James A Papke

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James August Papke from Purdue University was a well known, and therefore highly credible, taxation expert. However he also provided witness services to the Tobacco Institute in a legislative hearing on passive smoking in the Chicago area.

He volunteered for this highly remunerated task by sending his resume to the Tobacco Institute in April 1985 offering his services. [Note: there could be some confusion in other documents because the names James K Papke and James W Papke are also found in the document archives (machine reading errors??). He is also called 'Leon' in one document.]

Documents & Dates


1959 - 61 Assistant Professor of Economics, Wayne State Univerity


1961 - 64 Taxation Fellow, Claremont Graduate School, Claremont California


1962 Joined Purdue University as Faculty member: Associate Professor of Economics


1963 Jan 14 Albert E Haag, Executive Secretary of the Indiana tobacco distributors association has written to Ray Jones, Vice President of Philip Morris:

When I visited in your office, I informed you I was having copies made of Dr Papke's research figures. This report was to be presented to the Committee on Tax and Financing Policy. We are enclosing the completed report for your files. So far I have been successful in having the cigar and tobacco tax deleted from any recommendations to the Legislature. However, we have to be on constant watch to see that no hip pocket bill is presented from the floor.

[Note this does not specifically say Dr James Papke, but it is almost certainly him -- although very early. This letter date is correct.] http://legacy.library.ucsf.edu/tid/ojs17e00/pdf


1976-77 President of the National Tax Association - Tax Institute of America


1983 Feb Indiana's revenue structure: major components and issues, edited by James A. Papke (at Purdue University).

This book contains ten papers discussing Indiana's revenue system. Individual chapters examine Indiana's economy, state and local tax burden, the individual income tax, the retail sales tax, the competitiveness of Indiana's business tax structure, etc.

http://legacy.library.ucsf.edu/tid/xhw97b00/pdf


1984 Nov 25 - 28 Seventy-Seventh Annual Conference on Taxation, sponsored jointly by the National Tax Association and the Tax Institute of America .

  • James A Papke presided over an NTA award and was a member of the conference committee. (past president)
  • Leslie E Papke of Michigan State University is on the Editorial Advisory Board of the National Tax Journal

http://legacy.library.ucsf.edu/tid/lak13b00/pdf

[A Leon Papke is also mentioned with the NTA, but it is probably a misprint]

1985 Jun His resume was sent to the Tobacco Institute in mid-1985 The Tobacco Institute may have been primarily interested in James Papke because he has a "computerized model" which can "calculate tax liability for specific firms including all major taxes and the interactions of state tax systems as they affect a multi-state company." http://legacy.library.ucsf.edu/tid/sec23b00/pdf


1985 Oct A newsletter State Policy Reports [Not specifically tobacco] has a note on Papke:

The most sophisticated approach to comparing business taxes is to calculate tax liability for specific firms including all major taxes and the interactions of state tax systems as they affect a multi-state company. Professor James Papke of Purdue University has a computerized model that does this, which has been used by some state tax study commissions

http://legacy.library.ucsf.edu/tid/xgp65b00/pdf

A later document in the tobacco files gives further details of this computerized model (known as AFTAX) in a recommendation for the Californian Senate Committee on Revenue and Taxation http://legacy.library.ucsf.edu/tid/yqr15b00/pdf


1986

How independent is Independent ?
A recent Indiana study (by James Papke, ed.) provides an exception.
Indiana's Revenue Structure: Major Components and Issues , - Purdue University Office of Publications,)
The study's sponsorship is interesting: State officials complain, from time to time, that the state universities do not provide policy-relevant research for them and, when they do, that they like to charge for it. This study was financed by Purdue. As Papke comments:
    "From the outset he (Purdue's acting president) envisaged the contribution the University could make to Indiana through research on its fiscal and economic affairs. Further, he expressed the view that the study should be conducted as a project of strictly independent and uninhibited research and that the authors have full and complete autonomy in the design of their work and in the presentation of their results."
http://legacy.library.ucsf.edu/tid/sdf89b00/pdf

1986 Feb 4 James Savarese gave testimony before the Senate Ways & Means Committee of the Ohio State Legislature on behalf of the tobacco industry. A note on page 9 (duplicated on page 21) references an

"Outline of Testimony for this Committee"

