James M Savarese

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This article is part of the Tobacco portal on Sourcewatch funded from 2006 - 2009 by the American Legacy Foundation.

The tobacco industry lobbyist and organiser, Jim Savarese, worked for Ogilvy & Mather PR before branching out to form James Savarese & Associates (aka Savarese & Associates) which originally had the same address as O&M in Washington DC. At the same time (circa 1990-91) O&M Public Relations became Ogilvy Adams & Rinehart (OA&R) also with the same address. It is not at all clear what the relationship was between O&M/OA&R and the Savarese companies -- they appear to have overlapped by decades and has the same staff.

One puff piece says that James Savarese & Associates was founded ... "in 1981 [as an] economic consulting firm in Washington, D.C."

"[Jim] Savarese has produced economic studies and provided economic experts to testify in dozens of legislative settings at all levels of government. From 1972-81, Savarese served in several important capacities with the American Federation of State, County and Municipal Employees (AFSCME), one of the largest unions in the AFL-CIO." [2]

Savarese claimed to be an economist, and he was capable or writing Economic articles for newspapers and magazines, but basically he was a public-relations practitioner and lobbyist with Democrat political connections.

Note 1981 appears to be too early to establish his own operation. He was still working for Ogilvy & Mather PR in 1984.

Savarese's company essentially had two very substantial commissions from the tobacco industry:

  1. to run the Cash for Comments Economists Network which consisted essentially of a tame professor of economics in a State university in each of the 50 US states. They were regularly commissioned to write an op-ed article for their local newspaper which promoted an economics argument against taxing or regulating of tobacco sales. See also Economists' network {needs consolidation}
  2. to administer and organise the Labor Management Committee of the tobacco industry, funded through the Issues Management division of the Tobacco Institute. This was the organised infiltration of the union system at the highest level (with dozens of unions and the AFL-CIA), with bribery of officials and funding of left-wing think-tanks, etc.

Savarese had the devoted help of an assistant Leslie Dawson for many decades. There are also three others in the archives who share the 'Savarese' name, but it is not known what relationship these people had with Savarese and his company:

  • Ms. Deborah Savarese a lawyer with Jones Day Reavis & Pogue who represented RJ Reynolds Tobacco.
  • Mrs. Dianne S Savarese, a research secretary at the Tobacco Institute. She assisted the TI's medical director and the director of statistics.
  • John F Savarese, a lawyer with Wachell Lipton Rosen & Katz, who worked for Lorillard.
  • Later Anna Tollison the wife of Robert Tollison began to work with the partnership of Tollison and Savarese (under the same banner)

Cash for Comments Economists' Network

In the mid-1980's Savarese became involved in organizing and running

... "an informal committee of economists from 42 states who have collectively and individually participated in activities on behalf of the tobacco industry in the areas of excise taxation and public smoking." [3] (see Committee on Taxation and Economic Growth) and the Economists' network.

. What these weasle words hide is a multimillion dollar conspiracy to subvert a whole section of the academic economics profession to serve the interests of the tobacco industry.
Jim Savarese and Professor Robert D. Tollison from George Mason University established and ran the Cash for Comments Economists Network which, over time, recruited about 150 Libertarian economists to act as surreptitious lobbyists for the tobacco industry. They were not paid retainers, but given $600 to $3,000 a time for planting a propaganda article in their local newspaper.

Members of this clandestine network changed over time -- through deaths, transfers (and perhaps even consciences!) -- but the economist's network operated very successfully for decades with at least one (sometimes more) professors operating in almost every state. The economist they recruited were generally:

  • professors of economics or business management at a State University. (Easily bribed because of their relatively low pay); They were paid between $600 and $3,000 a time, although some of the core group earned much more -- often in the $20-40,000 range -- for producing 'independent research' which was customised to produce the desired results
  • members of the ultra-Libertarian 'Public Choice' faction of the profession (extreme promoters of free-enterprise, small government, less-regulation of markets)
  • members of the Center for the Study of Popular Choice (CSPC) which was run at George Mason University, under Robert Tollison. Savarese and Tollison sometimes used the adminstration staff at the Center for Study of Public Choice at George Mason University (GMU) to help launder payments.
  • willing and able to write an op-ed article to order when given a subject and a list of key points to promote.
  • willing to send the article to a selected Congressman, and perhaps phone or contact him/her to reinforce the message, for extra payment.

Over a 120 professors of economics at major American universities participated in this cash-for-comments network, and many of them remained available to service 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. The network was set up in November 1982 and it operated under Savarese and Tollison until early 1999, when the remnants were handed over to the Independent Institute to run.
See the Economists' network entry for a more detailed account of the economic arguments involved.

