Collision Course: Endless Growth on a Finite Planet (33 page)

The council also acted as the arbiter of the definition of public service and met no obstacle in running the business propaganda campaign under that rubric. In this situation, no attempt at “balance” or “equal time” was considered necessary. As Congressman Benjamin Rosenthal (D-NY) commented:

The Ad Council and the networks have corrupted the original intent of public service time by turning it into a free bonus for the special interests. The Ad Council is a propagandist for business and government … it not only makes sure its own side of the story is told, but the other side isn’t. The public has no meaningful access to the media.
¹⁶

Since public service work was by definition nonpartisan, the council justified the propaganda campaign by arguing that the American public, tragically ignorant of its own economic system, needed “economic education.”

Under the leadership of Barton Cummings, head of Compton Advertising, market research was conducted that “revealed” an ignorance that required remedy. In
Free Market Missionaries
, Sharon Beder assembles questions (with their “correct” answers) from Compton’s nationwide 1976 survey of US public attitudes to the economic system. For example, the approved response to the proposition that “when business profits are up, times are good for more people” was “Agree.”
¹⁷
Although more than 80 percent of the respondents
did
agree on this point and on many others, suggesting that previous “education” efforts had succeeded handsomely, this level of “knowledge” apparently rated as unsatisfactory. Such claims justified the economic education program as public service. In addition to media advertising, the Ad Council distributed “millions of booklets to schools, workplaces, and communities.”
¹⁸
Individual corporations launched their own campaigns alongside the Ad Council, and numerous business coalitions sprang to assist—the US Industrial Council, representing 4,500 companies, ran its own multifaceted media blitz. This avalanche of advocacy for private enterprise, disguised as an educational service to the community, was described in
Fortune
magazine as “a study in gigantism, saturating the media and reaching almost everyone.”
¹⁹

At the same time, corporations also began to fund specific institutions inside existing universities and to withdraw funding with no strings attached. The Joint Council on Economic Education “funnel[ed] money from business to some 155 university centers and 360 school district programs that helped teachers give instruction on the free enterprise economy.” Between 1974 and 1978, corporations endowed more than forty academic centers and chairs of free enterprise in American universities.
²⁰
Business was not only establishing its own dedicated ideological apparatus via think tanks, it was colonizing universities with similar institutions.

Littering the World with Think Tanks

Forerunners

Think tanks were not first invented at this time. Nor were they all dedicated to the ascendancy of radical neoliberalism. The great majority, however, were advocates for private enterprise. One typology of think tanks distinguishes between the “old guard,” founded before the 1970s, and the “new partisan.”
²¹
Many of the old guard, however, were part of precisely the same movement as the later efflorescence. This is particularly true of Anthony Fisher’s Institute of Economic Affairs in London. Other old guard think tanks such as the AEI (US) and the Institute of Public Affairs (Australia) are argued to have been less doctrinaire in their earlier days. Most caught the neoliberal wave in due course, however. Of eighty-three think tanks operating in Australia in the 1990s, only five had any kind of “wet” or leftist leaning, confirming that the great majority were linked to the conservative side of politics.
²²
The AEI was an early US example, organized during World War II by “a partnership of top executives of leading business and financial firms (Bristol-Myers, General Mills, Chemical Bank) and prominent policy intellectuals.”
²³
Its program at this time involved opposing the continuation of government involvement in the economy after the war. The partnership of CEOs and free market theorists that characterized the beginnings of the AEI would prevail throughout the think tank proliferation. Like the new think tanks, the AEI dramatically expanded both its budget and its staff during the 1970s.
²⁴

Aims of Industry
²⁵
was founded by the UK Chairman of Ford in 1942 to foster appreciation of private enterprise in the UK and, after the war, to resist the nationalization of industry and curtail planning by government. Anthony Fisher launched his Institute for Economic Affairs (IEA) in London in 1955, another pioneer think tank predating the 1970s economic crisis and an early outgrowth of the missionary zeal of Hayek’s Mont Pèlerin Society (discussed in chapter 6). Fisher, who funded the venture with the considerable fortune he made from introducing the factory farming of chickens into the UK, was also instrumental in founding the Manhattan Institute, the Pacific Research Institute, the Fraser Institute (Canada), and the Atlas Foundation (1981), committed to “littering” the world with think tanks dedicated to these ideas.
²⁶
Fisher met Hayek just before the first MPS meeting in 1947 and attended his first MPS meeting in 1951. He acted as entrepreneur, giving organizational form to this aspect of the project Hayek sought to initiate.

