Globalisation:Cato Institute

History

The Cato institute is a ‘public policy research organization - think tank’ which was founded in 1977 by Edward H. Crane (President and founder) and Charles Koch (Executive Vice President of Koch Industries) . The name Cato Institute was based on the early 18th-century British essays written by John Trenchard and Thomas Gordon under the alias of Cato, where the series of essays were in support of freedom of speech and political liberty. These very principles such as: ‘Individual liberty, limited government, free markets and peace’ ostensibly form the basis of the Cato Institute’s values today however they are not free from criticism from a large array of individuals and groups.

Ideology, Mission and Aims

‘The mission of the Cato Institute is to increase the understanding of public policies based on the principles of limited government, free markets and individual liberty’ . The research conducted in order to achieve these fundamental principles - described as being ‘nonpartisan and independent’- are conducted by many respected scholars and analyst whose work has been published in mainstream media such as: ‘The Wall Street Journal and the Washington post . In terms of Aims, the Cato institute are in pursuit of more lenient approach towards policy regarding environmental issues.

Downsizing the government.org

CATO is a think tank that favour a free market economy and standing in the way of a world which the founders dream of, it would appear to them is the government. A website has been specially set up in these premises of anti government ideology. The website essentially takes legislation and details where cuts can be made and spending can be dropped covering a hand full of areas they consider key and some of which will be looked at in more detail;

Beginning with the agriculture department is heavily criticised for the money going into their funds. For instance there are around 4 million less farmers than there used to be but there is an increase in staff in the department of over 70 thousand. CATO uses these discrepancies within government to show how they are unable to operate properly so there for should be taken away with the control of government altogether implementing an attempt to reform it. This is not the only area which Cato casts judgement over. Cato recognises some of the governments commerce projects but writes negatively on others like local development projects which is seen as a drain to the tax payer and as well as small business subsidizing which would be the first cut under the CATO plans. .The defence budget area can become quite complex as Cato is against war which is not something one would automatically assume from a more right wing think tank as there selves. The reason they are against this is however more because of the drain on the economy and less because of the damage being done to other countries being occupied. .Cato would see all energy budgets cut and privatised. Not surprising from the general Cato line that they see energy management in the hands of business a better equipped to judge as “Federal research subsidies impose a burden on taxpayers, and they can be counter productive if they steer markets away from the most efficient energy solutions.” Although it could also be said that efficient energy solution here means the solutions that make most capital for corporations rather than solutions for society. .Transportation would again be privatized to run more efficiently under business according to the institute as it is seen at the moment as “costly one-size-fits-all regulations imposed on the states.” However when we look at Britain’s transport since it was privatised in the Thatcher years we know house the most expensive and least effective transport system in Europe. Housing department is seen by Cato again as a drain on the American people. Chris Edwards and Tad DeHaven in a report said that housing benefits “encourage dependency on the government, discourage self-improvement, and stifle renewal in city neighbourhoods”. For this to be rectified Edwards believes that there should be no department of housing as privatised companies can make low rate housing to accommodate people.. Surprisingly Edwards in an interview also said the tax he would like to cut is corporate tax which fits perfectly into the CATO way of thinking as the rest of this page divulges. One of Cato's slightly more obvious right wing ideologies is their education proposals which are to shut down the entire education department and take this power to the state level where curriculum and structure is dependent on the state and the parents within the state. Funding to colleges again will be scrapped and left to the individual and charitable organisations. When something is left to privatised areas and taken away from state control there is always a shift towards profit over value and good standards of education. Large proportions of people take loans to pay for education from universities run by businesses. At the moment in America there is already a large move towards privatised education, the Phoenix universities were the founding college in America to privatise this and paints a picture where tuition fees are 3-4 times more expensive than a state college would be creating a much larger proportion of debt for students. Within these universities themselves 20-25% of revenue is spent on advertising and only 10-20% on the actual teaching of students which can raise questions as to where the priorities lie within these institutions. This ejects students into mass amounts of debt where there is very little consideration to how students can pay and debts can roll over figures like sixty thousand dollars because of increasing loan rates meaning the corporation gets bigger and the individual seeking education becomes poorer. Figures like these raises the question as to where exactly CATO ideologically sees education in the future. On an interview in the states Edwards said that the government cannot afford to be involved in the nation’s education . However with something as fundamental as education and its benefits to society and individuals it should be questioned why such an attack is taking place.

