Richard Nathan
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Richard Nathan was a Professor of Law, Ohio State University during the 1986-88 period when he worked for the tobacco industry. He was briefly a member of what had been the Cash for Comments Economists Network which was run for the Tobacco Institute by Professor Robert D. Tollison and lobbyist James Savarese with the help of Tollison's wife Anna and the staff from the Center for Study of Public Choice which was located on the grounds of George Mason University.
The Cash for Comment Economists Network had about 170 professors of economics/business/law, and it operated for about ten years between May 1984 and 1993. (One section then shifted to the Independent Institute under William Shughart and Robert Higgs) Savarese and Tollison appear to have formalised their partnership, with Tollison and his wife becoming part of James Savarese & Associates, and they ran a major union/labor operation also, called the Labor Management Committee.
It later became obvious that these secret networks were always being run surreptitiously, as an arms-length operation of Ogilvy & Mather (later Ogilvy Adams & Rinehard) Savarese and Tollison just provided a front so the other recruits weren't fully aware of the degree of manipulation behind the scenes.
In the 1986-88 period the main economists' network also recruited lawyers to counter the threat posed by the New York State Bar Association's (NYSBA) decision to support a ban on tobacco advertising, and also to provide expert witnesses services for the series of Waxman hearings in the House, and similar hearings in the Senate on ETS.
| HOW THE NETWORK WORKED |
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The Cash-for-Comments Economists' Network was run by Savarese through a partnership with Professor Robert D Tollison who used the staff and facilities of the Center for Study of Public Choice at George Mason University to prove cut-out and organisation services. They developed and maintained a network of Economics Professors with at least one on tap in virtually every US state. As one Professor transferred or dropped out (there was a regular turn-over) a new one would be recruited in that State. In all, about 130 university professors were involved in the period 1985-1995, and costs ran to $3 million/year at a time when professor's salaries were in the $30-40,000 pa range. An active network member at a State university could almost double his normal salary. The main focus of the group was to write commissioned op-ed articles on a subject determined by the Tobacco Institute. The draft article would then pass back through the network to TI staff, who were essentially public relations experts. Here they were 'improved' and refined; then sent to the Institute's outside lawyers for vetting. Modified articles then returned to the professor, who would then send them to a designated State newspaper as if they were his 'independent expert opinion'. The professors received a base amount for writing and bonuses for successfully planting the article on the newspaper. Some, but not all, received a small (eg.$1000) annual retainer.[2]] Published papers would also be copied by the professor and sent to his local Federal Representative and Senator (for a further bonus). Sometimes there were special commissions, but generally the work was writing op-eds and LTE's where they were paid just on results (varied from about $700 to $3000 over the years). Network members could also be called upon to provide witness services and promote the cigarette companies' political/economic line at local ordinance or State legislative hearings. An active professor of economics at a State University could almost double his salary with these activities and with some further appearances, for instance, speaking on the importance of cigarettes in economic terms at major economic conferences, etc. |
| Cash for Comments Economists Network & Robert Tollison & James Savarese & Network Document Index |
Documents & Timeline
1986 June: The Anti-smoking Congressman Henry Waxman (D-CA) unexpectedly sprung some hearings on the tobacco industry with only a few week's notice. He planned to inquire into 'Smoking in Public Buildings'.
A major effort was then made to stall the hearings (led by Republican Thomas Bliley of Virginia). Jim Savarese at Ogilvy & Mather was also to recruit a network of academic lawyers in the constituency of the members of the Waxman Committee -- and set them to work writing op-ed articles for their local newspaper and making personal representations to their Congressmen, questioning the Constitutional legality, etc.
1986 June 13 Susan Stuntz, Director of Issues Management at the Tobacco Institute has written to Bob Lewis in charge of Federal Relations re: the Waxman Committee hearings, to restrict smoking in federal buildings. Californian Rep. Henry Waxman was also floating the idea of cigarette advertising bans.
Because of clearance problems, Bob Tollison's study and statement were not available for submission to the Waxman committee until Thursday afternoon, 6/12. Given the now "unofficial" nature of the hearing, should Tollison now go ahead and submit the statement? I query, because if Bliley's strategy is to continue to protest the hearing, he may not want us to submit additional information for an "official" record. Tollison is awaiting instructions from me.
