Cato Institute

For other uses, see Cato (disambiguation).

Cato Institute

Established	1977
Chair	Robert A. Levy
President	Edward H. Crane
Faculty	46
Staff	100
Budget	US$24,063,000
Address	1000 Massachusetts Avenue NW Washington, D.C. 20001
Location	Washington, D.C.
Website	www.cato.org

The Cato Institute is a libertarian think tank headquartered in Washington, D.C.

The Institute's stated mission is "to broaden the parameters of public policy debate to allow consideration of the traditional American principles of limited government, individual liberty, free markets, and peace" by striving "to achieve greater involvement of the intelligent, lay public in questions of (public) policy and the proper role of government." Cato scholars conduct policy research on a broad range of public policy issues, and produce books, studies, op-eds, and blog posts. They are also frequent guests in the media.

The Cato Institute is non-partisan, and its scholars' views are not consistently aligned with either major political party. For example, Cato scholars have been sharply critical of the Bush administration on a wide variety of issues, including the Iraq war, civil liberties, education, health care, agriculture, energy policy, and excessive government spending. However, on other issues, most notably Social Security, global warming, tax policy, and immigration, Cato scholars have praised administration initiatives. During the 2008 presidential election, Cato scholars criticized both major-party candidates, John McCain and Barack Obama.

History

Cato Institute building in Washington, D.C.

The Institute was founded in San Francisco, California in 1977 by Edward H. Crane and initially funded by Charles G. Koch. The Institute is named after Cato's Letters, a series of British essays penned in the early 18th century by John Trenchard and Thomas Gordon expounding the political views of philosopher John Locke. The essays were named after Cato the Younger, the defender of republican institutions in Rome. Libertarian Murray Rothbard was a founding member of the institute's board and is credited with suggesting the name. He later came into sharp disagreement with other members, resulting in his dismissal in 1981. Cato relocated to Washington, D.C. in 1981, settling first in a townhouse on Capitol Hill. The Institute moved to its current location on Massachusetts Avenue in 1993.

In November 2002, shortly after Cato's website was named the "Best Advocacy Website" by the Web Marketing Association, the Alexa ratings service issued a report saying that it was "the most popular think tank site over the past three months," receiving a total of 188,901 unique visitors during the previous month of September.

Publications

The Cato Institute publishes the periodicals Cato's Letter, Cato Journal, Regulation, Cato Supreme Court Review, and Cato Policy Report, as well as policy studies. Some of Cato's books include Social Security: The Inherent Contradiction, In Defense of Global Capitalism, Voucher Wars, You Can't Say That!: The Growing Threat to Civil Liberties from Antidiscrimination Laws, Peace and Freedom: A Foreign Policy for a Constitutional Republic, Restoring the Lost Constitution, and Reclaiming the Mainstream: Individualist Feminism Reconsidered.

Cato published Inquiry Magazine from 1977 to 1982 (before transferring it to the Libertarian Review Foundation), and Literature of Liberty from 1978 to 1979 (before transferring it to the Institute for Humane Studies, where it was ended in 1982). They also had a monograph series called "Cato Papers".

Principles

The Cato Institute's work is rooted in the classical liberal tradition of John Locke and Adam Smith. Cato scholars base their work on a variety of philosophical and religious perspectives. Three Nobel Laureates have been particularly influential to the Cato Institute's work. Milton Friedman first proposed the concept of school choice, which is now promoted by Cato's Center for Educational Freedom. He also was an influential advocate for a number of policy proposals supported by Cato scholars, including monetarism and the end of the draft and the drug war. F.A. Hayek's ideas about spontaneous order and the importance of the price mechanism have been fundamental to Cato scholars' work on a wide variety of topics. And James M. Buchanan's work in public choice economics have been fundamental to Cato scholars' critiques of many government programs.

