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

Randall Holcome became recruited into a clandestine network of academic economists who secretly worked for the tobacco industry (via the Tobacco Institute) probably through his connections with Robert Tollison and Richard Wagner of the Public Choice Society, but maybe because of his university associations with Robert Ekelund at Auburn University.

The network was set up in November 1982 by James Savarese (working through his own company and Ogilvy & Mather PR) with later expansion nationwide through Professor Robert Tollison of George Mason University.

Tollison and Savarese acted as contractors and cut-outs, using the Center for the Study of Public Choice at GMU, which supplied the adminstration staff. They recruited Radnian and ultra-libertarian economics professors at the major state universities through the Public Choice Society and various regional economics societies.

The problem is not that these scientists were ultra-libertarians, and that many of them were Tea-Party disciples of Ayn Rand, Frederick Hayek and/or Ludwig von Mises. Nor was it necessarily made worse by the fact that the industry they helped prosper made a product that caused the premature death of about four million people globally each year.

The problem is that these academics

• exploited their trusted position as a teacher at a university to promote dubious corporate view points contrary to the public good.
• hid their corporate links from the university administration and staff, and from the public which ultimately paid their salary.
• exploited the public trust in universities and their reputation for independent research, for their own financial benefit.
• allowed the tobacco industry to preview, edit and alter the reports they wrote specifically as industry propaganda.
• wrote op-ed articles which were planted on their local newspaper — misleading both the editors and the readers,
• maintained a claim of being 'independent academic/scientists' when writing to politicians or giving evidence at hearings, etc. after being coached by tobacco lawyers.
• generally acting secretly as tobacco industry lobbyists.

Over a hundred professors of economics at major American universities were successfully recruited by Tollison and Savarese, and many of them remained in service to the tobacco industry for many years. Others only served for a short time, and then dropped out voluntarily ... or were found to be unreliable or unsatisfactory.

They were not paid retainers or salaries, but were erratically commissioned to perform specified functions (usually for $1000 to $3000 per project) when the tobacco industry came under attack. Some earned much more — often in the $20-40,000 range — for producing 'independent research' which was customised to produce the desired results.

Payments were never made directly from the tobacco industry to the economists. Commissions were all carefully laundered through Savarese's company or Tollison's GMU operations — and so the economist (wrongly) assumed this would provide deniability if ever challenged over selling out their academic credibility to the merchants of death.

Some key documents

• Holcomeb was an old associate of Tollison, Lee, Shughart, etc. and briefly became a member of the cash-for-comments economists network working through Savarese. 82 documents in the tobacco archives carry his name.

• His current online CV

1950 June 4: Born

1972: BS.BA. in Economics, University of Florida, Gainesville

    He was given the [Richard Mellon] Scaife Foundation Fellowship for a year

1974: Master of Arts in Economics,

1976: PhD Virginia Polytechnic University. Dissertation Chairman: James M. Buchanan

1977: Robert Tollison, Randall Holcombe, W Mark Crain and Thomas Deaton have published "Rational Choice and the Taxation of Sin," in the Journal of Public Economics, Vol. 8

The traditional literature on sumptuary taxation indicates that these taxes are the result of a majority of individuals imposing their moral code upon consumers of goods that are thought to be undesirable. Undoubtedly this explanation is not trivial, and accounts for the existence of the sumptuary taxes, the authors report.

1984 Oct: A "revised Draft" of a joint paper by James Savarese and William Shughart "The Incidence of Taxes on Tobacco" in the files of RJ Reynolds Tobacco quotes the earlier Tollison/Holcome paper:

'Crain, Deaton, Holcombe, and Tollison (1977) suggest, however, that an individual could approve an excise tax on a good that he or she consumes. Their argument is that the tax-induced price rise may lower the cost to consumers of exercising moral restraint. For example, when an excise tax on alcohol raises the price of liquor, it is cheaper at the margin to reduce drinking. This allows the individual to consume more of other commodities, including goods such as "safe driving." Alternatively, Buchanan and Flowers (1980, p. 427) contend that because taxes an smoking are discriminatory, it is unlikely that they could be enacted were it not for the nonrevenue aspects.

1988: A excise study by Holcome claimed to have...