Labor Management Committee

Savarese and his staff also acted as administrators for the Labor Management Committee which also ran with Tobacco Institute funding to provide a channel for industry bribes to be paid to unions and union officials, and in some cases to Democrat politicians.

His main associate in the LMC was labor lawyer/lobbyist Michael A Forscey of the Democrat law firm of Wunder Diefenderfer Ryan Cannon & Thelen, (which changed names fairly regularly). The LMC also paid the services of David C Wilhelm, at one time the Chairman of the Democrat National Committee (DNC), who also ran a lobbyshop The Strategy Group and a union-oriented think-tank, Center for Tax Justice.

Savarese probably ran scams for industries other than tobacco. He built a very wealthy company with only ever a couple of employees.

Documents & Timeline

1984 Nov 20 Ogilvy & Mather PR (O&M) is organising for the Tobacco Institute the first economists forum at the Public Choice Society meeting in New Orleans, Feb 21-23. (Note: at this time James Savarese worked for O&M's PR division)

The topic would be "Public Choices About Tax Reform." William F. Shughart II, an economist from Clemson University, would chair the panel. Those who would present papers would be:

  • Thomas Borcherding, from Claremont Graduate School. Subject: "Tax Reform and Simplification: A Public Choice Perspective."
  • Harold Hochman, from City University of New York. Subject: "The Value-Added Tax: Do We Need Another Excise Tax?"
  • Fred McChesney, Emory University Law School. Subject: "Tax Reform in a Rent-Seeking Perspective: The Role of Interests."
  • Gary Anderson, an economist from George Mason University, would be the discussant.

Bob Tollison would be responsible for getting us on the program. He and Jim Savarese would work with each of the people to ensure that each paper contained a clear anti-excise tax message. Shughart and Anderson would also mention excises in their presentations. We will be obtaining CV s from Anderson and Shughart, who Jim and Bob Tollison know well. The other economists have all worked with us before.

Savarese's estimate of the costs for running this Economists' Forum project with the three papers at $2,000 each and Gary Anderson with $1000, plus travel, hotel, administration, etc. was $16,000. [4]

This appears to be the first operation of what was to become the Cash for Comments Economists Network

1985 Sept The address and telephone number on the letterhead of this letter from James Savarese & Associates, dated September 1985 is identical to that of Ogilvy & Mather (O&M). They were both effectively running the Committee on Taxation and Economic Growth (CTEG) under some joint agreement.

1986 May Ogilvy & Mather are still handling James Savarese's billings/charges to the Tobacco Institute. He has a billing rate of $115 per hour as a 'consultant, which is only marginally below O&M's Vice President and General Manager, Marcia Silverman at $125 per hour.

Three other O&M staff working for tobacco Richard Marcus, Lynn Snoddon and Keith Tarr-Whelan charge at $100-$110/hr

Nancy Pelosi (Californian Democratic Party) is a consultant to O&M with the top charge rage of $250 per hour. [5]

Report on a Savarese "brain-storming" meeting with the leaders of the Cash for Comments Economists Network

1988 Feb 2 James Savarese reports to the Tobacco Institute on a "brain-storming" meeting with a "core group of economists and lawyers to exchange thoughts and ideas on the Social Cost issue. [The total cost to the economy of smoking: related to health, pollution, cleaning, etc.]. Their goal was to determine project priorities and making assignments for 1988. The meeting was directed at ... [attacking] Anti-smoking activists [who] have distorted the issue of Social Cost. Even though economists ridicule their statistics, [the] politicians and the press believe them.
The core group of economists were:

[Note: This is lobbying pure and simple: The report's conclusions contain outright admissions. They expose the scientific and academic subterfuges being employed. This is not the result of a simple difference in economic opinion: network members were knowingly acting as paid lobbyists.]

Report Conclusions:

  • The higher rate of illness of smokers is a 'private cost' not a social cost '[and therefore should be ignored!]
  • It is not politically useful for us to argue the primary health statistics.
  • Up to this time, ETS has not been translated effectively by the opposition into cost numbers. Rather, it is a regulatory issue.
  • We cannot afford to lose the argument among people who think they are being harmed by ETS. If ETS causes harm, it becomes a classic case of real social cost.
  • We must make sure that primary costs of smoking be kept out of any social cost calculation. We must separate primary smoking statistics from ETS statistics.
  • More research is needed on ETS in order to deny health consequences.

