WARNING: This site deals only with the corporate corruption of science, and makes no inference about the motives or activities of individuals involved.
    There are many reasons why individuals become embroiled in corporate corruption activities - from political zealotry to over-enthusiastic activism; from gullibility to greed.
    Please read the OVERVIEW carefully, and make up your own mind.

OPINION ONLY

Gary Anderson was a 'core' member of the Tollison/Wagner economists network. who had been trained by the Tobacco Institute to make their "Social Cost' arguments. His name appears in both the 1989 Five-man core group of 'Consulting Economists Team; and in the 1990 Six-man core group.

He is clearly an enthusiastic servant of the tobacco industry for many years and he was closely associated with Robert Tollison, the Center for the Study of Public Choice, and the Public Choice Society.

Tobacco lobbyist James Savarese and Professor Robert Tollison of George Mason University had collaborated in 1984 to provide the tobacco industry, through the Tobacco Institute, with a number of networks of academics who would be willing to write propaganda material ... always provided their names were not linked to the industry or to any of the cigarette companies.

The idea was simply that the academic 'sleepers' would be available on a cash-for-services basis when needed to counter attempts to increase excise taxes, or to ban public smoking, or just to appear as independent experts at Congressional hearings and promote the industry causes.

Economist were by far the most useful academics to the tobacco industry because the distinction between economics and politics was never clear: so support of the cigarette companies could always be claimed as support for free-market economics ... the rights of individuals to make public choices ... small government ... or even the first Amendment to the Constitution.

The economist always claimed to be 'independent' 'professionals' and ' academics' from some credible university, and never revealed the source of their funding in their op-eds or letters-to-the-editor.

If ever put under cross-examination, they must be able to claim with weasel-word precision, that they had never received a penny from the tobacco industry. Therefore all payments were laundered, either through tobacco industry lawyers (usually Covington & Burling), the principle organisers, James Savarese & Associates, or through Bob Tollison's Center for the Study of Public Choice at George Mason University.

The aim was to have, in each State, at least one academic economist, one academic lawyer, and one academic from a business management, business law, marketing or advertising discipline willing to jump into action and write op-ed articles for their local newspaper, or to appear at local ordinance or legislative hearings. Copies were always sent to a local Congressman, who sat on some important (to the tobacco industry) committee.

The academics were always expected to wave their own and their university's credentials vigorously, and loudly proclaim their "independence' from any crass-commercial motives. And those who could boast of being 'non-smokers' were especially prized — since without this addiction, their non-dependent-on-tobacco status was thought to be proved beyond any doubt!

Some key documents

• Professor of Economics, Californian State University at Northridge

1990 June: Carol Hryjak reports to the Tobacco Institute on her progress with the "Social Cost" program.

Consulting economists presented papers on the social cost issue during the Western Economic Association's annual meeting in San Diego, California. Dwight Lee chaired the session entitled, "Smoking and Public Policy." Papers were offered by Lee ("Smoking and Public Policy"), Gary Anderson ("Politics, Redistribution and Smoking") and Benjamin Zycher ("Insurance and Smoking: Market vs. Government"). A full report on the conference is expected next month.

    We have agreed to support consulting economists' presentations during sessions of two other major academic conferences later this year: the Atlantic Economic Society and the Southern Economic Association. Both will focus on aspects of "user fees" and budgetary politics.

    Consulting economists Bob Tollison and Richard Wagner began work on the manuscript for the revised edition of Smoking and the State.

    We received a proposal from consulting economist Dwight Lee to write an article on the social cost issue for placement in an economic periodical, The Margin. The publication is required reading for students of economics at universities around the country.

    We continued to work on the social cost plan for 1991, with a final draft submitted for Public Affairs review.

1984 Nov 20: O&M is organising the first economists forum at the Public Choice Society meeting in New Orleans, Feb 21-23.

The topic would be "Public Choices About Tax Reform."

W.F. Shugart II, an economist from Clemson University, would chair the panel. Those who would present papers would be:

• Thomas Borcherding, from Claremont Graduate School. Subject: "Tax Reform and Simplification: A Public Choice Perspective."
• Harold Hochman, from City University of New York. Subject: "The Value-Added Tax: Do We Need Another Excise Tax?"
• Fred McChesney, Emory University Law School. Subject: "Tax Reform in a Rent-Seeking Perspective: The Role of Interests."
• Gary Anderson, an economist from George Mason University, would be the discussant.

Bob Tollison would be responsible for getting us on the program. He and Jim Savarese would work with each of the people to ensure that each paper contained a clear anti-excise tax message.

    Shughart and Anderson would also mention excises in their presentations. We will be obtaining CV s from Anderson and Shugart, who Jim and Bob Tollison know well. The other economists have all worked with us before.

1984 Dec 18: James Savarese at Ogilvy & Mather is organising panel discussion involving Henry Butler and Bob Tollison (See Below) He has already recruited Gary Anderson to give a paper at the Pittsburg Eastern Economic Association meeting in March 1985 (misdated)

Gary M. Anderson, George Mason University, "Tax Reform and the Size of Government," Department of Economics, George Mason University, Fairfax, Virginia 22030 703/323-3770

1985 Mar 20: -23 [The report is dated Dec 18 1984] Jim Savarese, as subcontractor to Ogilvy & Mather, has set up seminars for some of the industry's cash-for-comments economists under the auspices of the Southwestern Social Science Association and the Eastern Economic Association. Jim Savarese writes to Trish Milita of O&M who refers this to the Tobacco Institute:

Attached are the panel sessions that were accepted by both the Southwestern Social Science Associations and the Eastern Economic Association in March, 1985.

    These are very strong academic panels and add a great deal of depth to our list of consultants for future use.

    I know all of these individuals personally except for Henry Butler who is a friend of Bob Tollison's at Texas A&M. They all understand their mission and will be submitting papers for us to review well in advance of the meetings.

• The SouthWestern Social Science Association seminar run by O&M in Houston (Mar 20) was on "Taxation and Social Process. It had Robert Ekelund in the chair, and papers by Henry N Butler, Joseph M Jadlow and Richard E Wagner. Keith Watson was a discussant.
  
  
• The Eastern Economic Association seminar, run by O&M in Pittsburgh (Mar 21) was on "Perspectives on Tax Reform". It had Robert Tollison in the chair, and papers by William Shughart, Gary Anderson, and a joint paper by John Bowman/Michael Pratt. The discussant was George Hoffer.

1985 June 21: James Savarese submits his bill to the Tobacco Institute for

• Op Ed Project - $1000 each 'professional fees'
  for Abrams, Alston, Armentano, Harper-Fender, T Anderson, Denzau, Bohanon, Jadlow, Wagner and Menchik.
  
  
• Southwest Social Science Meeting — Houston
  • Keith Watson ($1,000),
  • RB Ekelund Jr ($2,003)
  • Joseph Jadlow ($2,605),
  • Richard Wagner ($2,716)
  • Robert D Tollison ($5,000)
  • Henry N Butler ($2,070)
  
  
  
• Eastern Economic Assoc, Meeting — Pittsburgh
  
  • George E Hoffer ($1,431)
  • Gary M Anderson ($2,450)
  • Robert D Tollison ($6,375)
  • Bill Shurghart III ($2,529)
  • Michael D Pratt ($1,288)
  • John H Bowman ($1,000)

1985 Dec: The Annual Report of the Center for the Study of Public Choice at the George Mason University.

The Center for Study of Public Choice is an integral part of George Mason University. While maintaining its separate identity, the Center staff is part of the George Mason Economics Department. As such, the university budget covers the salaries of the permanent Center staff and minimal operating expenditures. Excluding the physical facility which houses the Center, St. George's Hall, general university support in 1984 additionally amounted to some $500,000 on an annual basis.

    Center activities extend beyond those supported by the university. Funds for summer and release-time research, guest lecturers, visiting scholars, graduate students, and for supplemental travel and operating expenses have been provided by external supporters. External support in 1985 summed to approximately $300,000. These funds were provided by numerous external supporters, to whom we are very grateful for their sustained support over the years.

[One of those generous supporters was the tobacco industry — and, in return, they were provided with the administrative and organizational services of the Center — both to create cash-for-comments lists of academics, and also for the Center to act as a front for seminars, conferences, and the production of published material.]

• Elizabeth A Masaitis and Carol M Robert were employed as secretaries at the Center
• Dwight Lee and William Shughart were both Research Associates.

• Gary Anderson, University of Rhode Island
• Wayne Brough, University of Central Florida
• Samson Kimenyi, (University of Mississippi later)
• Jack Wiseman, University of York, England
  — a renowned contributor to public finance and public sector economics, now dedicated to integrating public choice with Austrian economics, and a valued friend of the Center.

1986: Center Alumni, at the George Mason University lists Gary Anderson

1986: This is the Tollison/Saverese network list for 1986. It has 64 names, but it still doesn't cover all 50 States. Some States have two or three network members, so newspapers [and sometimes Congressmen] need to be specified for each member to ensure there is no accidental duplication.

    Telephone numbers (office and home) are often included in case an urgent op-ed or ordinance hearing is needed. These are grouped by State:

CALIFORNIA
Professor Gary Anderson
    Department of Economics, California State at Northridge, Northridge, CA, 91330, 818-885-2443 (W) 818-886-5837 (H)

Professor David Saurman
    Department of Economics, San Jose State University, San Jose, CA 95112, 408-924-5400

1986 May: /E A Tobacco Institute list of "Schedule of Payments - Excise Tax Op-Ed project." (April-May 1986) This lists those academic economists who have already planted their article on a local newspaper, and the amount they are to be paid.

    They appear to have been paid $900 for each article, and $1025 if they had also made contact with their local Congressman. However a number of the cash-for-comments network members still have not completed their commission.

    The George Mason (Uni) production staff of Bob Tollison, Bill Shughart, and Gary Anderson were paid for "rewrites, editing and research, 18 articles", and Carol Robert for the "production of final product. " A total of $18,000 + $1067 expenses [or $1000 per article to make them into saleable propaganda for their local newspapers]

    A month or so later the GMU production staff were also being paid $9,500 for rewrites, editing and research on 9 additional articles, while Savarese seems to have been charging $5,800 + $235 in expenses for recruiting replacement economists in California, Montana, New York, Ohio and Tennessee.

1986 Dec 11: James Savarese sends Fred Panzer at the Tobacco Institute a summary of the activities of his network of economists. This is effectively the beginning of the main cash-for-comments economists network.

Dear Fred,
    I have attached a list of all the economists we have used along with the projects they have worked on in behalf of the Tobacco Institute.

• GSA = General (Government) Services Administration.
• 'Ways & Means' = Congressional committee on finances
• ALEC = American Legislative Exchange Council (a formalised way for big business to directly influence Congressional and State politicians)
• Chase Econometrics = A company that did economic impact studies for the tobacco industry in various locations to 'prove' that smoking bans would destroy local economies.
  
      The references for this network member were:

Virginia [ Region VI ]

Gary M. Anderson

Advisory Council on Intergovernmental Relations, 1111 20th Street NW, Suite 2000, Washington, DC 20575

Services rendered:
• academic forum

[He was on leave from the Californian State University at Northridge]

1987: He now has his PhD from George Mason University

1987 June 9: The Tobacco Institute's Phase II - Excise Tax Op-Ed project involved an article-writing campaign by cash-for-comment economists was run by James Savarese & Associates but organised by Robert Tollison at George Mason University.

