R Morris Coats

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

Professor R Morris Coats (often misspelled 'Coates') was an economics lecturer from Marshall University, in Huntington, West Virginia, He worked for the tobacco industry extensively -- both through their extensive op-ed-writing Cash-for-Comments Economist Network, -- and also as one of their Scientific Witness Team run by the Tobacco Institute. Later he became Assistant Professor of Economics and Finance, Nicholls State University in Thibodaux. He was married to (Anna) Lisa Huval, a school administrator.

Coats was a close associate of Dr Wendell E Sweetser, an older economist, also from Marshall University, who worked briefly for the cash-for-comments network and with Michael M Kurth from McNeese State Uni LA. They seem to have formed a sub-group within the main Tobacco Institute conspiracy.

Documents & Timeline

1955 May 27 Born in Waco Texas, educated in Thibodaux LA.

1979 May the International Committee on Smoking Issues (ICOSI) begins using economists Robert Tollison and Richard Wagner (both "Public Choice" economists of Virginia Polytechnic) to write material to counter the rising tide of criticism attacking the 'social cost' of smoking -- the costs that smoking imposes on the community (through fires, cleaning, health, discomfort, welfare, etc) [2] Coats became part of this group.

1980 PhD. Studied economics under James Buchanan at the Virginia Tech. Buchanan was the guru of Libertarian "Public choice" economics which was an extreme version of laissez-faireism. No government intervention in anything; let the market decide. T

1981 Dec 1Lobbyist James Savarese runs James Savarese & Associates, a do-anything lobby firm which works through, and in association with, Ogilvy & Mather PR. He reports to Susan Stuntz at the Tobacco Institute about their activites during November (both for himself and his employee, Leslie Dawson). At this time Savarese's consultancy specialises in co-opting unionists, labor lawyers and economists. He has been put to work on projects which can be useful in countering the next Surgeon General's report on smoking and health.

He lists the successes his group has had in getting economists to plant op-eds on various local newspapers. This is the early stage in the formation of the Cash-for-Comments Economists Network which Savarese and Robert Tollison eventually ran:

  • Prof David Saurman -- op-ed on Prop 99 with San Jose Mercury News

He had also commissioned and placed numerous newspaper reviews of the Tollison/Wagner edited book (done for the Tobacco Institute) Smoking and the State which has been by-lined by tame academic economics professors at various State Universities. (Most members of the Public Choice Society). Reviews have been planted on local newspapers without any reference to the source of funding:

  • Prof Ryan Amacher (Clemson Uni) published in The State.
  • Joseph Jadlow (Oklahoma State Uni) in Tulsa Tribune.
  • Todd Sandler (Iowa State Uni) in Fort Dodge Messenger.
  • Robert B Ekelund (Auburn Uni) Montgomery Advertiser.
  • Dwight R Lee (Washington Uni) Regulation Magazine
  • Samson Kimenyi (Uni of Mississippi) in Jackson Clarion Ledger.
  • David ER Gay (Uni of Arkansas) in Arkansas Democrat.[3]
  • [Savarese's account of $114,589 would probably have included laundered payments to the economists.]

    1983: Coats has received his PhD in Economics fom Virginia Tech University (Public Choice)

    1983-84: Coats is now an instructor in Economics at Virginia Tech, Lynchburg College and Marshall University.

    1983 Mar 31 Morris Coats and Wendell E Sweetser Jr begin collaborating They are both disciples of James Buchanan who has become one of Savarese's cash-for-comment economist. Buchanan is still at Virginia Polytechnic. [4] (later George Mason Uni)

    1984 Professor Wendell Sweetser (now at Marshall University, Huntington WV) and graduate student/Instructor Morris Coats [both later cash-for-comments economists] have made a study of the state excise taxation and monopoly sales of liquor for the West Virginia Tax Study Commission. [5]

    [The tobacco industry found this study noteworthy and Coats joined the economists network shortly after this when he reunited with Sweetser at Marshall University. Wendell Sweetser himself joined the Cash-for-Comments Economists Network a few years later (1986) , but dropped out after only a brief period.]

    1985 Morris Coats joins Wendell E Sweetser at Marshall University in Huntington, West Virginia.

    1985 Jan 31 A Tobacco Institute list of about sixty economists from the early Cash-for-Comments Economists Network has been sent to the Institute's Regional Directors. The list has been organise by State, and includes the names of Congressmen they wish the Economist's 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

    Morris Coats [misspelled Coates] from Marshall University, Huntington, WV has been included but not given a Congressman to influence. Most of the economists have been detailed to make contact with specific Representatives and Senators.

