Lies, Incorporated: The World of Post-Truth Politics

Ari Rabin-Havt and Media Matters for America

Lies, Incorporated

Ari Rabin-Havt is host of The Agenda, a national radio show airing Monday through Friday on SiriusXM. His writing has been featured in USA Today, The New Republic, The Nation, The New York Observer, Salon, and The American Prospect, and he has appeared on MSNBC, CNBC, Al Jazeera, and HuffPost Live.

Along with David Brock, he coauthored The Fox Effect: How Roger Ailes Turned a Network into a Propaganda Machine and The Benghazi Hoax. He previously served as executive vice president of Media Matters for America and as an adviser to Senate Democratic Leader Harry Reid and former vice president Al Gore.

Media Matters for America is a Web-based, not-for-profit, progressive research and information center dedicated to comprehensively monitoring, analyzing, and correcting conservative misinformation in the U.S. media.

ALSO AVAILABLE FROM ANCHOR BOOKS

Free Ride: John McCain and the Media by David Brock and Paul Waldman

The Fox Effect: How Roger Ailes Turned a Network into a Propaganda Machine by David Brock, Ari Rabin-Havt, and Media Matters for America

AN ANCHOR BOOKS ORIGINAL, APRIL 2016

Copyright © 2016 by Ari Rabin-Havt and Media Matters for America

All rights reserved. Published in the United States by Anchor Books, a division of Penguin Random House LLC, New York, and distributed in Canada by Random House of Canada, a division of Penguin Random House Canada Limited, Toronto.

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Reinhart-Rogoff chart on this page created by Jared Bernstein for jaredbernsteinblog.com. Reprinted by permission of Jared Bernstein.

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Contents

Cover

Ari Rabin-Havt and Media Matters for America

Also Available from Anchor Books

Title Page

Copyright

Epigraph

Preface: Liar

Introduction: Lies, Incorporated

Chapter 1: The Birth of Lies, Incorporated: Tobacco

Chapter 2: Tobacco’s Sequel: Climate Change

Chapter 3: Lie Panel: Health Care

Chapter 4: Growth in a Time of Lies: Debt

Chapter 5: On the Border of Truth: Immigration Reform

Chapter 6: Two Dangerous Weapons: Guns and Lies

Chapter 7: One Lie, One Vote: Voter I.D. Laws

Chapter 8: Shut That Whole Lie Down: Abortion

Chapter 9: A Lie’s Last Gasp: Gay Marriage

Chapter 10: Defeating Lies, Incorporated

Notes

Acknowledgments

Lie \´lī\

1: to make an untrue statement with intent to deceive

2: to create a false or misleading impression

Merriam-Webster’s Dictionary

Politicians lie. This behavior is not the monopoly of any political party or ideology. They lie about their personal lives, their aberrant behavior, and their records. This book is not about those lies.

The types of lies this book is concerned with are the ones many politicians fully believe to be true—ones that have been passed to them by a staffer, a constituent, or a lobbyist. Those lies, sometimes repeated without intent, are designed to distort the policy-making process. Dig deep enough and you find an industry dedicated to the creation of lies and a group of people who profit from them.

They are Lies, Incorporated.

Preface: Liar

R ichard Berman is a liar.

He is a man who manipulates the truth on behalf of corporate clients and earns his living profiting from the invention and trafficking of lies. The fast-food industry, tobacco companies, and high-fructose corn syrup producers have all called upon him to do what few others would: shamelessly spread falsehoods, smear the reputations of well-regarded nonprofit groups, and purchase phony research.

For decades, when industries decided their last resort was the nastiest of PR campaigns, they have summoned him. Berman, who relishes the title of Dr. Evil,¹ is not just an operator for sale to the highest bidder. He is the purest representation of a growing force in American politics that creates and disseminates lies designed to disrupt the public policy process for monetary and ideological gain.

With a shield of anonymity provided by the tax code, Berman’s donors use him to engage in a form of asymmetric public policy warfare.² For example, when agricultural interests sought to retaliate against the Humane Society for their advocacy work against factory farms, Berman launched a series of attacks against the organization. The companies funding this effort would never want their names associated with such a campaign. Attacking a popular organization like the Humane Society would damage their brands. Instead, Berman created a tax-exempt organization, HumaneWatch.org, to which they could anonymously donate and from which he would be paid a fee to manage.