Many strands of thought have influenced the work of various Cato scholars. For example, a 2005 pamphlet by Dan Griswold, Cato's director of trade policy studies, made the case for individual liberty from a Christian perspective. Cato policy analyst Will Wilkinson has argued that the case for liberty can best be made by combining key insights of Friedrich Hayek and John Rawls, a political philosopher whose egalitarian ideas are often thought of as antithetical to libertarianism. Ayn Rand's philosophy of Objectivism has also had a particularly strong influence on the Cato Institute. Objectivists share with other libertarians a respect for individual liberty, free markets, and limited government. In 1997 David Boaz, Cato's executive VP, wrote he believed all Objectivist are necessarily libertarians.

Relationship with conservatism

In the years immediately following the Republican Revolution, the Cato Institute was often seen as a standard-bearer of the U.S. conservative political movement. Barry Goldwater and Ronald Reagan, credited with reshaping and rejuvenating the Republican Party, and key contributors to the late-20th century conservative movement, were heavily influenced by libertarian ideals.

Despite this, the Cato Institute officially resists being labeled as part of the conservative movement because "conservative smacks of an unwillingness to change, of a desire to preserve the status quo". Such tensions have become increasingly evident in recent years, as the Institute has become sharply critical of current Republican leaders. The growing division may be attributable to Republican officeholders' growing support of policies promoting government intervention in the economy and society, increased budgetary spending, and neoconservative foreign policies.

Cato scholars have also been strongly critical of the expansion of executive power under President George W. Bush, and his management of the Iraq War. In 2006 and 2007, Cato published two books critical of the Republican Party's perceived abandonment of the limited-government ideals that swept them into power in 1994. For their part, only a minority of Republican congressmen supported President George W. Bush’s 2005 proposal to partially privatize Social Security, an idea strongly backed by the Institute. And in the 109th Congress, President Bush's immigration plan—which was based on a proposal by Cato scholar Dan Griswold—went down to defeat largely due to the eventual opposition of conservative Republican congressmen.

Cato President Ed Crane has particular scorn for neoconservatism. In a 2003 article with Cato chairman emeritus William Niskanen, he called neoconservatism a "particular threat to liberty perhaps greater than the ideologically spent ideas of left-liberalism." As far back as 1995, Crane wrote that neoconservatives "have a fundamentally benign view of the state," which Crane considers antithetical to libertarian ideals of individual freedom. Cato's foreign policy team have frequently criticized neoconservative foreign policy.

Relationship with progressives

There has long been discussion of possible co-operation between libertarians and progressives based on their shared values of peace, tolerance, equality, and individual liberty. Interest in such possibilities has increased as a result of disillusionment with the Bush Administration and the Iraq War. However, there has been continuing disagreement over the basis on which such co-operation might take place.

Cato's scholars advocate positions that are appealing to many on the left-hand side of the American political spectrum, including support for civil liberties, liberal immigration policies, equal rights for gays and lesbians , and peace. An early example of this effort was the launching of Inquiry Magazine, which was aimed at liberals who shared libertarians' skepticism about concentrated state power.

More recently, in 2006, Markos Moulitsas proposed the term Libertarian Democrat to describe his progressive position, suggesting that libertarians should be allies of the Democratic Party. Replying, Cato vice president for research Brink Lindsey agreed that libertarians and liberals should view each other as natural ideological allies, but noted continuing differences between mainstream progressive views on economic policy and Cato's "Jeffersonian philosophy".

The Jeffersonian philosophy that animates Cato's work has increasingly come to be called "libertarianism" or "market liberalism." It combines an appreciation for entrepreneurship, the market process, and lower taxes with strict respect for civil liberties and skepticism about the benefits of both the welfare state and foreign military adventurism.