    At the Tobacco Institute in the mid 1987 period, this project came under the control of Jeff Rose [who was himself under Peter Sparber]. It focussed on defeating cigarette excise tax increases — and especially the threat of such taxes being 'earmarked' to bolster health care budgets.

Anna Tollison, the wife of Bob Tollison, was employed by James Savarese Associates to keep a record of the articles generated by the large contingent of academic economists, and to organise payment. She reported that

"In sum, 41 economists were solicited to write editorials. We have publications in 20 states, 14 articles have been written and submitted, and 7 articles are still outstanding." [Others were in the offing]

CALIFORNIA, Anderson, LA Times, [circ.] 1,076,000, [no pub date]

1987 June 9: A number of tobacco industry witness appear at a Pittsburgh City Council public hearing on smoking bans.

    Three days later Gerald Kupris from the Tobacco Institute reported to his superiors on the value of their witnesses :

• Gray Robertson: Gray's testimony was excellently received, As I had indicated previously, the public hearing was broadcast live over cable television, including cable reception in each council member's office.
• Phil Witorsch: Phil's testimony was presented in a very strong fashion. obvious that he had control of his facts; even though it was equally obvious that the members of the city council not only did not find him credible but, in fact, found his testimony to be "overbearing."
• Josh Douglas: It was obvious that Josh Douglas has difficulty speaking before groups. His delivery was weak. He stuck specifically to his three-page presentation, which at no time used language that any normal human being would understand. I would not request Mr. Douglas' presence at any public hearing over which I have any control.
  [An added handnote says he 'lacked conviction']
• Gary Anderson: Mr Anderson presented his testimony adequately. But, in my estimation, he was not prepared to respond to direct, or leading, or barbed questions from city council members. Having seen such people as Savarese and Tollison in action, I would take Mr Anderson only when his superiors were not available. [Note the classification of Tollison and Savarese as his 'superiors']

1987 June 22: The Tobacco Institute has been sent by Savarese a "Schedule of Payments — Excise Tax Op-Ed Project" It details the name of the cash-for-comment economist, the State, the targetted newspaper, and both past and current payments — with a separate column labled "Total Earned to Date".

In CALIFORNIA
Anderson for LA Times —Owed $1200, — Total to date $1200

Borcherding for Sacramento Bee — Owed $1500 — Total to date $1500

1987 June 23: Savarese writes to Jeff Ross at the Tobacco Institute sending along a list of Democrat members of the House Ways and Means Committee...

... along with the economists we use in those areas. Nine of these are good, solid hits which we should be able to count on to do the job and get a publication. I have *ed these on the attached list. The remaining 6 are all people we have used in the past, but who have not been consistently successful.

    Since I'm under a new financial arrangement with the Tobacco Institute and I need to get these costs cleared in advance, I'll make my best effort here to budget this proposed project.

    If all 15 would get published, which is highly unlikely, the cost of Phase II Excise Tax Op-ed Project would run $45,000.

    More than likely we'll get 8-10 placements and 3 to 4 others who won't get placed, but will still send letters to their members on the Ways and Means Committee. In that case, the cost will be $37,000.

1987 Aug 21: Tobacco Institute's "Field Staff Evaluation of Economists"

In January, State Activities Division asked field staff to personally meet with 34 of our economic consultants to evaluate their suitability as economic witnesses. Roger Mozingo provided Bill Kloepfer with a compilation of their evaluations in May. Below.. I have attempted to summarize field staff comments along with our use of the economists for excise tax op-eds and preparation and delivery of testimony. As you can see, our excise tax op-ed project has been very successful.

CALIFORNIA

Professor Gary Anderson, California State at Northridge Northridge, CA
Excise Tax Op Eds: None accepted for publication.
Economic Witness/Testimony: Anderson and Robert Tollison prepared testimony opposing ACA 14. Tollison testified. Anderson prepared document rebutting "social cost" justification of an excise tax increase.
Field Staff Contact: Meeting scheduled with Anderson.
Field Staff Evaluation: No evaluation of Anderson. Delighted with Tollison's performance.

OHIO
Professor Mark Toma Miami University Oxford, OH

Excise Tax Op Eds: None accepted for publication.
Economic Witness/Testimony:
Field Staff Contact: None.
Gary Anderson (CA economist) prepared and submitted testimony opposing excise tax increase.
Field Staff Evaluation: None.

1988 Feb 2: James Savarese reports to the Tobacco Institute on a meeting with a "core group of economists"...

To exchange thoughts and ideas on the social cost issue with the goal of determining projects and making assignments for 1988.

    [In order to attack] Anti-smoking activists [who] have distorted the issue of social cost. Even though economists ridicule their statistics, politicians and the press believe them.

• Gary Anderson
• Bob Ekelund
• Richard Higgins
• Dwight Lee
• Jim Savarese
• Bob Tollison
• Richard Wagner

• Leslie Dawson, Karen Hochberger, Richard Marcus.- from Ogilvy & Mather and James Savarese & Associates
• Mike Forscey - lawyer from Wunder and Diefenderfer, working for the Labor Management Committee of TI
• Jeff Ross, Carol Hyrcaj and Paula Duhaime from the Tobacco Institute

• The higher rate of illness of smokers is a 'private cost' not a social cost [and therefore should be ignored.]
• It is not politically useful for us to argue the primary health statistics.
• Up to this time, ETS has not been translated effectively by the opposition into cost numbers. Rather, it is a regulatory issue. We cannot afford to lose the argument among people who think they are being harmed by ETS. If ETS causes harm, it becomes a classic case of real social cost.
• We must make sure that primary costs of smoking be kept out of any social cost calculation. We must separate primary smoking statistics from ETS statistics.
• More research is needed on ETS in order to deny health consequences

