Thomas J. DiLorenzo

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

Thomas J. DiLorenzo was a Professor of Economics at Loyola College in Maryland and George Mason University who attacked tobacco control researchers in the press. He then moved on to a position as Senior Fellow at the Ludwig von Mises Institute. [1]

DiLorenzo was a minor figure in the Cash for Comments Economists Network run by Robert Tollison out of the libertarian think-tank, the Center for Study of Public Choice at George Mason University. The tobacco industry paid James Savarese and his staff (at James Savarese & Associates) to organise and oversee the operations and keep it at arm's length. This was a Tobacco Institute operation which went on for many years.

Its aim was to keep pressure on Congress and State Assemblies not to increase excise taxes on cigarettes - or to pass legislation that would ban cigarette advertising - and to stop them blocking sales via vending machines (mainly to minors). Because of the ad-ban threat, they had the tacit support of many media outlets in promoting this message. Their input was generally in the form of 1000-1200 word op-eds for a designated newspaper, or a letter to the editor on a subject the Tobacco Institute wanted promoted. They would be paid $700 to $1500 for each piece published, with a bonus if personal letters were sent to two local Congressmen.

 

HOW THE NETWORK WORKED

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

 

In the mid 1990s there appears to have been a break up of the larger network with most of the non-core members joining William Shughart in working through the Independent Institute. Savarese and Tollision, however, continued to work through George Mason University. DiLorenzo served as a research fellow at the Independent Institute and the Capital Research Center, two public policy think tanks that have accepted tobacco industry funding.[3]

Documents & Timelines


1977 Center for Study of American Business (1977) He was a visiting Olin Professor (CSAB). He was also at some time the chairman of the Consumer's Alert (NCC) and a writer for National Review.  


If there are any lingering doubts that these economist knew exactly what they were doing, it should be dispelled by a Tobacco Institute memo of June 3 1987. [4]. This shows that they knew that this work was unethical - that it needed to be done surreptitiously - and that they were working for the Tobacco Institute ... but in a way that was deniable since no formal contracts existed.

Apparently Prof. McMahon has " … reviewed and agreed to "author" an economic impact study on the effects of a smoking bill …"
The writer puts "author" in quotes
... leaving no doubt that the professor was being paid to put his name to a tobacco industry paper.

The same file has an letter from Professor K. Celeste Gaspari, an economist from the University of Vermont. She tells us that:
  • She had been contacted in Sep 1985 by the Center for Study of Public Choice at George Mason Uni (Tollison's think-tank)
  • She was offered an annual retainer of $1000 + paid work for the Tobacco Institute.
  • In 1986 she had been paid the retainer and had written a paper for them.
  • It was now March '87 and her retainer hadn't arrived. She'd complained but still hadn't received the retainer.
  • She has now been asked to do more work, but is on strike until her $1000 annual retainer is paid.

I am very disappointed with the Tobacco Institute's policies on making good on verbal agreements.
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.
I am not interested in working with your group at this time if this is the way you do business.

Sincerely K. Celeste Gaspari

 

1991 April The Political Economy Research Center (PERC) and the National Center for Policy Analysis (NCPA) have a joint task force which reports on "Progressive Environmentalism: A Pro-Human, Pro-Science, Pro-Free Enterprise Agenda for Change,"

[implying that their opponents were anti-human, anti-science and anti-free enterprise]

Cash-for-comments economist Richard L Stroup was the chairman, assisted by NCPA's President & CEO, John C Goodman, a professional lobbyist who worked for the Tobacco Institute. There were 76 Environmental Task Force members (far too many for them to have useful discussions) so this was obviously some "for the record" meeting of cloned minds.

This appears to be at some sort of coordination meeting of ultra-libertarian think-tanks from around the world -- almost all belonging to the Atlas Group network and many of them worked for the tobacco industry. Some of the most interesting perople listed here are:

[5]

[Di Lorenzo was now Director, Center for Economic Education, Universiy of Tennessee at Chattanooga (with JR Clark)]

1993 (late) The Independent Institute received $56,750 from RJR and $21,000 from PM. Thomas J DiLorenzo was also a Senior Fellow at the Capital Research Center (also funded by PM) [6]


1994 the Independent Institute accepted funds from R.J. Reynolds (RJR) specifically to fund anti-tobacco control research by DiLorenzo. He had served often as a research fellow at the Independent Institute [7]


1994 July The infamous Capital Research Center has published a paper in their series "Alternatives in Philanthropy" on "California's Proposition 99: Pork Barrel for Anti-Smoking Groups."

This is a totally mercenary think-tank which specialized in paid advocacy for the tobacco industry which is now accusing Califonian anti-smoking crusaders of pork-barrelling ... because they wanted to renew the 1988 legislation directing cigarette taxes to medical research and health education.

[Almost the perfect psychological definition of 'psychotic projection']

The main article is written by long-term tobacco lobbyist and cash-for-comments economist Thomas DiLorenzo of Loyala College, Baltimore (Now a Senior Fellow at the Capital Research Center, if you buy their pseudo-academic titles). The article is adopted from a longer study entitled Sin Taxes: The Political Control of Incorrect Behavior, to he published later by the Independent Institute in Oakland. California.

The overview of the article says:

In 1988, California voters approved Proposition 99, a "sin tax" on tobacco that has raised some $600 million annually for medical research, anti-smoking education, and other purposes. As this issue goes to print, the California state legislature is reauthorizing the tax, which expired July l. A legislative conference committee is now ironing out differences in how the money should be spent. Thomas J. DiLorenzo examines bow the medical establishment and anti-smoking groups have been fighting over the distribution ofProposition 99-funds "almost from the day [the money] became available," and how revenues are being used in ways that voters never intended.

[8]



1994 Thomas J DiLorenzo and James T Bennett have written a long monograph (or short book) CancerScam: The Diversion of Federal Cancer Funds to Politics. The draft 316 page document is in Philip Morris file and it is an atttack on the anti-smoking activists. [9] One section points to a Philip Morris funded program on the "Bill of Rights" where ..

the only identification with Philip Morris was the company's logo shown at the end of the ad. There was no mention of any product .

The health busybodies were incensed that a tobacco manufacturer was linked, even in a tangential way, with the Bill of Rights (and) the American Cancer Society, "criticized the Philip Morris company for 'appropriating' the Bill of Rights 'to better their public image."

The health nannies appealed to their congressional allies to investigate Philip Morris' involvement with the Bill of Rights.At the hearings, Rep. Thomas A. Luken (D-Ohio) charged that Philip Morris had attempted "to purchase the exclusive use of the Bill of Rights from the National Archives for its own advertising purposes . . . . Philip Morris has paid the modern day equivalent of 30 pieces of silver, $600,000."

See truncated copy


1994 Nov 1 Victoria Hughes, Vice President for Development at the Citizens for a Sound Economy Foundation, has written to Neal M Cohen, the Executive Vice President of APCO & Associates asking for a large donation to aid the CSE in tort-reform lobbying.

[Cohen also ran American Tax Reform Association (ATRA) for Philip Morris]

She had been supported at a recent meeting by CSE executives Paul Beckner, James Gattuso, and Wayne Brough [Brough is a minor cash-for-comments economist from the Uni of Central Florida].

Following up on our discussion, I am writing to outline Phase One of our research and educational efforts and to formally request that APCO underwrite our work with a grant for $63,000.

[She must have known that a PR company doesn't underwrite research programs for ten cents: 'APCO' was a surrogate for 'Philip Morris' which effectively owned the PR company via Arnold & Porter, its boardroom lawfirm.]

As a first phase of CSE Foundation's efforts to educate citizens about abuses in the legal system, we would publish an economic analysis, as part of our Issues and Answers series. The study would frame the current rash of Medicaid litigation as part of an overall trend to redirect the judicial system from contract enforcement and property rights protection toward income redistribution or taxation. The study would also identify the relevant interest groups, assess the impact on taxpayers and consumers, and examine the potential adverse effects on economic activity.

With a working title of "Assaults on the Rule of Law," we would publish the study in late November or early December. Dr Wayne Brough, economist and Director of Research at CSE Foundation, would write the study, which we would distribute to nationally and in targeted states to policymakers, journalists, business and community leaders, and others.

To enhance the impact of this study, CSE Foundation would commission an academician with a law and economics background to author an Issue Analysis. We would commission the study potentially using an expert such as Henry Butler (University of Kansas), Thomas L DiLorenzo (Loyola College of Maryland), James Gwartney (Florida State University), or Richard Wagner (Center for Study of Public Choice at George Mason University), as the author. We would distribute this analysis nationally and in targeted states to policymakers, journalists, business and community leaders, and others.
These are all cash-for-comments economists already working for the tobacco industry. She is actually specifying that the CSE would write op-eds and have their key executives appear on radio and TV -- talk shows, etc. -- to boost any tobacco industry theme. The letter sums up their hypocricy with the statement that the Foundation is tax exempt provided they don't engage in political or commercial activity.]

The donor shall receive no benefits (goods or services) from this contribution in order for it to be fully tax deductible

[10]

1994 Dec 14 David Theroux, President of the Independent Institute writes to Tim Hyde, of RJ Reynolds Tobacco.

As you and I discussed, we greatly appreciate your offer of a tax-deductible contribution of $5,000 toward our completing the study of the federal anti-tobacco campaign, by Professor Thomas DiLorenzo. Please forward the contribution so that we may expedite this work. As we also discussed, if you want to proceed in having Professor DiLorenzo and others brief congressional staff members and/or freshman congresspersons, please advise me when and where you might want to have such a program occur.

