Think tanks in the 1990s
By GEORGINA MURRAY [email protected] and DOUGLAS PACHECO [email protected]
(Based on an article entitled "The Economic Liberal Ideas Industry: Australasian
Pro-Market Thinks Tank in the 1990s", Journal of Social Issues, May 2000.)
Think tanks play an important role in the spread of ideas that sustain and support capitalism. In Australasia the post-world-war-two proliferation of think tanks has little to do with the permeable, flexible and pluralistic nature of the market for ideas but rather more to do with wealthy corporate patronage (Da Silva, 1996), the rapid spread of economic liberalism and the unified stance of the ruling class against labour. We maintain that the ideas that come from pro-market think tanks are influential not because of their superior logic, effectiveness or relevance but because their recycled concepts continue to serve an ideological purpose as legitimation for capital. And, the partisan information provided by networks of think tanks has a secondary function of cohering the ruling class (that is, those who own and control capital).
What is a think tank?
There is no accepted definition although there is an identifiable consensus arguing that think tanks are pre dominantly non-partisan, public spirited, fragmented and charitable bodies. This construction of think tanks is tied to a variety of theoretical sources of which pluralism and governmentality are two - Pluralism, (that is, the desirability of diffused power amongst institutions (Dahl, 1970)) and its related concept of governmentality (in which autonomous, decentered individuals experience fragmented power through loose government (Foucault, 1971). These theoretical strands dominate early thinking and recent highly referenced material on think tanks.
This perspective, premised on a rejection of Marxism as too simplistic, has become a post-structural mantra that has great difficulty going beyond descriptive accounts to explain real phenomena like poverty (Henwood, 1997; Hinkson, 1998). The mantra is that ideas (in this case ideas coming from think tanks) consist of complex cultural constructs that do not follow universal principles (read economistic Marxism). This is because there are no such things as universal principles, human actors are notoriously inconsistent and contradictory in the construction of their meaning, and meaning is anyhow relative to its social location rather than being a universal truth (Weber, 1922; Mannheim, 1936).
From this essentially liberal, pluralistic and post structural basis what emerges is a picture of think tanks that are not "involved in the implementation and administration of government policies… (though they do) desire to inform the policy process". Rather they are seen as "intellectually independent… research agendas are determined within the institution rather than by outside bodies…most think tanks strive for a diversity of funding to help preserve their intellectual integrity". It’s further argued that "think tanks are characterised by public spirit…they do not represent vested interest in society but they conduct research for the sake of building a body of knowledge, raising public awareness of issues and improving policy" (Stone, 1996b).
We argue that this is a wrong understanding. We follow a more critical tradition that suggests ideas are normally value laden in a class society (Nicolaus, 1969) and therefore, although think tank ideologues act as individuals, they do not always (or even often) act in circumstances of their own choosing. No matter how intellectually or ethnically diverse these actors are they operate within some universal limits. The most easily identifiable universal limit continues to be capital (Henwood, 1997, Baud, 1996, Stopford and Strange, 1991). Non-Marxists may instantly dismiss this as mindless Marxist economism or universalising. On this point however, there is a breaking of ranks amongst Liberals (e.g. Ohmae, 1990, 1996), Cultural Studies experts (e.g. Spark, 1996,) and Social Democrats (e.g. Hirst and Thompson, 1995) who are increasingly accepting the obvious that capitalism is a universalising condition. Globalization spectacularly affects existing cultures, and a critique of culture does not immediately displace a critique of capital; rather it adds to it (see Habermas, 1979). Habermas argues that the very survival of advanced capital rests on its ability to capture the popular imagination and legitimise itself in the cultural sphere. In common with Habermas and other theorists we argue the importance of ideas and the think tanks role as political organizations that recycle economic orthodoxies and in as much as they succeed they are able to further capitalist interests.
The knowledge demanded from think tanks by government, business and pressure groups could well be more fragmented, complex and demand more specialist understanding than was previously needed, but this does not stop its likely emanation from a single paradigm. As Keynes has oft been quoted as saying "Practical men, who believe themselves to be quite exempt from any intellectual influence are usually slaves to some defunct economist" (Keynes, 1936). We argue that the most influential paradigm used by think tanks is economic liberalism. But first, what does influence mean in relation to think tanks?
Influence means having the power to have an intellectual, moral or emotional effect that modifies, guides or controls the opinions of others. Influence is a means to the end of making think tanks more powerful and capital more legitimate. However, influence is a notoriously difficult relation to quantify for it can be both formal, as in interlocking membership of a number of company boards (Murray, 1990), or more likely in the case of think tanks, informal (Granovetter, 1973). Influential meetings of think tank members and their executive occur at clubs, through social, old-school or family links.
Dye, in an old but still relevant work (1979), argues that think tanks exist within a powerful network of inter-connected bodies funded by private business interests who operate in diverse number of ways to influence legislative bodies:
Where a think tank is to be found also affects its influential efficacy. For example in USA or the UK think tanks are better funded (NIRA, 1996) and more instrumentally effective on the state (Ricci, 1991) than they are in most other places such as Australia (NIRA, 1996; Ricci, 1991; Stone, 1991).
The need for private funding is the most crucial circumstantial evidence to support our argument that think tanks must be partisan. All private think tanks are by definition dependent upon sponsorship and in many cases there is very large amounts of money are involved (Da Silva, 1996). To argue that that think tanks preserve their intellectual integrity and autonomy by having a diversity of funding sources may be true in that this may allow think tanks to put a variety of items on their agenda, but if this agenda violates their sponsors’ interests then those sponsors will withdraw the funding. There is, in other words, no guarantee that diversity will guarantee integrity or that a diverse number of sponsors have different interests.
