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 Robert McMahon was a substansive member of the network of academics put together by tobacco lobbyists James Savarese and Professor Robert Tollison of George Mason University who collaborated in the 1980s to help the industry develop economic propaganda.

They provided the tobacco industry [through the Tobacco Institute] with a number of academics who would be willing to write supporting material for publication ... 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 they wre recognised 'academics' from some credible university. They 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 of these articles were always to be 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 at the University of Southern Maine.

• His CV as sent to the Tobacco Institute in January 1985

1962–66: Instructor of Economics Olympic College

1964: MA Economics from the University of Washington

1967–69: Teaching Assistant Lehigh University

1969–73: Assistant Professor of Economics UMPG

1970: PhD in Economics from Lehigh University

1973: Associate Professor of Economics Uiniversity of Southern Maine

1984 July: Cigarette Excise Tax Plan
The Tobacco Institute's plan involving the recruitment of academic economists in each US State:

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:

• 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.

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 Jan 31: Hurst Marshall has distributed this Tobacco Institute list of economists from the cash-for-comments network to their Regional VPs and Directors. It has been organise by State, and includes the names of Congressmen they wish to influence.

Attached for your information are the names of economists who have been identified by PR to assist TI on the federal cigarette excise tax issue.

These people are also available to testify at the state level.

    If you feel that this type of witness can be of assistance to you on state cigarette tax issues, please contact Fred Panzer for details and arrangements.

    Please notify your lobbyists as to the availability of these people. At the same time, you may wish to ask them for their ideas or suggestions for other economists within their states.

1985 Feb 6: Fred Panzer writes to Hurst Marsahll on "Change to List of Economists"

Please add the following names to the list of eoonomic experts:

• Professor James Heins
  University of Illinois (Urbana)
• Professor Robert McMahon
  University of Southern Maine (Portland)

Please delete from your list the following:

• Professor Kathy Hayes, Northern Illinois University (DeKalb)

1985 Mar: Tobacco Institute document "Federal Markets" on the likely allies the industry has acquired to oppose the earmarking of cigarette excises for healthcare. It also includes a record of their successful activities in each state

Market: MAINE
Positive Actions by Local Allies:
Academics: Professor Robert McMahon (University of Southern Maine) wrote an op-ed article on tax reform and submitted to the Portland Press Herald. Editor is considering for publication. A copy of the article was sent to Senate Finance Member Mitchell.

See page 4
See Success List

1985 Nov: The Public Relations Resources Catalogue of the Tobacco Institute.

• Resources are defined as witnesses, materials, publications, corporate relations, and public service programs. Public Service programs center mainly on the success of the Fire Safety education grants and "Helping Youth Decide." [aka HYD program]

These programs are listed in the Fire and Youth and Sampling issues sections, respectively.

McMahon delivered testimony on the negative impacts of public smoking restrictions in early 1985, in Maine,

1985 Dec 12: Annual Report of the Tobacco Institute's Public Relations division lists him as having:

We believe that the active and creative use of experts — our scientists in particular — gives us an edge. But without question, public smoking is our toughest challenge.

    A close second is taxation. In 1985, most of our resources in this area were focused on the federal situation.

    That being the case, we concentrated almost exclusively on the home districts and offices of the 56 members of the House Ways and Means and Senate Finance Committees.

    We identified and utilized economists from universities in 48 of those districts. Some testified at the four federal tax hearings in which had interest. Others participated in academic symposia attended by Congressional staffers. Others communicated directly with their Congressmen.

    And 34 of them wrote op-ed articles on the need to consider excises as part of tax reform. Many of these articles appeared in the principal newspaper in the targeted districts which have, by our estimation, a total circulation of nearly 4 million.

    The economists were of great help. [SNIP]

Professor Robert McMahon (University of Southern Maine) wrote an op-ed article on tax reform and submitted to the Portland Press Herald. Editor is considering for publication.

    A copy of the article was sent to Senate Finance Member Mitchell.

1986 Jan: The Tobacco Institute's Public Relations Resource Catalogue for their Regional Directors, lists documents, booklets, article, posters and people who can help them fight local public smoking ordinances and threats to raise the excise taxes on cigarettes.