People

Directors

The Cato institute is lead by a board of directors, including some key players such as: Founder and President of Cato institute Edward H.Crane; Robert A. Levy (Chairman of the board, Cato Institute); John C. Malone, Chairman Liberty Media Corporation; and David H. Koch (Executive Vice President of Koch Industries).

David Koch - Oil Industry

David Koch once told the National Journal: "My overall concept is to minimize the role of government and to maximize the role of private economy and to maximize personal freedoms " .

From this quotation,David Koch’s beliefs are in line with the Cato Institute, where he is in support of lower corporate as well as personal taxation through privatisation of social security, and deregulation of industries by the government - especially regarding environmental policy. It has also been stated by the Research Centre for Public Integrity that between 1986-1993 the Koch family gave $11 million to the Cato Institute. Koch industries operate three oil refineries based in Alaska, Texas and Minnesota with revenues estimated to be around $100 billion . Interestingly, the Political Economy Research Institute drew up a list of 100 toxic air polluters in March 2010: based on their data Koch Industries was ranked 10th . In another case, Koch Industries was sued by the government in 1995 and 1997 over a reported 300 oil spills at pipelines which were owned and operated by the company. The lawsuits included stringent penalties - from $71 million to $214 million- placed on the company for dumping an estimated three million gallons of oil into lakes and streams in six states . The implication of the past events regarding Koch Industries and David Koch’s close affiliation with the Cato Institute may be lined with personal interests on David Koch’s behalf rather than the common interest of accomplishing individual liberty, free markets and peace.

John C. Malone and Rupert Murdoch - Media Industry

Interestingly, in Autumn of 1997 Rupert Murdoch, President and CEO of News Corporation joined the Cato Institute Board of Directors, where he was described by president of the Institute Edward H Crane as “one of the most successful entrepreneurs in the world, a strong advocate of the free market and a committed civil libertarian” . To loosely sum up Murdoch’s perspective on how business should be conducted Murdoch stated: "I start from a simple principle: in every area of economic activity in which competition is attainable, it is much to be preferred to monopoly." The relationship between Murdoch and fellow board member John C Malone (then president and CEO of Tele-Communications Inc, the largest U.S. Cable operator) had been fostered over the years as both media titans had engaged in many profitable media dealings regarding satellite television, cable TV and program distribution. It was also reported that both Murdoch and Malone helped to run think tanks like the Cato Institute to “actively promote the deregulation of the television and telephone industries" . Some of the main issues that Cato advocated were the privatization of the Internet and communications systems . An example of the libertarian perspective taken was highlighted in 1997, when the Federal Communications Commission’s (FCC) regulation was that TV tations must air at least 3 hours of educational and informational programmes per week. The Cato Institute’s response to this rule was that it extended “government control over the content of broadcasting and endangered the First Amendment.” .

One contrary aspect of Cato’s interest in the deregulation of media networks in America is that Murdoch’s News Corporation profit from federal giveaways where they are able to hold licences worth millions of dollars . Similarly, cable TV corporations such as TCI (Fronted by Malone) are able to expand their services, and in turn their profits, under the protection of federal regulations which limits the power of license fees to be set at a local level . What can be taken away from these findings is that both Murdoch and Malone rely on financial and legislative support from the federal government in order to achieve the aim of media monopolisation upon which Murdoch bases his principles within business.

It can therefore be concluded that the creation of the Cato Institute as a think tank and the heavy funding contributed by major corporations is no real coincidence. Consequently, the reports which are produced by the Institute are frequently quoted and accepted within various News Corporation owned media - such as the Wall Street Journal, the New York Post and Fox News - as being the real expert opinion of the day .

Robert A. Levy - Tobacco Industry

This quotation sums up Levy’s stance on the ongoing issue of 'individual choice vs the tobacco industry responsibility: “After all, cigarettes are legal; the choice to smoke is freely made” There are many links which can be generated from the hub of the Cato Institute - the Board of Directors room. The Cato institute promotes the subjugation of the tobacco industry; however the institute’s connection with organisations within the tobacco industry is seldom mentioned by the media - bearing in mind the institutes already established ties with media giants .

