Group tied to shadowy network created $93T estimate

By Scott Waldman | 04/01/2019 07:31 AM EDT

What’s in a number? When it comes to the $93 trillion estimate for the Green New Deal, the answer is found in a network of interlinked groups: a think tank, its political arm and a super political action committee.

Douglas Holtz-Eakin, president of the American Action Forum, said the Green New Deal could cost $93 trillion.

Douglas Holtz-Eakin, president of the American Action Forum, said the Green New Deal could cost $93 trillion. Douglas Graham/CQ Roll Call/Newscom

This story was updated at 5:52 p.m. EST.

What’s in a number?

When it comes to the $93 trillion estimate for the Green New Deal, created by its critics, the answer is found in a network of interlinked groups: a think tank, its political arm and a super political action committee. Add a web of secret donors, and eager lawmakers, and you have the blurry outlines of an echo chamber that propels an unverified claim into the orbit of Washington politics.


Round and round it goes.

The price tag was tallied by the American Action Forum. The group, which counted Elaine Chao as a director on its board until shortly before she became President Trump’s Transportation secretary, has received financial support from conservative groups that fund political attacks through undisclosed donors. They, in turn, have sometimes been funded by fossil fuel lobbying interests opposed to environmental regulations.

The $93 trillion price tag exemplifies the way political arguments flow in Washington — on both sides of the aisle. Some of the deadliest ammunition against policy proposals often come from think tanks that are connected to other ideologically driven groups and propped up by unknown funders.

"The problem is there is a whole lot of money sloshing around Washington, and it usually represents the interests of individuals and interests with a whole lot of money, and it tilts the system away from ordinary Americans," said Fred Wertheimer, president of Democracy 21, which advocates for reducing the influence of big money in politics.

In this case, the estimated cost of the Green New Deal was produced by a think tank whose status as a 501(c)(3) nonprofit prohibits it from getting involved in politics. That’s not the case for its sister organization, the similarly named American Action Network. It’s also a nonprofit, but its designation as a 501(c)(4) allows it to be an "action tank" that’s able to use some political language.

Then there’s the network’s super PAC. The Congressional Leadership Fund is purely political, and it’s been running attack ads against Democrats and the Green New Deal — even if those lawmakers haven’t endorsed the ambitious climate plan.

Collectively, the three groups represent a nexus of potent Washington interests that are bankrolled by anonymous donors who have given the network millions of dollars. It’s not an unusual story. It happens all the time in the realm of Washington politics, by both political parties.

The American Action Forum — which created the questionable estimate of $93 trillion — has received several million dollars from its sister group, the American Action Network. The two organizations share board members and the same address on Pennsylvania Avenue in Washington, D.C. The American Action Forum does the wonky work, while the American Action Network takes "direct action" politically.

"AAF will stay neutral in elections, and by and large will leave its sister organization, the American Action Network, to engage in any appropriate direct legislative advocacy in support of the policy proposals it discusses," the group states on its website.

‘They want to take away your car’

Those political attacks are sometimes informed by the number-crunching work of the nonpolitical think tank. In this case, the $93 trillion estimate for the Green New Deal bounced from its offices on Pennsylvania Avenue to the Capitol, and beyond.

On Friday, Sen. John Cornyn (R-Texas) said in a tweet that the Green New Deal would increase the cost of electricity for every Texan up to $3,800 annually. He cited the American Action Forum, whose president concedes that the price tag is just a guess.

Last month, a group of House Republicans held a press event to rail against the Green New Deal, with one criticizing it as "genocide."

Rep. Greg Walden (R-Ore.) challenged Democrats to prove that the price tag was wrong.

"The Democrats and their allies dispute the various estimates that show the Green New Deal would cost $93 trillion, then I say one thing, prove it," he said. "Let’s see your numbers, let’s hold hearings, let’s pull the curtain back and see where the socialist Democrats stand and how the American people might feel about a 22 percent increase in their energy costs. Frankly, House Democrats, I think, are afraid to have this debate in public and in their committees."

President Trump has also cited the figure.

"They want to take away your car, reduce the value of your home and put millions of Americans out of work, spend $100 trillion, which, by the way, there’s no such thing as $100 trillion," Trump said at a rally in Texas last month.

Activists and the roughly 100 Democratic lawmakers who support the Green New Deal have not put a price on the ambitious plan. So far it’s just a resolution, and supporters say it’s a starting point for a larger conversation around legislation to address climate change. The nonpartisan Congressional Budget Office has not put a price on the plan either.

A valid cost estimate of the Green New Deal can’t happen until specific proposals are released with a timetable for their completion, said Robert Stavins, director of Harvard University’s Environmental Economics Program.

"Given that the Green New Deal proposal itself is nothing more nor less than an outline of some long-term goals without there being any detailed description or even general specification of how the goals would be achieved with specific public policy and specific action, any kind of estimate of the cost is going to be exceptionally speculative," he said.

Until then, the $93 trillion number will remain part of the nation’s political dialogue. The economist who oversaw the estimate, Douglas Holtz-Eakin, said his group, the American Action Forum, crunched the numbers without any input from its politically active sister organizations.

His group, he said, operates independently from the American Action Network and is not connected to the Congressional Leadership Fund. He denied that they operate as some sort of nexus, though it does approach policy from the center-right.

"Our donors, the people who fund us, are a collection of individuals, trade groups and corporations, and we’re missing the traditional support that foundations have," Holtz-Eakin said. "It is easy for this to be portrayed as shady, I get that."

Nevertheless, the three organizations — the think tank, the "action tank" and the super PAC — share a web of connections.

Fred Malek, a longtime Republican donor and former CEO of Marriott hotels who died last week, was chairman of the American Action Forum. He also co-founded the American Action Network and was chairman of the Congressional Leadership Fund.

Former Minnesota Sen. Norm Coleman (R) is listed as sitting on the board of the American Action Forum. He’s also chairman of the American Action Network and a co-founder of the Congressional Leadership Fund.

Dan Coston is president of the American Action Network and the Congressional Leadership Fund. Coston raised $213 million for the two organizations in the last election cycle, according to the groups. The super PAC received money from Chevron Corp., ConocoPhillips, Occidental Petroleum Corp., Marathon Petroleum Corp., Koch Industries Inc. and Alliance Coal LLC, according to the Center for Responsive Politics.

The Congressional Leadership Fund shares some staff members with the American Action Network, according to tax documents. The group is located at the same address as the American Action Network and the American Action Forum.

The three groups are also linked by money.

The American Action Network donated more than $4 million to the American Action Fund between 2012 and 2017, according to tax records and the Center for Responsive Politics. And during the last election cycle, the American Action Network gave $25 million to the Congressional Leadership Fund.

The super PAC is running attack ads against the Green New Deal — and Democratic lawmakers.

Millions or trillions?

Within days of the Green New Deal’s unveiling, the Congressional Leadership Fund launched attack ads against vulnerable House Democrats. It tried to connect the climate plan to joblessness. The ads targeted two black members of Congress and showed an image of a homeless white man. Neither of the lawmakers, Reps. Antonio Delgado (D-N.Y.) and Colin Allred (D-Texas), has co-sponsored the plan.

The American Action Fund estimated that the Green New Deal could cost between $51 trillion and $93 trillion. It assumes that much of those costs will come from policy ideas unconnected to climate. It estimated that the plan’s call for universal health care would cost $36 trillion, guaranteed jobs would cost $6.8 trillion to $44.6 trillion, and a low-carbon power grid would cost $5.4 trillion. A green housing program would cost $1.6 trillion to $4.2 trillion, and a net-zero transportation system would cost $1.3 trillion to $2.7 trillion, according to the American Action Fund.

"Given the attention the GND has received, it is worth assessing its proposals, yet its breadth makes it daunting to apply the standard tools of policy analysis," the group acknowledges in its analysis.

The group’s president, Holtz-Eakin, an economist who headed the Congressional Budget Office under President George W. Bush, said he was trying to create a cost spectrum of the Green New Deal. He acknowledges that the estimate is imprecise.

"I think of this as answering the question ‘Is this a proposal that’s going to cost tens of millions of dollars or tens of billions of dollars or tens of trillions of dollars?’ and to my eye, the answer is the latter, and it informs the debate in that way," he said in an interview. "For me, the order of magnitude matters the most."

Holtz-Eakin has been critical of climate science while also recognizing that increased carbon dioxide emissions pose an economic threat. He was the chief economist for the presidential campaign of the late Sen. John McCain (R-Ariz.), and he advocated for a limited carbon tax in the past.

He says his group is not influenced by its political sister, the American Action Network.

The American Action Network does not disclose its donors. But tax returns show that it’s received money from fossil fuels groups. The American Petroleum Institute donated $250,000 in 2012, and the American Natural Gas Alliance gave $35,000 in 2010, according to the Center for Responsive Politics.

The American Action Network has also received millions of dollars from conservative dark money groups that don’t disclose their donors. That includes $500,000 from Crossroads Grassroots Policy Strategies, an offspring of the American Crossroads super PAC founded by Karl Rove.

Meanwhile, the American Action Forum received at least $150,000 from Donors Trust, which in turn received millions of dollars from the Koch brothers network, according to the Center for Responsive Politics.

There is no indication that any of the groups have violated the law. And there are similar groups on the left that share board members between educational arms and super PACs. The Sierra Club does not disclose all of its donors, and it has an affiliated super PAC, Sierra Club Independent Action.

For decades, clean-government groups have called on organizations like the American Action Network to reveal their funders, said Wertheimer, the president of Democracy 21. Innocuous-sounding names leave the public guessing about a group’s political motivations, he said.

"It bothers people to see ads running by groups that are taking potentially controversial positions without knowing who’s funding them, particularly if the groups have names that don’t tell you much," Wertheimer said. "If you had the name that said ‘energy companies for fossil fuels,’ you would know what they’re about regardless of who is funding them."

The American Action Forum, American Action Network and Congressional Leadership Fund are part of a common template orbiting the federal government, said Ciara Torres-Spelliscy, a law professor at Stetson University and author of "Corporate Citizen? An Argument for the Separation of Corporation and State."

Each arm operates independently and performs its specialized functions in accordance with the law. Though they’re technically separate, the work of one feeds the other, providing fuel for a policy fight and the financial muscle to wage battle against political adversaries.

"There are a lot of people with Ph.D.s, or law degrees for that matter, who will write you a white paper for enough money," Torres-Spelliscy said. "You can think about the entire climate change ‘debate.’ It’s not a real debate among serious scientists, but you have a few fringy ones who will take the money and run, and dispute what 99 percent of real scientists think, and then it gets couched in our political discourse as if it’s a real scientific debate when it’s not."