• Insurance and Health Costs: Health problems exist for smokers. The cost for health care due to excess illness or death of smokers equals smokers' cost to society.
  • Insurance premium — Discounts for non-smoker (not justified?)
  • Pension Plans — Increased mortality rates saves money
• Productivity and Absenteeism: Smokers are absent more frequently than non-smokers.The time spent by a employee smoking on the job is time spent not working. These factors make the smoker a less productive member of society than a non-smoker.
  • The worker bears the cost of absenteeism via fewer raises, less advancement, or termination. Society bears no burden.
• Social Security and Medicare: [Death benefits argument]
  • Based on lifetime calculations, smokers should be getting a rebate. We should propose a rebate program, rather than a tax program.
  • If non-smokers live longer, when the baby boomers reach retirement age, very high tax rates will be necessary to finance Medicare and Social Security. If smoking is banned, it would cause some serious problems in future years.
• Fires: It is not a social cost for a smoker to burn his house down, just a private cost. Social cost only exists if a neighbor's house burns down (a much smaller number).
• ETS: Blanket smoking.restrictions raise costs to private employers. If restrictions are cost effective, individual companies will adopt them.

Goals:
    As a result of this meeting, we should devise a specific plan and timetable- of implementation with assignments for specific projects.

    We need to review and critique existing materials and develop our own core of research.

Tollison is looking for one or two others. Major session of a university to bring together all relevant research on social cost will be planned after research projects are completed. Proceedings will be published in a monograph.

1988 July 27: Richard Wagner, writing on the letterhead of the Center for Study of Public Choice at George Mason University, writes to James Savarese [as surrogate for the Tobacco Institute] outlining a book editing project being mounted by himself and Robert Tollison.

    The tobacco industry is fighting to block the 'ear-marking' of cigarette excise taxes for Federal health programs. .

Bob and I both think we have an excellent chance of getting [libertarian journalist Henri] Lepage, as well as having a strong chance of getting [Nobel Prize-winner James] Buchanan.

    You may not know of Lepage. He is a prominent French journalist-economist, who several years ago had an international best seller that was translated into English as Tomorrow, Capitalism. Lepage is presently conducting a major research project into pricing in French utilities, and finds that the actual conduct of French utflities bears no relation to the normative economics of user-charging [actually a gross overstatement], but bears a strong relationship to the theory of public choice.

    I think you will agree that we have the makings of a strong and interesting book on user-charges and tax earmarking, one that will challenge very strongly the halo that seems to surround these terms in ordinary discourse about tax policy.

Chapter 2. — "The Fiscal Significance of User Charges and Earmarked Taxes: A Survey," by Gary M. Anderson, California State at Northridge.
The newfound enthusiasm for user fees springs from "the notion that revenue can somehow be increased without raising taxes." The author explains that many so-called "user fees" would more appropriately be called "fines," since the users do not receive benefits.

Several new excise tax-related studies are underway and will be completed by spring 1989. In addition, an update of the Chase economic impact study has been commissioned.

    Due by mid-year is a book examining earmarking and "user fees" from a public choice perspective. The treatise will contain 8-10 chapters written by respected economists, including, Henri LePage and Nobel laureate James Buchanan.

    Preliminary research has been conducted assessing public attitudes toward excise taxes.

See

1989: Social Cost Issue, Consulting Economist Team. This document is assumed to be the Tobacco Institute informing their litigation team about the facts of the cash-for-comments academics network — and its offshoot, the core team trained in Social Cost Issues.

The social cost economic team includes: Robert Tollison, Richard Wagner, Dwight Lee, Richard Higgins, Gary Anderson and Michael Davis,

How we use them

• Conduct research.
• Prepare op-eds and letters to the editor.
• Review and comment on (government and private sector] social cost studies and reports.
• Media tours to promote Smoking and the State.
• Conduct briefings on the issue/arguments with legislators, staff and lobbyists.

Kinds of things they do

• Conduct and publish economic research (constituting the basis of the social cost program).
• Write and place op-eds on discrete topics.
• Prepare and submit letters to the editor.
• Available to present testimony.
• Media tours.
• Make presentations to academic/economic peers.
• Conduct briefings on the issue (during social cost economist network meeting with PAD, SAD, lobbyists and legal counsel).

1989 Jan 10: /E This is a mixed bag of files dumped together. See page 54: Tobacco Institute "Confidential" memo on "Tax Hearing Readiness" which is their battle plan to counter earmaking of cigarette excise taxes to fund health programs. It lists a large number of organizations and a few congressmen who can be relied on to help. It also has both primary and secondary lists of economists willing to give testimony.

Economists: [Primary]

• Bill Orzechowski, Tobacco Institute
• Robert Tollison, George Mason University
• Richard Wagner, George Mason University
• Dwight Lee, University of Georgia, Athens
• Michael Davis, Southern Methodist University
• Gary Anderson, California State at Northridge
• William Prendergast (Prendergast/Solmon papers)
• Other Network economists [see Secondary attached list below]
  
      "Due by mid-year is a book examining earmarking and "user fees" from a public choice perspective. The treatise will contain 8-10 chapters written by respected economists, including, Henri LePage and Nobel laureate James Buchanan."