    It provides a long list of economists who are willing to speak at hearings, write letters to the editor, or create op-eds for the newspapers to counter any threat to public smoking or possible increase in excise taxes.

    The Tobacco Institute offered their Regional Directors the C/Vs of all of these economists, and said

"Requests for economists should be made ASAP. Allow at least one week. PR approval needed."

• Professor Robert C. McMahon
  Department of Economics, University of Southern Maine, Portland, ME,
  
  McMahon delivered testimony on the negative impacts of, public smoking restrictions in early 1985, in Maine.

Public Smoking/Witness: Local economists are available on two-weeks notice to provide economic testimony on the public smoking issue. Those economists who have testified or prepared op-ed pieces on the economic effects of public smoking are marked accordingly. The others may be briefed on the potential cost to government of implementing smoking restrictions.

Tax witness: [He will] "explain why excise taxes are regressive and unfair to consumers and unsuitable and unreliable as a means to increase the federal revenue."

    Those economists who have testified or prepared op-ed pieces on the economic effects of public smoking are marked accordingly. The others may be briefed on the potential cost to government of implementing smoking restrictions.

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]

McMahon in Maine has been given the target of planting his article on the Portland Press H. and was due for payment of only $900.
A later Schedule of Payments increases this amount by another "$1100.00 — Paid in Full"

    The GMU production staff were also being paid another $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 May: A bundle of 72 pages of information is being circulated by the Tobacco Institute to its Regional Directors. The data is predominantly on the tobacco-industry beat-up known as Sick Building Syndrome and on the general problems of Indoor Air Quality [all down-playing the effects of smoking in confined spaces]

    Section 1 is headed

List of sources. Local and national experts you can call for quotes or background information. It promotes the services of three specialist lobbyists

• Lewis Solmon - an academic who discounts problems of workplace smoking
• Al Vogel - who claims to be an expert in public attitudes to smoking
• Mike Forscey, a labor lawyer/lobbyist who helped the tobacco industry keep the union movement on-side.

1986 May 30: Fred Panzer of the Tobacco Institute was contacting British-American Tobacco's PR executive, Tom Humber [also Burson-Marsteller and National Smoking Alliance] sending him some of the examples of the network economists.

Enclosed are: (1) The first wave of 27 op-ed reprints, (2) A second wave of 32 op-ed articles (21 published and 11 unpublished), sent out on Packwood's first tax reform proposal.

    I've also included one on the Chase [Economtrics] study. There are a few others being rounded up, as well as a syndicated excise tax feature series we developed. Out of all this should come something useful for your people.

• Florida — Wagner — Tampa Tribune and Washington Times
• Indiana — Bohanon — Muncie Star
• Maine — McMahon — Portland Press Herald
• Minnesota — Raab — Minneapolis Star & Tribune
• Missouri — Denzau — St Louis Post Dispatch
• Montana — Anderson — Billings Gazette
• New Jersey — Crew — Wall Street Journal
• New York — Greene — New York Times and Newsday
• North Dakota — Doblitz — Forum
• Oregon — Eberts — Oregonian, Statesman-Journal, and Washington Times
• Tennessee — Anderson — Knoxville Journal, Memphis Commercial Appeal, and Chattanooga Times.

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:

Maine [ Region I ]

Professor Robert McMahon

Department of Economics, University of Southern Maine, Portland, Maine 04103, 207-780-4308

Services rendered:
• original excise tax op-ed

1987 Jan 6: and 12 Jim Savarese advises the Tobacco Institute that some economists were no longer working for his network. However McMahon is still being listed as their major Maine 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 McMahon still active)

1987 Feb 6: Jim Savarese, Bob Tollison and Henry Butler write to "Participants in advertising op-ed project"[These are the new academic economists on the Tollison/Savarese list].

We are finally ready to get this first op-ed project off the ground. I am asking you to review the attached materials and write an editorial for a major newspaper in your state. This article should support the basic right to advertise legal products and oppose attempts to restrict advertising either by outright bans or by punitive use of the tax code.