A prime example of how the Cato Institute is involved and at times influenced by those who fund the think tank can be highlighted by Robert .A Levy’s affiliation with giant tobacco company R .J Reynolds. Levy has in the past argued that in the battle against tobacco industries, various states (Florida, Maryland and Vermont) had thwarted established laws- where the tobacco industry could not ‘use assumption of risk’ as a defence- in order to successfully stand against the tobacco industry in a lawsuit. In 1997 he stated on the subject of changes in statute law regarding liability in ‘smoking-related-illnesses that: “The same tobacco company selling the same person the same product that results in the same injury is, magically, liable, not to the smoker but to the state” and that the tobacco industry was being “singled out and demonized for its deep pockets and public image” .

Levy has gone even further to rebuke some of what he describes as the myths about the consequences of smoking tobacco, which he claims have been exaggerated profusely by the Government. His arguments emphasises the role of the dangers related to smoking, as Levy is a non smoker himself and aware of the apparent link to illnesses such as lung cancer. However, he argues that the advertisement of the dangers of smoking has been advertised on the packets of every legally sold pack of cigarettes in the US over the past 35 years, therefore consumers are aware of it: Yet consumers of this product knowingly still smoke. He also adds that smoking a cigarette doesn’t bear the same weight in consequence as would be seen with other intoxicants, such as alcohol and drugs. Finally, Levy adds that smoking doesn’t result in the death of young people: According to him, with the average age of tobacco -related deaths being 72, he states that “Those years lost after 72 are important, but they're not of the same magnitude, as years lost to the young” . A big talking point for Levy was the introduction of the 1998 Tobacco Settlement: where they were to pay a settlement of $370 billion of which Levy claims were used to cover children’s healthcare insurance and anti-smoking campaigns as well as adhering to administrative regulations. In return the tobacco industry would be exempt from punitive damages which arose as a result of past lawsuits .

It is clear that Levy takes a strong stance on the legislative repression of tobacco industries, by the Government. And it should be noted that some of his arguments are not only reflective of the Cato Institute, but various political stances. However what is under scrutiny when analysing his role within the institute is that major tobacco Industries such as Phillip Morris have funded the institute in previous years and others such as R. J Reynolds continue to do so today . It has been reported that between 1995 and 1998 Phillip Morris and R.J Reynolds have made philanthropic contributions in excess of $150,000 . For this reason, it is only necessary to question the impartiality and intention behind campaigning so vigorously for this industry when it is a contributing factor in Levy’s role as a scholar and the running of the Cato Institute as a whole.

Views on climate change and environmental policy

There is a wide range of policy areas where extensive research has been conducted by various scholars, such as: Education; Finance; Foreign Policy; Health; Tax, Trade and Immigration . However, the controversial research produced by Cato’s scholars on the topic of Climate Change and Environmental Policy in particular is one of interest within the topic of today’s globalised world.

Work of Patrick J. Michaels

The Cato Institute has numerous scholars and research projects working on finding out more about climate change. Several articles from Cato scholars have been published on the topic of climate change and global warming, including Patrick J. Michaels, who has written numerous articles outlining in particular why global warming is not as big an issue as the government and global warming scientists assert that it is. In his article “The Global Warming Myth”, published in 2008, Michaels summarised several reasons why global warming is a “myth”. . He challenges Al Gore and his supporters who say that the “science is settled” on global warming, saying that 1998 was the warmest year in modern record, and that there has been no additional global warming. . Michaels bases his opinion on evidence from the work of Noah Keenlyside and his team from the Leipzig Institute of Marine Science. According to their paper, the Earth’s oceans have a natural variability which will “temporarily offset” global warming from carbon dioxide. . The Earth’s surface is 70% oceanic, therefore significantly influences global temperature. “Both Atlantic and Pacific temperatures can get “stuck” for a decade or longer, in relatively warm or cool patterns.” . The North Atlantic is predicted to be stuck in a cold stage for a decade, and Pacific temperature is predicted to not be warm enough – supposedly curbing global warming. .