Relationship with Objectivism

Main article: Libertarianism and Objectivism

Relations between the Cato Institute and Objectivist organizations have not always been cozy. Ayn Rand scorned the nascent libertarian movement, and her intellectual heir, Leonard Peikoff, has followed her lead, refusing to associate with libertarian organizations, Cato included. Other Objectivist organizations, notably the Atlas Society, have been more friendly. At an October 2007 event to celebrate the fiftieth anniversary of the publication of Atlas Shrugged, Cato President and Founder Ed Crane stated that he and all the senior leadership of the Cato Institute consider themselves Objectivists. He emphasized that Objectivists and other libertarians are natural allies, and encouraged Objectivists to become more involved in the libertarian movement. Cato Institute leaders have worked for years to improve relations between Objectivists and libertarians.

Cato positions on current political issues

Following its motto, Cato scholars advocate policies that advance "individual liberty, limited government, free markets, and peace.” They are libertarian in their policy positions, typically advocating diminished government intervention in domestic, social, and economic policies and decreased military and political intervention worldwide. Specific policy proposals advanced by Cato scholars include such measures as abolishing the minimum wage, reforming illegal-drug policies, eliminating corporate welfare and trade barriers, diminishing federal government involvement in the marketplace and in local and state issues, enhanced school choice, abolishing government-enforced discrimination, including both traditionally conservative racial profiling and traditionally liberal affirmative action, and abolishing restrictions on discrimination by private parties.

On Social Security

The Cato Institute established its Project on Social Security Privatization in 1995, renaming it the Project on Social Security Choice in 2002. The change sought to emphasize that its proposals would allow Americans to opt in or out of the program. Like other organizations supporting the "personal healthcare savings accounts" concept, Cato scholars now avoid using the word privatization in describing such policies, due to the presently unpopular sentiments that the public associates with it.

Cato's Social Security proposal involves giving workers the option of investing half of their contributions (6.2 per cent) into individual accounts, in return for forgoing the accrual of any future Social Security entitlement benefits. For workers selecting this option, future claims on already-accrued Social Security benefits could be sold as bonds, allowing the workers to re-invest those funds in higher-yielding securities, if desired. However, for these workers, past and future payroll tax contributions to Social Security, nominally made on behalf of the employer, would go to funding the Social Security benefits of people remaining in the traditional system.

Cato scholars have emphasized that the present Social Security system is unsustainable, and will necessitate future tax hikes and benefit cuts to make ends meet. Because of the "pay as you go" nature of the system, present workers are taxed to support past ones (i.e., current retirees). As the ratio of workers-to-retirees drops, workers will bear an increasing payroll-tax burden. Cato scholars also emphasize the benefits of inheritability. Unlike the status quo, Cato's plan would allow a worker who dies before reaching their (variable) retirement age to leave the assets in his/her personal account to legal heirs.

In 2003, the Cato Institute said that Bush's social security privatization plan could be funded if funding for corporate welfare were reduced.

On foreign policy and civil liberties

In recent years, Cato's non-interventionist foreign policy views, and strong support for civil liberties, have frequently led Cato scholars to criticize those in power, Republican and Democrat. Cato scholars opposed President George H. W. Bush's 1991 Gulf War operations, President Bill Clinton's interventions in Haiti and Kosovo, and President George W. Bush's 2003 invasion of Iraq. On the other hand, Cato scholars supported the 2001 invasion of Afghanistan as a response to the terrorist attacks of September 11, 2001.

Cato policy experts have been similarly critical of recent perceived infringements upon American's civil liberties. They sharply criticized then-Attorney General Janet Reno's 1993 raid of the Branch Davidians in Waco, Texas. More recently, they have opposed the USA Patriot Act, the imprisonment of so-called unlawful enemy combatants like José Padilla, and the second Bush Administration's aggressive assertions of unilateral executive authority.

On other domestic issues

Cato has published strong criticisms of the 1998 settlement that many U.S. states signed with the tobacco industry. Among other laissez-faire policies, Cato scholars have argued for allowing immigrants to work in the U.S.