In addition to running its website, which promotes daily smears of the Humane Society and spreads false information about their work, Berman has produced ads targeting the group. One particularly misleading commercial aired during the 2013 Academy Awards compared the Humane Society to the notorious Ponzi scheme operated by Bernie Madoff. The ad charged HSUS gives less than one percent of its massive donations to local pet shelters but has socked away $17 million in its own pension fund.³ This attack was misleading at best. Every year the organization cares for hundreds of thousands of animals through a variety of its programs⁴; in 2014, programmatic expenses made up 80 percent of the year’s overall revenue and support.⁵

Berman is something of a caricature of the unprincipled lobbyist, the apotheosis of all that is wrong with Washington. It’s a notoriety he enjoys. Whether appearing as a guest on The Colbert Report or defending his exploits on The Rachel Maddow Show, Berman oddly seems to relish being berated for making outrageous claims on behalf of his undisclosed clients,⁶ ⁷ such as pregnant women should not worry about mercury levels in fish.

When Richard Berman appeared with Fox Business’s host Stuart Varney in July 2013 to discuss low-wage worker strikes taking place in cities across the country and their potential for negatively impacting workers, he was identified as being from the innocuous-sounding EPI—Employment Policies Institute. At fifteen dollars an hour, many, I won’t say a majority, but many fast-food restaurants are out of business, he told Varney.⁸ EPI’s funding from the fast-food industry or its connections to Berman’s consulting business was never disclosed.

The New York Times called Berman’s work on behalf of the fast-food industry a critical element in the lobbying campaign against the increase in the minimum wage, noting that industry insiders often cite the [EPI’s] reports, creating the Washington echo chamber effect that is so coveted by industry lobbyists.⁹ This is a form of media manipulation mastered by Berman: a 2013 IRS filing from the Employment Policies Institute reports the organization’s media outreach resulted in over 830 stories on radio, TV, in print, and online in that year alone.¹⁰

The brilliance of Berman’s strategy of creating front organizations is that reporters are often duped into quoting him (or his staff) not as an industry-funded lobbyist, but as the conservative, yet financially disinterested, head of a nonprofit.

When The Wall Street Journal covered an EPI-funded study on the impact of increasing the minimum wage, it referred to the organization as a right-leaning think tank and quoted the study’s author as saying, There’s never a good time to raise the minimum wage.¹¹ Yet the paper did not disclose that the Employment Policies Institute receives its funding from the fast-food industry, nor did it justify the vast overstatement of calling the group a think tank.

For one, the Employment Policies Institute has zero full-time employees. On its 2013 IRS Form 990, the group reported that $1.044 million of its $2.131 million budget was paid directly to Richard Berman’s firm for management, advertising, research, and accounting. Meanwhile, the organization’s lack of staff was evidenced by the fact that their total payroll for the year was $46,417, all of which save $3,500 was listed as a fund-raising expense. Furthermore, $20,175 of this total was paid to Richard Berman personally.¹² Meanwhile, EPI’s staff list on the same form includes just eight positions: six people each holding the title of Director, all paid $500 for less than fifteen minutes of work per week; one Secretary/Treasurer, who was paid $500 for less than twenty minutes of work per week; and Richard Berman, the President / Executive Director, who, as previously mentioned, was paid $20,175 for less than nine hours of work per week. Of the total $46,417 in payroll expenses, just $3,500 was spent on management and general expenses (the amount paid to the Directors and Secretary/Treasurer).¹³ The Employment Policies Institute exists as nothing more than a vessel to funnel money to Berman’s firm, revealing his greatest achievement: the way he so effectively blurs the lines between political operatives, corporate lobbyists, and the think tank world, sowing confusion on behalf of his clients.

Richard Berman keeps his clients and their goals well hidden.¹⁴ He has front groups layered upon front groups layered upon front groups—many, if not all, sharing the same office space. Berman heads up the larger organizations, which then develop smaller projects, which then create more small projects. The only way to truly get to the bottom of who leads and funds these organizations is to sift through hundreds of pages of IRS filings, and even then the information is murky at best.

Here are some of Berman’s groups:

Berman and Company

President: Richard Berman¹⁵

Center for Organizational Research and Education (CORE)

President and Executive Director: Richard Berman¹⁶

CORE Projects:¹⁷

Environmental Policy Alliance (EPA)

EPA Projects:¹⁸

Big Green Radicals¹⁹

EPA Facts²⁰

Green Decoys²¹

LEED Exposed²²

Center for Consumer Freedom (CCF)

CCF Projects:

HumaneWatch.org²³

HumaneWatch.org Projects:

Maternity Pens²⁴

PETA Kills Animals²⁵

Prop 65 Scam²⁶

Center for Accountability in Science²⁷

Activist Facts²⁸

CREW Exposed²⁹

Humane Society for Shelter Pets³⁰

Employment Policies Institute (EPI)