Michaels also criticised legislative efforts to control climate change, stating, “Science no longer provides justification for any rush to pass drastic global warming legislation”. . He described the Climate Security Act, which aimed to cut emissions of carbon dioxide by 66% over the next 42 years, sponsored by Joe Lieberman and John Warner as “impossible to achieve”, and he called the Interior Department’s intent on naming the polar bear an endangered species as a “political stunt” because they were, according to Michaels, near record-high population levels. . Michaels also refers to the numerous computer-driven projections for 21st century warming, and how none of them show that Earth’s natural climate variability will shut down global warming from carbon dioxide for two decades (which is what has happened). . Michaels basically points out that there is a possibility of an overestimation of the amount of global warming going on. .

Other notable publications relating to climate change

Cato have also published a Handbook for Policy Makers, and section 45 outlines Global Warming and Climate Change. This section of the handbook provides more evidence in how global warming is less of a problem than suspected and then outlines suggestions for congress, including not passing laws restricting the emission of carbon dioxide and report to the public about how such legislative measures would not be beneficial. It states that the technologies needed to succeed in the legislations would not be sufficient, and that there is enough time to develop them, requiring investments. . An example outlined is from 2005 when Congress allowed the accelerated production of ethanol, which, according to critics, would increase carbon dioxide emissions, rather than reduce them, particularly in corn-based ethanol, as well as increase the price of corn, soybeans, rice and wheat. It uses the United Nations’ Intergovernmental Panel on Climate Change records of planetary surface temperature.

The graph included shows two different periods of warming, one from about 1910 to 1945 and another from around 1975 and ends in 1998.

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Statistically, the rates of warming for the two periods are indistinguishable, the warming in the early period is likely to be caused by solar activity, whereas the latter was likely to be caused by human activity as well as natural changes. . The handbook reinforces what Patrick J Michaels said about the history of climate change, and how a large amount of the public are not aware that in the last 11 years there has been no net change in the average surface temperature. .

The handbook also mentions the event of the El Niño warming in 1998, which was the hottest year in the IPCC’s records of the earth’s temperature history of nearly 150 years. The relative temperature was cooled in 1999 and 2000, which is typical after a strong El Niño warming. .

As Michaels also covered, the only means of predicting climate change that scientists and policymakers have are computer models of how the increase of carbon dioxide in the atmosphere could affect the earth’s temperature. According to these computer models, there is no scientifically credible model showing future warming, as there has been a lack of warming since 1998, and there are predictions for little or no warming until the middle of the next decade. .

Criticisms of Patrick J. Michaels

Michaels’ work has of course been subject to criticism, and he has been called a “fraud”. . Michaels has been accused of scandal, after altering the evidence James Hansen gave for his Congressional testimony on global warming in June 1988. .

Hansen said he was highly confident in the arrival of a long-term warming trend, due to the greenhouse effect. He provided a graph which outline three scenarios, bases on different levels of CO2 output. These scenarios were shown to demonstrate the wide range of possibilities of how CO2 forcings would develop, as it is too difficult to gauge how much coal humans will potentially burn. .

10 years later, Hansen updated the graph with the most recent measurements made of temperature, and it was found that his predictions from the original graph were very accurate. (Graph also provided here). . Patrick Michaels also testified in front of Congress, using Hansen’s graph, however he had erased the scenarios B and C, which were considered the two most accurate scenarios. . Michaels’ testimony on the Cato Institute website outlines the reasons why Hansen’s predictions were supposedly “an astounding failure”: the computer models used were inaccurate to what was happening in nature, in terms of the temperature measurement. .

Funding And Support

On the website CATO puts across a very proud acceptance of funding from essentially anything bar the government. One can give to the CATO institute and become not just a supporter but "you become a part of Cato". This would mean that CATO is free to be a non partisan think tank which is entirely independent. Although this is given to be the case on the website it is not necessarily how it is perceived by others elsewhere.

An important case is one of Doug Bandow who was a senior scholar at CATO and who was found to be taking money from Jack Abramoff for writing articles which would favour him. Jack Abramoff was a lobbyist for a top lawyer and lobbying firm in America and is currently in prison for committing fraud against 4 American tribes for millions of dollars. This incident which can be further probed is just one example of discrepancies within a company with such ‘pride’ in independence .

