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

The cash-for-comments economists network was set up by Professor Robert Tollison with lobbyist and consultant to the Tobacco Institute, James Savarese. It's purpose was to provide propaganda and lobbying services to the tobacco industry in all 50 US States, utilizing trusted and prominent academics at the local universities. It was:

• Funded and controlled by the Tobacco Institute.
  
• Organised and influenced by the Center for the Study of Public Choice at George Mason University, and the Public Choice Society (neo-con economists).
  
• Operated on a day-to-day basis through Ogilvy & Mather, and then by James Savarese & Associates a lobby firm based in Washington.

• Tobacco Institute staff — Peter Sparber, Susan Stuntz, Carol Hyrcaj, Fred Panzer, Jeff Ross and Calvin George.
  
• Economist organizers — Robert Tollison, William Shughart, Dwight Lee, Richard Wagner, Gary Anderson, Robert Ekelund, Henry Butler —
  
• Organizers from the GMU Center — Anna Tollison (wife of Robert), Elizabeth Masaitis, Carol Robert
  
• Organizers from Savarese & Assoc. — Jim Savarese, Leslie Dalton, Kelleigh Varnum
• Organisers from Ogilvy & Mather— Richard Marcus, Marcia Silverman, Patricia Milita

• Write op-ed articles for their local newspapers (after they had first been sub-edited and legally cleared by the Tobacco Institute). This earned them $2-3,000.
  
• Appear as 'independent' witnesses at local ordinance hearings, or at State or Federal legislative hearings.
  
• Make public statements to the broadcast or print media, or write letters to the editor supporting the tobacco industry's position [but concealing their connections]
  
• Make submissions to academic/scientific conferences. This could earn them $5,000.
  
• Write letters to their Congressmen — which had often been rough-drafted by the tobacco industry.

Some payments were laundered through Savarese & Associates, and some seem to have passed through the Center for the Study of Public Choice. Other means of hiding the sources of payment were probably via tobaco industry lawyers.

• See a detailed list of all known cash-for-comment economists.

• Also see the Tobacco Institute's original 1984 plan

• This is one of the early letters of instruction

Some key documents

• Professor of Economics, Florida State University. He was also a Board member, James Madison Institute, a Tallahassee think tank

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.

• 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 Apr 13: James Savarese bills the Tobacco Institute for funding the Public Choice Society Meetings in Florida ($18,500) and for individual out-of-pocket expenses for Robert Tollison ($673.41), Gary Anderson ($955.78), Bruce Benson ($366.60), Richard Wagner ($750.74) David Gay ($651.53) and Dwight Lee ($699.87)

    A handnote on Page 1 says "1311-7301 D Schoonmaker 4-14-89 Chq to CPSP"
    [Debbie Schoonmaker was looking after the accounts at the Tobacco Institute.

1990 May: This is a list of the newspapers designated to certain economists on the network. They are to attempt to plant an op-ed article on "Excise Taxes" on this local newspaper.

FLORIDA,
Bruce Benson Florida State University,
      Tampa Tribune.

1990 July 12: A Tobacco Institute document lists the editorial successes of a large number of the paid cash-for-comments academics and consultants. It outlines what each has done in the recent past.

1990 Aug 3: Sam Chilcote at the Tobacco Institute has advised the Members of the Executive Committee of plans to develop a celebrity speakers program using academics and other expert consultants. There are offer the speakers both money and personal promotion:

[W]hile it is clear that there are a number of individuals who can and are speaking out on our issues independent of The Institute, there also is much more that could be done. There are, for example, opportunities to develop higher profiles for those individuals with whom we enjoy an existing relationship, and to increase within the media an awareness of their availability.

    There also are a number of individuals who have been identified who do not currently have a relationship with the industry, but whose views appear to be compatible with our own. Should the Executive Committee decide that it wants to proceed with an expansion of our speakers' program, these individuals would be contacted to determine their interest in our issues.