California only had one at this time:

• CALIFORNIA
  Professor Gary Anderson, Department of Economics, Texas ASM California State at Northridge, Northridge CA

1989 Jan 11: The Tobacco Institute's list of economists and their state and university affiliations — made available to provide witness services, or to write op-eds, etc. [Which is referenced on the second document as "Other Network economists" (see attached list)


    It comes from the Tobacco Institute storage box on "Tax Hearings Readiness" and is labeled "Economists." The associated document on Tax Hearing Readiness outlines all the economic arguments available to counter legislation which raise tobacco taxes. Such ideas as:

• Excise taxes are regressive and take away any tax reforms for low- and middle-income Americans. As a percentage of income, low income families pay as much as 27 times more in federal excises as high-income families.
  [Only if the users are totally addicted to tobacco company products.]
• Cigarette excise taxes are discriminatory. They fall disproportionately on Blacks, Hispanics and other minorities.
  [As do medical costs — on people who can't afford these high rates of smoking.]
• Excise taxes are unfair. Tobacco consumers are forced to pay more than others for government services benefitting everyone. Why should smokers pay more for national defense than nonsmokers?
  [What happened to the medical-cost argument? Why should non-smokers pay for smokers, also?]
• Excise taxes are not a reliable source of revenue. When excise taxes increase, sales, as well as tax revenue, decrease.
  [Which is why excise taxes on cigarettes were such a good health measure]
• Earmarking cigarette excise taxes is unfair tax policy. It is an indirect way to make smokers pay for government services that benefit the entire community.
  [Like health care? Welfare to widows?]
• Excise taxes have a negative impact on the nation's economy. When sales decrease, the result is lost jobs and revenue.
  [It's the same with decline in opium sales and the demise of horse carriages]
• An increase in excise taxes will not significantly reduce the federal deficit. Smokers should not shoulder the burden of the federal deficit.
  [What is significant? How many billion does it take to be significant?]
• Overall cigarette excise taxes, as a percentage of price, have not decreased.
  [Who expected a decrease?]

1989 Mar 17-19: The Annual Meeting of the Public Choice Society together with the Economic Science Assocition. These are Hayek-oriented neo-con economists of the kind which gave us the Global Financial Crisis of 2008-9. The speakers list mentions many active members of the economists network: — some of whom spoke more than once. (William Hunter in particular.) It is clear that this society was a profitable recruiting ground for Tollison and Savarese.

    The large group of speakers connected with Tollison's Center for the Study of Public Choice at George Mason University completely dominated the conference session on Public Health.

Public Choice Society Speakers on Public Health
Robert Tollison	Richard Wagner	David ER Gay
Dwight Lee	William C Mitchell	Burton Abrams
Cecil E Bohanon	Charles Breeden	William J Hunter
Bruce Benson	Burton Weisbrod	Bruce Yandle
Roger L Faith	Roger Congleton	James Buchanan
Gary Anderson	Peter J Boettke	Jeffrey R Clark
Robert J Staaf

1989 April 18: Susan Stuntz (Issues Manager) at the Tobacco Institute memoes her boss Sam Chilcote. She is sending him material previously used for a two-day "Gerry Long" presentation. He wants to use it in a shorter one-day (unspecified) briefing session.

[Gerald H Long was the CEO of RJ Reynolds who in 1988 had just taken over as Chairman of the Tobacco Institute's Executive Committee and wanted to make changes.]

Economists' Network 64 Strong [is] Targeted to Congressional Tax Writing Committees [and utilizing the] Production of Op-Eds on Federal Tax Policy.
[List of economists]

1989 May 31: Debbie Schoonmaker recommends funding of Tollison & Wagner's "Earmarking Book Proposal"

1989 June: Carol Hrycaj & Debbie Schoonmaker's monthly report to the Tobacco Institute on their "Excise Taxes" and "Social Cost" projects.

Drafts of all four of the 1989 research projects have been received. Gary Anderson's 1988 research paper, "The Social Cost of Everyday Life," was well received by his peers during the recent Western Economic Association annual meeting.

1989 Aug 8: Leslie Dawson of Savarese & Associate gives a status report on the Social Cost Project

• Smoking & Absenteeism (Ekelund, Ault, Jackson, Saba, Saurman) — submitted to the Southern Economic Journal, then revised and resubmitted — no editorial decision yet.
• The Social Cost of Everyday Life (Gary Anderson) — submitted to Contemporary Policy Issues — no editorial decision yet.
• Smoking and the Problem of Social Cost (Tollison & Wagner — accepted by Journal of Public Choice (they controlled the journal)
• Smoking and the Wealth of Nations (Wagner) — submitted to Journal of Contemporary Business.
• Self-Interest, Public Interest, and Public Health (Tollison & Wagner) — submitted to to Journal of Public Interest and Public Choice
• Smokers' Subsidy of Nonsmokers' Retirement Benefits (Higgins and Gordon Sufford from Capital Economics) — submitted to Social Science and Medicine
• Social Cost and the Cigarette Excise Tax: A Misguided Rationale for an Inefficient and Unfair Policy (Dwight R. Lee) — Unpublished
• Some Economic Consequences of the Koop Doctrine: National and State Revenue Shortfall from Smoking Regulation (Ekelund) - still at TI for review.

1989 Nov 13: Debbie Schoonmaker writes to her superiors at the Tobacco Institute about "Political Entry Barrier and Tax Incdence: The Political Economy of Sales and Excise Taxes," recently published in Public Finance. The authors are Robert Tollison, Gary Anderson and William Shughart — three of their favourite cash-for-comments academics. Walter Woodson has ccd the document to the Regional VPs, Kurt Malgrem, George Minshew and 'BC' with the note: "This piece may be of interest to you and some of your more 'scholarly' associates." It is an article on the "regressive" nature of excise taxes. Debbie says:

This hypothesis may be useful in tax battles in Congress and the states.

    While The Tobacco Institute did not commission the piece, legal counsel advises that we may use the article should we wish to do so.

1989 Nov 14: /E Carol Hrycaj's monthly report to the Tobacco Institute on her project "Excise Taxes."

Economists Tollison, Shughart and Anderson have offered their article, "Political Entry Barriers and Tax Incidence: The Political Economy of Sales and Excise Taxes," (published in Public Finance) for our use. We are considering distribution options for the author's conclusions.

Consulting economists Robert Tollison and Gary Anderson provided a state-by-state analysis based on the hypothesis set forth in their article, "Political Entry Barriers and Tax Incidence: The Political Economy of Sales and Excise Taxes." We will review the findings of the analysis and assess its utility in tax matters.