David Koch Foundation

The Cato Institute can be described as being "Libertarian"...In A Corporate Way . In terms of funding, the Cato institute does not receive any government funding. Data shows that the largest proportion of funding for the 2010 fiscal year came from individual contributions (77%), the next largest contribution came from foundations (14%)

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The Institute did receive funding from 2004 - 2006 by the David Koch Charitable Foundation . In US law, charitable foundations such as the David Koch Foundation must perform entirely nonpartisan acts that endorse public welfare. However, a 2004 report by watchdog group National Committee for Responsive Philanthropy described the Kochs’ foundations as being self-serving: These foundations give money to organizations that research and promote anti-environmental regulations issues which potentially profit Koch Industries .

This is evident where in the past, the Koch brothers (David and Charles ) have funded organisations and lobby groups of environmental sceptics such as: The Independent Women’s Forum, which opposes the presentation of global warming as a scientific fact in American public schools and The Heritage Foundation . In 2008, a similar incident occurred which highlighted these biases in action: oil company ExxonMobil gave $50,000 to The Heritage Foundation to publish ‘inaccurate and misleading’ information about climate change. However, the foundation to this day still maintains that: "Growing scientific evidence casts doubt on whether global warming constitutes a threat” .

From the evidence provided, the Cato institute in essence, can be described as ‘a creature of corporations and foundations’ . The criticisms and emerging pattern which can be found when referring to the Cato Institute is that their historic roots are libertarian in origin, yet this is not enough to make a stark differentiation from those of academic or government researchers. In addition to this: “No mention is made of the corporate money that is lavished on them–or the corporate agenda, which is, at heart, their raison d’être’” . This quotation solidifies the argument over the Cato Institute’s impartiality when publishing work which goes against the grain of what mainstream and widely accepted research is saying. Cato claims that they are a non-partisan organisatio:, however it is evident that the amount of funding received from its benefactors alongside the beliefs of those who support the institute form the basis of their professional opinions as an institute .

Patrick J. Michaels

Patrick J Michaels has received more than $115,000 from coal and energy companies, according to Ross Gelbspan (1995 Harpers Magazine author). Michaels is also reputed to have had payments of at least $100,000 from other coal interests, according to the Intermountain Rural Electric Association. Being a Senior Fellow in Environmental Studies with the Cato Institute and a Visiting Scientist with the George C. Marshall Institute, Michael also receives funding from Exxon Mobil and other oil companies. . Michaels, being a senior fellow with the Cato Institute, also receives funding from the Cato Institute for his firm, New Hope Environmental Services, founded in 1994.. New Hope Environmental Services describes itself as a company that “produces cutting-edge research and informed commentary on the nature of climate.” It produces a bi-weekly publication online, World Climate Report, written by research scientists and climatologists, and according to its website it is “the nation’s leading source of breaking news concerning the science and political science of global climate change.”. According to the Cato Institute’s annual returns, since April 2006 they have paid $242,900 to New Hope Environmental Services, as well as possibly funding Michaels’ background research for his 2009 book “Climate of Extremes” (published by the Cato Institute).

