USA

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

Professor Lee Anderson was one of the earlier and more enthusiastic recruits to the cash-for-comments network of academics who worked for the tobacco industry. Clearly he was unencumbered by feelings of guilt about supporting an industry which has shortened the lives of a 100 million people.

Tobacco lobbyist James Savarese and Professor Robert Tollison of George Mason University collaborated in the 1980s 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

• College of Marine Sciences, University of Delaware, Newark, Delaware also listed as "professor in the College of Business and Economics of the University of Deleware

1984 Jul: The Tobacco Institute's Cigarette Excise Tax Plan.

The plan augments our basic lobbying efforts by relying on groups outside the industry — some not regularly associated with the industry — to argue against excise taxes for us.

    It is an ambitious program, based on the notion that many of the most effective protests against tobacco taxes will come from groups philosophically distant from The Institute. Many such groups agree with us on the excise issue, even though they disagree with us on other matters.

    At the federal level, supporting Congressional members from the tobacco states is essential to our lobbyists. The tobacco members consistently vote as a unified group — something that is rarely seen in Congress today. They are our lobbyists' most important resource.

    The program recommends that economic and other consultants assist us in developing, "packaging," and presenting our anti-excise arguments in legislative testimony or meetings with coalition members.

Resources:
Economic consultants with different areas of expertise will conduct research and act as spokespersons for The Institute and organizations supported by The Institute. Specific activities with economists are discussed throughout the tactics.

Tactics:

• Stimulate reputable public finance economists at key state universities to determine the validity of state revenue forecasts, perhaps on behalf of state business organizations and present arguments against excise taxes in various forums; e.g., meetings with potential coalition members or budget officials.
• Encourage economists to make the case against regressive taxation in meetings with potential coalition members and legislators.
• Retain public finance economists affiliated with non-profit organizations to research the subject and use their findings in forums such as:
  • Private meetings with state legislators or staff ;
  • formal testimony before government bodies ;
  • targeted media appearances;
  • speeches before business, civic, labor, and other groups ;
  • tax symposia in key states where the proceedings could be published for use in other states ; and
  • articles which raise the visibility of key arguments in the business, academic, and popular press.

Strategies:

• Presenting specific members of the House Ways and Means and Senate Finance Committees with arguments prepared by economists with whom they share some common interest; e.g college affiliation, service on the same commission.
• Gaining the support of Citizens for Tax Justice (CTJ), the most influential labor/liberal tax reform group in the country, in opposition to excise taxes.
• Relying on the AFL-CIO — via The Bakery, Confectionery, and Tobacco Workers Union — to ensure that the labor/liberal tax package that emerges in the next session of Congress does not include tobacco.

Appendix: A list of economists in key states who may be willing to act as industry and third-party spokespersons on the tax issue.
Following is a list of economists in key states who might assist us as experts receiving honoraria. We have begun contacting them to ensure their willingness and expertise. We are asking each about past experience; work with similar issues; previous work with the industry; published articles or research; and availability.

    Our intent is to have a group of individuals whom we can call upon as needed to testify, conduct special research and discuss their research projects and/or views on excise taxes with budget officials, potential coalition members, legislators and the media.

1985 Dec: /E President Ronald Reagan asked Senator Bob Packwood, chairman of the US Senate Finance Committee, to design a proposal for comprehensive tax reform

which would reduce the highest individual income tax rate down to 35% from its current 50% level, but retain adequate incentives for business investment, and avoid inclusion of any new taxes.

    In an attempt to do this without reducing the total amount of tax revenue that is currently collected, the Packwood plan proposes to offset reduced revenues from income taxes by what the Wall Street Journal has referred to as a "backdoor increase in excise taxes."

    The Packwood plan proposes to eliminate the income tax deductibility of excise taxes and import tariffs paid by businesses [and it] would increase federal excise tax receipts by an estimated $75 billion over five years. Approximately $13 billion of this would be a result of a direct increase in excise taxes on motor fuel, wine, distilled spirits, and tobacco.

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:

DELAWARE
Professor Lee Anderson
    College of Marine Sciences, University of Delaware, Newark, Delaware, 19716, 302-451-2650

Professor Burton Abrams
    Department of Economics, University of Delaware, Newark, Delaware 19716, 302-451-2566

1986 March: Copies of the letters that the cash-for-comments economists wrote to the newspapers editors, and also the ones they wrote to their Senators were sent to the Tobacco Institute as proof of their activities

    The published articles are grouped here.