To illustrate our argument that think tanks most often represent vested class interest in a capitalist society we take one of these information-centres - Australasian think tanks (e.g. the Tasman Institute and the Institute of Public Affairs) – and their subset business lobby groups to show how pro market think tanks exercise influence and use networks to consolidate their power.
The following material is divided into two parts. The first, identifies the conditions within which economic–political climate in which think tank have evolved and the second, looks at examples of Australian and New Zealand think tanks.
The economic background
The really puzzling question in a capitalist society is not why are privately funded pro market think tanks effective, but why now? Why were there only 15 think tanks in Australia and two in New Zealand before 1979? Our answer is that the demand reflects the stagnant economic climate (Tabb, 1997). That is, between the 1980s and the 1990s global economic stagnation (Brenner, 1998) meant capital needed a hand to help it to continue to make the same level of profit because economies were adversely affected by a number of global phenomena. Sweezy argues that these were the following:
1. A slowing of the overall global rate of growth,
2. Expansion of un/ under employment;
3. Proliferation of multinational corporations and
4. Financialisation of the capital accumulation process (Sweezy, 1997).
Stagnation in profit hit both Australian and New Zealand economies in the forms of declining Gross Domestic profits and the rise of unemployment (Australian Bureau of Statistics, and New Zealand Official Yearbook, 1997). The stagnation has been disproportionately borne by workers whose wages have not risen in line with company profits (Australian Yearbook, 1998, p. 647). This is where think tanks play a role. They produce material that proports to show workers that stagnation in national profit is not meant to be experienced equally throughout all sectors of society. Their material tells workers to work harder for worse wages and conditions so that capital can gain a competitive advantage (e.g around Porter’s Competitive Advantage, 1985). Pro market think tank interventions also act to placate the naturally competitive tendencies between capitalists of different sectorial interests (Useem, 1984) by marshalling them through lobby groups toward a long-term goals for themselves and for capitalist society (e.g. Arthur Seldon’s Capitalism, 1990) or Graham Hutton’s All Capitalist Now (1960). The class-wide strategy, or the ideology that unites pro-market think tanks long-term interests, is Economic Liberalism - for this is the political theory that provides the rationale for the untying of state assets, and it lies behind much of the restructuring that took place in western economies after 1980. As Hinkson (1988) argues, neo liberalism (synonymously with economic liberalism and economic rationalism) cannot be read as a fragmented, structureless entity as this mitigates against its critical analysis.
The Australian ideology - economic rationalism
Ideas used by pro-market think tanks are most often popularizations of economic liberal thinking. In Australia this is called economic rationalism, a term unknown before the 1980s The neologism first appeared in 1988 (Head, 1988, Emy and Hughes, 1988) and related to the idea that only markets, not governments, could be efficient. Pusey (1992, 1994) added to this that the term described a dogma which said markets and money can do anything better than governments, bureaucracy or the law. Economic Rationalism has become the Australian name of the business-legitimating ideology of the 1980s-90s. In New Zealand the ideology was virtually identical in content but it was called Rogernomics after the Minister of Finance Roger Douglas, the man responsible for putting the ideology into legislation. Battin (1991) argued that Economic Rationalism is a bastardization of neo classical thought but its origins are older - in the Classical Economics or more precisely the anti mercantilism of Dudley North who outlined the beginnings of the theory in his book Discourses on Trade (1691). North’s central idea was the desirability of a less than omnipotent state, a state that would allow for the development of industrial capital to be freely traded without interference from the landed aristocracy. The small(er) state later became an idea enshrined in Adam Smith’s work - The Wealth of Nations (1776) - in which he advocates letting the invisible hand of the market be the arbiter of human economic relations. The "rational" part of economic rationalism can be traced to Buchanan and Tulloch’s reading of Adam Smith noted in their Public Choice theory (Tulloch, 1978). This theory holds that public choice is no more than the sum of individual’s self interest.
These liberal ideas, the basis of pro-market think tank thought, weave in and out of political periods with the relative needs of capital. The latest resurgence of economic liberal policy demands blossomed with the development of the ideas of the Austrian School in the UK from the 1930s but flowered in political practice in Margaret Thatcher’s regime in in the 1970s. This coincided with the growth of global economic stagnation. Historian Richard Cockett (1994) traces economic liberalism in its current evangelical form specifically back to the Austrian School member Fredrich Von Hayek whose work from the 1940s onward assaulted the dominant Keynesian paradigm. In 1938, Von Hayek with other Austrian School theorists resident at the London School of Economics (Ludwig Von Mises, Karl Popper, Lionel Robbins, etc.,) ran a conference to try to reverse the trend toward socialism, collectivism or totalitarianism. (Their efforts consistently conflated the three perspectives.) Their first conference was called the Colloque Walter Lippman and members nominated as their primary objective an anti Keynesian counter-revolution. John Maynard Keynes (1883-1946) and his collectivist theories of demand management and full employment were held to take "the naive down the dark road to totalitarianism" (Von Hayek, 1946). Following the Colloque Walter Lippman, Von Hayek and his colleagues held bi-annual meetings continuously from the period of the Second World War. These meetings took the name of their second location, in Switzerland called Mont Pelerin, hence the beginning of that secret fraternity the Mont Pelerin Society. This organisation spread to become a central ideological source of economic liberalism for many countries including Australasia (Cockett, 1994).