1989 Dec: Carol Hrycaj report to the Tobacco Institute on her project "Excise Taxes."

Responding to reports that an administration "task force" might recommend raising cigarette excise taxes, we implemented a new op-ed program designed to reinforce opposition to federal excise tax increases.

    Consulting economists Robert Tollison and Gary Anderson provided a state-by-state analysis based on the hypothesis set forth in their article, "Political Entry Barriers and Tax Incidence: The Political Economy of Sales and Excise Taxes." We will review the findings of the analysis and assess its utility in tax matters.

1990 Jan 23: Robert Tollison sends Martin Gleason the

"Preface and first five chapters of the book + the 'third of the four billings for this project" = $36,250

1990 Feb 1: Savarese's report to Susan Stuntz at the Tobacco Institute lists a number of projects involving the cash-for-comment economists:

• "Smoking and the Problem of Social Cost: A Survey" by Tollison and Wagner, published in Journal of Public Finance and Public Choice - reprints have been distributed.
• "Smoking and Absenteeism: An Empirical Study" by Ault, Ekelund, Jackson, Saba, and Saurman - submitted to Applied Economics.
• "Smokers Subsidy of Nonsmokers' Retirement Benefits" by Higgins and Shuford - submitted to Social Science and Medicine.
• "The Social Costs of Everyday Life" by [Gary] Anderson submitted to Contemporary Policy Studies.
• "Social Cost and the Cigarette Excise Tax: A Misguided Rationale for an Inefficient and Unfair Policy" by [Dwight] Lee - submitted to Contemporary Policy Studies.
• "Self Interest, Public Interest, and Public Health" by Tollison and Wagner - accepted for publication in Public Choice.
• "Some Economic Consequences of the Koop Doctrine: National and State Revenue Shortfall from Smoking Regulation" by Ekelund - returned to Ekelund for submission.
• "Smoking and the Wealth of Nations" by Wagner - submitted to Journal of Contemporary Business.

    Began Phase III of the social cost research. Proposals have been submitted to TI.

1990 April: The annual Social Cost overview by Carol Hrycaj at the Tobacco Institute says:

[A] TI-commissioned social cost research paper on smoking and absenteeism, completed in 1989, has been accepted for publication by an academic journal.
"Smoking and Absenteeism," by consulting economists Robert Ekelund, Richard Ault, John Jackson, Richard Saba and David Saurman, has been accepted for publication by the academic journal, Applied Economics. The authors examine previous absenteeism and productivity studies and find that the "association of smoking and increased absenteeism is spurious."

    Consulting economists will receive TI support for a presentation of academic papers during the Western Economic Association's conference to be held in San Diego in June. The session, "Smoking and Public Policy," will involve Dwight Lee and Gary Anderson in a discussion of smoking and social cost issues.

See page 30

[Note the date the study was 'completed and accepted' — a date which is two years after it was being referenced by Tollison and Wagner for the tobacco industry.]

1990 May 7: The Tobacco Institute's "1991 Tax and Social Cost Plans" have sections on

• "Social Costs" Hearings Readiness (preparation for fielding witnesses at Congressional hearings.) They list here the arguments that the Institute and its allies must be prepared to present.
• "Tax" Hearing Readiness (as above, but for excise tax increases, State and Federal)
• List of cash-for-comment network economists in each State.

CALIFORNIA
Professor Gary Anderson
Department of Economics, California State at Northridge
Northridge, CA 91330
818-885-2443 (ofc) 818-886-5837 (hm)


    (NORTHERN CALIFORNIA)
Professor David Saurman
Department of Economics, San Jose State University
San Jose, CA 95112 408-924-5400

(home) 20703 Celeste Circle
Cupertino, California 95014

1991 Jan: /E Tobacco Institute draft plan for 1991 with emphasis on "Taxes." These are the economist-related paragraphs:

Objective
To discourage reliance on consumer excise taxes on cigarettes to meet social and economic objectives by demonstrating that excise taxes are regressive and inconsistent with fair taxation.

Goals and Tactics:

• Commission two op-ed articles in 1991 from consulting economists. As articles are published, provide to other Institute decisions for promotion and submission to appropriate policy makers.
• Conduct at least 10 presentations by consulting economists on the excise tax issue before national, regional and state tax policy conferences.
• Continue to utilize consulting economists for testimony and briefings. Expand appearances to include presentations to business clubs and the business press. Conduct media refresher courses for public speaking appearance and delivery of testimony.
• Utilize the consulting economists for an op-ed program that addresses the national earmarking issue and state specific earmarking issues. As articles are published, provide to other Institute divisions and promote to appropriate public policymakers. Use field staff network to support distribution efforts.

1991 Jan 8: Jim Savarese has sent the current list of network economists to Carol Hyrcaj at the Tobacco Institute. It contains three new names, but otherwise it is essentially the same as the older lists.

1992 Mar 18: James Savarese writes to the Tobacco Institute attaching a reprint...

of Dwight Lee's paper, "Government v. Coase: The Case of Smoking." This paper is a product of the seminars and research projects which were commissioned over the past couple of years.

1992 Nov 7: Delores Martin, Lowell Gallaway and Gary Anderson, all cash-for-comments economists from the network, are working for Dick Armey (R-TX) by contributing to the preparation of outright political material for the Republican's Joint Economic Committee: "Derailing the Small Business Job Express."

    Lowell Gallaway and Gary Anderson are listed as Visiting Scholars on the JEC Republican staff.They are all working under the notorious lobbyist Ed Gillespie who was acting as Republican Staff Director.

The paper, authored by JEC-GOP Visiting Scholars Lowell Gallaway f Ohio University and Gary Anderson of California State University, Northbridge, calculates the cost of various new Federal rgulations from 1989, including an increased minimum wage, the Clean Air Act, and the Americans with Disabilities Act, as well as increases in taxes on businesses.

1993 March: The Newsletter of the National Chamber Foundation (the NCF President was J Paul Sticht — Executive Chairman of RJ Reynolds)

    The NCF has published a free give-way report The Impact of Recent Federal Regulations on Small Business Job Creation by Gary M. Anderson and Lowell Gallaway (also a cash-for-comments economist).

1994 March 16: A group of academic economists including almost all the members of the Tobacco Institute's cash-for-comments network sent an "An Open Letter to President Clinton on Healthcare Reform." This had been organised by David J Theroux, the founder and operator of the Independent Institute apparently with the assistance of an academic network member, Simon Rottenberg. [The institute was well-funded by the tobacco industry]. They say:

In The Open Letter to President Clinton, 565 economists and 76 other scholars from all 50 states and the District of Columbia state their firm opposition to any form of direct and indirect price controls in any healthcare program.

    Rationing Health Care: The New Threat of Price Controls, by Simon Rottenberg and David J. Theroux

In countries that have imposed these types of regulations, patients face delays of months and years for surgery, government bureaucrats decide treatment options instead of doctors or patients, and innovations in medical techniques and pharmaceuticals are dramatically reduced.

1994: April/E Anderson has sent Philip Morris a draft of his proposed article (seemingly aimed at an academic publications by the citations) "Bureaucratic Incentives and the Transition from Taxes fo Prohibitions."

    Where his is unsure of an appropriate word, he has left a gap for someone to fill-in by hand.

1994 Aug: See the full outline of his involvement in creating the fake Alexis de Tocqueville ETS/EPA report written by S Fred Singer and Kent Jeffreys, secretly for the Tobacco Institute.

1994 Aug 11: The Alexis de Tocqueville Institute has produced a report by S Fred Singer of SEPP via Philip Morris's own PR-firm APCO, for the tobacco industry and other industries in a small coalition.

    This was a well-funded, and well-camoflagued attack on the activist concerns about Environmental Tobacco Smoke (ETS), which hid behind the potential problems raised by the Environmental Protection Agency (EPA) over radon, pesticides and the SuperFund toxic chemicals in the environment. It says:

" Science, Economics, and Environmental Policy: A Critical Examination" is an evaluation of the data, statistical analyses, and underlying scientific theories that underlie the Environmental Protection Agency's (EPA) policy decisions on environmental tobacco smoke, radon, pesticides and hazardous clean-up under the Superfund law.

    With the total costs of environmental regulations estimated to be $150 billion annually — or $1,500 per U.S. household — it is extremely important that environmental decisions be based on sound scientific analyses of potential risks to public health and the environment, and that the costs of environmental regulation be weighed against the benefits. [Note the lack of conculsions that it was even more important for American industry to clean up its act and stop polluting!]

    But as Dr John Graham of the Harvard Center on Risk Analysis notes, "While it may seem obvious that EPA should use good science, students of the Agency have documented that the Agency's leadership, when preoccupied with public fears and legal pressures, has sometimes allowed good science to be neglected."

1995 July 13: The newsletter of the Independence Institute says:

To evaluate the effects of tax reform on the American public, the Independent Institute assembled 27 leading economists, legal experts, policymakers and journalists for the conference, De-Taxing America? Alternatives to Predatory Politics, July 13th, in Washington, D.C.
[Dwight Lee copied his speech to Philip Morris. (for payment)]


    Excise taxes on "politically incorrect" products [read 'cigarettes'] or activities are used increasingly to fund the "nanny state." In the opening session, chaired by Independent Institute research director Robert Higgs, William Shughart II (U. of Mississippi), editor of the forthcoming Institute book based on the studies presented at the conference DE-TAXING AMERICA: Predatory Politics and the Public Interest, examined the arguments used to rationalize excise and other selective taxes.

    Traditionally, such taxes are claimed to minimize economic distortions, to fund targeted programs, and to reduce "spillover" costs of the targeted behavior, but Shughart concluded that only anti-social political considerations and ill-founded attempts at social engineering can explain their widespread use.

    Uninformed voters, Dwight Lee (U. of Georgia) explained. are more favorably disposed toward tax increases when revenues are "earmarked" for popular programs. Earmarking helps politicians circumvent taxpayer resistance by making more funds from general revenues available for discretionary spending.

Thomas DiLorenzo (Loyola College) [A tobacco tout who worked outside the Savarese/Tollison network] explained how excise taxes funding "politically correct" propaganda threaten free speech, including that of business people who risk regulatory retribution and IRS audits for criticizing unequal taxation.

1995 Dec: /E The Independent Institute has run a conference "De-Taxing America" at which a number of tobacco-economists were key speakers.

Dwight Lee (Uni of Georgia) explained that "Uninformed voters are more favourably disposed to tax increases when revenues are " earmarked" for popular programs. Earmarking helps politicians circumvent taxpayer resistance by making more funds from general revenues available for discretionary spending.

Thomas DiLorenzo (Loyola College) explained how excise taxes funding "politically correct" propaganda threaten free speech, including that of business people who risk regulatory retribution and IRS audits for criticizing unequal taxation.

Adam Gifford (California State Uni, Northridge) showed how taxes on whiskey, margarine, and the press illustrate politicians' diverse aims, and how citizens have responded to predatory taxation by rebellion, flight, and evasion.

Martin Thornton (Auburn University) said "Prohibition, the ultimate sin tax, evolved from new Enlgand Puritanism into today's secular neo-puritanism, often allying with empire-building bureaucrats and profit-seeking dealers of contraband. Prohibition produces undesirable side effects, especially violent crime.

Bruce Benson (Florida State Uni) explained that "Quebec's 60% cigarette taxes of the early 1990s led to gang warefare over the lucrative trade in untaxed cigarettes.

