$1 Billion for Conservative Ideas

$1 Billion for Conservative Ideas

Last year the Heritage Foundation celebrated its twenty-fifth anniversary.

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Last year the Heritage Foundation celebrated its twenty-fifth anniversary. For a progressive think tank, a birthday such as this might have been the occasion for a fancy banquet and perhaps a modest fundraising drive. For Heritage, it was an excuse to mount a massive “Leadership for America Campaign” designed to raise $85 million. This effort yielded more than $40 million in 1998, and Heritage expects easily to bring in the full amount before the end of 1999.

Heritage’s success at filling its coffers is dramatic testament to the growing financial resources available to conservative think tanks in the nineties. These institutions have long been familiar players on the political scene. But in recent years, following the Republican takeover of Congress, the scope of their operations has grown dramatically. This decade has proven to be a boom time like no other.

A recent report that I wrote for the National Committee for Responsive Philanthropy estimates that spending by the top twenty conservative think tanks will likely top $1 billion in the nineties. In 1996 alone, these organizations spent $158 million to develop and disseminate policy ideas–an amount comparable to what the GOP raised in soft-money political donations that year. The $158 million represents a significant increase from 1992, with many organizations more than doubling their budgets over that period. Partial data from 1997 and 1998 suggest that the budgets of conservative think tanks are continuing to grow rapidly.

Much of this money comes from corporations and wealthy businessmen, with conservative think tanks increasingly acting as magnets for special-interest money. More than ever, private-sector leaders see the dividends that come from tax-deductible donations to nonprofit policy groups. These groups put a highbrow spin on the self-interested arguments of corporate America. In effect, gifts to right-wing think tanks have become another form of political campaign donation by those anxious to roll back government regulations, cut corporate taxes and loosen labor laws. Notable examples of this trend in the nineties include the several million dollars that Wall Street firms have given to the Cato Institute and other supporters of Social Security privatization; large donations from telecommunications companies to Citizens for a Sound Economy and like-minded antiregulatory groups that worked hard for passage of the 1996 Telecommunications Act; and the millions that Koch Industries, an energy conglomerate, has given to think tanks working to water down federal environmental laws. This swelling river of private money has allowed the network of conservative think tanks to grow and has enhanced the sophistication of their operations. A number of developments in recent years stand out:

The nineties have seen more than half a dozen new conservative think tanks rise to positions of visibility. These newcomers include such aggressively ideological outfits as the National Center for Policy Analysis, the Reason Foundation and the Competitive Enterprise Institute. Many of these new organizations have doubled or even quadrupled their budgets since 1990. For example, the far-right NCPA’s budget grew from $1.7 million in 1992 to $4.3 million in 1997, making it a major player in the think-tank world. CEI grew from $500,000 in 1990 to $2.5 million in 1996. On issues such as deregulation, Social Security privatization and school vouchers, the smaller think tanks have played an important role in echoing arguments made by the larger institutions and adding a wider array of conservative voices to the national debate.

Conservative policy groups have become ever more sophisticated at waging high-intensity battles over extended periods of time, better coordinating their activities with lobbyists in the private sector, political operatives in Washington, DC, and the states, and activists at the grassroots. Major policy battles in the nineties over telecommunications and healthcare have taught these institutions important lessons and helped them to refine their advocacy operations. Many operate as extraparty organizations, adopting the tactics of the permanent political campaign by incorporating a fundraising arm, a lobbying arm, a policy analysis and development arm, a public relations arm and a grassroots mobilization or constituency development arm. All these tactics have recently been on display in efforts by conservative policy groups to torpedo the Kyoto Protocol on global warming signed in 1997. Bankrolled by heavy industry, these efforts have focused on depicting global warming as “theory, not reality” and exaggerating the economic consequences of curbing carbon dioxide emissions.

Conservative think tanks have poured increasing funds into influencing legislation in Congress. Despite legal restrictions on lobbying, conservative policy institutes have dramatically expanded their visibility on Capitol Hill and have come to work ever more closely with Republican leaders in Congress. The Heritage Foundation in particular has solidified its role as the de facto research arm of the GOP. Through major investments in data-management technology, including the purchase of a Viper 1000 supercomputer, Heritage has become an increasingly important resource for Congressional conservatives, who rely on the organization to provide detailed economic analyses of various legislative proposals. Meanwhile, Heritage’s government relations team keeps in constant contact with key legislators and staff members in Congress, organizes briefings for Congressional officials and often hand-delivers Heritage publications to GOP leaders. Cato, Citizens for a Sound Economy and the Family Research Council have imitated Heritage’s success in walking the fine line between illegal lobbying and nonpartisan policy analysis.