- [Thomas Bliley (R-VA) -- known as "Mr Tobacco" among Congressmen -- was demanding both new hearings, and the classification of Waxman's earlier June hearings as "unofficial". A new "official hearing" date had been set for June 27. [3]
1986 Aug 12 James Savarese writes to Fred Panzer at the Tobacco Institute who has complained that the tobacco industry needs more academic lawyers willing to provide comment in the media in support of the industry, especially on advertising issues. With this new Savarese/Tollison network of business lawyers, they are dealing with Panzer, rather than Peter Sparber and Susan Stuntz.
The idea is to have these academic lawyer promote the tobacco industry's causes by writing op-ed articles for their local newspapers, and acting as 'independent' witnesses at State legislature hearings or local government ordinarnce hearings, etc. Their academic [rather than crass-commercial] status is the important factor. Savarese writes:
There are 19 people on the list, 16 are lawyers and 3 are economists. The three economists are Bob Ekelund in Alabama, Bill Mitchell in Oregon, and James R Kearl in Utah.
We have used both Ekelund and Mitchell on other projects with the Tobacco Institute. We are still having problems with New Jersey but have calls in to several people. I'll let you know as soon as we get someone there. As you can see, the majority of these people are new with the exception of Ekelund, Parkman, and Mitchell. They all understand the issue and will be on call should we need them. [4]
- Professor Ekelund is an expert on the economics of advertising and knows the law.
- Professor Mitchell is a political scientist tuned into the constitution and an expert on first amendment arguments.
- Professor Kearl is probably the only person in Utah who will make these arguments (He was a Mormon with a flexible conscience).
This is an extension of the Cash for Comments Economists Network and it uses some of the same resources provided by George Mason University. Savarese also attaches the annual report from the Public Choice Society and Center for Study of Public Choice at George Mason University. This was Tollison's money-laundry service.
1986 Aug 12 The cash-for-comments academic lawyer network was run by Savarese. It included three economists
enclosed is the academic lawyer list. There are 19 people on the list, 16 are lawyers and 3 are economists.
We are still having problems with New Jersey but have calls in to several people. I'll let you know as soon as we get someone there.
As you can see, the majority of these people are new with the exception of Ekelund, Parkman, and Mitchell. They all understand the issue and will be on call should we need them.
[The two copies of this list of cash-for-comments lawyers have minor differences, probably reflecting the date of recruitment of the academics. See both below.]
- ALABAMA, Professor Robert Ekelund, Dept of Economics, Auburn University [Also economists network]
- CALIFORNIA
- Los Angeles/Southern California -- Professor Donald P Lyden (Woodland Hills, CA) Don is a business law professor at California State University at Northridge
- San Diego -- Lloyd R Cohen, JD. PhD -- California Western School of Law, San Diego.
- COLORADO, Professor John C Ruhnka, University of Colorado, Graduate School of Business Administration, Denver
- FLORIDA, Professor Marvin E Newman -- Rollins College in Winter Park, Clearwater,FL
- ILLINOIS, Professor Randy E Barnett, Illinois Institute of Technology, Chicago-Kent College of Law, Chicago
- IOWA, Professor Paul Lansing -- Department of Industrial Relations, Phillips Hall, University of Iowa
- KANSAS, Professor Douglas Whitman -- University of Kansas School of Business, Lawrence KS
- MARYLAND, Professor John A. Gray -- Loyola College, School of Business and Management, Baltimore,
On vacation until 8/18/86 - MICHIGAN, Professor Steven B Dow-- Michigan State University,Dept of Business Law, East Lansing/Detroit
- MINNESOTA, Dr David A Reese, Gustavus Adoiphus College, St Peter, MN
- NEW JERSEY/Camden/Rutgers, Professor William Clarritt -- Rutgers University, Department of Business and Accounting, Newark, NJ
- NEW MEXICO, Professor Allen Parkman -- School of Management, University of New Mexico, Albuquerque, [Also economists network]
- NEW YORK
- New York City, Anthony Wiener, Professor of Management, Polytechnic University of New York, Brooklyn
Tony will be out of the country during August. He was very enthusiastic about the free speech arguments. Harvard J.D., with strong economic emphasis in his teaching and research. - Rochester, Professor George M Sullivan -- Rochester Institute of Technology, College of Business, Rochester, NY
George would like to see a legal brief on the subject he is arguing.