Gary Anderson (California State Uni, Northridge) explained that prohibition often results in more revenue for politicians and brueaucrats, more employees and more graft. Conventional wisdom further holds that selectively taxing some products will hardly reduce purchases, but Richard Vedder (Ohio University) showed that in the case of smoking, consumers cross state lines to buy cheaper cigarettes, hindering the tax collectors' goal.

George Tullock (Uni of Arizona) suggested that too many scientific and economic questions remain to determine the social costs of smoking or whether taxes are preferable to moral suasion.

1996: Northridge Economics Department faculty have published:

Gary M. Anderson & Dennis Halcoussis, 1996. "The Political Economy Of Legal Segregation: Jim Crow And Racial Employment Patterns," Economics and Politics, Wiley Blackwell, vol. 8(1), pages 1-15, 03.

Excise Tax Forum

1996 Aug 14: Philip Morris and RJ Reynolds were trying to put together a coalition of tobacco and alcohol companies and organizations to run a three-day "Comprehensive Inter-industry Forum on Excise Taxes", to be held early January 1997 in Palm Beach, the Bahamas, or Nassau.     It would bring together "15 Leading Academics, 10 Industry Representatives, 5 Decision Makers, and 5 Representatives from the Public Policy Community [eg. think-tank operatives]."     It would be funded by the tobacco companies through the Coalition Against Regressive Taxation (CART) [a tobacco front], but officially run by the Tax Foundation [A subsidiary of Citizens for a Sound Economy which is now known as FreedomWorks.] Deliverables The Excise Tax Forum will produce two immediate deliverables: A special journal supplement, and related articles summarizing the proceedings of the meeting. It is anticipated that this will be published in a scholarly economic journal: Press materials and video summarizing the meeting, and its findings.     In addition, participants in each of the four workshops will determine at least one area for additional research. The result of each of these research projects will be an academic journal article and related press material. Estimated Cost. Provisions wIll be made to provide small honoraria to forum participants [those who attend, not just those who speak] and all expenses will be paid by the sponsors. These expenses include airfare, ground transportation, 2 hotel nights, and all food and sponsored entertainment.     As currently envisioned, the cost for the Excise Tax Forum will be approximately $195,000.[Plus the cost of future research committed.]     It is recommended that a small New York based boutique shop, Current Medical Directions (CMD), be hired to undertake this event. See also $205,000 version of document

1996 Oct 28: Gil Pinac, a politician in the House of Representatives, Louisiana, writes to Gary Anderson at The Tobacco Institute, 815 Brazos St, Austin Texas thanking him for "your generous contribution to my campaign."
[This would be the Texas lobbyist Gary Anderson.]

1996 Nov 20: Philip Morris Facsimile Transmission (coversheet only) refers to a Gary Anderson letter sent by their Legal Department to Shook Hardy & Bacon the tobacco industry disinformation lawfirm.
[This is probably the Texas Gary Anderson seeking information about smoking & health.]

1997: The Independent Institute publishes "Taxing Liberty and other 'Sins': Predatory Politics and Taxation" — a book edited by William F Shughart II of the cash-for-comment economists network. Many of the network members also get to write a chapter[in bold], while the other chapters are all written by their close academic associates at Clemson, Auburn, Florida, and Californian State Univerities.

[This 626 page document is the last corrected copy of the full manuscript ready for the printer. It has last-minute white-outs and hand-corrections and insertions by a single editor in order to maintain the 'excise tax' theme. It was in the Philip Morris file cabinet to Josh Slavitt.]

2000: Northridge Department of Economics staff have published:

Anderson, Gary M. & Halcoussis, Dennis & Johnston, Linda & Lowenberg, Anton D., 2000. "Regulatory barriers to entry in the healthcare industry: the case of alternative medicine," The Quarterly Review of Economics and Finance, Elsevier, vol. 40(4),

2003: This year's update of the Department of Economics, California State University, Northridge (CSUN) still lists him as Professor.
    [He is included in later listings as a member of the Emeritus Faculty]

Independent Institute

The Independent Institute, which is itself a component of the Atlas Group of ultra-free-market think tanks with links to the Alexis de Tocqueville Institute [all heavily dependent on commissioned corporate funding] appears to have taken over the role of administrator of the Tobacco Institute's cash-for-comments network at the end of the 1990s.Their research director and journal editor, Robert Higgs, was already a member of the network.     Tobacco funding continued to flow to the Independent Institute which appears to have taken over (from Savarese and Tollison) the role of 'warehousing' these academic supporters to insulate them from discovery. The Institute acquired the bulk of the cabal of cash-for-comments economists who were still operating, and some who had been retired: Senior Fellows Bruce L Benson, Florida State Robert Higgs, Independent Institute William Shugart, Utah State Richard Vedder, Ohio University Research Fellows Burton Abrams, Uni of Delaware Gary Anderson, California State at Northridge Dominick Armentano, Uni of Hartford Peter Boettke, George Mason Uni Thomas DiLorenzo, Loyola College, Maryland Robert Ekelund, Auburn Uni Lowell E Gallaway, Ohio Uni Randall Holcombe, Florida State Dwight Lee, Southern Methodist Uni Cotton 'Matt' Lindsay, Clemson Uni Fred McChesney, Northwestern Uni Mark Pauly, Uni of Pennsylvania Richard Stroup, Montana State Mark Thornton, Ludwig von Mises Institute Richard Wagner, George Mason Uni Bruce Yandle, Clemson Uni Also dozens of other academics and writers who provided independent contract services to the tobacco industry — like Richard Epstein, John Goodman, Peter Huber, Paul Craig Roberts, Paul Rubin, Peter Samuel, S Fred Singer. Russell Sobel, etc.

CONTRIBUTORS:LR13 scsu JJHS