Primary assumptions that need to be countered.

  • Insurance and Health Costs:
Health problems exist for smokers.
The cost for health care due to excess illness or death of smokers equals smokers' cost to society.
Insurance premium -- Discounts for non-smoker (not justified?)
Pension Plans -- Increased mortality rates saves money
  • Productivity and Absenteeism:
Smokers are absent more frequently than non-smokers.
The time spent by a employee smoking on the job is time spent not working. These factors make the smoker a less productive member of society than a non-smoker.
The worker bears the cost of absenteeism via fewer raises, less advancement, or termination. Society bears no burden.
  • Social Security and Medicare:
Based on lifetime calculations, smokers should be getting a rebate. We should propose a rebate program, rather than a tax program.
If non-smokers live longer, when the baby boomers reach retirement age, very high tax rates will be necessary to finance Medicare and Social Security.
If smoking is banned, it would cause some serious problems in future years.
Note: see here the infamous Death benefits argument... (paraphrased as...) "When people die young they are less of a burden on society."
  • Fires: It is not a social cost for a smoker to burn his house down, just a private cost.
Social cost only exists if a neighbor's house burns down (a much smaller number).
  • ETS: Blanket smoking.restrictions raise costs to private employers.
If restrictions are cost effective, individual companies will adopt them.

Goals: As a result of this meeting, we should devise a specific plan and timetable of implementation with assignments for specific projects.

We need to review and critique existing materials and develop our own core of research.
Note: They then allocated research projects to the economists and discussed additional ideas which might prove useful to the industry.
Both the Southern and Eastern Economic Association presented forums at which the economists could present papers and ...
  • Tollison is looking for one or two others.
  • (potentially a) major session at a university to bring together all relevant research on Social Cost will be planned after projects are completed.
  • Proceedings will be published in a monograph.   [6]

In 1991 the list of Economists who were writing op-eds for the network organisers, and planting them on their local papers, was already quite extensive.

1991 Jan 8: Jim 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.
Core Group: Robert D Tollison (George Mason) Richard E Wagner (Florida State, then GMU), Dwight R Lee (Georgia), Thomas E Borcherding (Claremont Coll./Maryland Uni.), William F Shughart (Clemson/GMU)
Robert B Ekelund, Jr., Auburn University
William J Boyes, Arizona State University
David ER Gay, University of Arkansas
Gary M Anderson, California State at Northridge
Roger A Arnold, California State Univ. - San Marcos
Barry W Poulson, University of Colorado
Dom Armento, University of Hartford
Burton A Abrams, University of Delaware
Bruce L Benson, Florida State University
Dwight R Lee, University of Georgia
Allan Dalton, Boise State University
A James Heins, University of Illinois
Cecil E Bohanon, Ball state University
Todd Sandler, Iowa State University
Michael Babcock, Kansas State University
Brian L Goff, Western Kentucky University
Michael M Kurth, McNeese State University
Robert C McMahon, University of Southern Maine
David G Tuerck, Suffolk University
Bill Shughart, University of Mississippi
Joe A Bell, Southwest Missouri State University
Thomas I Wyrick, Southwest Missouri State University
Terry Anderson, Montana State University
Dee Martin, University of Nebraska
John L Dobra, University of Nevada Reno
Dennis E Logue, Dartmouth College
Allen M Parkman, University of New Mexico
Cliff Dobitz, North Dakota State University
Richard K Vedder, Ohio University
Joseph M Jadlow, Oklahoma State University
William C Mitchell, University of Oregon
Ann Harper-Fender, Gettysburg College
Arthur C Mead, University of Rhode Island
Ryan C Amacher, Clemson University
Dennis D Hein, Augustana College
Jeffrey R Clark, The University of Tennessee at Martin
S Charles Maurice, Texas ASM University
Michael L Davis, Southern Methodist University
Richard E Wagner, George Mason University
Richard D Zerbe, Jr., University of Washington

1991 Sep 29 James Savarese is writing to Susan Stuntz at the Tobacco Institute on the letterhead of Ogilvy Adams & Rinehart. He and Leslie Dawson are setting up a conference in Chicago. Attached to the memo is

  • an earlier fax sheet to Fiona Deroulez, Manager International Services at INFOTAB. This is confirming Stuntz's attendance at an meeting of the international tobacco manufacturers in Hamburg, Germany Oct 14-17 1991)
  • other notes on other conferences
  • another memo from Savarese on James Savarese and Associates letterhead for a Florida conference in February 1991


Other SourceWatch resources

External links

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Savarese, Jim