The corrupted 120+ member tobacco economists network. Part 23 of many

Overview of previous posts here

Economic associations meetings

Some of the recruited economists had formal bonds with the Western Economic Association (Gary M. Anderson, Dwight R. Lee, Richard L. Stroup, Thomas Borcherding)

At least five network economists at that point had formal bonds with the Southern Economic Association. Anno 2015, 3 of the 8 officers of the association were members of the Social Cost Consultants network (Peter Boettke, Fred McChesney & Jeffrey Clark). Back in 1985, Robert D. Tollison, ringleader of the economist network, was elected president of the Southern Economic Association. Consultant James Savarese saw the lobbying-potential, and wrote this letter 

Savarese's letters seem to imply the tobacco industry wrote material subsequently presented by the economists as their original work.

Savarese's plan worked out, and the economists presented their anti-tax (read: pro-tobacco) message during several conferences of economic associations They all knew their mission.

It is impossible to claim the economists attending these conferences, 'understanding their mission', and submitting their papers to the Tobacco Institute ‘for review in advance’ were useful idiots. They were aware their mission was manipulating the conference attendees.

In 1984, economists received $2,000 for presenting a paper, the chairman and members of the panel got $1,000. In 1991, the economists earned $5.000 per presentation

The 120+ corrupted tobacco economists network - Part 22 of many

Overview of previous posts here

Robert C. McMahon & Dennis Logue

The letters written by Dennis M. Dyer show the contacts with the economists were not left to Savarese alone (he received a copy of the letter though). Dyer described how the economists were asked to participate: the industry never said 'defend this crap'. Instead they sent the economists papers written by the industry, asking the economists if they would be willing to defend it. All the economists knew they would receive money if they said yes. But is seems they always had the option to say 'no' if they did not feel comfortable defending something. Of course, too many no's probably would get them removed from the network.

Lee J. Alston at the time was in Australia, but wrote hestill was interested in working with the Tobacco Institute. Alston was not a very active member. His letter shows that the Tobacco Institute did have direct contact with everyone the network, not just the core group of economists.

A follow up memorandum shows Savarese had identified 6 possible new economists to work as consultants, and had effectively recruited and contacted SimonRottenberg. Rottenberg received the same letter as above acouple of months later, yet it seems Rottenberg never did much for the tobacco industry. But it makes one wonder where Rottenberg's articles on the costs of transportation and the costs of medicine came from. Not exactly two fields that are related to each other. Rottenberg would also edit a book for the Independent Institute.

Some of the economists must have replied to Dyer's letter. 

This is corruption, nothing less.

More proof that some of the economists were for sale is found in another passage in the same letter:

Even though he realized the work he defended at a testimony was seriously flawed, Logue decided to defend it. . .

The 120+ corrupted tobacco economists network - Part 21 of many

Overview of previous posts here

Ryan C. Amacher

The Ogilvy and Mather report of a meeting held april 29, 1985 is interesting

Ryan Amacher indeed signed the piece corrected by PR-firm Ogilvy and Mather

In 1988 Northwest Airlines became the first American airline company to ban smoking on domestic flights. Ryan Amacher wrote

Even without checking Amacher's data it is obvious that the things he mentions are not related to a smoking ban. But where did his arguments come from? The Tobacco Institute's president Samuel Chilcote wrote a memorandum explaining how the tobacco industry responded to the announcement of the smoking ban

Ryan Amacher wrote exactly what the Tobacco industry wanted him to write.

The tobacco economists network - or how the Tobacco Institute recruited over 100 American economics professors. Part 20 of many

Overview of previous posts here

Buying the academics names 

Dennis Chinn

Not recruited by the Tollison/Savarese network, Dennis Chinn is the odd man out. Nevertheless his example is interesting. It seems the Tobacco Institute never was able to recruit an economist in every state. The documents show sometimes a network economist was ‘transferred’ to another state to fill in a temporary hole in the network. This was done because the industry always focused its lobby-activities on those states actively working on excise taxes. States with little activity were low priority for the lobbyists.