... found that none of the traditional bases fit the actual structure. While excises at one level all generate revenue, Holcombe found that the levels of taxes on gasoline and on tobacco did not vary across states, removing credence in the use of the tax as an efficient revenue source.

1988 Nov: Robert Cook of the University of Richmond has sent his draft Discussant's Remarks to the Tobacco Institute for vetting. It has been prepared for presentation at the Southern Economic Association meeting, November 1988 San Antonio, Texas. He is crtical of Holcombe's paper:

Session: Political Economy of Excise Taxation Excise Taxes in Theory and in Reality. Holcombe, Randall G.

    This paper rejects the theory of public finance as it applies to excise taxation. The author suggests that in a representative democracy the theory of special interest groups is the "real" explanation for the incidence of excise taxes.

    The theory of public finance is rejected on empirical grounds. The author argues - without empirical support - that the demand for gasoline and tobacco are inelastic. As a corollary the elasticity of demand should be constant across states.

    I do not know why the elasticity of demand for tobacco in Alaska is correlated with the elasticity of demand in Florida, however the author asserts this is true. I suspect the demand for tobacco is a function of socio-economic factors that are not constant across states. Surely the demand for gasoline is a function of the availability of substitutes for private passenger vehicle transportation.

1988 Nov 20: At Auburn University, and working with Robert Ekelund, Dwight Lee, Richrd Wagner, Henry Butler and Joseph Jadlow at a Southern Economic Association meeting in San Antonio.

    The Tobacco Institute has vetted these papers and paid the economists to attend to attack the concept of excise taxes. Randall Holcombe of Auburn University has presented "The Fiscal Politics of Excise Taxation".

    Ekelund later cited his paper extensively [while knowing full-well that it was a tobacco-funded stitch-up]:

In an empirical study of whether the standard theoretical justifications for excise taxes — as sources of revenue, as user charges, or as sumptuary taxes — explain the pattern of excises across states, Randall Holcombe (1988) found that none of the traditional bases fit the actual structure.

    While excises at one level all generate revenue, Holcombe found that the levels of taxes on gasoline and on tobacco did not vary across states, removing credence in the use of the tax as an efficient revenue source. Further, he found the user charge explanation on tobacco excises — which would suggest higher taxes in metropolitan areas due to the supposed social costs of smoking — to have only weak statistical support.

1988 Nov 28: Debbie Schoonmaker at the Tobacco Institute writes to Savarese about Social Cost Research Papers.

Enclosed are drafts of the Wagner and Ekelund social cost papers.
Each has been reviewed and will not need further clearance provided the recommended changes are incorporated into the final versions of the papers.

    The legal comments are fairly straight-forward. If you or the authors need an explanation or wish to discuss further, please call.

    You'll also see that I've enclosed a copy of the California Health Department's "social cost" study. We can discuss this example in our "SWAT team" meeting.

• Atlantic Economic Assn., Philadelphia, Oct 6-9 , meeting on User Charges: has
  • Dwight LeeChairman + paper, "Some Bureacratic Implications
  • Richard Wagner"User Charges: Principles and Practice"
  • Bruce Yandle, "User Charges: Evaluation and Critique.
  • Discussant: Robert Staaf.
• Western Economic Association, Los Angeles, June 30 — July 3 meeting on Tax Earmarking and User Charges.
  • Dwight R. Lee, "The Political Economy of Tax Earmarking"
  • Richard Wagner, "The Fiscal Politics of Tax Earmarking"
  • Paul Wilson,"User Charges and the Problem of Externalities"
  • Discussants: Thomas Borcherding and Benjamin Zycher, Rand Corporation [unknown relationship]
• Southern Economic Association, San Antonio, Nov 20-22 on Excise Taxation
  • Robert Ekelund, Chairman:
  • Dwight R. Lee, "Political Economy of Corrective Taxation"
  • Randall Holcombe, Auburn University. "Excise Taxes in Theory and Practice"
  • Richard E. Wagner, "The Fiscal Politics of Excise Taxation"
  • Discussants: Joseph Jadlow, and Henry Butler,

1988 Nov 29: Savarese bills the Tobacco Institute for:

Final third, book Review Project for Smoking and the State by Robert Tollison and Richard Wagner $20,000.00

1989 Mar: /E He is at Florida State University and has written Excise Taxes In Theory And In Reality The main table in the article gives Cigarette And Gasoline Excise Taxes By State in 1985.

