Think tanks at risk for corruption

By CHRISTIAN BOURGE, UPI Think Tanks Correspondent

WASHINGTON, Dec. 28 (UPI) -- Steve Clemons, executive vice president of the New America Foundation, is on a crusade against what he views as a dangerous and growing phenomenon: special interests and corporate lobbyists using non-profit think tanks in their efforts to promote their pet policies.

Clemons says think tanks must address the problem before these practices damage the sector's reputation as a reliable source for sound and objective policy analysis.


"As lobbyists' tools of the trade, particularly their ability to court (political) favor with money, have become more and more transparent and regulated, (they have) discovered that think tanks -- also regulated in theory but less so in practice -- constitute a great vehicle to pursue their agendas," Clemons writes in a draft of a soon-to-be-published paper he presented at conference in Paris last month.


The paper, "The Corruption of Think Tanks: The Unintended Consequence of Regulating American Lobbyists," will be published in French by the French Institute for International Relations and the German Marshall Fund. It may also appear in English in the coming months in association with the AEI-Brookings Joint Center on Regulatory Studies.

Clemons told United Press International that the problem often takes on a somewhat benign form of "deep lobbying" when corporations, unions or other interest groups underwrite think tank luncheons, special events, or even simple policy briefings. Congressional staffs are invited to these events, which reflect the view of the funding entity.

He said that, even more damaging to the autonomy of think tanks, special interests also sometimes fund research or policy papers that promote a specific outcome or policy proposal that the funder has requested.

"To allow lobbyist influences to infiltrate the non-profit public policy sector without restraint threatens to undermine the legitimacy of the important role think tanks play in public policy," said Clemons. "The think tank sector is in no way immune to the suspicion and corruption that have recently stricken other segments of American society."

Although hard data is unavailable on how many congressional staffers actually attend lobbyist-backed think tank events, several mid- and high-level Senate and House staffers told UPI that they regularly receive invitations to luncheon briefings and dinner events from the likes of the Heritage Foundation, the Cato Institute, the American Enterprise Institute, and other large and small tanks.


This is not surprising given that one purpose of think tanks is to promote policy debate, but these sources also indicated that at least some of those events had some form of tacitly understood -- but not openly discussed -- backing from a corporate or other interest group.

Yet it is common for think tanks to get their funding from corporate and foundation sources, many of which have some sort of ideological bent. It is logical that such groups give to think tanks that best reflect their priorities. Also, under Internal Revenue Service rules think tanks are allowed to spend up to five percent of their annual resources on lobbying, so what if lobbyists give directly to tanks also?

Robert W. Hahn, director of the American Enterprise Institute-Brookings Joint Center for Regulatory Studies, said that although Clemons has identified a potential problem, the lack of hard data makes him question the extent of the influence of lobbyists on think tanks.

Nevertheless, he said that whatever problem may exist reflects an issue that faces all non-profits.

"I think it is a balancing act that Steve talks about insightfully in his paper," said Hahn. "But you are never going to solve the problem of potential conflicts as long as you have to get funds from somewhere."


Clemons agrees that running a non-profit policy organization is to some extent a Faustian bargain, but he said that an ethical bridge is crossed when think tanks allow themselves to become tools in the lobbying process without being transparent about it.

He cited several anecdotes and personal examples culled from his own experiences at the New America Foundation and in his previous positions at the Nixon Center, the Economic Strategy Institute and on Capitol Hill.

For example, in his paper he details an occurrence at the Economic Policy Institute, a think tank that focuses on macroeconomic policy and also does consultancy work. During a staff discussion on a policy debate in which telecom companies had lined up on opposite sides of the issue, several people suggested that EPI should weigh in on the side of the argument that would generate the most money for to the think tank.

"This story is not unique," said Clemons, "it is commonplace."

One prominent Washington lobbyist and a former official in the Bush and Reagan Administrations told UPI that think tanks, especially smaller ones, are a prime target for lobbying efforts given limited IRS interest in reviewing their practices.

Analysts at the Cato Institute, the Heritage Foundation, the Center for Strategic and International Studies and others think tanks said that although they remain relatively well shielded from the money side of the operation, they have been asked by funding sources, including lobbyists, to do papers with predetermined outcomes supporting the source's position.


Two of the analysts said that while their think tanks refused, they knew that the companies and lobbyists had gone to other tanks and gotten what they wanted.

"There are think tanks, mostly very small, that have been transformed into lobbying shops, there is no doubt," a top official at one conservative think tank told UPI.

Clemons and other analysts believe that most tanks do not start out acting as shills for lobbyists, but that it is nearly impossible for small and financially strapped organizations resist the money involved.

Several tank officials and analysts, who spoke to UPI on the condition of anonymity, said that the Alexis de Tocqueville Institution, a small Arlington, Va.- based think tank that promotes free-market principles, receives a significant portion of its funding from the Microsoft Corp. The sources said that the think tank essentially lobbies in favor of issues important to Microsoft through op-ed pieces and policy briefs by tank officials.

Although no one at de Tocqueville could be reached by deadline, an examination of their Web sites showed that the think tank has taken positions aligned with policies that would clearly benefit the computer software giant.

Think tank analysts also told stories of being asked by a Microsoft lobbyist if it was possible to fund research that supported Microsoft's side in the government's anti-trust case against the firm.


Clemons, along with other think tank analysts, said that small policy institutions such as the Progress and Freedom Foundation and the Economic Strategy Institute are known to do such lobbyist-funded work.

But larger free market-oriented think tanks like the American Enterprise Institute, which have clear ties to corporate America, are tougher to get a handle on, say officials at other tanks. This is partly because they are large enough that they do not need to risk taking a policy stance solely for financial gain.

In addition, their core ideologies typically intersect with the policy goals of corporate America. Some in the think tank world believe this circumstance drives much of their funding. AEI has a policy of not discussing its funding sources.

"AEI is a tough question," said one tank official. "AEI has really cornered the market on industry and regulation research. They address serious questions with typically sound study and research, but always with that slant. This is a subtle niche that simply corrupts a lot of small shops."

What can be done about the problem? Clemons said the major think tanks in Washington need to get together and develop "best practices" policies as a way to self- regulate and avoid any potential problems that could blow up and taint the industry.


"I actually think it is going to get worse across the board," said Clemons, noting that there has been a general decline in giving by foundations and corporations to non-profits.

In addition, he cited the recent ban on so-called soft money political donations to political parties as another potential source of revenue that could develop into a funding conflict problem.

Hahn agreed that the development of best practices for the think tank industry could be a good means to address the problem, but warned that disclosure rules for think tanks would have unintended consequences, like those that developed in the wake of lobbyist restrictions.

"In general I think that transparency is a laudable goal, a good idea even, but I am not sure how far we want to go," said Hahn. "(But) if this is a big enough problem as Steve presents with his anecdotes, then I think people will have to take steps to start eliminating it."

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