Last fall, The New York Times raised questions about the independence of some of Washington's leading "independent" think tanks by revealing that many of them had accepted millions of dollars in donations from foreign governments.
Canadians know too well how hard it is to get a hearing in the U.S. capital. Diplomatic channels only work if you're big or problematic enough to warrant attention. As a result, many smaller foreign governments have turned to big-name think tanks to push their causes and influence the Washington power elite.
The Brookings Institution is at the top of Washington's think-tank food chain. Its studies and policy suggestions are required reading on Capitol Hill. Its events draw a who's who of Republican and Democratic power brokers. So the news that Brookings had taken millions from the governments of Norway and Qatar put the austere Massachusetts Ave. institution on the defensive.
Brookings president Strobe Talbott bluntly rejected the Times report. Brookings, he said, had implemented "institutional safeguards" to ensure its independence. "Our scholars determine our research and policy recommendations, not our contributors."
Still, the Times report raised legitimate questions about the transparency, or lack thereof, at think tanks. These quasi-academic entities have proliferated on both sides of the border in recent decades and emerged as major players in the sausage-making that leads to government policy.
Like Brookings, almost of all of Canada's leading think tanks claim to be independent and non-partisan. But while none – not even the Broadbent Institute – is directly affiliated with a political party, it's not hard to discern an identifiable political agenda in the research they produce.
American think tanks, says former think-tank founder David Callahan, "often operate as the motherships of ideological movements – weaving together a jumble of values and ideas into a coherent story and actionable agenda." You could easily say the same of most of their Canadian counterparts.
At the very least, no one would confuse them with charities. Yet, that's what they are under Canadian tax law. Polar opposites such as the Fraser Institute and the Canadian Centre for Policy Alternatives allow their donors – individuals, corporations, foundations – to claim a tax rebate.
Just who is funding these think tanks? Usually, the public has no idea.
Some think tanks provide more disclosure than others. The annual report of the Macdonald-Laurier Institute lists donors, including the Mining Association of Canada. The Canadian Association of Petroleum Producers is listed as a sponsor. But how much money each organization provided is not disclosed.
Canadian think tanks can also accept money from foreign entities, including governments. Since 2009, the total amount of foreign funding is traceable in filings made with the Canada Revenue Agency. But the individual sources of such funding remain confidential.
The Fraser Institute raised 15 per cent, or about $6.6-million, of its total revenue from foreign sources in the four fiscal years to 2012. Not to single out Fraser – whose research, like that of its peers, is rigorous but only half the story – but no one could argue that such money has gone toward charity.
"Fundamentally, think tanks on the left and right have been abusing the privilege of being a registered charity," says Toronto lawyer Mark Blumberg, a leading expert in the field. Since charities are only allowed to devote 10 per cent of their revenue to political activities, "you could argue some of them haven't been following the rules."
The line between political advocacy and policy analysis has become increasingly blurred. Three years ago, the Harper government made a big to-do about anti-pipeline environmental groups taking foreign donations. And the CRA has started cracking down on organizations that confuse political advocacy with charity.
Perhaps it's time we also focused on think tanks. They play a valuable role in democracies, but their research is only as credible as the amount of disclosure they provide. The pro-transparency blog Transparify recommends that journalists add the phrase "does not disclose its funders" when reporting on research produced by such think tanks. It's advice worth following.