In conclusion, there are many theoretical justifications for excise taxation. The tax structure is the product of the political process, however, and this paper finds evidence that special interests are more important in shaping the structure of excise taxation than the theoretical justifications suggested by economic theory.

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 Dec 14: Jim Savarese is listing the economists taking part in their new Excise Tax Op-Ed project.

I have attached the list of economists that we have contacted to participate in the new excise tax project. I have also listed the newspapers we plan to target and a package of the materials we are sending to the economists.

    We should start getting drafts of the op-eds around the first of the year.

FLORIDA:
Randy Holcombe
      Orlando Sentinal

1990 Jan: The newsletter of the National Center for Policy Analysis [A Dallas-based, Koch-funded, offshoot of the Atlas Foundation] is promoting a study on privatisation:

Randall G. Holcombe, 'The Tax Cost of Privatization" Southern Economic Journal, January 1990.

1990 May 14: A copy of the letter-reply from Senator Connie Mack of Florida to Randall Holcombe is in the Tobacco Institute files. They are fighting a battle to keep smoking sections on commercial flights, and are therefore taking a keen interest in the funding and legislative control of the the Federal Aviation Administration. She has written

Dear Mr. Holcombe:
It was good to hear from you recently regarding S. 1600, the "Federal Aviation Administration Independent Establishment Act of 1989."

    It is important that monies in the Aviation Trust Fund be used for the purpose for which they were intended. Be assured, I will keep your thoughts in mind when this bill reaches the Senate floor for a vote

1991 Jan 10: A Louisiana state University biomedical study on T-cells acknowledges discussions with two other academics — for some completely unfathomable reason !

The authors wish to thank Mr. Kevin Boykin for his technical assistance throughout this work and Dr Randy Holcombe for helpful discussions of these data. This work was supported by American Cancer Society grant #IM-568.

1993 July 21: The Orlando Sentinal Story "Pros huddle to plot [Jeb] Bush's race for Goveror" reveals that Bill Kristolo (ex chief of staff to Dan Quayle, and associates of Governor Bob Martinez, were being funded by businessmen Phil Handy for a three-day confab to lever Niami developer, Jeb Bush, into the governor's office.

    One singled out for mention in the article was "Florida State University professor, Randy Holcombe, an advocate of budget caps."

1994 Mar: /E Holcombe has written "The Politics of Selective Excise Taxation" and sent a copy along to Philip Morris. This is also the chapter in the book "Sin Taxes" for the "Independent Institute," which is fronting for the Tobacco Institute.

1994 Oct 14: Holcombe is given a chapter in a proposed book on "Sin Taxes" to be funded by the Tobacco Institute through the Independent Institute. The director and editor of the project is the cash-for-comments economist, William Shughart, and all the chapters are written by tobacco industry network economists.

    The Independent Institute would act as a front and promote the book. It would also arrange lectures and pubic presentations. With tongue held firmly in their cheek, they say:

"Sin Taxes" would be the culmination of a separate rrsearch project involving economics, law, political science, history, and other fields. The book's authors are selected as Research Fellows based on their track-record of outstauding tesearch in public policy employing research techniques of methodological individualism.['methological individualism', presumably means techniques not used by any other scientist ?]

    They would be paid an honorarium on a performance basis....

    "Sin Taxes" would be completed by a team of authors, who would report to, and work in conjunction with, the Independent Institute's Research Director, Dr Robert Higgs, who oversees the Institute's overall research program.
[And who works on the side as a TI cash-for-comments economist.]

1995: The Politics of Selective Excise Taxation: Randall G. Holcombe, Florida State University

Economic theory provides three clear rationales for selective excise taxation.

1. An excise tax can be applied as a substitute for a user charge, as, for example, a gasoline tax earmarked for financing highway expenditures, or the federal excise tax on airline tickets earmarked for the aviation trust fund.
2. Excise taxes can be part of an efficient tax structure if they are placed on goods with inelastic demands, following the Ramsey rule for allocating taxes among markets.
3. An excise tax can be placed on goods whose consumption is considered to be undesirable; in this case, the tax can be viewed either as a penalty for consuming the good, as a tax on a negative externality associated with the good's consumption, or both.