The Cato Institute published a study proposing a Balanced Budget Veto Amendment to the United States Constitution. This would, according to the study's author, act as a self-enforcing mechanism to reduce deficit spending by the U.S. government.

In 2003 Cato filed an amicus brief in support of the Supreme Court’s decision in Lawrence v. Texas, which struck down the few remaining state laws that made private, non-commercial homosexual relations between consenting adults illegal. Cato cited the 14th Amendment, among other things, as the source of their support for the ruling. The amicus brief was cited in Justice Kennedy's majority opinion for the Court.

Domestically, Cato scholars have been sharp critics of current U.S. drug policy, and the perceived growing militarization of U.S. law enforcement. Additionally, there is a strong objection to "nanny" laws such as smoking bans and mandatory seatbelt use.

On environmental policy

Cato scholars have written extensively about the issues of the environment, including global warming, environmental regulation, and energy policy. The Cato Institute lists "Energy and the Environment" as one of its 13 major "research issues", and global warming is one of six sub-topics under this heading. The Institute has issued over two dozen studies on energy and environmental topics in recent years, which is on par with Cato's other research areas.

Some left-of-center groups have criticized Cato's work on global warming. Cato has held a number of briefings on global warming with global warming skeptics as panelists. In December 2003, panelists included Patrick Michaels, Robert Balling and John Christy. Balling and Christy have since made statements indicating that global warming is, in fact, related at least some degree to anthropogenic activity:

No known mechanism can stop global warming in the near term. International agreements, such as the Kyoto Protocol to the United Nations Framework Convention on Climate Change, would have no detectable effect on average temperature within any reasonable policy time frame (i.e., 50 years or so), even with full compliance.

In response to the World Watch Report in May 2003 that linked climate change and severe weather events, Jerry Taylor said,

It's false. There is absolutely no evidence that extreme weather events are on the increase. None. The argument that more and more dollar damages accrue is a reflection of the greater amount of wealth we've created.

Three out of five "Doubters of Global Warming" interviewed by PBS's Frontline were funded by, or had some other institutional connection with, the Institute. Cato has often criticized Al Gore's stances on the issue of global warming and agreed with the Bush administration's skeptical attitude toward the Kyoto protocols.

Cato scholars have also been critical of the Bush administration's views on energy policy. In 2003, Cato scholars Jerry Taylor and Peter Van Doren blasted the Republican Energy Bill as "Hundreds of pages of corporate welfare, symbolic gestures, empty promises, and pork-barrel projects." They have also spoken out against the president's calls for larger ethanol subsidies.

Funding

The Cato Institute is classified as a 501(c)(3) organization under U.S. Internal Revenue Code. The institute performs no contract research and does not accept government funding. For revenue, the institute is largely dependent on private contributions.

According to its annual report, the Cato Institute had fiscal year 2008 income of $24 million. The report notes that 77% of Cato's income that year came from individual contributions, 13% from foundations, 2% from corporations, and 8% from "program and other income" (e.g., publication sales, program fees).

Foundation support

The Cato Institute has been supported by dozens of foundations including:

• Charles G. Koch Charitable Foundation
• Earhart Foundation
• JM Foundation
• John M. Olin Foundation, Inc.
• Claude R. Lambe Charitable Foundation
• Lynde and Harry Bradley Foundation
• Castle Rock Foundation (formerly known as The Coors Foundation)
• Scaife Foundations (Sarah Mellon Scaife, Carthage)
• Ford Foundation
• Ploughshares Foundation
• Atlantic Philanthropies

Corporate support

Like many think tanks, Cato receives support from a variety of corporations, but corporations are a relatively minor source of support for the Institute. In fiscal year 2008, for example, corporate donations accounted for only two percent of its budget.