Even in its own terms the problem with economic liberalism is that it does not work to produce long-term capitalist stability. As Panitch argues "the new reality is a massive asymmetry between the international mobility and organization of capital and the dispersal and segmentation of labour" (Panitch, 1996). The urban and rural poor are both politically (eg the rise in the extreme right vote) and economically unhappy about their economic marginalisation and the urban poor are also unhappy. Baud (1996) argues that economic liberal theory (manifest in the global integration of business) is concentrating resources in the hands of the developed nations and poorest countries who are 20 per cent of the world’s population. These 20 per cent of poorer nations are getting less involved rather than more involved with world trade. This has resulted in an erosion of real wage of workers globally (Baud, 1996) reflected in Australian and New Zealand incomes (Bramble, 1997; New Zealand Yearbook, 1998). Lowered wages do not produce more productivity but they do tend to lead to poor health care, stress with an increase in social insecurity and crime (Graham, 1995). The problems associated with the implementation of economic liberal regimes are all at the expense of those least able to bear them. The next section looks at the Australasian pro-think tanks use of these ideas in peak corporatist bodies from business, the unions and the state.
Australian think tanks
Pro-market think tanks, using economic liberal theory, have been around since the IPA was established in 1943. Other think tanks were formed earlier (e.g. the Australian Institute of International Affairs established in 1924) but these are less clearly economically liberal. Before this time we can only surmise that big business used weak ties (Granovetter, 1973) to consolidate their class power. These class ties were through political parties, old boy school associations, clubs, boardrooms and other social networks that allowed them to secure their interests (Sharkey, 1943; Scott, 1985; Kuhn, 1993). However, compared to the well-funded, single mindedness of the new pro-market think tank, these links are the uncoordinated (bureaucratic in the case of political parties) fumblings of ideological amateurs. For although the pro-market think tanks still use the old networks (the club, the state, the media, the university, the corporation, etc.) they have built new links (e.g. the conference circuit, the journal) for more focused pressure on target bodies. Marsh argues that think tank executives’ prime purpose in Australia has always been the development of intimate relationships with government, business and academic communities, to help disseminate their policies and increase their function as "important brokerage, knowledge generating and evaluation" players (Marsh, 1994).
In Australia and New Zealand think tanks have proliferated within the last twenty years. In the 1990s, they have become an industry with estimated think tank numbers for Australia of between 83 and 90 and approximately six in New Zealand. Herd’s sample of 83 think tanks show only five that he suggests would be within the commonly accepted range of "wet" tanks (that is, politically left). Marsh estimates that Australian think tanks have a collective budget of $130 million, they employ 1,600 people, publish 900 reports and discussion papers, and hold almost 600 conferences and symposia each year (Herd, 1998; Marsh, 1991; Marsh, 1994). Corporate contribution and personal wealth are the biggest source of funding to the budgets of pro-market research think tanks. The amount and sources of funding as well as the staff of the think tanks is noted in the following table:
Table 1: Australian Think Tanks (Examples)
Budget & Funding Sources
Staff & members
Points of Interest
Institute of Public Affairs (IPA)
Free Market economics, small state and identified with the ‘New Right’.
Sources: subs, donations, conferences, publications.
M. Nahan (CEO);
Publications in 12,000 schools, 475 companies & for 2,000 individuals.
Committee for Economic Development of Australia (CEDA)
Economic and Social Development
Budget $4 million
Sources: subs, publications & members.
Dr. J. Nieuwenhuysen (CEO);
Considered to be a network for businessmen;
Has members from both sides of politics.
Centre for Independent Studies (CIS)
Advocates of the small state;
New Right commitments.
Budget $1.1 million;
Sources: subs, publications & members.
Supports re-invigoration of the family.
A free market institute arguing for a minimalists govt. role in the economy.
Budget $1 million;
21 corporate sponsors.
Dr. M. Porter (CEO);
Gave Premier J. Kennett the blueprint for privatisation.
Australian Business Council (BCA)
Free Market orientation
Campbell Anderson (CEO);
Established 1983 by PM.G. Hawke;
Attendence at meetings exceeds 50 of 101 members.
Source: 1. Da Silva, 1996, 2. Nira, 1996, 3.Gluyas, 1999.
These think tanks share a pro-market ideology but to different degrees and with differing twists.
Australian think tank ideology
The Australian Labor government in the 1980s followed the British government initiative in supporting, sustaining and in the Australian case initiating think tank development. For the British this manifest itself in a growing dependence on the Adam Smith institute and the Centre for Policy Studies for policy direction. For the Australian Labor government post 1983 started a number of peak policy bodies or think tanks such as the Economic Planning Council, the Asia-Australia Institute, the Australian Manufacturing Council, the Communications Law Centre, the Australian Commission for the future and the Business Council of Australia (BCA). Even existing think tanks such as the Australian Bureau of Agriculture and Resource Economics and the Industry commission were revamped and re-oriented by Labor "toward market economics" (Da Silva, 1996). With the general incorporation of economic liberal theory into state policy, think tank executives expressed considerable satisfaction. For example, Dr. Mike Nahan of the IPA, one of those known for his rigorous pursuit of free-market economic solutions, said "In the past because our over whelming focus was on economics, social issues were not our major focus. Now they are going to be. The debate has moved on. These are areas that the left thought they had sewn up" (Nahan, in Da Silva, 1996). In New Zealand this lead is also being followed by Roger Kerr, of the very influential New Zealand Business Roundtable; he is reported as having said "I think that we may have a crack at the family as a follow up. The value side of politics needs to be explored" (Clifton, 1996).
Consistent with this trend to use cultural icons to reinforce and consolidate economic liberal policy successes is the policy of the Lyons Forum, a think tank named after Dame Enid Lyons, the first woman member of Federal Parliament (1943-1951); she had twelve children. The qualification for membership of the Lyons Forum is not that like Dame Enid you have 12 children, but as Toohey puts it, "it helps if you think other people should". Toohey claims that the Lyons Forum (established in 1992) has an estimated 45-50 of the Liberal/National coalition's 130 parliamentarians as members. John Howard, the Prime minister and treasurer Peter Costello are or were members (Toohey, 1996). The Lyons Foundation is known for its opposition to homosexuality, abortion, divorce, euthanasia, women working outside the home and unions and its support for a deregulated labour force.
Greg Lindsay from the Centre for Independent Studies (CIS) has joined with this back to the home movement. He says:
Maybe the changes in the divorce laws in the 1970s were not such a good idea: you know, the notion that for children a good divorce is better than a bad marriage. Well the evidence seems to me to show that this is not the case. The problems that we are bringing on young people are far greater. If adults are letting the children down then we have to fix things. (quoted in Da Silva, 1996).
This new focus has been spear-headed by a three year research project called "Taking Children Seriously" which received increased funding of 22 per cent or $1.1 million.
From the start, Lindsay saw the CIS's role as influencing policy-making processes. In his own words:
We set out to influence the general ideas environment... but as I went on I realised that there was more to achieving change than dreaming up what a Liberal Party future might be. For instance ... If you felt that shopping hours should be deregulated, it was not just a matter of putting it on to paper and feeling confident that your brilliant statement would win the day. You had to make a case because there were all sorts of interest groups opposing it... it developed from looking at the general intellectual environment to particular issues... (Lindsay, 1996).
The guiding ideological thinkers for Greg Lindsay are Ayn Rand, Milton Friedman, Robert Nozick and Fredrick von Hayek. All of these writers are of liberal or even (in the case of Rand and Nozick), extreme anarcho-liberal persuasion. Liberal in this context means advocating individualism and free markets to ensure personal liberty. Extreme anarcho-liberalism manifests in a bitter rejection of any form of collectivism and a confused conflation of any form of collectivist thinking into totalitarianism.
Networking with each other is important. Director Lindsay through his pro-market think tank activities met Lord Antony Fisher, the head of the Institute of Economic Affairs and discussed with him his plans to open a replica think tank in Australia. Fisher "wished me luck" (Lindsay, 1996). In 1978, Lindsay went to his first Mont Pelerin meeting in Hong Kong where he was introduced to Professor Milton Friedman and the Public Choice doyen, James Buchanan.
Another unambiguously dry pro-market think tank, is the Tasman Institute run by former Monash University economics lecturer, Dr. Michael Porter. Like the former two examples Dr. Porter runs a free market institute that argues for a minimalist government role in the economy. His institute has been a strong advocate of privatisation and a big influence on the direction of the State of Victoria. "Its ground-breaking Project Victoria study, argu(es) for the large scale sell off of state assets and a new right orientation (for) the public service, [and] served as a manifesto for the revolution brought about by former Premier Jeff Kennett and Treasurer Alan Stockdale" (Da Silva, 1996). Kennett was described as the small businessman in the Victorian lolly shop, where they were "frenetically selling off as well as buying in: it is the boldest State in privatising utilities" (Grattan, 1997a).
All of the larger well-funded think tanks are in an excellent position to influence public opinion. The IPA pamphlets – Facts - have a reputed print-run of 58,000, sent to 12,000 schools, 475 companies and 2,000 individuals (Moore and Carpenter, 1987). The IPA, the CIS and CEDA a large membership networks that total 7,278 people.
Table 1 shows that top Australian think tank budgets can be as high as $5 million for BCA and although the New Zealand think tanks (table 2) are not so large with a top figure of $110,000. (This is not high in regard to other countries where the Brookings Institute in the US has a budget of $20 million or the UK where the Adam Smith institute has a budget of $US500,000). This money is gathered from donations endowments, government, corporations, individuals, publications and conferences (Da Silva, 1996; NIRA, 1996).
The government is a rich source of funds for pro market think tanks. The Menzies Foundation, the Liberal Party pro-market think tank, was accused in 1997 of receiving a $100,000 Liberal government grant that the public paid for. This means that the Liberal Party can "undertake this 'intellectual' branch of their work without eating into their funds that they can use for other work" (Gattan, 1997b). According to Grattan, this was money stripped by the government from the Evatt Foundation (a more left-leaning think tank) and redirected to revive the moribund Menzies Centre. The Menzies Centre was opened in 1994 with David Clark as the chairperson of the board. Clark is also the chair of the Macquarie Bank. Other board members of note are former premiers of New South Wales Nick Greiner and Professor John Rose of Melbourne University.
To be seen to be autonomous both the New Zealand Instititute for Policy Studies and the New Zealand Institute for International Affairs advertise that they do not accept contract research. The question then becomes: if their manifest politics (as seen through their publications and public speeches) are economically right-leaning, do they have to be contracted to say the things that other right-leaning people know that they will say anyway? The IPS for example has a strong tradition of support for and from Economic Liberals. The IPS chief researcher Sir Frank Holmes comes from the corporate sector and quite consistently produces pro-market research. For example he has written a book called A New Approach to Central Banking: The NZ Experiment and Comparisons with Australia (1994) that lauds the New Zealand experiment.
Much funding for think tanks comes from corporations. Director Lindsay of the CIS is on record saying that he got his big financial break from Hugh Morgan, the CEO of Western Mining. Morgan did a financial whip around amongst mates for seed money for the CIS. He received a total of $200,000 that was to be spent by the CIS over five years (Da Silva, 1996). These extremely right leaning pro market think tanks are not the only ones there are many others with more mixed messages.
Wetter than dry think tanks are those with a left-lean. These are much fewer in number than dry think tanks (Herd, 1999 estimates seven out of the 83 in his sample). An example is the Committee for Economic Development of Australia (CEDA) started in 1960 in Melbourne and known for being "wetter" than other top think tanks, (even though it acknowledges no ideological preference that differs from the stance of the government of the day). The committee conducts research and publishes papers on issues relating to economic development. Their chief executive John Nieuwenhuysen, is an ex-University of Melbourne economist who worked for the Labor governments of Hawke, Cain and Keating. Today, CEDA members claim to come from both sides of politics although they seem to come largely from the business community and include such businessmen as Rodney Adler (FAI), James Strong (Qantas) and Tony Berg (Boral). Dr. Nahan dismisses CEDA. "I wouldn't call CEDA a think tank. I think that it’s more a network for businessmen who like to participate in public debate, but don't like to say tough things. They often approach them and then wimp out." (in Da Silva, 1996).
Links between think tanks and the universities have been established for some-time. Universities do have a number of pro-market think tanks within their ambit (e.g. Institute of Labour Studies, (Flinders Uni.), Labour Relations Institute (Monash Uni.), etc.) and they provide a large number of staff members (eg Professor Gary Hawke, Professor Michael Porter, Professor Peter Sheehan). Also many of the staff members have had extensive university educations (eg Dr Peter Botsman, Brisbane Institute, Dr Lesley Jackson (AHA), Professor Milner (AHA) Professor Joan Beaumont (AHA)) University economics curricula are dominated by economic liberal theory (Wheelwright, 1994). Academics are also notable as think tank board members (e.g. Dame Leonie Kramer (IPA) and Fred Chaney (CEDA).
New Zealand think tanks
Unlike Australia, New Zealand’s think tanks have been unobtrusive exponents of economic liberalism with the notable exception of the New Zealand Business Roundtable (NZBRT) which is more vociferous in this regard than anything operating in Australia, including the Business Council of Australia (BCA), its Australian equivalent.
Table 2: New Zealand Think Tanks (Examples)
Budget & Funding Sources
Staff & members
Points of Interest
Institute of Policy Studies
New Zealand & the world;
Economic & Social Policy;
Public Sector Reform;
Business Study & taxation.
Sources: University grants, project grants & fellowships (from government & private sector).
Prof. G. Hawke (CEO);
Chief Researcher- Sir Frank Holmes;
3 admin. Staff.
Established in 1983;
G. Hawke wrote ‘Improving Policy Advice’, 1993;
Does not accept contract research;
New Zealand Institute of International Affairs
Economic & political affairs;
Security and Defence;
Sources: Corporate members, govt., institutional members & individual members.
G. Davidson (President) ;
B. Brown (CEO);
2 Admin staff;
Researchers S. Hoadley & M. Templeton.
Does not accept contract research.
New Zealand Business Roundtable
Free market and privatization,
Budget: $NZ2 million;
Member fee $40, 000.
D. Myer (Chair);
Roger Kerr executive director;
43 members (1992)
19 major state assets have been bought by NZRT members.
Sources: Clifton, 1992, NIRA, 1996.
The NZBRT has been described as "the most powerful (of the) driving forces of free market economic reforms transforming New Zealand" (Ninness, 1992). Michael Porter refers to the closed and selective nature of the NZBRT as the basis of its great success because this allows "an inbuilt quality control they can keep out the wimps" (Penberthy, 1996). The relationship between the NZBRT and the state has always been close. As a newspaper reporter at the time noted when Manurewa MP Roger Douglas was Minister of Finance his relationship with the Roundtable was rumored to be "so close you couldn't slide a Treasury paper between them" (Managh, 1989). The NZBRT ultimate achievement or "reward is the Employment Contracts Act" (Lange, 1996), that is, the act that effectively decimated the union movement. Apart from this major dismemberment of the union structure in New Zealand they have also influenced micro-economic changes in fiscal strategy, social and state expenditure.
The NZBRT policy implementation success rate measured in terms of their ability to get legislation passed that reflects their position, though obviously not directly written by them has been much more impressive than the BCA’s.
Table 3: The States’ Response to Initiatives from the NZBR and the BCA
Top Lobby Group Recommendation
• Nullify awards.
• Dismantle arbitration system.
• End right to strike.
• ACTU accepts enterprise bargaining 1991 and the principle of 'International Competitiveness'
• Legislation introduced for the ‘Employee Advocacy Panel’.
• Reform Act 1993 limits parameters of strikes.
• Employment Contracts Act, 1990 destroys awards.
• Employment Court and Tribunal replaces the Arbitration Court 1987.
• Labour Relations Act 1987 limits strike action.
• Lessen public spending for non business infra-structural needs.
• Privatise state owned enterprises.
• Introduce flat taxes.
• Deregulate banking and financial sector.
• Move away from universal to Residual Welfare system.
• Floated Qantas, privatised banking and national shipping line. Creeping corporatisation eg selling car fleet.
• Two failed attempts to introduce a GST tax (1985/92) a third attempt for 1999.
• Deregulation starts in 1983, furthered by Wallis Commission, 1997.
• A bare residual system.
• Privatised the majority of state owned assets - rail, air, forestry, post offices, telephones.
• GST introduced 1987; increased 1989.
• Financial Deregulation starts 1984.
State Social Expenditure
• Reduce welfare spending.
• Introduce targeted benefits. for health, education, the elderly, etc.
• Huge education cuts in the Liberal budget post 1996.
• All benefits reduced from 1987.
• Value of unemployment and related benefits reduced by between 3-25%.
• Education severely cut from
The NZBRT is proud of the implementation of their ideas into government policy. As one satisfied New Zealand Roundtable member said in a 1992 interview:
I would say that over ninety per cent of any decent policies that have come out of the government in the last seven years have had a hell of a lot to do with the intellectual contribution of the Roundtable. It is the least self-interested body that I am involved with. It has been captured by the intellectual processes of Roger Kerr and he has done a wonderful job of keeping self interest out of the project and controlling conflicts of self interested institutions (Gibbs, 1992).
The class ties between business and pro market think tanks are most visible. The Chief Executive for Western Mining Hugh Morgan is ubiquitous as the "primary contender for the title of the ideological father of the New Right" (Da Silva, 1996) and he is also on the board of a number of pro-market think tanks. Morgan has been a member of the IPA board since 1981, he has also been on the board of the Liberal Party's private company Vapold Pty for ten years, and he is a one third shareholder of the Cormack Trust Foundation, which donated $800,000 to the Liberal Party. Morgan is a founding member of the H. R. Nicholls Society, recently described as the New Right's "supper club". This society’s focus is the reduction of the role of the trade unions, the reform of the current wage fixing system and the "necessity for labour relations to be conducted in such a way as to promote economic development in Australia" (H.R. Nicolls Society Aims, 1998). Other examples of class ties are those shown in the Tasman Institute's backing by businessmen such as Richard Pratt, Rupert Murdoch, Will Bailey, Hugh Morgan and Ballieu Myer. There is further evidence of inter-locking directorships between the boards of corporations and pro market think tanks. For example, Richard Charlton, ex-Shell Oil CEO and presently a Coles Myer director is on the CIS board. Carnavon Petroleum’s Michael Darling is also on the CIS board.
Class ties that extend from think tank networks to the state bureaucracy can also be shown. Des Moore and John Stone of the IPA were both former Australian treasury officials. The present Finance Minister Peter Costello was a member of the IPA as was John Kerr (the former Governor General). Ray Evan and Dave Trebeck (consultant to the Liberal Party secretariat) were also involved with the IPA (Moore and Carpenter, 1987). In New Zealand the same cross fertilisation between pro-market think tanks and the state bureaucracy is evident. Roger Kerr, the executive director of the NZBRT was in Treasury, Dr. Rod Deane is chairperson of the State Service Commission and formerly of the IMF. Deane taught Kerr economics at Victoria University and later recommended him for the job on the NZBRT's executive. He comments that Kerr is "one of the three or four best students I ever had. A neat guy and a top economist" (Hubbard, 1992).
Areas for future research
Any future work in this under-researched area should systematically look at think tank board members’ multiple directorships held with the state, universities and business. This would highlight influence links. Second, the systematic correlation of the content of think tank research with the type of legislation that is passed by governments in Australia and New Zealand (e.g. Murray, 1990) would be useful. Third, the claims of think tank influence made by think tanks themselves could be tested. For example, the Adam Smith Institute claims to have more than 100 of their ideas incorporated into public policy (Adam Smith Institute, 1990).
Taking a post structuralist or pluralist stance on the brilliantly organised emergence of economic liberal think tanks is, in our opinion, a limiting exercise. Fragmented governmentality (cf Foucault) located in identifying key individuals and their institutions can not satisfactorily explain why this happened with such rapidity. Why, for example, was the Atlas Foundation between 1981-1991 able to be an umbrella for the creation of 78 new economic liberal institutes (Cockett, 1994)? There needs to be a whole picture that locates this rapid growth of economic liberal think tanks within a certain period of capitalist development. That is a relatively hard time for capital, a period of global economic stagnation, where capital needs to have an ideology that legitimates its’ squeeze of more productivity from labour for lower wages and worse conditions. Capital needs an ideology that legitimates the privatisation of state assets, which they can and have swallowed up, greedily. Think tanks have provided and disseminated this ideology for capital.
Australian Bureau of Statistics (1997) Australian Economic Indicators, June, no.1350.0
Australian Government (1996) Future Labour Market Issues for Australia, Commission Paper No. 12, July, Australian Government Publishing Service.
Australian Bureau of Statistics, Australian Yearbook (1998), Canberra, ABS Catalogue 1301.0, p.647.
Barton, A. & C. Weiss (1980) Making Bureaucracies Work, Beverly Hills, Sage.
Brenner, R. (1998) The Economics of Global Turbulance: A Special Report on the World Economy, 1950-1998, New Left Review, May/ June vol. 229.
Campbell, C. & G. Wilson (1995) The End of WhiteHall: Death of a Paradigm Oxford, Blackwell.
Cockett. R. (1994) Thinking the Unthinkable: Think Tanks and the Economic Counter Revolution, 1931-1983, Harper Collins, London.