In Australia, think tanks and libertarian rhetoric were rare before the 1970s, but not entirely unknown. The Institute of Public Affairs (IPA) was founded in 1942 at the instigation of the Victorian Chamber of Manufacturers to “combat socialism”
²⁷
and was an integral part of the conservative side of Australian politics: its branches from both Victoria and New South Wales participated in the conference that gave birth to the Liberal Party in 1944.
²⁸
In 1956 the IPA was urging Australian businesses to fund “economic education” along American lines, and in 1950, W. D. Scott, a prominent accountant and management consultant, claimed that “the system of free enterprise is at stake” and recommended a wide-ranging public relations program that would “educate” the public and sell private enterprise along the lines he had observed in the United States.
²⁹
But it was not until the 1970s that the long-standing US corporate project to naturalize and extend the idea of the free market was ignited in Australia.

“Independence”

While their funding, when revealed, reflected its corporate sources, most think tanks claimed to be “nonpartisan” or “independent.” From the US Ad Council’s emergence in the 1940s to the IPA in Australia today, this self-styled dispassion has always been questionable, since they are almost all linked to the conservative side of local politics and were developed with an explicit propaganda agenda. In Australia, dense interconnections exist between influential think tank operatives and conservative politics; of twenty-three key neoliberals listed by Bette Moore and Gary Carpenter, eleven are members of or staffers for the Liberal Party, Australia’s conservative party.
³⁰
Liberal Party members, including many in senior positions, appear with regularity among their personnel. The political economist Damien Cahill identifies think tank affiliations for thirty-seven free market campaigners from the conservative Coalition, many of them members of parliament (MPs).
³¹

These links are not trumpeted. In the UK, Fisher’s cofounder at the IEA warned back in 1955 that it was “imperative that we should give no indication in our literature that we are working to educate the Public along certain lines which might be interpreted as having a political bias.”
³²
Similarly, in Australia, political connections were concealed. Greg Lindsay himself, the founder of the Centre for Independent Studies (CIS), told the CIS magazine that his Liberal Party allies “were very conscious of my unwillingness to be seen as being involved in party politics and they were careful not to compromise us.”
³³
Their supposed independence helped to qualify many think tanks for the tax exemptions that go with charitable status, as well as giving an appearance of political neutrality. Almost all the free market think tanks worldwide are tax exempt.

The Foundation for Economic Education (FEE), dedicated to “individual economic freedom, private property, limited government and free trade through ‘economic education,’” is, with the AEI, among the earliest of the free market think tanks and provides another US example of corporate origins and influence. Its seven 1946 creators included senior executives from Goodrich, GM, the
New York Times
, ORC, and a former top manager with both the Chamber of Commerce and NAM. Initial funding came from GM, Chrysler, Edison, DuPont, and several oil and steel companies; forty-six corporations had made million-dollar contributions by the end of 1949.
³⁴

The erstwhile workers’ parties in the two-party systems of the English-speaking world have increasingly embraced the business agenda, partly in an alliance similar to that between business and the parties of the Right and partly as a response to the propaganda campaign that engulfed policymaking from the mid-1970s on. Once financial deregulation had taken hold, what Thomas Friedman called the “golden straitjacket” cramped governments’ freedom of movement. Government policies that offended the “electronic herd” of international financial traders and speculators brought swift retribution in the form of flights of capital and credit downgrades from international ratings agencies.
³⁵
The Australian Labor Party pioneered the adoption of the neoliberal program in Australia, though it tried to maintain government regulation in many areas—more than was comfortable from a free market think tank viewpoint. Its senior MPs did not found neoliberal think tanks and only occasionally participated in them. Nonetheless, it laid the groundwork for the Howard government—when the conservative Coalition governed from 1996 to 2007.