    The addition of new speakers to our program will be expensive. Most of these individuals command substantial consulting fees; media and other activity will require a new commitment of funds, although an exact amount cannot be determined until candidates have been approached.

• Authors, newscasters and newspaper columnists
• Well-known politicians, political aides, White House staffers, State authorities, agency administrators, etc
• Heads of various coalition groups (American Advertising Federation. etc)
• Cash-for-comments legal and business academics from Savarese's network list.
• Cash-for-comments 'risk assessment' academics and promoter.
• Cash-for-comment experts in indoor air pollution and ventilation systems.
• Cash-for-comment academic economists + some likely allies:

• BRUCE L. BENSON, professor of economics, Florida State University and board member, James Madison Institute, a Tallahassee think tank.
• DWIGHT R. LEE, professor of economics, holder of the Ramsey Chair of Private Enterprise, University of Georgia
• JAMES C. MILLER, Citizens for a Sound Economy Foundation, Washington; former director of OMB
• WALTER E. WILLIAMS, professor of economics, George Mason
      University, Fairfax, Va.
• BOB TOLLISON, George Mason University, Center for the Study of Public Choice

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: Savarese has sent the current list of network economists to Carol Hyrcaj at the Tobacco Institute. It contains three new names, but otherwise is essentially the same as the old lists. Benson is included in the list as:

FLORIDA
Bruce Benson, Florida State University

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.

1996: Feb/E The Independent Institute operates partly as a laundry service for tobacco industry payments made to academics [ie $5,000 paid to Professor Thomas DiLorenzo for a 'Study of the Federal Anti-tobacco Campaign']. This Scaife-funded Institute has run a conference "De-Taxing America" at which a number of tobacco-economists were key speakers. They were all part of the Tobacco Institute's economists network.

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) [Then working directly for the Tobacco Institute out of Austin Texas] 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.

1998 Aug 15: The Florida "Press Journal" carries an article "Government assults success" by cash-for-comments economist DT Armentano which attacks the McCain tobacco bill and the FDA.

    The list of the activities of the other economists shows that the network continued to be operated by the Tobacco Institute itself (under Walter Woodson, and Lance Morgan - both Public Affairs division). [However Savarese is still in the picture.]

However, since legally discovered tobacco documents had already begun to appear on-line, they have carefully deleted the names of the Professor of Economics who wrote each op-ed piece.

Benson is listed under the heading

FLORIDA, Florida State University
PUBLISHED 7-20 Tallahassee Democrat

1999 Oct 19: Thirty Seven right-wing academics have signed an "Open Letter to the Attorney General" in support of senior tobacco industry executives and helpers who were under threat of being charged with Racketeering under the RICO Act. This was two years after the signing of the Master Settlement Agreement (MSA)

    It appears to be a final-draft version (organised through George Mason University) from the Philip Morris files. It says [truncated]

• The lawsuit instituted by the Department of Justice against the tobacco industry to recover Medicare expenses from smoking related illnesses is without legal or economic merit. This politically motivated, thinly disguised tax ignores the rule of law and establishes dangerous precedents and threats to free enterprise.
• The tobacco industry should not be denied its constitutional right to require individual evidence of causation and damages.
• The Administrations' effort to circumvent the will of Congress is transparent. Congress has already rebuffed federal government efforts to tax tobacco out of existence when it rejected the McCain tobacco tax bill in 1998. Other administration efforts such as the Food and Drug Administrations effort to expand its jurisdiction to include cigarettes and tobacco have been rejected by federal courts of appeals.
• This action poses an unprecedented threat to commerce and constitutionally guaranteed freedoms. The federal assault on cigarettes threatens to establish a dangerous precedent for other industries.
• The Department of Justice Tobacco Medicare litigation violates elementary considerations of fairness and undermines confidence in the constitutional system. We oppose this threat of vast expropriation of private property and this attempt at taxation through litigation.

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