Dror, Y. (1980) 'Think tanks: A New Invention of Government' In Making Bureaucratic Work. Eds. C.H. Weiss and A. Barton, Beverly Hills Sage.
Emy, H. & O. Hughes (1988) Australian Politics: Realities in Conflict, Mcmillian, Melbourne.
Foucault, M. (1971) Madness and Civilization: A History of Insanity in the Age of Reason, London, Tavistock.
Habermas, J. (1979) Communication and the Evolution of Society, London, Heinmann Books.
Henwood, D. (1997) Wall Street, Verso, London.
Hill, C. & P. Beshoff (1994) Two Worlds of International Relations: Academics and Practitioners and the Trade in Ideas, London, Routledge.
Hirst, P. & M. Thompson (1996) Globalisation in Question, Cambridge, Polity Press.
H.R. Nicolls Society, (1998) Application Form and Aims, http://venue.exhibit.com.au/~nicolls/introthl.htm.
Hutton, G. (1960) All Capitalists Now, IEA Press, London.
Keynes, M. (1936) The General Theory of Employment, Interest and Money, London, Mcmillan.
Mandel, (1972) Late Capitalism, London, New Left Books.
Mannheim, K. (1936) Ideology and Utopia, London, Routledge Keagan and Paul.
Merton, R. (1957) Social Theory and Social Structure, New York Free Press.
Moore, B. and G. Carpenter (1987) 'The Main Players', in The New Right's Australian Fantasy, (Ed) K. Coghill, Fitzroy, McPhee Gribble Publishers, pp. 145-160.
Murray, G. (1990) New Zealand Corporate Capitalism, Auckland University, Ph.D.
New Zealand Official Yearbooks, (1998) Department of Statistics.
North, D. (1691) Discourses on Trade, in McCulloch Early English Tracts on Commerce, pp. 529-30, quoted in Rubin, I. (1928) A History of Economic Thought, Pluto Press (1989).
Ohmae, K. (1990) The Borderless World: Power and Strategy in the Interlinked Economy, London, Collins.
Ohmae, K. (1996) The End of the Nation State, Free Press, New York.
O’Lincoln, T. (1996) Wealth, Ownership and Power: the Ruling Class’ in Class and Class Conflict in Australia (Eds.) R. Kuhn and T. O’Lincoln, Longman, Melbourne.
Pinder, J. (1981) Fifty Years of Economic Planning: Looking Forward 1931-1981, London, Heineman.
Polsby, N. (1984) Political Innovation in America: the Politics of Policy Imitation, New Haven, Yale.
Porter, M. (1985) Competitive Advantage: Creating and Sustaining Superior Performance, New York: the Free Press.
Pusey, M. (1992) Economic Rationalism in Canberra: a Nation-building State changes its Mind, Cambridge University Press: Melbourne.
Ricci, D. (1993) The Transformation of American Politics: the New Washington and the Rise of American Politics, New Haven, Yale UP.
Scott, J. (1985) 'Theoretical Frameworks and Research Design' in Networks of Corporate Power, J. Scott, F. Stokman, and R. Zeigler, Polity Press: Cambridge.
Seldon, A. (1990) Capitalism, London, Blackwell.
Sharkey, L. (1943) Australia Marches On, Sydney: Communist Party of Australia (Quoted in Kuhn, op cit. 1993).
Smith, A. (1776) An Inquiry in to the Nature and Causes of the Wealth of Nations, Wakefield, London.
Stone, D. (1996b) Capturing the Political Imagination: Think tanks and the Policy Process, London, Frank Cass.
Stopford, J. & S. Strange (1991) Rival States, Rival Firms: Politics and Competition for World Markets in Developing Countries, New York, Cambridge University Press.
Tulloch, G. (1978) The Economics of Politics, Reading 18, IEA.
Useem, M. (1984) The Inner Circle: Large Corporations and the Rise of Business Political Activity in the US and the UK, New York; Oxford University Press.
Von Hayek, F. (1944) The Road to Serfdom, Chicago: The University of Chicago Press.
Weber, M. (1922) Economy and Society: an Outline of Interpretative Sociology, New York, Bedminister Press.
Weber, M. (1949) The Methodology of the Social Sciences, Glencoe, Free Press, eds. E. Shils and H. Finch.
Battin, T (1991) ‘What is this thing Called Economic Rationalism?’ Australian Journal of Social Issues, v. 26, n. 4, November, pp. 294-307.
Baud, M. (1996) ‘Market Globalisation’, UNESCO-Courier, November, pp. 33-36.
Bellamy-Foster, J. (1997) ‘Promoting Polyarchy: Globalization, Intervention, Hegemony, and US’, Monthly Review, v. 49, n.4, pp. 51-63.
Boal, J. (1985) ‘Great Thinkers get the Word Out’, American Way, March 5.
Bramble, T. (1997)’Statistical Review of Australian Economy, under the ALP-ACTU Prices and Incomes Accord’, 1983-1996, August, MIMEO.
Clifton, J. (1996) 'Dining at The Top Table', Sunday Star Times, p. C.1.
Clifton, J. (1996) 'An Exclusive Club by Invitation Only', Sunday Star Times, p .C.1.
Cornford, J. (1990) ‘Performing Fleas: Reflections from a Think-Tank’, Policy Studies, 11/4, pp.22-30.
Dahl, R. (1970) Modern Political Analysis, Englewood Cliffs, Prentice Hall.
Da Silva, W. (1996) ‘The New Social Focus’, The Australian Financial Review Magazine, June.