President and Executive Director: Richard Berman³¹

EPI Projects:³²

MinimumWage.com³³

TippedWage.com³⁴

Bad Idea New Jersey³⁵

Bad Idea California³⁶

Interstate Policy Alliance³⁷

Econ4U.org³⁸

Rethink Reform³⁹

Defeat the Debt⁴⁰

American Beverage Institute (ABI)

President, General Counsel, and Director: Richard Berman⁴¹

ABI Projects:⁴²

InterlockFacts.com⁴³

NoDrinkTax.com⁴⁴

ResponsibleLimits.com⁴⁵

NegligentDriving.com⁴⁶

The New Prohibition⁴⁷

Center for Union Facts (CUF)⁴⁸

President and Executive Director: Richard Berman⁴⁹

CUF Projects:

Teachers Union Exposed⁵⁰

DC Teachers Union Exposed⁵¹

AFTFacts.com⁵²

EmployeeRightsAct.com⁵³

WorkerCenters.com⁵⁴

ProtectingBadTeachers.com⁵⁵

SEIUExposed.com⁵⁶

LaborPains.org (blog)⁵⁷

Enterprise Freedom Action Committee⁵⁸

President and Executive Director: Richard Berman⁵⁹

For each of these groups, the goal is often not simply to advocate for their point of view. As Berman explained during a surreptitiously recorded speech to a room of industry executives gathered at the Western Energy Alliance conference in June 2014, he works to confuse the public so they don’t know who to believe, putting them and the policy makers they represent in a position of ideological paralysis.⁶⁰

After graduating from William & Mary Law School, Berman began his career as a labor lawyer, working on behalf of Bethlehem Steel. He then joined the U.S. Chamber of Commerce in the early 1970s, before moving into the restaurant industry, working for the Steak and Ale chain. He later did a stint as executive vice president of the Pillsbury Restaurant Group, which at the time owned Burger King, before founding his public affairs firm.

One of Berman’s early clients was tobacco giant Philip Morris, which contributed $600,000 toward the creation of a front group known as the Guest Choice Network⁶¹ to fight the growing effort to ban smoking in restaurants.⁶² In the 1990s, restaurants were already taking steps to ban smoking on their premises. As the CEO of one company wrote Berman, I have found that the majority of our guests (in some cases as high as 80%) do not want smoking in the dining rooms.⁶³

Guest Choice Network, which Berman ultimately renamed the Center for Consumer Freedom, sought to fight this trend by creating a proactive aggressive mentality by [restaurant] operators in opposition to government smoking bans.⁶⁴ Berman laid out his strategy in a letter to Barbara Trach, a senior program manager for public affairs at Philip Morris, noting that working to appear driven by restaurant interests and obfuscating the tobacco company’s role would allow for more flexibility and creativity.⁶⁵

In 1991, Berman founded the American Beverage Institute. On behalf of restaurant chains, the group set out to fight against laws that aimed to reduce drinking and driving. As part of this mission, Berman targeted Mothers Against Drunk Driving, a wildly popular organization that has successfully fought to lower the legal alcohol limit.⁶⁶

Berman has spent his career fighting for corporations at the expense of individuals but still told The New York Times that he get[s] upset when people say we are putting out junk science and twisted economics.⁶⁷ In fact, that is exactly what his organizations do, as evidenced by emails unearthed as part of a lawsuit between sugar companies and makers of high-fructose corn syrup.

David Martosko, then a staffer at Berman’s Center for Consumer Freedom, volunteered to bury the data for the high-fructose corn syrup makers if a study Berman and Company proposed did not deliver the funders’ desired results.⁶⁸ This is not the behavior of an organization out to discover the truth—it is the work of a corporate front group more concerned with advancing its financial interests and a predetermined agenda.

Perhaps the most scathing critique of Berman’s behavior came from his son David Berman, the former lead singer of the indie rock band Silver Jews. His father’s identity was a secret, he wrote, worse than suicide, worse than crack addiction.

David Berman went on: You might be surprised to know he is famous, for terrible reasons. My father is a despicable man. My father is a sort of human molester. An exploiter. A scoundrel. A world historical motherfucking son of a bitch. David did ask his father to stop but he refused. He has just gotten worse. More evil. More powerful.⁶⁹

Unfortunately, if his son had succeeded and Berman closed up shop, there would be a long line of firms ready to take his place. In the decades since he began his practice, many others have adopted his tactics. Now there is no major public policy debate in Washington, D.C., that is not influenced by false data manufactured and spread by paid political operatives.