March 14, 1985, (when the network still was incomplete) Regional Philip Morris Director Alexander King wrote a text on the Tobacco Institute's need of an economic analysis to oppose a Senate Bill in Washington State

The bill sent to the Tobacco Institute shows in just 59 hours (including gathering all data) the Applied Economic Associates were able to write a full impact excise-tax analysis for the entire state of Washington. Seems rather implausable. 

Dennis Chinn seemed to enjoy the work for the tobacco industry, and wrote a first letter and a second one soliciting more consultancy work. For a while, Chinn would become a tobacco economist 

Dennis Chinn not being honest

A couple of months after he sent his letter, (January 13 1986) Chinn had become a member of the Tobacco Institute's Washington Task Force

Yet three days later (January 16), a press release by the Tobacco Institute's PR-firm Public Affairs Associates stated Chinn was 

The press release does not mention that Chinn was a TI-consultant, proven by the memo from 3 days earlier

As he accepted money from the industry, Chinn most certainly was not an independent economist. 

The tobacco economists network - or how the Tobacco Institute recruited over 100 American economics professors. Part 19 of many

Overview of previous posts here

Requesting an economist

Dwight R. Lee

After a while, the regional lobbyists must have known who the "best" economists were. Even though in 1987 he did not perform well, the training must have worked and in 1990 Bill Trisler simply requested Dwight R. Lee

Lee attended thehearing. Dwight Lee is the economist who by far attended the most legislative hearings, and Lee seems to have been the last core member active (until at least 1998).

Regional director Bob Pruett's wrote a thank you to letter in 1988 to Lee 

The same day, Pruett wrote another interesting letter 

Dwight R. Lee might not have been paid directly by RJ Reynolds, but the Tobacco Institute paid Lee $3,000. R.J. Reynolds was one of the companies funding the Tobacco Institute. Technically Lee did not lie.  

Someone else not lying was Fred S. McChesney, who testified for the Tobacco Institute in 1984.

In 2002 Fred McChesney was heard in a trial against Philip Morris

Of course McChesney's 1984 testimony was during a hearing on taxes, not a hearing on a tobacco company. Technically McChesney's answer was correct.

Michael L. Davis

In 1990 William Orzechowski wanted to use economist Michael L. Davis

Before the tour Davis participated in a Texas Tax Strategy Meeting held by the Tobacco Institute and indeed he did accept touring for the Tobacco Institute

A summary of the tour shows they talked with many editors from newspapers.

Corrupted tobacco economists network. Part 18 of many

Overview of previous posts here

Economic experts witness team orientation

Probably still not satisfied with the economists’ performance, the industry set up an economic experts witness team orientation and media training program in 1988, attended by employees of the Tobacco Institute, and by the core members of the economists network

Robert Tollison and James Savarese moderated the session utilization of economic witness team

Tollison and TI-employee Debbie Schoonmaker moderated the session research programs

The following members of the network attended the meeting: Gary M. Anderson, Michael L. Davis, Dwight R. Lee, Anna Tollison  (Robert's wife), Robert D. Tollison, Richard E. Wagner. Or in other words: the core members.

The tobacco economists network - or how the Tobacco Institute recruited over 100 American economics professors. Part 17 of many

Overview of previous posts here

The industry keeps evaluating

The industry kept evaluating for effectiveness

Full list of remarks:

• Prof Dominick Armentano — "Yes: Contacted, make good witness"
• Prof Summer LaCroix — "Yes: if needed in Hawaii"
• Prof Allan Dalton — "Yes: Good Witness"
• Prof Fred McChesney — "No Contact. Reported to be OK and could be used in future.
• Prof Cecil Bohanon — "Should be replaced by listed Indiana Economist, Prof. James A Papke"
• Prof Thomas Pogue — "Yes, Could be outstanding."
• Prof Robert McMahon — "Yes: Creditable witness and one-on-one contact."
• Pro Greg Neihaus — "Yes, outstanding witness"
• Prof Raymond Raab — "Yes: Outstanding"
• Prof Terry Anderson — "Yes, Good Witness"
• Prof Terry Logue — "Yes: Outstanding witness"
• Prof Kenneth Greene — "Yes: Only in particular situations with controlled information."
• Prof Cliff Dobitz — "No contact: State not lend itself to Economic witness use."
• Prof Richard Vedder — "No - Conflict minimizes effectiveness"
• Prof William Mitchell — "Yes, Good witness"
• Prof Ann Harper-Fender — "No contact - out of country, will contact in June.
• Prof Arthur Mead— "Yes: Good witness"
• Prof Dennis Hein — "Contact sometimes back; will probably be good witness and usable in 1988.
• Dr Mark Schmitz — "Washington — No"
• Dr Dennis Chinn — "Washington —Yes, Excellent"

PR-firm Ogilvy and Mather and James M. Savarese  explain

In order to make the most of the new opportunities for the economist network, several factors had to be taken into consideration

(...)

As effectiveness was everything, the industry even asked Savarese to replacesome economists because they. . . lived in the wrong city. 

Corrupted US-economists network, part 16: The Tobacco Industry training the economists

Overview of previous posts here

Training the economists

Field lobbyist Michael F. Brozek knew why some economists did poorly:

Therefore, the industry would not just tell the economists what they had to say, but would train them better.

This passage (and a few others in the memorandum) clearly indicate the industry did prepare the industry-sponsored witnesses. Again, this implies the economists were not useful idiots being recruited without them realizing themselves (O&M = PR-firm Ogilvy and Mather)

Again, this is not normal academic behavior.

The tobacco economists network - or how the Tobacco Institute recruited over 100 American economics professors. Part 15 of many

Overview of previous posts here

Savarese gets audited

The network was led by consultant James M. Savarese and economist Robert D. Tollison.

In 1997 James Savarese wrote he was under a new financial arrangement with the Tobacco Institute. 

The new financial agreement Savarese mentioned arose as result of the Tobacco Institute’s dissatisfaction with the way Savarese wrote his invoices (and maybe other reasons). Savarese nearly always mentioned the economists' names, but even in his correspondence with the Tobacco Institute he withheld two names (no idea why). As proof we are dealing with professionals, the Tobacco Institute in 1987 audited its subcontractor, leading to new arrangements with James Savarese.

The document is interesting because it shows the industry did not search for the economists, this job was left to Savarese. But:

The audit did generate some unfriendly messages within the Tobacco Institute and whatever sparked the dismay, the industry decided it would evaluate the economists themselves. 

Hurst Marshall wrote a letter to all regional VP's asking to fill a questionnaire

The impetus for these unfriendly communications is unclear but a few months earlier Savarese had been ordered to re-contact all the economists he listed

As another result of the audit, the Tobacco Institute seems to have made its own evaluation of the economists

[etc]

Tobacco employee Pete Sparber contacted 40 economists and 3 economists received less favorable reviews

Nevertheless, all three economists above stayed in the network for the next few years and still wrote op-eds (see another blogpost), but perhaps did not appear at any more hearings. The document does not mention why they wanted to replace Cecil Bohanon, but it shows the Tobacco Institute preferred James A. Papke who delivered very effective testimony in 1986

The same document finally solves the mystery why there were almost no women in the network 

Thomas Borcherding also received a poor review 

Gary M. Anderson indeed would enter the network and he had already worked as assistant for Robert Tollison). Nevertheless. Borcherding does not seemed to have been kicked out but in the future would only be asked to write, not to deliver testimony.

The industry in the beginning did not like the newly recruited Gary M. Anderson even though he was a member of the core group. Interestingly in this memorandum Tollison/ Savarese are referred to as his "superiors"

Richard K. Vedder never was asked to testify. Lobbyist Bill Trisler explains