These justifications for excise taxes can provide an omniscient and benevolent government with the guidance it needs to set taxes optimally.

    In reality, taxes are not set by benevolent despots, but are created through the political process. Interest groups, not economic theory, determine the structure of excise taxes.

[This argument was a double-edged sword]

1997 May 20: Draft: " A Concept Proposal for a Social Cost Forum" has been sent to Philip Morris. [by The Department of Economics at George Mason University under the auspices of Dr Walter Williams... (probably with the backing of Robert Tollison)]

Outlandish claims made by some anti-industry advocates pertaining to so-called costs that products such as automobiles, beer, tobacco and other products impose on society as a whole are generally deemed credible by much of the general public, and are often used as excuses for increased taxes and regulations. This occurs despite the fact that the entire idea of a social cost is generally spurious.

    In order to reverse the tendency of both the media and the general public to blindly accept outlandish statements made by special interest advocates, it has been proposed that an inter-industry coalition sponsor an academic forum to discuss the idea of social costs and social cost theory. This forum will bring together academics, corporate research managers and decision makers to discuss the current state of research concerning these theories and to propose and promote additional academic research to fill in existing gaps in knowledge and answer current questions.

    Corporate funding for the forum will come from a minimum of five separate firms, including Philip Morris, which will cover one-fifth of the costs of the symposia. While corporations will fund the forum, all control over content will rest with George Mason University and Dr Williams.
[The standard Faustian disclaimer that denies the influence of Mephistopheles]

    George Mason will use the Social Cost Forum to bring together representatives from academia, industry, government and the public policy community to discuss the current state of the research on social cost theory. As currently envisioned, the forum will bring together approximately: 15 Leading Academics
[His list is almost entirely from the Public Choice Society]: -

• Dr Walter Williams, George Mason University (network economist)
• Dr Roy Cordato, Campbell University (also Institute for Research on Economic of Taxation (IRET))
• Dr Kip Viscusi, Harvard Law School (long-term tobacco lackey)
• Dr Richard L Stroup, Political Economy Research Ctr. (Montana Uni & network economist)
• Dr Randall G. Holcombe, Florida State University (network economist)
• Dr Russell Sobel, West Virginia University (ex Frances Marion College & associate of Holcombe)
• Dr Fred Foldvary, California State University, Hayward (a relative 'Tim' was anti-FDA lobbyist0
• Dr Donald Boudreaux, Clemson University (also Cato Institute)
• Dr Roger Meiners, University of Texas, Arlington (neo-con anti-environmentalist, ex-Clemson University)
• Dr Charles Rowley, George Mason University (a UK tobacco lackey on sabbatical)
• Dr Francesco Parisi, George Mason University Law School (unknown)
• Dr Willard Manning, University of Minnesota (+ Rand Corp & long-term tobacco lackey)
• Dr Steven Cheung, University of Hong Kong (IEA, Hoover Institution)

• Dr James D Gwartney, Florida State University, Public Sciences Center, (Cato Inst.; associate of Stroup)

1997 May 21: Biographies of participants by Walter Williams in support of his project for a "Social Cost Forum" sent to Philip Morris.

Professor Randall G Holcombe
Florida State University
PhD Virginia Polytechnic University (1976).
Selected Publications: Growth and Variability in State Revenue, The Economic Foundations of Government, "The Welfare State, Poverty, and Economic Opportunity," "Politics and Deficit Finance," "Absence of Envy Does Not Imply Fairness."

1998 Apr 13: An RJ Reynolds Tobacco tax lobbyist, Lewis K Uhler (founder and president of the National Tax Limitation Committee, headquartered in Sacramento CA), has been corresponding about Fiscal Strategy Considerations (CONFIDENTIAL). The index tells us that his letter discusses President Clinton and "Conservative Freinds" He has mentioned cash-for-comments economists James Gwartney, Robert Lawson, and Randall Holcombe.

2004: Senior Fellow with James Madison Instittue, Tallahassee, Florida

2006: President of Public Choice Society for two years.

2013: Randall G Holcombe is a Research Fellow at the Independent Institute.

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 on 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.

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