According to Cato supporters, the relative paucity of corporate funding has allowed the Institute to strike an independent stance in its policy research. In 2004, the Institute angered the U.S. pharmaceutical industry by publishing a paper arguing in favor of "drug re-importation." A 2006 study attacked the Digital Millennium Copyright Act. Cato has published numerous studies criticizing what it calls "corporate welfare", the practice of public officials funneling taxpayer money, usually via targeted budgetary spending, to politically-connected corporate interests. For example, in 2002, Cato president Ed Crane and Sierra Club executive director Carl Pope co-wrote an op-ed piece in the Washington Post calling for the abandonment of the Republican energy bill, arguing that it had become little more than a gravy train for Washington, D.C. lobbyists. Again in 2005, Cato scholar Jerry Taylor teamed up with Daniel Becker of the Sierra Club to attack the Republican Energy Bill as a give-away to corporate interests.

Still, some critics have accused Cato of being too tied to corporate funders, especially in the 1990s. Critical sources report that Cato received funding from Phillip Morris and other tobacco companies in the 1990s, and that at one point Rupert Murdoch served on the boards of directors of both Cato and Phillip Morris. The Knight Ridder newspapers reported that in the late 1990s Cato received financial contributions from the American International Group, "an insurance and financial services company whose business includes managing U.S. retirement plans" as Social Security reform emerged as a more prominent issue. Between 1998 and 2004 the Cato Institute received $90,000 of its funding from ExxonMobil– about a tenth of a percent of the organization's budget over that period.

Associates in the news

• Several Cato Institute-affiliated scholars have achieved academic distinction, including Nobel laureates F. A. Hayek, Milton Friedman. James M. Buchanan, and Vernon L. Smith.
• Cato senior fellow Randy Barnett argued the Gonzales v. Raich case in front of the Supreme Court in 2004.
• Mencken Fellow P. J. O'Rourke is the bestselling author of Parliament of Whores, All the Trouble in the World, and other books.
• Cato policy analyst Radley Balko was cited by Justice Breyer's dissent to the Supreme Court's 2006 Hudson v. Michigan decision, concerning "no knock" raids.
• Cato senior fellow Robert A. Levy personally funded the plaintiffs' successful Supreme Court challenge to the District of Columbia's gun ban (District of Columbia v. Heller), on the basis of the Second Amendment.
• In December 2005, Doug Bandow, a Cato fellow, admitted taking money from lobbyist Jack Abramoff in exchange for writing columns for the Copley News Service favorable to Abramoff clients. The columns did not, however, deviate from Bandow's own views. Copley suspended his column. Bandow subsequently resigned from Cato on December 15, 2005.
• In 1999, David Platt Rall, a prominent environmental scientist, died in a car accident. Steven Milloy, at the time a Cato adjunct scholar, celebrated Rall's death on his site junkscience.com, writing: "Scratch one junk scientist who promoted the bankrupt idea that poisoning rats with a chemical predicts cancer in humans exposed to much lower levels of the chemical– a notion that, at the very least, has wasted billions and billions of public and private dollars." Cato Institute President Edward Crane called Milloy's attack an "inexcusable lapse in judgement and civility," but Milloy refused to apologize. He retained his position with Cato until the end of 2005. Following renewed controversy over the financial support Milloy received from tobacco and oil companies while writing editorial pieces favorable to them, Milloy's name was removed from the list of Cato adjunct scholars.
• In January 2008, adjunct scholar Dominick Armentano separated from the Institute after writing an op-ed piece in the Vero Beach Press-Journal. Cato Executive Vice President David Boaz wrote that “I won’t deny that this latest op-ed played a role in our decision."

Milton Friedman Prize

Since 2002, the Cato Institute has awarded the Milton Friedman Prize for Advancing Liberty every two years to "an individual who has made a significant contribution to advancing human freedom." The prize comes with a cash award of $500,000.

