November 15, 2013
Posted by Jane Mayer
In every state in the country, there is at least one ostensibly independent “free-market” think tank that is part of something called the State Policy Network— there are sixty-four in all, ranging from the Pelican Institute, in Louisiana, to the Freedom Foundation, in Washington State. According to a new investigative report by the Center for Media and Democracy, a liberal watchdog group, however, the think tanks are less free actors than a coördinated collection of corporate front groups—branch stores, so to speak—funded and steered by cash from undisclosed conservative and corporate players. Although the think tanks have largely operated under the radar, the cumulative enterprise is impressively large, according to the report. In 2011, the network funnelled seventy-nine million dollars into promoting conservative policies at the state level.
Tracie Sharp, the president of the S.P.N., promptly dismissed the report as “baseless allegations.” She told Politico, “There is no governing organization dictating what free market think tanks research or how they educate the public about good public policy.”
But notes provided to The New Yorker on what was said during the S.P.N.’s recent twenty-first-annual meeting raise doubts about Sharp’s insistence that each of the think tanks is, as she told me, “fiercely independent.” The notes show that, behind closed doors, meeting with some eight hundred people from the affiliated state think tanks, Sharp compared the organization’s model to that of the giant global chain IKEA.
At the annual meeting, which took place in Oklahoma City this past September 24th through 27th, Sharp explained what she called The IKEA Model. She said that it starts with what she described as a “catalogue” showing “what success would look like.” Instead of pictures of furniture arranged in rooms, she said, S.P.N.’s catalogue displays visions of state policy projects that align with the group’s agenda. That agenda includes opposing President Obama’s health-care program and climate-change regulations, reducing union protections and minimum wages, cutting taxes and business regulations, tightening voting restrictions, and privatizing education. “The success we show is you guys,” she told the assembled state members. “Here’s how we win in your state.”
Sharp went on to say that, like IKEA, the central organization would provide “the raw materials,” along with the “services” needed to assemble the products. Rather than acting like passive customers who buy finished products, she wanted each state group to show the enterprise and creativity needed to assemble the parts in their home states. “Pick what you need,” she said, “and customize it for what works best for you.”
During the meeting, Sharp also acknowledged privately to the members that the organization’s often anonymous donors frequently shape the agenda. “The grants are driven by donor intent,” she told the gathered think-tank heads. She added that, often, “the donors have a very specific idea of what they want to happen.” She said that the donors also sometimes determined in which states their money would be spent.
The S.P.N. operates as a tax-exempt nonprofit, allowing it to take tax-deductible contributions that it does not have to publicly disclose. According to the study by the Center for Media and Democracy, the donations include more than a million dollars run through the organizations DonorsTrust and Donors Capital Fund, which serve to erase the donors’ names, operating, as Mother Jones put it, like a “dark-money ATM for the conservative movement.” Numerous wealthy conservative individuals and foundations pass money through those two groups. In addition, according to the Center for Media and Democracy study, corporate donors to the S.P.N. have included many of America’s largest companies, such as Facebook, Microsoft, A.T. & T., Time Warner Cable, Verizon, Philip Morris and Altria Client Services (both subsidiaries of Altria), GlaxoSmithKline, Kraft, and funds from various entities linked to the fossil-fuel billionaires Charles and David Koch. Melissa Cohlmia, the director of corporate communication for Koch Companies Public Sector LLC, told me, “We think State Policy Network is a worthy organization that is focussed on creating more opportunity for everyone, thereby making people’s lives better.”
Asked about the IKEA model and her contention that each state’s think tank was an independent entity, free to pursue its own scholarly research, Sharp answered with a prepared statement. In it, she stressed that “State Policy Network is a 501(c)3 service organization dedicated to providing state-based, free-market think tanks with the academic and management resources required to run a non-profit institution. Because we are legally and practically organized as a service organization (not as a franchise), each of the 64 state-based think tanks is fiercely independent, choosing to manage their staff, pick their own research topics and educate the public on those issues they deem most appropriate for their state.”
The statement went on, “Every think tank, however, rallies around a common belief: the power of free markets and free people to create a healthy, prosperous society. They eschew a top-down DC-centric approach to running peoples’ lives.”
Lisa Graves is the executive director of the Center for Media and Democracy (which discloses many of its own donors, including one grant from the Open Society Institute, funded by the liberal billionaire George Soros). “Perhaps surprisingly, I would agree with Sharp’s analogy that S.P.N. is like an IKEA catalogue, where its state affiliates reproduce the same bad policies across the country,” Graves said, when I reached her in Madison, Wisconsin. Many of these legislative measures “divert Americans’ tax dollars away from our state public institutions and into the coffers of out-of-state, and even out-of-country, for-profit corporations, enriching C.E.O.s and Wall Street speculators at the expense of working families,” she said.
Graves conceded that “Sharp’s claim that the states’ think tanks are independent is true as a legal matter.” Still, she said, “in practical terms, the Center for Media and Democracy has documented how these groups have promoted … carbon-copy claims, identical language, and distorted statistics, differing only through the state label placed at the top of a particular report.” Far from being independent, “they are intensely subservient to the wishes of the most powerful few.” But she did draw one distinction between S.P.N. and IKEA. Because, she contends, the bills that S.P.N. backs divert millions of taxpayer dollars from government to the private sector, “they are hardly cheap.”
Illustration by Tibor Kárpáti.