    Obviously, the point of this exercise is to support tobacco's right to advertise on basic constitutional grounds. Upon completion of a draft op-ed, please send it to me immediately via Federal Express. I will go over the article and return it to you for submission to a newspaper.

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 Armentano, 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 Feb 6: [Same day as above] another letter to "Economists" [the more experienced group] says:

We have received our first op-ed project of 1987 and for many of you it is a familiar one. The issue once again is opposition from any and all reasonable angles to an increase in cigarette excise taxes.

    We are attaching some materials which may be of help in formulating your argument and generating relevant data. Some of the more salient points are listed below:

    It is important that we generate a generalized opposition to the principle of earmarking revenues.

    Upon completion of a draft op-ed, please send it to me immediately via Federal Express. I will go over the article and return it to you for submission to a newspaper.

1987 Feb 6: This is the Tollison/Saverese network list of economists recruited until the end of 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:

MAINE
Professor Robert McMahon

    Department of Economics, Univ of Southern Maine,
Portland, Maine 04103, 207-780-4308

1987 Feb 24: Dennis Dyer of the Tobacco Institute writes directly to Professor McMahon at the University of Southern Maine.
[It is a form letter, also written to other academics on the network]

Dear Professor McMahon:
Some time ago you were contacted by Jim Savarese with regard to the economic impact of the tobacco industry on Maine. I assume you continue in your interest in the economics of tobacco.

    In anticipation of possible tax and smoking restriction legislation in Maine in 1987, I would like to discuss some of your opinions on the economic arguments in each of these areas. For your consideration, I have enclosed the following materials:

• New York Smoking Prohibition Economic Impact Study.
• New York Summary of Cigarette Tax Trends and Impacts.
• New York Study of Cigarette Tax Sunset Provisions on Sales and Bootlegging.

These are typical of the type of materials sometimes prepared for Tobacco Institute use.
[They were virtually templates for use in any state... and being offered to McMahon in Maine as ready-made reports for customization.]

    I would appreciate your written candid comments on the substance of, presentation of, and ability to defend the materials. During the near future, I will be in Portland and would like to get together with you to discuss these materials and how they can be improved. In addition, I would like to discuss the potential for your active participation in their development and presentation to various publics within Maine.

    Again, my thanks for your continued interest and help during the 1984 legislative session. I hope we can develop some believable materials for use in Maine.

1987 Mar 24: Jim Savarese writes to Jeff Ross at the Tobacco Institute about the "Tobacco Excise Tax Op-ed Project".

Attached please find two more excise tax op-eds and a copy of the clipping from the Hartford Courant.

    As of today, 18 articles have been written and 2 articles have been published. As I mentioned earlier, the Des Moines Register has accepted an article and we have a good chance at the Houston Post.

1987 May 5: Cotton Mather ('Matt') Lindsay of Clemson University has written an article "Excise Taxes: Facist Finance" which is being circulated at the Tobacco Institute. He has discovered through his extensive research that:

it is difficult to achieve vertleal equity [equal burden on everyone] through excise taxes because the amount of the tax paid depends on purchases rather than income.

    Breweries and tobacco companies write checks to the government for the excise taxes on beer and cigarettes, but here economists agree; these companies pass these taxes on to consumers. One's share of the burden of the revenues raised by these taxes depends on how much beer one drinks and how much one smokes.

    The unfairness of these excises is manifest; it is not merely another economists' debating point. The tobacco excise tax, for example, is the most regressive tax in the federal system. It is paid only by smokers who are today predominantly lower-middle income earners, lower income working women and blue collar workers.

    Some have argued that these taxes are appropriate because the funds can be earmarked for expenditures like Medicare, environmental protection and even public employee pensions. Why beer drinkers and cigarette smokers ought to pay more for such things is far from clear, however. To the extent that these activities shorten life, they relieve the burdens of Medicare and pension funds by removing potential claimants from the eligibility roles.

    Viewed from another perspective, smokers and beer drinkers not only bear a disproportionate share of taxes because they pay excises on these commodities, but they get less for their money, too. Because they live a shorter life span, they collect less in retirement benefits and receive fewer Medicare benefits.