1986 March: Copies of the letters that the cash-for-comments economists wrote to various newspapers editors, and also the ones they wrote to their Senators — none of which mentioned that they'd been paid by the Tobacco Institute to write both the op-eds and the Congressional letters.

    These were sent to the Tobacco Institute as proof of their activities:
    Lee G Anderson, College of Business and Economics, University of Delaware wrote to the editor of The News Journal Papers (with his op-ed), and also to Senators William Roth Jr and Joseph Biden.

Enclosed please find some comments on the excise tax provisions of Senator Packwood's tax reform proposal which I prepared as a letter to the editor to the Wilmington News Journal papers. I would appreciate your consideration of these arguments while you determine your position on tax reform legislation

See Pages 7 to 9

1986 Mar 20: Tobacco Institute document: Background Update Of the Estimated Effect of the Packwood Tax Plan On the Price Increase Necessary For Cigarettes

If the deductibility of the excise taxes is eliminated, then most, if not all, of this tax increase will be passed on to tobacco consumers as price increases to cover the additional corporate taxes they will be required to pay, plus the indexed excise tax requirement.

    On the basis of 1985 sales, and the level of federal excise taxes paid on cigarettes, the level of taxable sales would be: $4.5 billion / $0.16 = 28.125 billion packs — the remainder are either sent overseas as exports or to armed services, or to government institutions.

    If the Packwood plan is adopted, and if the effective tax rate on tobacco corporations is 35 percent as in 1983, the increase in corporate income taxes would be about $1.83 billion.

    It must be assumed that this tax increase will be passed on to consumers in order to maintain net income. This will cause a decline in demand on the base level of 28.125 billion packs.

1986 April: Professors Joseph M Jadlow (Oklahoma) and Charles Maurice (Texas A&M) have prepared draft articles attacking the Packwood Tax Plan. James Saverese has sent them, together with clippings of articles already published, along to Fred Panzer at the Tobacco Institute for correction and clearance. (See page 10)

    It lists many dozens of articles which the cash-for-comment economist on the network have now written, including one:

DELEWARE: Prof. Lee Anderson Submitted to Paper: 3/20/86 —Wilmington News Journal,
Current Status:Published 4/18/86
Letters to Senators: Biden and Roth on 3/20/86

1986 Apr 1: An Open Letter to Senator Robert Packwood (by Wm Mitchell) has been sent to the network economists to help them write their articles. This is a checklist of those in the 1) Writing Stage 2) Submitted to Newspapers 3) Letters Written to Senators.

    This cash-for-comments participant has written both the article and the letters to Senators, and has obediently attached copies of both, which are sent back to the Tobacco Institute.

1986 Apr 6: A list of excerps from major newspaper editorials and op-eds about the Packwood tax plan. Anderson is one quoted:

Lee G. Anderson, professor, College of Business and Economics of the University of Delaware, in the Wilmington (DE) Sunday News Journal
. "Equity is key to tax reform"

"...Because excise and sales taxes are regressive, the general emphasis of this part of the proposal is to make our tax system more regressive—finally, because the bottom line is an effective increase in excise taxes, and since excise taxes cause inefficiency in the economy by driving a wedge between what consumers pay for products and what the goods actually cost, the Packwood proposal would adversely affect the overall efficiency of the US economy."

1986 Apr 11: The Tobacco Institute plans for State-by-State actions to generate opposition to the Packwood Tax Plan.

1986 Apr 15: Jim Savarese is reporting to Fred Panzer at the TI about the [anti] Packwood Tax Plan project.

We have contacted the following people and have asked them to request to testify before the Senate Finance Committee on April 21, 1986. As of today, no one has been asked to testify, but here is the current status.

• J.J. Boddewyn, New York - called and wrote [CUNY]
• B. Poulson, Colorado - called and wrote
• Michael Crew, New Jersey - called and wrote [Rutgers]
• William Mitchell, Oregon - called and wrote [Uni of Oregon]
• Richard McKenzie, Missouri - called and wrote [Washington Uni, St Louis]
• Ann Harper-Fender, Pennsylvania - called and wrote [Gettysburg College]
• Joseph Jadlow, Oklahoma - called and wrote [Oklahoma State]
• Robert Tollison, Virginia and D.C. - called and wrote [George Mason]
• John Howe, Kansas - previous commitment
• Terry Anderson, Montana - previous commitment
• Lee Anderson, Delaware - previous commitment

We will check back with these people daily to see if they have heard anything and I'll let you know as soon as we are successful.

