728 x 90
728 x 90
728 x 90
728 x 90
728 x 90

Private Money Buys Public Influence

Opinion Editorial
February 1, 2000

By Linda Gorman

What do you call it when the executive branch of state government accepts millions of dollars in private money from an extraordinarily wealthy private group? Especially when the private group advertises that it wants to use its wealth to affect state policy on a hotly contested public policy issue?

Suppose the private group partially funds the salaries of people hired by the state as long as they work on projects to “study” the private group’s policy proposals. It provides “technical” support, trips for executive members of the department, contributions to departmental overhead costs, and equipment the department wishes to buy.

The group operates several projects at once and renews them about every two years. The state department must meet specific goals and file quarterly progress reports. To keep their paychecks coming, the group’s “state employees” work hard to keep it happy. They create lobbying coalitions led by the state and “educate” legislators. If a project fails to meet its goals, its support is cut. Those remaining continue championing the private group’s programs.

To support their efforts, the private group provides a clearing house for information from identical programs it is sponsoring in other states and in the federal government. It provides “technical advice” on a number of subjects, funds “independent” research on the outcomes it wants, and pays experts to advise on how best to mold public opinion on political issues.

It identifies the pressure groups that will gain if its policy is adopted and contributes lavishly to both their national organizations and their Colorado chapters. It identifies sympathetic experts at state schools and funds their research. It backs efforts to change the curricula at state schools.

When the state department is filling critical staff positions, it recommends “qualified” people.

When a “study” is complete and the public relations machine is ready to go, the private group produces a piece of carefully crafted model legislation. “Educated” legislators, with the backing of the state department, present the program as Colorado’s own. Because the people funded by the private group are now the experts on the proposed program, they know that they will be hired to run it when it moves from the study stage to the implementation phase.

Boring and vague, the legislation is designed to raise no alarms in a legislator’s mind and the people from the state department claim that they want only to serve the people of Colorado. They may not even know that this legislation is just one piece of a 10 year program designed to covertly implement a policy that was soundly rejected by the people of the state years ago. That the programs they are working on have resulted in unmitigated disasters when implemented in other places is not mentioned. The private group, like other lobbyists, does not feature those results in its informational offerings.

The legislation passes. It includes a clause authorizing the state department to accept more private money. A public/private “partnership,” this is hailed as taxpayer relief. Funds roll in for another “study,” the department hires some more people friendly to the cause, and the cycle begins again.

You call this corruption? The state of Colorado calls it formulating health care policy.

Since 1992, the state’s executive branch, with legislative blessing, has accepted more than $4.5 million in health care policy grants from an exceedingly wealthy private group called the Robert Wood Johnson Foundation. In 1997, the Foundation had $6.7 billion in assets, including large chunks of health care giant Johnson & Johnson’s common stock. In 1995 it was Johnson & Johnson’s largest known stockholder with 6.5% of the total.[1]

Robert Wood Johnson is anything but neutral on health care policy. Its president, Steven A. Schroeder M.D., admires the government controlled European health care systems and distrusts individuals. One cannot, he writes, “just put the data out there and assume that people will make the right choice.” He baldly states that “[t]he key to public/private partnerships is to induce the private sector to play on terms that are acceptable to the public sector,”[2] and he deploys the Foundation’s assets to create the “strong incentivesfinancial or political[that are] needed to force cooperation on what were otherwise competing and successful institutions”[3]

He gets results. House Bill 1023, benignly authorizes extending the state infant immunization tracking program to all children under 18.[4] Without doing much to improve children’s health, this bill lays the groundwork for creating individual dossiers on each of them. The idea is to create “a comprehensive system [that] could target at-risk populations.[5]” The Robert Wood Johnson types in state health departments define “at-risk” broadly. Gun owners, smokers, drinkers, the overweight, people with contrary religious convictions, those who think this kind of information is none of the government’s business, and other undesirables had better watch out.


[1] The Johnson & Johnson web site as of 22 February 1999 was the source for a figure of 1,345.1 million Johnson & Johnson net shares outstanding in 1997 (http://www.jnj.com/news_finance/fp_fh_cstock.html). The source for Robert Wood Johnson assets and stock ownership was the Robert Wood Johnson Foundation 1997 Annual Report as posted on the internet on 9/28/98. See www.rwjf.org/ann97/annual.htm. The amount owned divided by the total outstanding is 4.97%. When a single entity owns 5% of the outstanding shares of a public company the Securities and Exchange Commission requires that it file a schedule 13D disclosing beneficial ownership.
[2] Steven A. Schroeder, M.D. Summer 1992. “Grantwatch,” Health Affairs, pp. 187, 212-218.
[3] Steven A. Schroeder, M.D. Summer 1992. “Grantwatch,” Health Affairs, p. 183.
[4] The text of HB 1023 was available at http://www.leg.state.co.us/pubhome.nsf as of 27 January 2000.
[5] Statement of Susan Abernathy, Program Analyst for the National Immunization Program at the Centers for Disease Control. Meeting of the National Committee on Vital and Health Statistics. February 3-4, 1999. Washington, D.C. p. 24. http://aspe.os.dhhs.gov/NCVHS/000203mn.htm as of January 26, 2000.

Linda Gorman is a Senior Fellow with the Independence Institute, a free-market think tank in Golden, Colorado, https://i2i.org. This article originally appeared in the Colorado Daily (Boulder), for which Linda Gorman is a regular columnist.

This article, from the Independence Institute staff, fellows and research network, is offered for your use at no charge. Independence Feature Syndicate articles are published for educational purposes only, and the authors speak for themselves. Nothing written here is to be construed as necessarily representing the views of the Independence Institute or as an attempt to influence any election or legislative action.

Please send comments to Editorial Coordinator, Independence Institute, 14142 Denver West Pkwy., suite 185, Golden, CO 80401 Phone 303-279-6536 (fax) 303-279-4176 (email)webmngr@i2i.org

Copyright 1999 Independence Institute