Past Prize Winners

Year	Recipient	Nationality
2002	Peter Thomas Bauer	British
2004	Hernando de Soto	Peruvian
2006	Mart Laar	Estonian
2008	Yon Goicoechea	Venezuelan

Notable associates

Policy scholars

• David Boaz, Executive Vice President
• Edward H. Crane, President and CEO
• Jagadeesh Gokhale, Senior Fellow
• Daniel T. Griswold, Director, Center for Trade Policy Studies
• Andrey Illarionov
• Robert A. Levy, Senior Fellow in Constitutional Studies
• Brink Lindsey, Vice President for Research
• William A. Niskanen, Chairman
• Tom G. Palmer, Senior Fellow, Director of Cato University
• Roger Pilon, Vice President for Legal Affairs
• José Piñera, Co-chairman, Project on Social Security Choice
• Alan Reynolds, Senior Fellow
• John Samples, Director, Center for Representative Government
• Michael D. Tanner, Senior Fellow
• Jerry Taylor. Senior Fellow
• Ian Vásquez, Director of the Center for Global Liberty and Prosperity
• Will Wilkinson, Policy Analyst

Adjunct scholars

• Donald J. Boudreaux
• Robert L. Bradley, Jr
• Tyler Cowen
• Michael Cox
• Richard Epstein
• Michael Gough
• Tibor Machan
• Randal O'Toole
• Vernon L. Smith
• Thomas Szasz

Fellows

• Randy E. Barnett
• James Bovard
• James M. Buchanan
• Leon Hadar
• Steve H. Hanke
• F. A. Hayek
• Andrei Illarionov
• Penn Jillette
• David Kopel
• Johan Norberg
• P. J. O'Rourke
• Jim Powell
• Teller

Board of directors

As of January 2007:

• K. Tucker Andersen, Senior consultant, Cumberland Associates LLC
• Frank Bond, Chairman, The Foundation Group
• Edward H. Crane, President, Cato Institute
• Richard Dennis, President, Dennis Trading Group
• Ethelmae C. Humphreys, Chair, Tamko Roofing Products, Inc.
• David H. Koch, Executive vice-president, Koch Industries, Inc.
• John C. Malone, Chairman, Liberty Media Corporation
• William A. Niskanen, Chairman, Cato Institute
• David H. Padden, President, Padden and Company
• Lewis E. Randall, Board member, E-Trade Financial Corporation
• Howard Rich, President, U.S. Term Limits
• Frederick W. Smith, Chairman and CEO, FedEx Corporation
• Donald G. Smith, President, Donald Smith & Co.
• Jeffrey S. Yass, Managing Director, Susquehana International Group, LLP
• Fred Young, former owner, Young Radiator Company

Former staff and faculty

• Radley Balko, former Policy Analyst, current senior editor at Reason magazine
• Doug Bandow, former Senior Fellow
• Dan Greenberg, former Director of Communications, currently a member of the Arkansas General Assembly
• Steven Milloy, former adjunct scholar, currently columnist for Fox News
• Julian Sanchez, former staff writer, currently Washington Editor of Ars Technica and a contributing editor to Reason magazine

External links

• Cato Institute's official website
• Center for Trade Policy Studies
• Project on Social Security Choice
• Cato Unbound, Cato's online monthly magazine
• Milton Friedman Prize for Advancing Liberty
• Center for Global Liberty and Prosperity

Critiques

• Mike Huben, "Criticisms of the CATO Institute," in "Critiques Of Libertarianism."
• Lew Rockwel's Editorial on the Bandow/Abramoff controversy
• John Fonte, "Dogmatic Libertarians: Over the edge", National Review Online, May 9, 2002
• "The Cato Institute or Anarchism seen through the Multinationals’ Eyes", Voltaire Network
• Dana Milbank, "At Conservative Forum on Bush, Everybody's a Critic", Washington Post, March 8, 2006, p. A02
• "The Promise of Freedom: Is America on Course?" a debate with the Cato Instiute's Executive Vice President David Boaz
• ExxonSecrets.org Fact Sheet on Cato.
• Cato Institute profile at Sourcewatch.org