes total sense. I’ve seen a lot of multi-member Commission kind of activity in Washington over my time where you have Rs and Ds together on boards. There’s often more division between the members of the same party than there is between members of the Republicans and the Democrats. And so I think it’s interesting to think about what you said in that context.

The laws of nature are the same everywhere, that’s what I always tell clients. This is politics, you have a bureaucracy, you have political actors. It doesn’t matter if you’re talking to the Topeka City Council or you’re talking to the United States Congress. The laws of nature are the same. And so that would be a good topic to explore, the administrative state and how you manage it when you’re a client that has an issue and the bureaucracy’s in the way.

Chris Allen

Well, I’m sending an email to our producers right now to add that as a topic, so we’ll get to that one next time. Hey, thank you guys both so much for being on here and sharing your insights. Jerry, Howard, it was a lot of fun talking to you today. Everybody else, I hope you enjoyed this conversation also. And please tune in next time for some more insights from our great team over here at Cozen O’Connor and Cozen O’Connor Public Strategies.

Jerry Kilgore

You’ve been listening to the state AG Pulse, brought to you by Cozen O’Connor’s State AG Group, and the State AG Report. Please leave us a five-star rating and of course, tune in again in two weeks for our next episode.