- New York City, Anthony Wiener, Professor of Management, Polytechnic University of New York, Brooklyn
- OHIO/Cincinnati, Prof Richard Nathan, Ohio State University, Columbus ohio
- OREGON, Professor William Mitchell -- Department of Political Science, University of Oregon, Eugene, [An old recruit for the economists network]
Bill will be in Washington in late August for the American Political Science Association meetings. He would like to go to lunch with us on August 28. - PENNSYLVANIA, Professor John Bagby, State College, PA
John is a business law professor at Penn State, which is about halfway between Pittsburg and Philadelphia. - UTAH/Salt Lake City, Professor James R Kearl -- Department of Economics, Brigham Young University, Provo, UT
Jim is Mormon, so he has a problem with most Tobacco Institute issues; however, he says he would probably be comfortable with a 1st Amendment op-ed on the advertising ban. - TEXAS, D. Bruce Johnsen-- Department of Management, Texas A&M University, College Station, TX [5] [6]
1986 Aug 14 Savarese has recruited his latest academic lawyer in New Jersey, so he sends the complete list along to Fred Panzer -- who sends it to Anne Duffin. He writes a note to her:
Here's the full list of experts -- tailored to your issue -- lawyer/economist or lawyer/business-management. One for each State represented on Waxman committee. [7]
1986 Aug 14 Along with the list of new recruits, Savarese has included a "Fee for developing list of academic lawyers in states with Congressmen on Waxman's subcommittee.
Complete invoice, 18 states, 29 academicians. ... $11,400.00 [8]
| 1986-87 Tobacco Advertising projects |
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| This document explains the background to the hurried recruitment of academic lawyers. 1986 Sep 27: Out of the blue, the New York State Bar Association (NYSBA) enacted by overwhelming voice-vote a resolution to promote the idea that the Congress should ban any form of media advertising of tobacco products. This was the second serious attempt to ban tobacco advertising from the press (first two years earlier). In the same month, columnist Jack Anderson reported that the American Civil Liberties Union ACLU had struck a secret deal with the tobacco industry where the tobacco industry was to pressure its ally, Sen Jesse Helms (R-NC), into dropping his planned amendment outlawing dial-a-porn phone calls in exchange for them offering support for tobacco advertising. The pornography measure which the ACLU opposed, would be attached to a privacy bill protecting citizens from electronic surveillance. In exchange the ACLU would then openly support the tobacco industry's 'Constitutional' right to retain advertising. James Savarese was immediately asked to recruit a number of academic lawyers who would be willing to lend their support in opposition to any advertising bans on 'Constitutional' grounds. This is only one small part of a massive project funded by the tobacco, advertising and publishing interests. It was later developed into a consortium known as the Freedom to Advertise Coalition (FAC). |
1986 Dec 1: An internal Tobacco Institute memo from Anne Duffin says that
The first of what could be multiple 1987 advertising hearings could occur as early as mid-January in the Senate, a week later in the House. Hearings in the House are more likely, however, in February or March, unlikely in the Senate in the near future. But we must explore options quickly and adopt an overall plan.
She anticipates a well-resourced attack on the industry from Reps Waxman and Synar.
TI has neither manpower nor funds to develop and utilize all of the following resources. Nor do I recommend we try to do so. But all should be considered and preparations taken for action, depending on what sorts of restrictions are proposed in coming months,: and by whom:
- American Civil Liberties Union
- Freedom of Expression Foundation
[A think-tank founded by Senator Robert Packwood and run by UCLA Professor Craig Smith- Tobacco lawyers, Covington & Burling, and TI staff are working with a task force of AAAA, AAF and ANA Washington executives [all advertising agency groups] to head off the NYSBA resolution on its way to New Orleans [annual conference] in February and/or win affirmative action from ABA.
- Placement of op-ed page articles and letters to editor by law-oriented professors of business in target cities and states, with judicious distribution of reprints.
Status:
Twenty-plus such professionals have been identified and ready to start. Awaiting ammunition on all-text regulation from Covington & Burling, and draft copy from Ogilvy & Mather, due Dec 15.- Jean Boddewyn, [Baruch College, CUNY] is also working on another possible op-ed piece and C&B's David Remes will investigate editing down Roger Blackwell and/or Scott Ward's Aug 1 testimony for other articles. [The testimony was given at Congressional hearing] [9]
1986 Dec 16: Jim Savarese writes to Anne Duffin at the Tobacco Institute:
Attached are three prototype Op-Editorials that address the advertising issue. I realize that some of the arguments made will not be acceptable, but I wanted to see exactly how far we could push.
In-addition, these prototypes are too lengthy for most newspapers and need to be cutback.
I have also attached a page of quotes from which excerpts can be drawn.
Please let me know how you want to proceed. [10]
- Prototype articles:
