The Great Think-Tank Bubble

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THINK TANKS FEBRUARY 19, 2013

The Great Think-Tank Bubble Think tank salaries are looking more and more like lobbyist salaries. That's no surprise.

Jim DeMint’s decision last December to leave the Senate to become president of the Heritage Foundation produced a mix of shock and hand-wringing in political circles. The shock involved some possibly quaint thinking about political power: DeMint was abandoning the lofty heights of the Senate—“long considered the pinnacle of power and influence in American politics,” as The Washington Post’s Chris Cillizza put it—to immerse himself in the world of policy research.

The hand-wringing, on the other hand, involved some even more quaint notions about the think tanks at the heart of Washington’s ideas industry. DeMint was not a “serious scholar,” wrote the Post’s conservative blogger, Jennifer Rubin. By making him its leader, she said, Heritage “becomes a political instrument in service of extremism, not a well-respected think tank and source of scholarship.”

Both reactions, though, leave out a crucial component: money. DeMint, who reported virtually no assets on congressional disclosure forms, stood to get a significant raise by moving to Heritage. Outgoing Heritage president Ed Fuelner received nearly $1.2 million in 2011, according to the group’s tax filing. If DeMint gets the same compensation—and one expects he’ll get more—it would amount to a raise of about 700 percent from his $174,000 annual take as a senator.

Once upon a time, the only way for a pol to cash in like that was to leave elected office in order to become a lobbyist—a nice living, but one that carries with it a stigma that would likely kill any future ambitions for high office. By contrast, a gig at Heritage, the main voice of the conservative movement, could be a good launching pad for a potential 2016 presidential bid. Candidate DeMint could run as a man of ideas, not another pol out shilling for his donors.

The problem with that wholesome image—and the anachronistic thing about Rubin's lament over Heritage's potential loss of intellectual virginity—is that think-tanking and lobbying have come to look more and more alike. Just like lobbyists, think tanks can frame policy debates and generate political pressure—for the right price.

Heritage had $109 million in assets in 2002, a figure that has ballooned to $174 million in 2011, according to its tax filings. During the same period its annual fundraising haul (in contributions and grants) climbed from $40 million to more than $65 million. Donors include major companies like Boeing and Chevron and conservative foundations such as the Lynde and Harry Bradley Foundation. In addition to Feulner, at least 19 other officials there cleared $200,000, including former attorney general Ed Meese ($420,000), former congressman Ernest Istook ($303,000), and former labor secretary Elaine Chao ($290,000).

Heritage is hardly the only purportedly scholarly outfit that pays distinctly non-scholarly wages. Think-tank salary escalation, and the glut of donors’ money it represents, spans the political spectrum.

  • The American Enterprise Institute had assets of $155 million and raised $37 million from contributions and grants, up from $40 million and $16 million, respectively, in 2002, according to tax filings. According to its 2012 annual report, AEI gets 39 percent of its funding from foundations and 15 percent from corporations. Arthur Brooks, head of AEI, took in $645,000 in 2011. Meanwhile, AEI’s 2011 tax filing shows Dick Cheney received $210,000 for toiling an average of one hour per week as a board trustee.1 Poor John Bolton, a senior fellow, took in roughly the same as Cheney even though those same tax documents say he spends 60 hours per week on AEI work.
  • The Brookings Institution had assets of $410 million and raised $87 million in contributions and grants. That’s up from $228 million and $15 million in 2002. Strobe Talbott, the former State Department official who heads Brookings, made $476,000. Martin Indyk, the former U.S. diplomat and ambassador to Israel, took home $336,000 for serving as vice president and director of Brookings’s Foreign Policy Program. William Gale, a Brookings tax expert and director of the think tank’s Retirement Security Project, netted $358,000.
  • The Center for Strategic and International Studies had $126 million in assets and raised $48 million in contributions and grants, up from $35 million and $17 million in 2002. President John Hamre, a former deputy secretary of defense, was paid $402,000. Charles Freeman, a former assistant U.S. trade representative for China affairs and currently the think tank’s senior adviser for economic and trade affairs, received a pay package worth $199,000. Frank Verrastro, a former Pennzoil executive and White House energy policy staffer who chairs the Energy and Geopolitics program at CSIS, took in $195,000.
  • The Center for American Progress, Heritage’s liberal counterpart, had assets of more than $44 million in 2011 (the date of its last available filing), five times more than when it opened its doors in 2003. Contributions soared after Barack Obama won the White House; in 2011 alone, CAP took in $34 million. In 2010, its affiliated advocacy organization, the CAP Action Fund, reported assets of $5.7 million and contributions of $9.4 million. John Podesta, the former chief of staff to President Clinton who ran the first Obama transition, netted at least $270,000 in 2011, when he was CAP’s president. (He is now the organization's chair.)

 

There are plenty of well-respected scholars at prominent Beltway think-tank positions. But supporting such large organizations requires the same ceaseless fundraising that politicians conduct when running for reelection—and the same sort of ignoble temptations. “Things have to be paid for, I respect that,” one former think tank staffer, who quit his job in disgust due to the intellectual horse-trading he observed, told me. “But at some point it becomes hard to turn down money from [big donors] and then it becomes hard not to do their bidding.”

Think tanks prefer to get general funding that they can use however they like. Donors, though, want measurable impact and are increasingly inclined to offer short-term funding earmarked for specific projects. Even centrist, mainstream organizations use the ability to target and influence policymakers as a way to entice donors. For example, a CSIS pitch to donors says the think tank is “in a unique position to bring together leaders of both the public and private sectors in small, often off-the-record meetings to build consensus around important policy issues.”

Nowadays if donors don’t like the results they get, they are increasingly inclined to move their money to more compliant think tanks, or to more expressly political operations. “Think tanks are competing with consulting firms, law firms, Super PACS, lobbyists and advocacy groups,” says James McGann, director of the Think Tanks and Civil Societies Program at the University of Pennsylvania. “That puts pressure on think tanks to be more responsive to donors.” The new buzz term among private and public donors is “high impact philanthropy,” McCann says.

“Think tanks have become more like PR and lobbying shops than research organizations,” says Steve Clemons, a former executive vice president at the New America Foundation. “That they’re lesser regulated than lobbyists makes them especially attractive to some funders.”

Intellectual promiscuity, of course, doesn’t just happen because a donor wants to steer research in some particular direction. The more partisan outfits, like Heritage and CAP, display high a degree of deference to political allies (a group that often overlaps with financial patrons).

When George W. Bush was president, CAP tended to view U.S. involvement in Afghanistan as a bungled failure and the war in Iraq as a neoconservative-spawned debacle. It became far more supportive after Obama took office, saying in 2011, for example, that “the United States military has achieved security gains in parts of Afghanistan, and the intelligence community has been relentless in its disruption of the Al Qaeda terror network.” One former CAP staffer told me, “People there want to be good Democrats. They are very cautious about being out of step with Obama. It might occasionally happen, but it’s not done lightly.”

“Our policy formation and analysis is independent, and we have advocated and will continue to advocate for ideas and policies that create progress for millions of Americans,” Andrea Purse, a CAP spokeswoman, said when asked if the think tank’s close relationship with the Democrats impacted its research. "We advance these ideas, no matter who is in power."

The end result of all this has been a general degradation of think tank research. Bruce Bartlett, who was fired from the conservative National Center for Policy Analysis after writing a book critical of George W. Bush’s policies, says much think tank scholarship today is akin to market research. “You don’t study data to see what position you should take, because you know your position in advance,” he says. “Now you do research to help better advocate for your position and identify constituencies that you can target and bring along. It’s like P&G studying the coffee market to see if it can come up with a new niche brand and take a few customers away from the competition.”

DeMint acknowledged as much in discussing his move to Heritage. “We must take our case to the people ourselves, and we must start where all good marketing starts: with research,” he wrote in a Post op-ed. “We need to test the market and our message to communicate more effectively.”

And he’s right: Political messages do need testing and tweaking in order to be more effective. But that’s a job for well-paid market-research types—DeMint’s avocation before entering politics—rather than humble scholars. Anyone confused as to which category describes large chunks of Washington’s think-tank output need only to look at their payrolls.

Ken Silverstein is a fellow at the Edmond J. Safra Center for Ethics at Harvard University and a contributing editor to Harper’s.

 

Center for American Progress President Neera Tanden has responded to this story here.  

 

 

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posted in: jim demint, heritage foundation, brookings institution, jennifer rubin, center for strategic and international studies, center for american progress, american enterprise institute, dick cheney, john bolton

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1

Judy Mayka, AEI’s director of media relations, told me that that the money reported to Cheney “was for the amount paid to the research assistant who worked on [his] book at AEI. AEI’s arrangement was that they would report the researcher’s salary, benefits, and other associated costs as compensation to Vice President Cheney, and he would pay the taxes on that amount.” This seemed like a curious arrangement, so on February 6 I asked Mayka to confirm that the book in question was “In My Time: A Personal and Political Memoir,” which was written with Cheney’s daughter Liz (and in which he declared that torturing prisoners was "safe, legal, and effective," and specifically endorsed water-boarding). I also asked her for the name of the researcher who got such a princely sum and why the compensation wasn’t paid directly to the researcher. Thus far she has been unable to provide me with a reply. One also wonders why Cheney couldn’t hire a researcher himself since he reportedly received a multi-million dollar advance for the memoir.

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