At the libertarian extreme, some think tank staffers have defined independence as
freedom from government funding
. Myron Ebell of the Competitive Enterprise Institute (CEI) told John Humphrys on the BBC’s
Today
program that, while “we still have independent scientists in this country [US] … virtually all scientific funding in Europe and Japan and Australia is held directly from government.” According to Ebell, governments are biased, whereas business is “independent.”
³⁶

While the Australian political scientist Diane Stone argues in favor of this putative independence,
³⁷
and most think tanks insist on it, others freely admit their dependence on corporate finance. As one American think tank vice president remarked, “there is no such thing as a disinterested think tanker. Somebody always builds the tank, and it’s usually not Santa Claus or the Tooth Fairy [and] unfortunately, many of these folk are often interested in satisfying the requirements of whoever pays the tab.”
³⁸
The prominent conservative columnist Irving Kristol expressed similar views in a 1977 essay in the
Wall Street Journal
. Kristol confirmed that the funding of think tanks such as the AEI, where he was then a resident scholar, is not and should not be disinterested:

When you give away your stockholders’ money, your philanthropy must serve the longer-term interests of the corporation. Corporate philanthropy should not be, cannot be disinterested.… Most corporations would presumably agree that [any donation] ought to include as one of its goals the survival of the corporation itself.… And this inevitably involves efforts to shape or reshape the climate of public opinion.
³⁹

“Capitalism Fights Back” in Australia: Centre for Independent Studies and Enterprise Australia

The efforts of US and British think tanks reverberated as far away as Australia, where think tank activity escalated in the mid-1970s. In 1976, the IPA helped bring Hayek to Australia for a lecture tour, and Greg Lindsay, dubbed the man who “controls your future” by Diana Bagnall in her
Bulletin
article,
⁴⁰
began building the innocuously named Centre for Independent Studies in a shed in his Sydney backyard. Lindsay was initially inspired by Ayn Rand, in particular the cinematic version of
The Fountainhead
, a classic of American pro-capitalist ideology. Pursuing the trail through Rand, he joined forces with the libertarian Workers Party for a time and began importing books from FEE; in 1975 he traveled to the US to visit relevant think tanks in person.
⁴¹
Lindsay also met Anthony Fisher in 1976 when Fisher visited Australia and began convening meetings and conferences with local academic libertarians and economists. Lindsay attended his first MPS meeting in Hong Kong in 1978, where he met Hayek and Friedman and numerous members of overseas think tanks.
⁴²
The CIS got its first big financial boost—some $40,000 a year for five years—from a group of prominent businessmen led by Hugh Morgan, CEO of Western Mining Corporation.
⁴³
Lindsay was also later assisted financially by Fisher’s UK-based Atlas Foundation. By 2004 the budget of the CIS had grown to $1.55 million.
⁴⁴

Enterprise Australia (EA) was set up in 1976, the same year as the embryonic CIS, and was funded by six major corporations, most of them with links to US-based multinationals.
⁴⁵
It was expected to be “by far the most important group in the propaganda warfare for capitalism,” according to Geoff Allen,
⁴⁶
a lecturer in business administration at Melbourne University who went on to lead the Business Council of Australia when it was formed in 1983.
⁴⁷
EA saw itself as responding to two supposed threats to “free enterprise”: government encroachment and “public misconceptions” about “the size of profits and who benefits.” EA claimed that the main beneficiary was the community rather than the owner of the business.
⁴⁸
Both these concerns had been exacerbated by the election of the first Labor government in over two decades, that of Gough Whitlam (1972–1975), which “shocked Australian capitalism.”
⁴⁹