Global warming is an issue which causes many debates between groups especially in America, at the fore front of these is the CATO institute which becomes less and less surprising when attention is brought to the main players within the institute. David. E. Koch in particular who is Vice President of Koch industries a large oil company in America. It is here questions are raised as to why the institute give such a focus on global warming and how this can affect the results which are found and displayed by them. In most if not all interviews with Patrick Michaels, a senior fellow in the CATO institute for environmental studies, will be seen to look at global warming as a very minor issue which is over blown by government. This is a man who is the most quoted academic sceptic in the U.S and is largely well known and highly regarded. When we look deeper into Michaels past corruption and deception becomes more apparent. In 2006 Michaels was found to be receiving hundreds of thousands of dollars of donations from Intermountain Rural Electric Association of Sedalia a power company dealing with thousands of customers in the Denver area. At this time a Colorado utility company also organised a donation of one hundred and fifty thousand dollars. Reasons given by the IREA’s general manager was that "we cannot allow the discussion to be monopolized by the alarmists,” The alarmists it would appear to be are those who are showing concern of the increasing temperature of the world and the affect it is having all over, like the melting ice caps and instinction of animals to name but two. This is also the same man who is less interested in affects on global warming and more keeping happy customers by keeping rates low This is just one example which will become one of many on this page but the effect of these financial deals from a falsely proclaimed non partisan group can have a damning affect on the greater picture and a countries opinion and attitude towards global warming.Patrick Michaels has the ability to reach a massive percentage of the population. In 2002 Patrick Michaels gave an interview where he spoke about the ‘myth’ that he believes to be global warming. Patrick Michaels has a lot of passion into attempting to encourage people to disbelieve in what global warming experts say about the problems that exist. This passion is shared by many in the industry who are able to benefit from less attention to global warming and less government regulation. Michaels is the chief editor of a newsletter funded by the Western Fuel Association called “World Climate Review” where he writes extensively on why global warming is such an insignificant problem for America. For this reporting for the association Michaels is paid an undisclosed amount and on top of this he has received another 63,000 for research which will only help corporations lobby for less regulation on their companies. Although these were originally confidential documents it has also came out that 20% of funding has been from other companies as well. For instance forty nine thousand pounds came from the German Coal Industry and a further fifty five thousand pounds combined from Cyprus Minerals Company and Edison Electric Company to allow the research to be taken place which raises serious doubt as to how objective Michael’s can be trusted to be with so much money for his research.Thus meaning that his ideas, especially when portrayed as non partisan findings, give an impression that this is dependable information to the masses. As shown however there is far more to the Cato institute and to Patrick Michaels than a strive for truth.

Concluding Remarks

Cato is essentially a neoliberal think tank that believes in prosperity of big business and reduction of government but it is important to look through what these policies say to the actual reality that they would incur. Free market breeds pure competition and competition always has its winner as well as its losers and the way in which these places are decided can often be unfair and once these classes are set mobility, self discovery and education to better themselves becomes a question of how much money a person has rather one the ability of the individual. The ideology of this institute is apparent even in recent politics with the prospect of an introduction of welfare health care. The uproar which is seen by right wing think tanks like the Cato institute shows the undeniable with even the simplest form of human need. “Cato has been a long time advocate of deregulating the health care industry, so that consumers can afford the health care insurance and treatment of their choice” the reality here however is that not everyone has the opportunity to actually be a consumer and these ideologies completely disregard the population of America and out with America that cannot afford these basic human needs. As the graph given shows 2.5% of America’s wealth is owned by 50% of the population where the top 1% own 33.3% and Cato’s ideology see’s this figure get bigger and more global as when there is free trade among societies smaller societies have much less to bet than bigger players like America which begs the question where people are supposed to accumulate the ability to be “consumers”.

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This again is another example here of privatisation of social issues that is wrong; when privatisation occurs things become about turning over profit instead of delivering a quality service to the human being who needs such services as health care. The Cato Institute do not pick on these fields and almost ignore the fact that business means profit so of course proper care may suffer if it is more ‘cost effective’ to skip corners. Members of the Cato Institute’s board of directors epitomise this point through the interdependence of corporations and think tanks like Cato. Their actions promote what are many features of globalisation: self-interest and widening profit margins, at the expense of ethical considerations. This can also be further highlighted with regards to Cato’s sceptic stance on climate change, when considering the views and research of its scholars such as Patrick J. Michaels. His research is funded by companies who benefit from publications which act as a smokescreen to dominant opinions on climate change; therefore Cato acts as a mouthpiece to those who fund them. It is almost impossible to live in a free market without inequalities and although Cato may think this is a fair system it is not for any one person or group to decide who deserves more quality of life than anyone else. Less government among other things means less accountability to the people and a bigger allowance to business to put welfare and lives behind making a profit to allow the rich to get richer and the poor to get poorer and more exploited.

Contacts

Website: http://www.cato.org/

Sections

• Melvina Robbin - Ideology Mission & Aims, People (Directors, Koch, Murdoch, Levy), Funding and Support: (David. H Koch Foundation)
• Lauren Rodier - Views on Climate Change and Environmental Policy
• Laura Robertson - Downsizing Governement.org, Funding and Support: (Abramoff, Patrick J. Michaels), Concluding Remarks