Reducing government intervention in the private sector has always been a central goal of conservative think tanks, and during the nineties deregulation has become even more of a focus. As their budgets have grown, conservative think tanks have been able to branch into new areas of deregulatory activity. In addition to escalating longstanding attacks on environmental and worker-safety regulations, they have recently concentrated fire on federal laws safeguarding the nation’s food and drug supply. For example, in the mid-nineties, the Progress and Freedom Foundation launched a major project aimed at weakening the FDA. Financing this work was at least $400,000 in contributions from drug, biotechnology and medical-device companies.

Following their historic victory in eliminating the federal welfare entitlement, conservative think tanks have begun a vigorous attack on the other main components of the New Deal/Great Society legacy: Medicare and Social Security. Aided by major new infusions of money from the financial services industry, Cato and other conservative think tanks have invested millions of dollars in a sophisticated campaign to privatize Social Security. Among the more influential results of this effort has been the plan put forward last year by the Center for Strategic and International Studies that advocated partial privatization of Social Security along with deep benefit reductions. Meanwhile, other groups like the National Center for Policy Analysis have put enormous resources into developing the Medical Savings Account concept and other ideas for privatizing Medicare. Overall, these efforts reflect stepped-up conservative efforts to do away with universal entitlement programs that have created common cause between the poor and the middle class.

The past few years have seen major new efforts by conservative think tanks to publicize ideas on the Internet. Their Web sites are some of the most extensive and heavily used sites in the entire public policy arena. The National Center for Public Policy Research, an organization with an otherwise low profile, runs an extensive Web site that links together different conservative organizations and bodies of policy analysis. Cato has built a state-of-the-art Web site advocating Social Security privatization. Heritage’s Web site receives 100,000 hits a day and is an electronic octopus that now has more than half a dozen separate sites dealing with various policy issues, a vast archive of publications, a large job bank and links to scores of other organizations. Heritage also collaborates with National Review to fund and manage Town Hall, a venture that U.S. News & World Report called the “premiere website on the right,” and one that was logging 145,000 hits a day in 1997.

Conservative think tanks have also begun new campaigns to influence politics at the state level. Throughout the nineties, conservatives have strengthened a network of more than fifty state-level conservative think tanks; these institutions are now better funded and more sophisticated than ever before. The most visible include the Heartland Institute in Chicago, the Commonwealth Foundation for Public Policy Alternatives in Pennsylvania, the North Carolina Center for Public Policy Research and the Independence Institute in Colorado. Many of these organizations explicitly pattern their operations after Heritage, producing brief and easily digested materials and focusing heavily on marketing. All of them have moved aggressively to take advantage of the “devolution revolution” in the late nineties by pressing conservative ideas for downsizing government at the state level.

Ultimately, it is impossible to measure the exact role that conservative think tanks have played in bringing about the recent rightward shift in American politics. But to those who play or observe the Washington game, on both left and right, their influence is inescapable–and, most agree, it is rising. Most impressive is the way in which conservative policy entrepreneurs have been so skilled and invested so heavily in marketing their grand story of American politics to the media. If national politics can be seen largely as a contest of broad frameworks, there is little question that conservatives have won this game in recent years.

Today, conservative think tanks are well positioned to consolidate and extend their major policy gains. In terms of resources, there is every indication that the vast funding stream that currently supports the conservative policy infrastructure will continue to grow in the early twenty-first century. Meanwhile, there is still no left-of-center parallel to the critical mass of conservative think tanks operating in the United States today. While progressive philanthropists and liberal foundations have greater financial resources overall than their counterparts on the right, they have proven reluctant to invest heavily in the war of ideas. Instead, the lion’s share of these resources are funneled into single-issue advocacy groups and direct-service organizations [see Michael H. Shuman, “Why Do Progressive Foundations Give Too Little to Too Many?” January 12/19, 1998]. New progressive think tanks find it difficult to raise money, and even established ones are invariably underfunded.

It is now beyond dispute that left-of-center funders have made a calamitous strategic blunder by underfunding public intellectuals and policy thinkers. This mistake is profoundly ironic. Who would have ever thought, thirty or forty years ago, that the right would come to believe more deeply in the power of ideas than the left?

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