1986 Apr 15: Jim Savarese is reporting to Fred Panzer at the TI about the [anti] Packwood Tax Plan project. He includes numerous letters sent to Senators, copies of published op-eds, and a revised op-ed for Maine and one for Minnesota, He lists the successes of the network economists, including:

DELAWARE, Prof Lee Anderson
[Submitted to] Wilmingham News Journal 3/20/86
[Letters sent to Senators] Biden, Roth 3/20/86
Published 4/6/86

1986 Dec 8: Sam Chilcote is summing up the Tobacco Institute's activities in fighting the Packwood Tax Plan which attempted to impose special excise taxes on tobacco, alcohol and fuel (in the oil crisis years) to reduce use. Packwood also wanted to make these taxes and tarffs non-deducatable for federal income tax purposes.

    The document bundle (219 pages) includes:

• Pages 2 to 34: A major study done for the TI by Policy Economics Group
• Pages 35 to 50: Another major study commissioned from DeSeve Economics for the Coalition Against Regressive Taxation (CART) [funded by tobacco to act as a front]
• Pages 51 to 57: A couple of papers done for Covington & Burling
• Pages 58 to 100: A long document which has deliberately NOT included the name of the organisation which produced it within the document itself. (But done by deSeve Economics Associates Inc).
• Pages 101 to 129 : A paper on the "Burden of Tobacco Taxes on Selected Demographic Groups"
• Pages 130 to 144: Some booklet trying to rabble-rouse the Hispanic and Black communities and make them believe Packwood is attacking them racially.
• Page 145 to 177: A Citizens for Tax Justice 'poll' on attitudes. and Coalition Against Regressive Taxation document
• From Page 178 on: many of the op-eds they have had published in newspapers by the cash-for-comment academic economists, (including one from this source.)

See Anderson article on page 193 of the document bundle.

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 = 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:

Delaware [Region VI]

Professor Lee Anderson

College of Marine Sciences, University of Delaware, Newark, Delaware 19716 302-451- 2650

Services rendered:
• Packwood

1987 Jan 6: and 12 Jim Savarese advises the Tobacco Institute that some economists were no longer working for his network. However Lee Anderson is still being listed as their main Delaware economist-for-hire.

In order to keep this project straight with respect to the economists, we were specifically assigned to go back to all 42 names on the original list to check to see if the economists were still interested in working for us, still in the same state, and available to meet with representatives from state activities.

    We have 34 who fit this criteria and have been contacted. The list is attached. The states that we once had that are currently missing are Arizona, Maryland, Massachusetts, Nebraska, New Jersey, Vermont, West Virginia, and Wyoming.

    The attached invoice covers the project of re-contacting the original 42 economists and coming up with the present 34 people.

The primary purpose of this contact is to determine if a given economist is capable of testifying effectively before a legislative body.

    They have been informed that someone from TI will be in contact with them.

    We request that an initial contact be made by telephone immediately. Please let me know when this initial contact has been made. Personal meetings should be arranged and completed no later than May 1, 1987.

1987 Jan 6: Savarese is charging the Tobacco Institute $3,200 to update the cash-for-comments economists list (with Lee Anderson still active)

1987 Feb 6: James Savarese has finalised his list of compliant economists, and sends them to Susan Stuntz at the Tobacco Institute. It lists all the familiar cash-for-comment economists

Old faithfuls:
Lee Anderson, Terry Anderson, Dom Armento, Cecil Bohanon, Thomas Borcherding, Henry Butler, JR Clark, John David, Allan Dalton, Arthur Denzau, Clifford Dobitz, Robert Ekelund, David Gay, Anne Harper-Fender, Dennis Hein, John Howe, Wm Hunter, Joe Jadlow, Michael Kurth, Suuner LaCroix, Dwight Lee, C Matt Lindsay, Dennis Logue, Chuck Mason [Masen], Charles Maurice, Fred McChesney, Robert McMahon, Arthur Mead, Wm Mitchell, Allen Parkman, Wm Peterson, Thomas Pogue, Barry Poulson, Raymond Raab, Simon Rottenberg, Mark Schmitz, Richard Vedder, Richard Wagner

Greg Niehaus, Mario Rizzo, Roger Riefler, and Boon Yoon.]

1987 May 30: A list of 26 quotes excerpted from major newspaper editorials and op-eds from the TI's cash-for-comments economists about the Packwood tax plan.