    This may be fine for Mussolini, but it is antithetical to tax principles in a free and open society.

Professor Robert McMahon:
"Yes: Credible witness and one-on-one contact..."

1987 May 18: Because of "possible improprieties noted during the examination of the initial two-month period." the Tobacco Institute had James Savarese & Associates's accounts audited. The auditor found that:

1. It was a one-employee operation - Savarese billed at a rate of $150 per hour, or approximately $300,000 a year.
2. He only keeps rough accounts and has no contract with the Tobacco Institute.
3. He marks up the conveyed cost of all subcontracters by varying amounts up to 100%.
4. Often the name of the subcontractor is not disclosed or [their existence] establishable... because of concerns that disclosure of their remuneration by the Tobacco Indsitute could harm the credibility of the work they produce."

1987 May 18: The same day as the auditor's report [above], James Savarese & Associates were placed under contract with the Tobacco Institute for two years — and with their hourly rates and markups strictly defined. Tollison was then earning $100 per hour for his contributions.

1987 May 31: Quotes from a list of 26 quotes excerpt from major newspaper editorials and op-eds by cash-for-comments economists about the Packwood tax plan.

Maine Sunday Telegram, May 31, 1987
"Excise taxes violate the principles of efficiency and fairness and to raise 'any or all of the rates would only make matters worse."

Robert C. McMahon; professor of economics, University of Southern Maine

Sen. John H. Chaffee of Rhode Island recently proposed that the federal excise tax on cigarettes be raised from 16 cents to 32 cents per pack. The impact of this tax Increase-would be 18 times greater on low-Income families relative to high income families, making the tobacco tax the most regressive of the excise taxes.

    Excise tax increases gre not a suitable way to balance the budget because they are inefficient and unfair. The federal government should look to broad-based taxes for their additional revenue sources.

1987 Jun 3: Memo on "Economic Witness Evaluation" from Dennis Dyer of the New England division of Tobacco Institute to his superior, George Minshew.

The Public Relations Division has identified six economists in New England who appear willing to work with us on our tobacco-related issues. In April another economist was identified and subsequently contacted — Professor Simon Rottenberg, University of Massachusetts at Amherst.

During the past three years, I have had an opportunity to meet and work with the designated economic witnesses in Maine ( Professor Robert McMahon) and New Hampshire ( Professor Dennis Logue).

• Professor McMahon reviewed and agreed to "author" an economic impact study on the effects of a public smoking bill in Maine.
  [Their quotes indicate that McMahon had allowd the Tobacco Institute to use his name and his university's credibility on an article written by tobacco industry lobbyists.]
  
  He presented testimony at two work-sessions and conducted a limited number of one-on-one briefings. The bill was defeated.
• Professor Logue testified on a broad workplace bill. In conjunction with this testimony, he submitted an economic impact study prepared by Jim Savarese.
  [He also allowed his byline to be used on a study done for the Tobacco Institute by a lobbyist.] The bill was enacted.

[This is an unequivocal statement that these two academics allowed their names to be attached as 'authors' to propaganda and pseudo-research prepared by the tobacco industry in order to deceive legislators.]

    On February 24 I contacted each of the identified economists in the region by letter (Attachment B). In each instance I provided the economist with three examples of Tl-generated economic impact studies and asked for their initial impressions and recommendations.
[He was effectively asking them whether they would put their names to this pseudo-research]

    Three of the seven economists [in the New England region only] responded (Attachments C-l through C-3). With the exception of Professor Celeste Gaspari from Vermont, the other two seem to continue their interest. Only Professor Logue chose to give even the briefest of responses to my inquiry.

    Follow-up conversations with all of the identified economists indicate a general willingness to be involved but a lack of real understanding as to what our requirements might be.

CONCLUSION

    I do not see the economists and their materials as separate programs. Each is ineffective without the other. Without the study the economists have nothing concrete to point to, and without the economist the study has no life. Therefore, I hope that both areas will evolve into a form that reflects their practical use rather than their internal ego gratification.

• Attachment 1. Page 15 is a pro-industry article Armentano has written in the Hartford Courant, "Cigarette taxes flunk on fairness"
• Attachment 2. Page 16 is the resume of Robert C McMahon, who is an Associate Professor of Economics at the USM.
• Attachment 3. Page 19 is the resume of Lee J Alston, Assisant Professor of Economics at Williams College and a private consultant to an unnamed law firm. [He is in Australia on leave - see reply page 45]
• Attachment 4. Page 24 is the resume of Dennis E Logue of the Amos Tuck School of Business Administration at Dartmouth College, New Hampshire. [He is at Georgetown University at this time, and he replies (Page 46) favourably reviewing the literature he has been sent, and suggesting lines of defense for the industry]
• Attachment 5 . Page 32 is the resume of Arthur C Mead, Assistant Professor at the University of Rhode Island. [He didn't reply to the TI request that he review their literature and comment on the economic case]
• Attachment 6 . Page 37 is the resume of K Celeste Gaspari, Assistant Professor of Economics, University of Vermont. [She replies (Page 48) saying she is still waiting for the annual $1000 retainer she was promised, and is disappointed with the Tobacco Institute. She won't work with them if this is the way they do business.]

  I will reiterate my disappointment with the Tobacco Institute. It is true I never had a written agreement with the Institute —we only spoke over the phone. I did, however naively, trust that a verbal agreement with a prestigious institute was as good as a formal contract. I was evidently mistaken.
  
      In answer to your letter, I am not interested in working with your group at this time if this is the way you do business.

• Attachment 7 . Page 40 is the resume of William F Shughart II, ex Special Assistant to the Director, Bureau of Economics at the FTC, and now an Associate Professor at Clemson University. [He apparently didn't reply — but he was a long-term lackey anyway.]

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. It was secretly directed by Robert Tollison from George Mason University with Savarese as the organiser and front.

    In the mid 1987 period, the project was controlled by 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.

    Saverese and Tollison appear to have been in some form of loose partnership, because Anna Tollison, the wife of Bob Tollison, was employed by James Savarese & Associates to keep a record of the articles generated by their 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]

MAINE, McMahon, Portland Press Herald, [circ.] 61,100, [pub date] 5/30/87

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.

MAINE
Professor Robert McMahon University of Southern Maine Portland, ME

Excise Tax Op Eds: Portland Press Herald — 05/30/87
Economic Witness/Testimony: (nil)
Field Staff Contact: Yes.
Field Staff Evaluation: Good witness and for one-on-one contact.

1987 Oct 7: Quotes from McMahon and other economists on the network have been sent to the tobacco-industry front organisation, Coalition Against Regressive Taxation (CART)

1988 Feb 8: The Tobacco Institute to its Regional VPs and Directors.

Attached is an updated list of The Institute's cadre of excise tax economists. These economists are available for testimony, one-on-one meetings with legislators, writing letters and op-ed pieces in the states in which they teach, as well as in any state you deem appropriate.

1988 Mar:

1989 Jan 11: The Tobacco Institute's Scientific Consultancy Activity 1988-89
This is an 80 page mixed bag of files dumped together [Well worth perusing]. The first document is from 1990 [ordered in reverse]

• Pages 3 to 23 begin 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 Tobacco Institute's 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.

  MAINE
  
  Prof Robert McMahon, University of Sourthern Maine

[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 Jan 11: He was still working for the tobacco industry in 1989 when this Tobacco Institute document [of available economists, ordered by State] was distributed to their Regional and State Directors. It had him listed as:

MAINE
Professor Robert McMahon Department of Economics
Univ of Southern Maine, Portland, Maine 04103 207-780-4308

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 includes McMahon]

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

  What TI and Its Allies Must Cover

  1. "Social cost" arguments used to justify excise tax increases, smoking restrictions and ad bans are not valid.
  2. Independent economists state that "social cost" calculations used by anti-smokers do not withstand credible economic scrutiny.
  3. There is no convincing economic evidence that smokers impose costs on society. Any supposed costs are "private costs" and are borne by the smoker.
  4. Other industries are vulnerable to social cost attacks. A "slippery slope" may exist as anti-smokers, using "social costs" arguments, seek legislation restricting smoking or increasing taxes. These efforts may signal lawmakers to regulate other products as well.