If there is a need for research to be manufactured, a fact massaged, or lies promulgated, Berman is the man to call. In a town full of people willing to sell their souls to corporations, he is the public policy process’s proudest and most joyful mercenary. In his speech to energy executives, Berman was transparent about his philosophy: I’ve had clients say to me, ‘Well you know, I don’t really want to attack, that’s not who we are.’ I say, ‘Well, you know, you can either win ugly or lose pretty.’ ⁷⁰ This is the clearest expression of both the mind-set and the strategy of Lies, Incorporated.

Introduction: Lies, Incorporated

B y any measure, the National Rifle Association is one of the most politically powerful groups in the United States. In 2013, the organization spent $3.4 million lobbying, hiring nine outside firms to assist in their efforts. ¹ This followed a 2012 cycle during which the NRA spent nearly $26 million on election-related activities. They made direct contributions to the campaigns of 249 members of the House of Representatives and 11 Senators. Eighty-eight percent of these funds were given to Republican candidates. In addition to these donations, the NRA spent $18 million on negative advertising, primarily attacking President Obama and other Democrats. That year, the organization’s total budget topped $250 million.

But standing in the Rose Garden in April 2013, the president, after losing a critical vote on gun-safety legislation in the Senate proposed in the wake of the Sandy Hook massacre, did not only blame the NRA’s money and lobbying muscle for the bill’s defeat. He told the assembled media the gun lobby and its allies willfully lied about the bill.²

The president was right. The NRA’s falsehoods were a critical component of the effort that undid the attempt to pass gun-safety legislation. This is because lies, along with money and lobbying, constitute three essential elements that distort our policy-making process. Like a barstool of corruption, each of its three legs offers support to groups that fight on behalf of financial or ideological interests. While most conversations about the ills of Washington tend to focus on the other two legs of the stool, the corrosive impact of the third—lies—is often ignored.

Stories about political corruption in Washington often hinge on the simplest explanations and most easily available data: lobbying disclosures, campaign contributions, and independent expenditure reports. This creates a tendency to simplify problems in our political system, whittling down failures of our democracy to unchecked political contributions, bloated lobbying budgets, Super PACs, and other forms of direct and indirect graft. Each of these factors obviously pollutes our political process. Yet focusing solely on them obscures a fundamental truth: our democracy has been hacked, manipulated by political practitioners who recognize that as long as there is no truth, there can be no progress.

Lies have a uniquely corrosive impact on the creation of public policy. At the most basic level, they destroy public trust in our political systems, causing the American people to lose faith in their government. Lies also distract from real debate, bogging down lawmakers and regulators, sometimes for years as settled science is argued over. Finally, lies create balkanization in our political culture, making ideological consensus impossible.

Over the past several decades, corporate and ideological interests have become better at manipulating the press to serve their policy goals. This often means muddying the facts in order to create a political climate where truth no longer exists—or where there are two opposing truths.

These erroneous factual disagreements, taken to their absurd conclusions, corrode public discourse. David Frum, a former speechwriter for George W. Bush, wrote about how conservative extremism limited the right’s ability to win the debate over President Obama’s health care bill: How do you negotiate with somebody who wants to murder your grandmother? Or—more exactly—with somebody whom your voters have been persuaded to believe wants to murder their grandmother?³

In The Fox Effect, David Brock and I detailed how Fox News, under the leadership of Roger Ailes, served as a conduit for conservative lies and propaganda, manipulating the political process on behalf of the Republican Party and right-wing organizations. From outrageous attacks on Barack Obama to falsehoods about every new policy his administration proposed, the breadth of the lies the network spread was astonishing. Yet, as we researched and wrote The Fox Effect, the question consistently arose: Where did these falsehoods originate?

Lies such as the existence of death panels in President Obama’s health care bill, the notion that in-person voter fraud exists and has a significant impact on elections, and the dozens of varieties of climate denial that Fox News broadcasts are not the network’s creation. Lies do not simply appear and take hold. They must be developed, introduced, and nurtured into the public discourse. While Fox News is dangerous because it is the first major television news network in our country to exclusively serve the aims of one political party, it only fertilizes and distributes the lies—it doesn’t create them.

All my research pointed in a single direction: a growing industry that exists to create and disseminate fictitious public policy facts on behalf of business and ideological interests willing to pay for them.

These lies are part of a coordinated, strategic assault designed to hide the truth, confuse the public, and create controversy where none previously existed, with the goal of halting progress. They undermine our most basic democratic ideals by preventing people in government from effectively acting in the interest of the electorate. In recognition of the combination of deception and the for-profit motive, I termed this industry made of lobbyists, PR companies, media lackeys, unethical experts, and unscrupulous think tanks Lies, Incorporated.

Lies, Incorporated is not a singular company or firm. It has no office, no boardroom, and no reception area. Thousands staff it, yet they are among the most loath