[11]

[He probably asked Philip Morris and the Tobacco Institute for matching amounts. These projects were often divided on a 33% each basis between the three major players]



1995 July 15 DiLorenzo who is now working at the Independent Institute is feature in PBS Technopolitics story attacking anti-smoking activist, Stanton Glantz. (Also 1995 Feb 7) Martha Perske, who was active in the smoker's rights movement has sent infomation on Stanton Glantz's grant to Jackie Miller, attacking his NCI grant to study the campaign funding by the tobacco industry. [12]


1995 Aug DiLorenzo was paid $30,000 by R.J. Reynolds to write a book called "CancerScam" denigrating the ASSIST Project, a 17-state national tobacco control program, and "Unhealthy Charities" a book attacking the major voluntary health charities (American Heart Association, American Cancer Society, American Lung Association). Pay request was sent to R.J. Reynolds and payments made to the Atlas Economic Research Foundation.[1]


1995 DiLorenzo has co-authored books funded by tobacco companies with James T. Bennett of George Mason University. In 1995, Bennett and DiLorenzo billed RJR $100,000 [13] to produce a book a called Cancerscam: the diversion of federal cancer funds to politics, that attacked health charities for spending what the authors deemed a disproportionate amount of their income on political advocacy. The authors argued the money should be spent on research instead. The Cancerscam book comported perfectly with a 1993 Philip Morris internal Corporate Affairs plan to work towards constraining health charities by restricting how much of their funds could be spent on research and capping the amount the charities could spend on salaries and lobbying. Bates Page -6028 of the 119 page plan


1995 July: William F Shughart II (U of Mississippi is editing "Taxing Liberty and Other "Sins": Predatory Politics and Taxation" for the Tobacco Institute. It has chapters by:

  • Brenda Yelvington (Professor of Economics, Clemson University)
  • Adam C. Gifford (Professor of Economics, California State University, Northridge)
  • Randall G. Holcombe (Professor of Economics, Florida State University)
  • Dwight R. Lee (Professor of Economics, University of Georgia)
  • Thomas J. DiLorenzo (Professor of Economics, Loyola College in Maryland)
  • Gary M. Anderson (Professor of Economics, California State University, Northridge)
  • Mark Thornton (Professor of Economics, Auburn University)
  • Bruce L. Benson and David W. Rasmussen (Professors of Economics, Florida State U .)
  • Richard E . Wagner (Professor of Economics. George Mason University)
  • Robert B. Ekelund, Jr . and Paula A. Gant (Professors of Economics, Auburn University)
  • Richard K. Vedder (Professor of Economics, Ohio University)
  • Jonathan R Macey (Professor of Law, Cornell University)
  • Bruce Kobayashi (Professor of Law, George Mason University)
  • Donald J. Boudreaux and Adam C. Pritchard (Professors of Law, Clemson University)
  • Gordon Tullock (Professor of Economics and Political Science, Arizona State University)

(The hot-linked names are a roll call of the old Cash for Comments Economists Network)

William Shughart pretends that the book was initiated by the Independent Institute (rather than the tobacco industry):

Hence, when David Theroux of the Independent Institute contacted me to ask whether I might be interested in putting together a volume that would explore the purposes and effects of tax policy in regulating consumption choices, I eagerly accepted. Let me here acknowledge the Independent Institute's financial sponsorship and David Theroux's encouragement along the way.

This draft copy was in Philip Morris files, and it has additions and corrections in handwritten form. For instance "politically incorrect" has been inserted before"products" and "excise" inserted before taxes. "Sin" taxes have been quoted. New chapter titles have been added. [14] [15]



1998 Feb /E Roy Marden who handled gifts in brown paper bags for Philip Morris has created a "Third Party Message Development Contacts List" which has a range of think-tank operators, journalists, and academics who are willing to write pro-tobacco material without mentioning their tobacco connections [third-party = 'independent commentator'], or sometimes allow their names to be used as bylines on articles written by tobacco company staff.

The list often has some comments on their usefulness. The notes on this person says:

Tom DiLorenzo, Professor of Economics, Loyola University (Baltimore) (note: expertise in regulatory issues)

[16]

[Marden maintained the contacts with the major think-tanks and millionairre family foundations. Usually contact with an economist would have gone through James Savarese and the Tobacco Institute.]


2008 /E Advisory Board, Committee for a Constructive Tomorrow [2]


2008 /E Advisory Board, Second Vermont Republic [3]


2009 /E*Columnist, Lewrockwell.com [4]

Books and Publications by Thomas DiLorenzo

  • The Mirage of Sustainable Development, article from The Futurist (Magazine/Journal) September 1, 1993.
  • Unhealthy Charities: Hazardous to Your Health and Wealth (Paperback) by James T. Bennett, Thomas J. Dilorenzo, June 1995, Basic Books.
  • Public Health Profiteering (Hardcover) by James T. Bennett, Thomas J. DiLorenzo, Transaction Publishers, August 2001.

Contact Information

Thomas DiLorenzo
Ludwig von Mises Institute
518 West Magnolia Avenue
Auburn, Alabama 36832-4528
Phone: 334 321-2100


Resources and articles

Related Sourcewatch articles

References

  1. J.T. Bennett, George Mason University This letter sumnarizes our discussion on August 18 regarding our activities during the coming year. Letter. August 31, 1995. 1 page. Bates No. 517118301
  2. Advisory Board, Committee for a Constructive Tomorrow, accessed September 19, 2008.
  3. Advisory Board, Second Vermont Republic, accessed January 5, 2009.
  4. About, Lewrockwell.com, accessed June 24, 2009.

External Sources

Wikipedia Entry includes attacks on Abraham Lincoln and chemical protection.

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