    [The did this mainly by letter; sending the Congreemen published op-eds and a private note suggesting that they oppose some legislation on economic grounds -- with no mention, of course, that the tobacco industry paid for this lobbying.]
    The details of this economist are simply:

      •   Professor Morris Coates,
          Marshall University, Huntington, West Virginia

    [Wendell Sweetser was only recruited as back-up the following year]
    [At this time the network of economists was run by James Savarese working though Ogilvy & Mather, directly to the Tobacco Institute. However Tollison was obviously involved because the list is recruited from the Public Choice Society.] See also: [7]

    1985 Feb 21 Roger Mozingo of the Tobacco Institute is sending his State and Regional Directors a list of resources available to fight against excise taxes in their states.

    Public Smoking Witnesses: Al Vogel (productivity); Steve Schlossberg (labor implications); Bob Klotz (enforcement) Lew Solmon (economics)

    Voter survey; Economic survey; Labor assistance; Response Analysis summaries; Public Smoking topic sheets;

    "Some Considerations" workplace kits;
    "In Defense of Smokers" reprints;
    "The Other Sice of the Smoking Controversy" reprints;
    Letter writing brochures; Advertising.

    Economist: Morris Coates (misspelled), Marshall University, Huntington, W.Va. <br< Media Relations: Contacts are in place in Huntington. Contact Bill Toohey for assistance. [8]

    1986 Jan The 1996 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.

    Coats is listed [along with 50 other economists] as a contact:

    • Professor Morris Coates (sic)
      Department of Economics, Marshall University, Huntington, WV
      He is available on two weeks notice as a witness for hire.

      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 also] 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.

    [Clearly these expectations could only arise if the economists had had long and fruitful discussions with Tollison and/or Savarese. They were now expected to deal directly with the TI's State and Regional lobbyists who would control them at the local level.] [9]

    1986 Feb Coats joined the Nicholls College of Business Administration, Nicholls State University.

    [He says in one C/V that he transfered to Nicholls State Uni in 1985, but he is still being listed at Marshall University, Huntington by the Tobacco Institute in early 1986. Their record-keeping was poor, however.]

    1986 Apr A bundle of information predominantly on Sick Building Syndrome [a public scare campaign created by HBI and amplfied by the US tobacco industry] and Indoor Air Quality (IAQ) is being circulated by the Tobacco Institute to its Regional Directors. It contains a substantial amount of propaganda material prepared by Gray Robertson (of ACVA/HBI) for the industry, attempting to lay the blame for passive smoking problems on fungii and bacteria in air-conditioning ducts and chemical exudates from insulation, carpets, etc.

    However, Section 1 is headed

    List of sources.
    Local and national experts you can call for quotes or background information.

    Coats' name and address are included under the heading

    Tobacco & Taxation (listed by state, alphabetically).
    PROFESSOR MORRIS COATS , Department of Economics, Marshall University, Huntington, WV

    [For almost the first time they have spelled his name correctly -- but they now get the university and state wrong.]

    1986 Apr 3 This is an approved copy of the letter on "New Research Proposals" that Jim Savarese sent to his long list of network economists. These academic economist knew that they were being paid to protect the interests of the tobacco industry, and they were being handed the words, ideas and opinions they were expected to write. (Not the use of the term 'research opportunities" (below) This makes them lobbyists, not economists..

    The economist were being given outline "rebuttals" developed by Tollison and Wagner to help them in writing their counter-attacks to an an Office of Technology Assessment (OTA) anti-smoking report.

    I would like to thank you for all of your cooperation and diligence in handling the projects we have worked on together. I am taking this opportunity to alert you to some new research opportunities that may be available in the upcoming weeks. As you know, the tobacco industry is exposed continuously to a barrage of attacks on economic issues. Many of these attacks involve a serious perversion of the concept of social cost. The Tobacco Institute is interested in considering research proposals which would establish a much more realistic examination of the social cost issue as it relates to the smoking issue.
    I have attached a report prepared by the staff of the Office of Technology Assessment which is representative of the kind of research being put forth by anti-tobacco activists. I have also included the rebuttals developed by Bob Tollison and Richard Wagner to the OTA report.
    The Institute would like to examine proposals for research that test, in a quantitative way, a number of propositions on the relevant cost considerations that apply to the smoking issue.

    Eight of the cash-for-comments economist on the network responded. [11]

    1986 Apr 28 In a quick reply to Savarese's request for research proposals to counter the anti-smoker's 'Social Cost' arguments, Michael Kurth (McNeese State University, LA) and Morris Coats (now at Nicholls State Uni) put in a joint proposal. [Letter by Kurth]

    If approved, the research would be done by myself and Dr Morrls Coats, Assistant Professor at Nicholls State University. Dr Coats and I both studied under Robert Tollison and Richard Wagner at Virginia Tech and we are familiar with the issues and methodology of the project. The research could be done this summer using the modern research facilities of McNeese State University. Dr Coats would devote his full attention to the project; I would work half-time with Dr Coats while teaching one summer course for McNeese. The cost would be $10,400: two-ninth's salary for Dr Coats ($6,000) and one-ninth's salary for myself ($4,000). [12]

    They identify two possible points of attack on the Office of Technology Assessment. The OTA has suggested that the elimination of cigarette smoking would save the nation $65 billion a year.

    1. It is not clear that the OTA has calculated 'social cost' properly.
    2. Taxes and restrictions may have already internalized the external costs associated with smoking.
    [This gives them an omnibus angle which allows any economist to add or subtract anything to existing figures to prove his point. Costs can be added or subtracted from either side of the ledger depending on what you want to prove.]

    Some commentators at the Tobacco Institute have scrawled defamatory comments on their weak proposal:

    - A very controversial and questionable estimate.
    - Can't measure producers' and consumers surplus acc. because models are inaccurate.
    - "Can't get useful results from research outlined."
    [A couple of months later the TI rejected their proposal outright. See below.]

    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 designed to down-play the adverse health and comfort 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:

    1. Lewis Solmon - an academic who discounts problems of workplace smoking.
    2. Alfred Vogel - who claims to be an expert in public attitudes to smoking
    3. Mike Forscey, a labor lawyer/lobbyist who helped the tobacco industry keep the union movement on-side.
      They have also provided a list of the 52 Professors of Economics from various State Universities who can be called on to provide services for roughly $1000 a time: Coats's name and address are included under "Tobacco & Taxation (listed by state, alphabetically)". [13]

    1986 May 16 Jim Savarese and Bob Tollison have reviewed the "Social Cost' (OTA) research proposals received and they suggest to the Tobacco Institute those that Merit Consideration for Funding:

    Although these can be improved in some regards to ensure they are most useful to the industry, three proposals seem to have a good deal of merit.

    1. Is Absenteeism Related to Smoking? An Empirical Study' by Robert Ekelund, Richard Ault, and John Jackson. This is a solid, well thought out proposal. I think they could show that smokers are not more absent from work, other things equal.
    2. "The Relevance of Consumption Benefits from Smoking: An Empirical Assessment" by Dwight R. Lee and Phillip A. Cartwright. This is a good proposal to estimate the benefits of smoking, which, strangely enough, has never been done. This research will be quite useful.
    3. "Employment Effects of Smoking Bans in Public Accommodations" by Cotton Mather Lindsay and Michael T Maloney. This is an interesting proposal about smoking bans and the impact on restaurants.

    They also want some of the proposals to be revised and re-submitted:

    • 'Improving the Accuracy of the Assessment of Social Cost Associated with Smoking" by Barry W. Poulson.

    They propose rejecting the Kurth-Coats proposal; the Lindsay-Maloney proposal; and one from Henry Butler. [14]

    [There is also a scathing criticism of the Kurth-Coats project and heavy criticism of one from economist Cotton Mather Lindsay. They have gone back to Henry Butler to give him a chance to revise his proposals. Economists Dennis Logue, Barry Poulson and the Cartwright & Lee proposal also aren't up to the standard required. On the whole, the economist's network scored fairly low by their standards.]

    1986 Oct 3 The Tobacco Institute is still circulting to its State Directors an old list, urging them to contact their local economists. The State Directors have been reviewing all economics network witnesses in their territories, and culling those who are not actively participating.

    Attached is a list of economists with their specialty areas and office phone numbers. They have been identified in several states by J. Savarese as available and hopefully capable to testify in our behalf or aid in our defense against proposed state or local legislation, from an economic aspect. Some phone numbers were not immediately available, but they can be obtained by phoning the university indicated. As indicated, I do not have any information at present on a few of these economists. [15]

    This list differs from others in providing a list of the economic specialities of each network economist, along with the Congresmen they were designated to influence. He is listed as specializing in:

    WEST VIRGINIA, Professor Morris Coates, Marshall University, Huntington, West Virginia [No specialization listed] [16]

    [His university affiliation is still being given as Marshall, and his name is being incorrectly spelled. He is now with Nicholl State University.]

    1986 Dec 11 James Savarese sends Fred Panzer at the Tobacco Institute a summary of the activities of his network of economists.

    The Tobacco Institute also now wants to know the details of those who have been recruited:

    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.

    Let me know if you have any questions.

    There are now 62 names on the list (Some states have 4 or 5) not counting himself and Bob Tollison.

    The details given for each, consist of State, Regional Division [of the TI], Name, Address and Telephone number.

    [Added to this in later lists is the 'Projects' they have completed and the names of Congressmen they have contacted.]

    Virtually all of these cash-for-comment academics have been generating op-ed articles for newspapers, or have, in some unspecified way, opposed the Packwood Excise Tax Plan' -- or perhaps helped fake up one of the Chase Econometrics studies done in various states.

    A few participants have attended Congressional or government inquiries ['Treasury I') or local ordinance hearings as 'independent witnesses' without revealing that they were acting for the tobacco industry.

    Two of the 64 members (Ann Harper-Fender and Gary Anderson) were now on Ronald Reagan's Advisory Council on Intergovernmental Relations -- which sought to bring pressure on the FDA, EPA and OSHA and stop them being pro-active with smoking bans.

    Other participants have been promoting the industry line at various academic conferences and fora [mainly as keynote speakers at economic society meetings], and a few of the core-team were involved in brianstorming sessions with members of the tobacco industry looking for new angles for their PR, and for possible research project which might generate some economic propaganda for the industry. Many of them have joined in with the industry's orchestrated letter-writing campaigns opposing workplace smoking bans.

    [GSA = General (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 West Virginia were now:

    West Virginia [Region VI]
    Professor [[Wendell E. Sweetser[[ - Department of Economics, Marshall University, Huntington, West Virginia 25701
    Services rendered: - original excise tax op-ed.

    [When Coats shifted to Nicholl State University, Sweetser temporarily replaced him as the economist serving West Virginia.]

    1987 Jan 6 A James Savarese memo to Fred Panzer at the Tobacco Institute.

    In-order to keep this project straight with respect to the economist list, 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 states listed in October 1986 as having representives (but not now) are:

    • Arizona, Professor Roger D Faith of Arizona State Uni
    • Maryland, Professor David Laband, University of Maryland
    • Massachusetts, Professor Lee Alston, William College, Williamstown
    • Nebraska, Professor Delores Martin, University of Nebraska
    • New Jersey, Professor Michael Crew, Rutgers University
    • Vermont, Professor Celeste Gaspari, Univesity of Vermont
    • West Virginia, Professor Morris Coates, Marshall University
    • Wyoming, Professor Todd Sandler, University of Wyoming.
      Not all of these professors ceased working for the tobacco industry entirely, however. Some provide later services.]

    See October 1986 list [18] and January 1987 list [19]

    1987 Mar 17-19 Coats is listed as one of the network speakers at The Annual Meetings of the Public Choice Society (run by Tollison and Buchanan at George Mason Uni). This meeting was held at the Holiday Inn Hotel, Orlando, Florida. Coats has joined forces with another cash-for-comment network economist, Thomas Dalton, to present a paper:

    Morris Coats (Nicholls State U.) and Thomas Dalton (Southern U., New Orleans) Vote Shares and Inalienable Entry Barriers in the Age of Russell, Disraeli, and Gladstone [20]

    1987 Mar 20 Coats has been culled from the list, at this time. The Tobacco Institute has transfered its arrangement for servicing the state to Coat's Marshall University associate, Wendell E Sweetser.

    1987 Aug The Tobacco Institute has drafted of a short article and press release. It has all been written in the third-person, quoting Wendell Sweetser as saying that West Virginia retailers would feel the sting of a $38 million decline in retail sales if cigarette excises were increased.

    Cross Border Smuggling
    A Cigarette Tax Increase Would Be Harmful to West Virginia.
    According to economist Wendell Sweetser of Marshall University (Huntington; WV) , a 10-cent cigarette tax increase in West Virginia would be a commercial boon to bordering states. The West Virginia economist estimates that the tax increase would trigger an annual $38 million loss in sales of cigarettes and sundry products in the Mountianeer state.

    The beneficiaries would be the states on West Virginia's border. A 10 cent tax increase would raise West Virginia's cigarette tax above that of any bordering state. Savings would range from 90 cents a carton in Ohio and Pennsylvania to $2.40 on the Kentucky and Virginia borders.

    The Marshall University economist estimates that cigarette sales in West Virginia will fall by approximately 9%. According to Sweetser,"with over 48% of West Virginia's population in border counties, most of the West Virginia sales reduction will simply end up in the cash registers of retailers in bordering states.

    [At the time this was written, Sweetser had not seen the draft statement.] [21] [22] The Tobacco Institute found this line of argument so convincing that they put the same words into the mouth of Morris Coats not long after.]

    1988 Wendell Sweetser is no longer acting as the network's West Virginia contact.
    The job now reverts to Morris Coats.

    1990 Witness List [attached to 1993 June 1 Tobacco Institute list of Witness/Expert Appearances -- Scientific/Legal/Spokespersons.] Tom Lauria, Mike Buckley, Simon Turner, Gio Gori, Bill Wordham, Gray Robertson, Peter Binnie (Now HBI), Larry Holcomb, John Fox, Rich Silverman, Walter Merryman, David Remes, Frank Powell, Melinda Sidak, Rudy Cole, Larry Halfen.

    Binnie appears to be concentrating on airports (not aircraft)'. Essentially this is an enlarged version of the Scientific Witness Team.

    An attached 1991 Witness List which also includes, Brennan Dawson, Jeff Seckler, Jim Goold, Joe Pedelty, Jolly Ann Davidson, Dick Wagner, Bernadette Davidson, and Walt Decker. Another 1990 Witness List (page 35) includes Bill Orzechowski, Mike Davis, and Morris Coats Also this document has attached the 1989 witness list with (in addition to above) Dwight Lee, David A Weeks, Alan Kassman, Bob Tollison, Richard Wagner, Jack E Peterson, Bestype Consulting, Dennis Vaughn, And a 1988 List (Most of above) + Alan Katzenstein, David Brenton (focus on airlines) [23]

    1990 Jan This is the Tobacco Institute's major planning document for the Public Relations Division in 1990. It has extensive details of their Strategies, Goals and Tactics. [It also includes an attachment dated May 23 1990.]

    For the excise tax and "social cost" issue:

    • Encourage editorial board visits and op-ed publication by economists on the regressivity, unfairness and unwise policy implications of excise taxes;
    • Publicize, via media tours, the new "social cost" studies, as well as the Tollison and Wagner book.
    • Publicize the findings on "earmarking " of excise taxes to be published.

    [It also has a detailed section on how to counter Tax Earmarking (eg. using cigarette excise taxes to pay for health care). The prospect of 'earmarking was an on-going concern, since any political move to increase health funding would almost automatically result in a price rise for cigarettes.]
    • Aggressively promote the Tollison earmarking book. Promotion will include media tours on the earmarking issue with economists sponsored by an academic institution. Commission op-eds and promote in targeted publications.
    • Develop an op-ed program to address the national earmarking issue and state specific earmarking issues from consulting economists. As articles are published, provide to other Institute divisions and promote to appropriate public policymakers. Use field staff network to support distribution efforts.
    • Develop arguments and materials to demonstrate that smokers are paying too much already. Materials may include studies, testimony, op-eds and lobbying tools for industry representatives.
    • As appropriate, encourage economic consultants to use "social cost" arguments to counter portrayal of excise taxes as user fees on the state and federal level.


    [There is much more here about utilizing the economists from the network to provide support in various ways.]

    1990 Apr 24 Coats has been breaking bread with a group of Louisiana Representatives and a bunch of Tobacco Institute lobbyists over a Dinner costing $800.00. [25]

    1990 May 15 Morris Coats gives testimony on behalf of the tobacco industry before the Louisiana Ways and Means Committee. The statements he makes are borrowed directly from those purportedly written by Wendell Sweetser for West Virginia a few years before. [See above]

    According to economist Morris Coats of Nicholls State University (Thibodaux, LA) , tax revenues from cigarette sales will rise by nearly $10 million in Louisiana without a tax increase. This is because Texas now has the nation's highest cigarette tax. According to Coats, Lousiana retailers will experience a surge in cross border cigarette sales as Texas residents take advantage of a $2.50 per carton tax savings in Louisiana. The result, according to the Nicholls State economist, will be an excise and sales tax windfall for Louisiana. Better yet, this revenue gain comes without piling more regressive taxes on the working man. According to Coats,Mwhy should Louisiana hurt its low and middle class citizens with a cigarette tax increase of 5 or 10 cents a pack when it can sit back and reap its cross border windfall." [26]

    See Sweetser's earlier statement.

    [This testimony and Sweetser's article were based entirely on figures generated by Bill Orzechowski from the Tobacco Institute. Coats hadn't seen these figures until a few days before the hearing, at most.]

    It is estimated by Nicholls State economist Coats that because of the current tax difference with Texas, Louisiana's cigarette sales will rise by approximately 8.2%.

    [This assumes smoking is price-elastic; the cheaper the cigarettes, the more they smoke. Which is a very good reason to charge the highest excise taxes on cigarettes that the legislature will tolerate.]

    Coats calculates this will trigger $6.1 million more cigarette excise tax revenue, $2.3 million more sales tax revenue from the new cigarette sales, and another $1.5 million in sales tax revenue from an increase in sundry product sales. This stacks up to a hefty $9.9 million revenue windfall for Louisiana. Coats warns that this tax windfall will be greatly jeopardized by further cigarette tax increases in Louisiana.

    [The Tobacco Institute obviously have these statements in boiler-plate form, where the economist only needs to drop in the appropriate costs per packet, and guess at a percentage rise. ] [27]

    1990 May 18 Tobacco Institute report of the Louisiana hearings (HB 944)

    Pat McWhorter and Bill Orzechowski traveled to Baton Rouge on 4/26 to meet with Joe Wood, Sarah Whalen, Randy Haney, C. J. Blache, Betsy Giles to discuss strategies for fighting cigarette tax. It was agreed that we would need an economic witness to testify in our behalf before Ways & Means Committee. Pat, Bill and Joe interviewed Morris Coats, Ph.D., from the Department of Economics and Finance at Nicholls State University. Orzechowski prepared economic impact papers for a 10-cent cigarette tax increase.

    1990 May 22 Attached to the Strategy document (above) is a slightly later report from Martin Gleason (TI Public Affairs) at the Institute which reports on some early successes.
    Re: the economists network he reports.

    • Texas economic program
    Developed regressivity and bootlegging studies (PW) [ Price Waterhouse]
    Economist ( Mike Davis) editorial board briefings

    Economic witnesses

    Dwight Lee provided for Wilmington, N.C.-- city council session on economic consequences of excise tax increase
    Morris Coats -- testified in Baton Rouge on proposed LA excise tax increase. [29]

    They also planned to extend the "social cost" arguments to other industries using these economist, in order to enrol these industries and their lobbyists in a wider coalition.

    1990 May 24 Morris Coats has enjoyed giving evidence for the tobacco industry at the Baton Rouge hearings and has written to Bill Orzechowski
    [The Tobacco Institute's iin-house economist.]

    Enclosed, find the bill for my expenses and testimony before the Louisiana Ways and Means Committee, May 15, 1990. I cannot find the receipt for the toll bridge. Take care of these as you see fit. The total for my expenses and fee was $1607.63. Please mail the payment to my home address: 508 Levert Drive, Thibodaux, Louisiana 70301.

    I enjoyed working with you on this. If I can ever be of any help to you or the Tobacco Institute, please let me know.

    P.S. If you are ever this way again and have a weekend, let me know ahead of time and I will try to arrange a fishing trip to Toledo Bend. [30]

    1990 Jun 6 The invoice for Coats' testimony has been passed through James Savarese and Associates. Expenses are $107.63 and his Professional fees are $1,500. [31]

    1990 Jun 26 Walter Woodson (PR) to Susan Stuntz (Issues Manager) at the Tobacco Institute. Woodson wanted to be able to deal with economists like Coats directly rather than through Jim Savarese (who obviously charged for his services).

    In the face of a very serious excise tax hike in Louisiana, Pat McWhorter asked that Professor Coats share information with lawmakers (and I think the press) on excise hikes.

    Coats is an economist Orzechowski dredged up and ran past the econ team. He shared the attached, based on numbers Orzechowski drew up from his economic models.

    [In other words, the Tobacco Institute supplied the figures, and Coats just pretended they were his.]

    McWhorter said the credibility that native-son Coats brought to the scene was instrumental in stopping (so far) the tax hike. He said Coats made the difference.

    This is a long way of asking about those 60 economists Savarese supposedly has around the country. Is it possible for us to tap them for similar authorship? Coats charged us 200 bucks to do this; if we could get similar help from the "Savarese 60," it might really help — in conjunction with actual testimony from the 5-6 economists who can walk and talk.

    [The 5-6 who presumably could walk and talk at the same time were Robert Tollison, Richard Wagner, Dwight Lee, William Shughart, Mike Davis and now Morris Coats.] [32]

    1990 Jul 30 Morris Coats has given testimony for the Tobacco Institute before the Louisiana House Ways and Means Committee opposing the "Proposed Tax Increase on Cigarettes".

    (Assistant Professor) Coats, now of Nicholl State University, is using the name of (Professor) Sweetser's of Marshall University to support his and the Tobacco Institute's arguments. As graduate students they had previously worked together on a similar study. In this piece to the Committee, Coats rolls out the same old 'regressive tax' arguments saying the poorest twenty percent, pay about 20 times [that of] the richest. [percentagewise].

    Bill Orzechowski, the resident economic lobbyist at the Tobacco Institute, has sent the transcript to Wendell Sweetser for information. Presumably this is because Coats had used Sweetser's earlier excise tax statement for West Virginia as his own arguments opposing the same taxes in Louisiana. Since they were friends and associates, Orzechowski may have felt the need to clear the Coats statement with Sweetser before using it. [33]

    1990 Sep 26 [Kurt Malmgren]'s Tobacco Institute telex re: Sacramento County, California Ordinance

    On September 25, the Sacramento County Board of Supervisors on first reading voted 3-2 to adopt a strict ordinance banning smoking in the workplace and phasing out smoking in restaurants by 1993.

    Terry Eagan -- along with expert consultants Gray Robertson (IAQ), David A Weeks, MD, (ETS), John Fox (labor/management attorney) and Melinda Sidak (C&B) were the subject of print and broadcast interviews. (All from Scientific Witness Team)

    Please contact me if you have questions, as we prepare for the referendum phase of this project.

    The file then includes a long list of "Scientific/Other Witnesses Appearances & Media Tours - 1990" Along with Robertson, Seckler, Turner, are some volunteers from the academic economists network:

    • March 16 -- Topeka, KS -- Legislative Hearing -- Dwight Lee
    • March 30 -- Park Ridge, IL -- Local Hearing -- Dwight Lee
    • March 21 -- "Social Cost" media tour, New York City -- Bob Tollison
    • April 12 -- Honolulu, HI -- Legislative hearing -- Dick Wagner
    • April 30 -- New Hanover, NC -- Local Hearing -- Dwight Lee
    • April (Editorial tour) -- "Social cost" Texas Newspapers -- Mike Davis
    • May 9 -- Baton Rouge, LA -- Legislative hearing -- Morris Coats.


    1995 Dec The National Tax Journal has an article by R Morris Coats "A note on estimating Cross-Border Effects of State Cigarette Taxes." Coats fails to credit Bill Orzechowski, the resident economic lobbyist at the Tobacco Institute who provided all the charts and calculations for him during the March 1990 Louisiana House Ways and Means Committee hearing. [35] [36]

    [Claims that tax hikes will increase interstate smuggling were pretty much the only arguments that the industry could mount. Years of corruption and the release of documents had thoroughly discredited the industry. Only in a state as corrupt as Louisiana could the industry mount more than a token effort to change legislation after 1996. This is probably why Coats was retained as a consultant when the main network had collapsed. His paper on smuggling became one of the industry's most quoted documents in the dying days following the Master Settlement Agreement.]
    He also appears to have turned it into a lecture with powerpoint slides.

    1996 In 1996 R Morris Coats was finally named a
    full professor at Nicholls State University.

    1998 Apr /E The Alexis de Tocqueville Institute, a mercenary libertarian think-tank, which was always available for hire by the tobacco companies (about $30,000 per report), has been persuaded to report on "Tobacco Smuggling: A Worldwide Phenomenon".

    They have churned out this Draft with the Tobacco Institute's message:

    Congress is considering legislation that will substantially increase the cost of smoking. When all is said and done, prices for cigarettes will probably double in the next few years, from about $2 per pack to more than $4. Such a significant rise in price for this popular, easily transported commodity will, without a doubt, increase the demand for contraband cigarettes.

    Increases in cigarette taxes historically have led to increases in smuggling; tax decreases have diminished the problem.

    The purpose of this report is to review the evidence on cigarette smuggling, both in the U.S. and elsewhere. It strongly suggests that Congress should be very careful in levying excessive taxes on tobacco, lest it give rise to a massive increase in legal sales that will both reduce revenue to the government and undermine efforts to discourage smoking.

    [The last line is a sophisticated touch when you know that the Tobacco Institute has paid for and controlled the writing of this report.]
    [The circularity of TI propaganda is most evident in the attached bibliography where many of the sources provided are long-term cash-for-comments economists who have worked extensively for the industry. They and the Alexis de Tocqueville Institute used the TI's own figures in their papers:
    • Richard P Saba at. al., The Demand for Cigarette Smuggling, Economic Inquiry. vol. 33, No.2 (April 1995), pp: 189-202;
    • R. Morris Coats, A Note on Estimating Cross-Border Effects of State Cigarette Taxes, National-Tax Journal, vol. 48, no. 4 (December 1995), pp. 573-84;
    • Richard K. Vedder, Bordering on Chaos; Fiscal Federalism and Excise Taxes, in William F. Shughart II, ed., Taxing Choice: The Predatory Politics of Fiscal Discrimination (New Brunswick, NJ: Transaction Published, 1997) [38]
    [Saba, Vedder and Shughart were all well-paid members of the Cash-for-Comments Economists' Network.]

    1998 May 5 The Tobacco Institute (which is now on its last legs) has made a payment to Morris Coats of "Professional Fees" $4,320.99 for "Testimony". [39]

    1999 Mar 8 The Tobacco Institute has had a Reconciliation Report for its Riggs National Bank account, for the period up to January 31 1999. Among the hundreds of accounts taking their final cut is one for R Morris Coats, for $4,200 -- the only recognizable name from the cash-for-comments list still working for the Tobacco Institute. [40]

    1999 Oct 2 Morris Coats remains on the Vendor's List of the Tobacco Institute, and is still at the same Thirodaux address. This document was prepared after the Master Settlement Agreement had begun to closed down the Tobacco Institute and (temporarily) most of the tobacco industry's corrupt practices.

    Almost all the old Cash for Comment Economists Network members have disappeared from this consultants and suppliers' list, except for

    • R Morris Coats, 508 Levert Drive, Thibodaux LA [41]

    1999 Dec 6 Morris Coats has now gone over to work for Philip Morris since the Tobacco Institute is no more. Their Weekly Activities Report for Issues Managment in November has an entry:


    Excise Tax Analysis

    • Met with Morris Coats of LSU (sic) to discuss a project he is doing on tax stamping.

    Other Analysis

    • Attended Southern Economics Association Meeting in New Orleans - Presented paper on business clustering
    • Attended presentation of PM sponsored paper on assessments
    • Discussed two papers and chaired a session [42]
    [The following weeks Dunham also met with Coats, and discussed the smuggling issue with other staffers.]

    2000 May 1 Coats has an op-ed in the Bayou Business Review : Spending Daddy's money: Louisiana's tax system in action.

    [Governor] Foster also plans to hike taxes on "sin:" increasing taxes on casino: gambling, beer, liquor and cigarettes. (Wine seems to have been left out, hmmm?) Increasing the tax on beer, liquor and cigarettes will certainly cause substantial losses in sales in the border areas of the state, as these are easily transportable across state lines. Increasing taxes on so-called "sin" items is often just the politically expedient way to raise taxes. For many voters, sin taxes tax, as Russell Long put it, "the man behind the tree," which really amounts to making someone else pay for those voters' bills. [43]

    [He still makes no mention of working for the tobacco industry. But he does say that these opinions aren't necessarily those of his university -- which is a slight step-up in his usually ethical standards.]

    2000 May 2 Coats has put out a Press Release on his own letterhead. He is still riding the old horse of cigarette smuggling


    Baton Rough, May 2 2000 - Nicholls State University economics professor Dr Morris Coats today told the Louisiana House Ways & Means Committee that the package of excise taxes currently under consideration are even more regressive than sales taxes, based on the state's large portion of low income wage earners.

    Coats, an expert in cross border sales - the phenomenon of pushing sales of excise tax-sensitive products out of high tax areas into lower tax jurisdictions - said the proposed increases will cause reductions in tax collections for two primary reasons.

    1. "Higher taxes on consumer items such as tobacco, beer and alcohol, result in higher prices," said Coats, "since retailers are generally unable to absorb the taxes at current prices.
    2. Then, he said his research indicates that as prices rise, purchases will fall. "Twenty percent of the reduction in purchases is due to lower consumption, and 80% is due to cross-border purchasing behavior."
    [He fails to credit the tobacco industry with funding his Committee appearance, or his 'research' (which produced the "bleedin' obvious") -- and doesn't recognise that the consequence of higher prices and lower consumption is better health.
    [He sends a copy of the press release to Philip Morris as proof of service. The Release gives no reasons why an obscure professor from an obscure Louisiana University would suddenly get the urge to spread the news about cigarette smuggling.] [44]

    2005 He appears to have still been writing in support of the tobacco industry. This article is referenced: R.Andrew Luccasen & R. Morris Coats & G. Karahan, 2005. "Cigarette smuggling mitigates the public health benefits of cigarette taxes," Applied Economics Letters, Taylor and Francis Journals, vol. 12(12),