Pieces of the Puzzle: Tax Foundation and Americans for Prosperity

Back in September, One Wisconsin Now called into serious question the Tax Foundation’€™s claim of being an objective research organization when it was revealed that it was a ‘€œSilver Sponsor’€ of an Americans for Prosperity event. Everyone knows the research coming out of the Tax Foundation is fundamentally conservative, but this was a little much. This suspect sponsorship led OWN down a line of research that would uncover a direct nexus between the Tax Foundation and the Americans for Prosperity.

A couple things to note before we journey down this long trail of connectedness between Americans for Prosperity (AFP) and the Tax Foundation:

First, AFP was founded by Charles G. and David H. Koch and is funded by the charitable arms of Koch Industries, the largest privately held energy company in the U.S..

Second, the precursor to Americans for Prosperity was called the Citizens for a Sound Economy (CSE). In 2003, CSE split into two new organizations, with CSE becoming FreedomWorks, and the CSE Foundation becoming AFP. More on that here and here. Not surprisingly, the two organizations would share a similar pro-corporate agenda and are now at the forefront of the anti-health insurance reform TEA Parties. (Note: to make it easier to follow along, I simply use ‘€œAFP’€ and ‘€œAmericans for Prosperity’€ in place of CSE and Citizens for a Sound Economy.)

The most direct relationship between the Tax Foundation and Americans for Prosperity came about in 1989 when AFP purchased the Tax Foundation. From the Washington Times:

The financially troubled Tax Foundation will cease to exist as an independent entity and its name, publications, library and other assets will be sold to the Citizens for a Sound Economy Foundation, a conservative Washington-based research and education group.

A reconstituted Tax Foundation will operate as a subsidiary of Citizens for a Sound Economy, which said it plans to continue the essential programs of the defunct organization.

[Albert B. Crenshaw, ‘€œResearch Group Buys Troubled Tax Foundation,’€ Washington Post, Oct. 09, 1989]

Documents would subsequently refer to the Tax Foundation as an entity ‘€œwhich operates as a separate unit of Citizens for a Sound Economy Foundation.’€ For example, check out the bottom right-hand corner of page 2 in this Tax Foundation publication.

The relationship is also reflected in tax filing Form 990 filed throughout the 1990s and into the 2000s by both the Tax Foundation and AFP. The documents indicate that the two organizations had shared office space at 1250 H Street, Washington, DC. (In 2002, both organizations moved to 1900 M Street, Washington, DC.) The same documents indicate the two organizations shared ‘€œcertain expenses for office space, personnel and administration.’€

Tax Foundation – Form 990 (1997)
AFP (c)(3) – Form 990 (1997)

Throughout this time, the Tax Foundation and AFP also shared numerous board members and executive directors, including:

Wayne Gable
, a former Tax Foundation executive director (1989-1991) and board member (1991-2008), is a former AFP president and was on the AFP board until 2004. He was also Managing Director of Federal Affairs at Koch Industries is president of two of the three major Koch charitable foundations.

Dan Witt, a former Tax Foundation executive director (1991-1993) was Director of Membership and Director of Privatization and Transportation at AFP before joining the Tax Foundation.

James C. Miller, III, former Ronald Reagan Budget Director, was a longtime board of member of both the Tax Foundation (1989-2001) and AFP (1989-2007).

In 2003, AFP split from CSE and started recording a different address than Tax Foundation. And though the relationship has since remained less apparent, AFP’€™s presence within the Tax Foundation still exists.

Current Tax Foundation President Scott A. Hodge was Director of Tax and Budget Policy at AFP before joining the Tax Foundation as its executive director in 2000. Current Tax Foundation Director of Policy and Communications and publications editor William Ahern worked at AFP before joining the Tax Foundation. Not to mention the aforementioned board members of both organizations.

Two of the three Koch charitable foundations’€” the Charles G. Koch Charitable Foundation and the Claude R. Lambe Charitable Foundation’€”are major funders of the Tax Foundation. Various 990s from Koch charitable foundations corroborate the figures below from Media Matters.

Claude R. Lambe Charitable Foundation to the Tax Foundation:
General Operating support      $125,000      12/31/2007
General Operating support     $100,000     12/31/2006
General Operating Support     $50,000     1/1/2005
General Operating Support     $50,000     1/1/2004
General Operating Support     $50,000     1/1/2003

Charles G. Koch Charitable Foundation to the Tax Foundation:
General Operating Support      $50,000      1/1/2002
General Operating Support     $50,000     1/1/2001

And, as OWN reported in September, the Tax Foundation has continued its work with AFP by sponsoring the TEA Parties (‘€œRepublican Rallies for Failure’€), for example.

Much like the Wisconsin Taxpayers Alliance’€”who regularly use Tax foundation numbers’€”the Tax Foundation operates under the guise of a non-partisan, objective research outfit, when in fact both organizations have ties to the Republican Party and other far-right wing groups that are compelling, undeniable, and date back decades. That WISTAX and Tax Foundation ‘€œfindings’€ consistently reinforce conservative messages should, then, be no surprise at all.

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