The Wilmington News Journal, May 30, 1987
"Congress should remember its own goals of equity and efficiency and also stick to the bargain it made with the U.S. taxpayer when it passed the tax reform act by resisting the urge to raise excise taxes."

Lee G. Anderson, professor of economics, University of Delaware

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. Robert Tollison at George Mason University ran this network secretly with Savarese as the front.

    In the mid 1987 period, the project was under control of Jeff Rose [under Peter Sparber] at the Tobacco Institute and 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]

Professor Lee Anderson has written a piece published in the Wilmington Journal (circulation 65,000) on 30 May 1987.

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 DELAWARE
Anderson for Wilmington Morning News —Owed $1200, — Total to date $1200

1987 July: a selected group of the economists have been commissioned to write op-eds about cutting the deficit — and to de-emphasise the value of excise taxes. Generally they follow the line of listing four possibilities approaches

• a general consumption tax (efficient but regressive)
• increased excise taxes (inefficient and regressive)
• a national lottery (regressive and competitive with State lotteries)
• increased income taxes (unpopular)

1987 Aug 21: Jeff Ross at the Tobacco Institute has prepared a consolidated summary of "Field Staff Evaluation of Economists" for his superiors, William Kloepfer and Peter Sparber. They have been asked to look at 34 of these academics. This includes an outline of their recent achievements.

DELAWARE
Professor Lee Anderson University of Delaware Newark, DE

Excise Tax Op Eds: Wilmington Journal — 05/30/87
Economic Witness/Testimony: Testified at public smoking hearing.
Field Staff Contact: Yes.
Field Staff Evaluation: Unfavorable; alternative requested.

1989 Jan 11: The Tobacco Institute's Scientific Consultancy Activity report for 1988-89. This is an 80 page mixed bag of files dumped together. [First is from 1990]

• Pages 3 to 23 It begins with Witness Appearances in 1988 and 1989 involving both "Indoor Air Quality experts" who work for the Tobacco Institute, and three economists [ Bob Tollison, Richard Wagner and Dwight Lee]
• Pages 24 to 31 Labor IAQ Presentations in 1988 and 1989 which involves key figures in the labor movement and a few "IAQ experts."
• Pages 32 to 39 IAQ/ETS conferences attended by tobacco industry disinformation experts in 1988 and 1989
• Pages 40 to 41 Academic and Unaffiliated Scientfic Witnesses
• Pages 43 to 53 Smokers Rights Legislation in various states.
• 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 from Tollison's "cash-for-comments" network 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 (resource: 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."

  The list of cash-for-comments professors and senior academics who were available to write op-eds and give evidence at Congressional hearings, etc. had grown extensively.

  Delaware now has two members:

  • Professor Lee Anderson, College of Marine Sciences, University of Delaware, Newark
  • Professor Burton Abrams, Department of Economics, University of Delaware, Newark, Delaware

[TI budget papers show that each op-ed now earned the economists $3,000. Presentations to conferences earned them $5,000. Savarese was paid $70 to $100,000 pa for this project, and Ogilvy & Mather $250,000.]

See page 5

1989 April 18: Susan Stuntz (Issues Manager) at the Tobacco Institute memos 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]

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.

DELAWARE
Professor Lee Anderson
College of Marine Sciences, University of Delaware
Newark, Delaware 19716 302-451-2650

Professor Burton Abrams
Department of Economics, University of Delaware
Newark, Delaware 19716 302-451-2566

1997: A 60-page file labeled "Nashville Tennessee" has details of Philip Morris's lobbying in the state during 1996, including:

• Both Company (PM) and Industry 'gifts' to the governor and politicians, some via lobbyist Bob Clement.
• "Focussed Giving" (commissions) by PM subsidiaries, Kraft, Millers, etc.
• Arts, Museums, College, Clubs, Societies — grants, sponsorships etc.
• "We Card" project ( a token attempt at limiting teenage smoking)
• TV Advertising expenditures of the Tobacco companies compared to the combined Democrat campaign and anti-smoking group advertising (about 30:1)
• Earned Media in Markets Reaching Tennessee together with the name of the commissioned author, the Market and the title of the article or editorial
  • cash-for-comments economist Lee Anderson (Uni of Delaware) has been prolific - dozens.
  • William Buckley Jr has had a couple of successes.
  • Reed Irving, of Scaife's Accuracy in Media makes a showing
  • Walter Williams has only one intriguing reference: "Court Rules for Williams, 9-0"

CONTRIBUTORS:in22 scsu TRMU