Dei, G. & J. Sefa (1996) ‘Critical Perspectives in Anti Racism: An Introduction’, Canadian Review of Sociology and Anthropology, August, v. 33, n.3, pp. 247-268.
Denham, A & M. Garnett, (1995) ‘Rethinking Think tanks; a British Perspective’ in J. Lovenduski, and J. Stanyer (eds) Contemporary Political Studies Belfast, Political Studies Assoc. vol. 1.
Desai, R. (1994) ‘Second Hand Dealers in Ideas: Think tanks and Thatcherite Hegemony’, New Left Review, v. 203,.
Dror, Y. (1984)"Required Break Through in Think Tanks', Policy Sciences, vol. 16, pp. 199-225.
Dye, T. (1978) 'Oligarchic Tendencies in National Policy Making: the Role of Private Planning Organisations', Journal of Politics, vol. 40, pp. 309-31.
Gibbs, A. (1992) 'Interview with G. Murray', at Gibbs Securities, Auckland.
Gluyas, R. (1999) 'Utopian Agendas’, The Australian, January 22, pp. 32.
Graham, A. (1995) ‘Statement on World Wide Wages Inequality’, International Conference of Progressive Policy Think Tanks, Maryland, US.
Granovetter, M. (1973) 'The Strength of Weak Ties', American Journal of Sociology, vol. 78, p. 1360-1379.
Grattan, M. (1997a) 'Doing Business with Jeff Kennett', Australian Financial Review, February 22, pp. 25-31.
Grattan, M. (1997b) 'The Dirty Trail of a Think Tank Grant', Australian Financial Review, April 21, pp. 25-31.
Head, B. (1988) ‘The Labor Government and Economic Rationalisatism", Australian Quarterly, Summer, pp.466-477.
Henwood, D. (1997) 'Post What?', Monthly Review, pp.1-12.
Herd, B. (1998) ‘The Left’s Failure to Counter Economic Rationalism in Australia: Classical Economists Legacy to Government, Bureaucracy, Think Tank and the Union Movement’, to be submitted Doctorate of Philosophy, Griffith University.
Higgott, R. & D. Stone, (1994) ‘The Limits of Influence: Foreign Policy Think tanks in Great Britain and the USA’ Review of Int. Studies, 20/1, pp.15-34.
Hinkson, J. (1998) ‘Subjectivity and the Neo Liberal Economy’, Arena, n. 11, pp.119-144.
Hubbard, A. (1992) 'Crusader of the Roundtable', Listener and TV Times, May 4, pp. 15-21.
James, S. (1993) ‘The Ideas Brokers: the Impact of Think Tanks on British Government’, Public Administrator, v. 71, Winter, pp.491-506.
Kuhn, R. (1993) 'The Limits of Social Democratic Economic Policy in Australia', Capital and Class, Issue 51, Autumn, pp. 17-50.
Lange, D. (1996) quoted in Clifton, J. 'Dining at the Top Table', Sunday Star Times, p. C. 1.
Lindsay, G. (1996) "Greg Lindsay Speaks Out about the Early CIS", interviewed by Andrew Norton, Editor of Policy, interview first appeared in Winter, Policy, also on the internet, http://www.cis.org.au/glint.htm
Managh, C. (1989) 'Knight's Driver Sticks to Issues', Sunday Star, Section A, Feb. 12.
Marsh, I. (1994), 'The Development and Impact of Australia’s "Think tanks"’, Australian Journal of Management, December, pp. 177-200.
Nicolaus, M. (1969) ‘Remarks at ASA Convention’, American Sociologists, v. 4, n.2, May, pp.154-155.
Ninness, G. (1992) 'Round the Table: the New Zealand Business Roundtable and Who are They?", Sunday Star, March 1, pp. D. 1/3.
NIRA's World Directory of Think Tanks 1996 http://www.nira.go.jp/ice/tt-info/nwdtt96/1050.html.
Panitich, L. (1996) Globalisation States and Left Strategy, Social Justice, v.23, n. 1-2, pp. 79-91.
Penberthy, J. (1996) ‘Absent Friends Knock Nervously on Howard’s Door’, Australian Financial Review, March 18, pp. 1/14.
Spark, A. (1996) ‘Wrestling with America: Media, National Images and the Global Village, Journal of Popular Culture, v.29, n.4, pp.83-89.
Stone, D. (1991) ‘Old Guard versus New Partisans’, Australian Journal of Political Science, vol. 26, pp. 197-215.
Stone, D. (1996a) From the Margins of Politics, Western European Politics, vol. 19, n. 4, October, pp. 676-692.
Sweezy, P. (1997) More (or less) Globalization’ Monthly Review, v. 49, n. 4, pp.1-4.
Tabb, W. (1997) ‘Globalization is an Issue, the Power of Capital is the Issue’, Monthly Review, v. 49, n. 2, pp.20-31.
Toohey, B. (1996) 'Rearing the Right', Eureka St., vol. 6, N. 8, October.
Weber, S. (1997) ‘Fewer Ups as: the Changing Business Cycle’, Current, September, n. 395, pp.11-17.
Weissman, R. (1997) ‘One World Ready or Not: The Manic Logic of Global Capitalism, Multinational Monitor, May, v.18, pp. 26-29.
Wheelwright, E. (1994) ‘Political Economy: Past, Present and Future’, Pacific Basin Studies Review, vol. 5, no. 3, pp. 3-18.
Back to opening page