• "Tax" Hearing Readiness (as above, but for excise tax increases, State and Federal)

  What TI and Its Allies Must Cover

  1. Excise taxes are regressive and take away tax reform for low- and middle-income Americans. As a percentage of income, low income families pay as much as 27 times more in federal excises than high-income families.
  2. Cigarette excise taxes are discriminatory. They fall disproportionately on Blacks, Hispanics and other minorities.
  3. 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?

• List of cash-for-comment network economists in each State.

MAINE
Professor Robert McMahon
Department of Economics, Univ of Southern Maine
Portland, Maine 04103 207-780-4308

1990: Attorney and lobbyist for the tobacco industry in Maine, Severin Beliveau, has written to Dennis Dyer enclosing a copy of one of Robert McMahon's articles (probably not for the Tobacco Institute although it criticises cigarette excises.) "On Excise Taxation". He writes

If necessary, we may want to consider retaining Professor McMahon as a consultant if the spectre of a tobacco tax increase should surface next year*

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.

    ALABAMA, Robert B. Ekelund, Jr., Auburn University
    ARIZONA, William J. Boyes, Arizona State University
    ARKANSAS, David E. R. Gay, University of Arkansas
    CALIFORNIA, Gary Anderson, California State at Northridge
                Roger Arnold, California State Univ. - San Marcos
    COLORADO, Barry Poulson, University of Colorado
    CONNECTICUT, Dominick Armentano, University of Hartford
    DELAWARE, Burton Abrams, University of Delaware
    FLORIDA, Bruce Benson, Florida State University
    GEORGIA, Dwight R. Lee, University of Georgia
    IDAHO, Allan Dalton, Boise State University
    ILLINOIS, James Heins, University of Illinois
    INDIANA, Cecil Bohanon, Ball state University
    IOWA, Todd Sandler, Iowa State University
    KANSAS, Michael Babcock, Kansas State University
    KENTUCKY, Brian Goff, Western Kentucky University
    LOUISIANA, Michael Kurth, McNeese State University
    MAINE, Robert McMahon, University of Southern Maine
    MASSACHUSETTS, David Tuerck, Suffolk University
    MISSISSIPPI, Bill Shughart, University of Mississippi
    MISSOURI, Joe A Bell, Southwest Missouri State University
                Thomas I. Wyrick, Southwest Missouri State University
    MONTANA, Terry L. Anderson, Montana State University
    NEBRASKA, Dee Martin, University of Nebraska
    NEVADA, John Dobra, University of Nevada Reno
    NEW HAMPSHIRE, Dennis Logue, Dartmouth College
    NEW MEXICO, Allen Parkman, University of New Mexico
    NORTH DAKOTA, Cliff Dobitz, North Dakota State University
    OHIO, Richard Vedder, Ohio University
    OKLAHOMA, Joseph Jadlow, Oklahoma State University
    OREGON, William Mitchell, University of Oregon
    PENNSYLVANIA, Ann Harper-Fender, Gettysburg College
    RHODE ISLAHD, Arthur Mead, Universityof Rhode Island
    SOUTH CAROLINA, Ryan Armacher, Clemson University
    SOUTH DAKOTA, Dennis Hein, Augustana College
    TENNESSEE, JR Clark, The University of Tennessee at Martin
    TEXAS, S Charles Maurice, Texas A&M University
                Michael Davis, Southern Methodist University
    VIRGINIA, Richard B Wagner, George Mason University
    WASHINGTON, Richard D. Zerbe, Jr., University of Washington

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

    The list of 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.]

    The op-eds are now being rejected by many newspapers, who are no longer willing to publish tobacco industry propaganda.

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

McMahon [we assume] is listed under the heading

MAINE, University of Southern Maine

FORTHCOMING:   Portland Press Herald
COMMENT:   Paper has agreed to publish a shortened version as a letter to the editor.

CONTRIBUTORS:in22 ajw2 KRS8