It is by Dr James A Papke, Professor of Economics and Public Finance, Director of Center for Tax Policy Studies, Purdue University http://legacy.library.ucsf.edu/tid/wmz44b00/pdf


1986 Feb 7 James Papke has sent the Tobacco Institute a bill for

Services Rendered and Related Travel Expenses

(Re Subsitute House Bill 583 Ohio legislature)

    Total Services -- 29.5 hours......... $8,850 Travel Expenses + hotel            ...... $319
                TOTAL BILLING
                $9164.55

http://legacy.library.ucsf.edu/tid/mbg75b00/pdf http://legacy.library.ucsf.edu/tid/ibg75b00/pdf


1986 Mar 9 The Tobacco Institute learns that a group in Ohio is planning to initiate a ballot initiative to earmark a new 4.5 cents per pack cigarette tax (plus tax increases on liquor) to pay for a new domed sports stadium. The TI plans to block the move through building local coalitions with retailers and the liquor companies: they have both their Strategy and Tactics worked out.

Direct lobbying of the County Commissioners'

  • Develop series of private education meetings with Commissioners, i.e. James Saverese , Prof. James Papke , Bond Specialists.
  • Preparation of a summary statements and follow up letters for Commissioners from experts with whom they met.

Bond Market Activities

  • Arrange for experts, i.e.
    • James Papke,
    • James Saverese,
    • members of rating agencies (Moody's, Standard & Poors) etc.,
to meet with members of bond market.
  • Publicly attempt to insure that bond rating are complete prior to placement of issue on the ballot.

http://legacy.library.ucsf.edu/tid/wnh34b00/pdf


1986 Apr A RJ Reynolds file holds a TI Evaluation report saying

James A. Papke (Purdue University):
This economist testified on a tax bill before the Ohio House Ways and Means Committee. Described as an "outstanding" witness with a good grasp of how this issue (tax hike) would affect the economy, he is rated as someone who could likely be used very effectively in any situation.

http://legacy.library.ucsf.edu/tid/hea71d00/pdf <img SRC="../library/space.gif" width=360 height=1> See summary http://legacy.library.ucsf.edu/tid/hea71d00/pdf


1986 Apr 8 The Tobacco Institute's administration wants some accounting and address details on Dennis Chinn, Greg Niehaus, James A Papke , Thomas Borcherding and many others http://legacy.library.ucsf.edu/tid/sdq95b00/pdf


1986 Apr 22 Hurst Marshall at the Tobacco Institute is circulating draft material objecting to tax earmarking.

One document notes "Dr James A. Papke, Director of Purdue University's Center for Capital Tax Policy Studies ."


1986 Jul 3 Ellen Quinn in TI Accounting still has not received the required payment data for network economists Thomas Borcherding, Dennis Logue and Greg Niehaus .

[These are all members of the infamous Cash for Comments Economists Network. Her remarks must also apply to Papke

When requesting a payment for services, an honorarium, or a political contribution, please include the social security or federal ID number and the address of the recipient.

http://legacy.library.ucsf.edu/tid/jid99b00/pdf


1986 Jul 23 [See page 5 of 33] File note from Katherine Becker at the Tobacco Institute " Resource Evaluation -- Trisler Interview"

At Bill Trisler's (BT) request, Public Relations provided an economic impact study on pending smoking restriction legislation in Michigan.

Marketing Resources [the local lobbying company] and Gary Neuhaus [sic Greg Niehaus ] used the study "to educate the public and legislators" about the potential costs of restrictions through newspaper articles and legislative briefings. In BT's view, if Tobacco Institute sponsorship is identified, "red flags go up." Reaction is good if Institute sponsorship is not identified or if our representative has a "good relationship" with a legislator. Legislative reaction to presentation of the TI study by an industry ally will elicit a different response than if presented by TI, depending on who the ally is and who are the legislator's constituent groups.

Economist Witness

  • Dwight Lee (University of Georgia): A last-minute substitute to present legislative testimony, Professor Lee was rated by BT as having little, if any, effectiveness at the hearing on smoking restrictions. He was not familiar and/or comfortable with the obviously canned testimony he presented. Lee, apparently viewed as a "stranger" by some midwestern legislators, may be more effectively utilized in the southern states,
  • James A. Papke (Purdue University): This economist testified on a tax bill before the Ohio House Ways and Means Committee. Described by BT as an "outstanding" witness with a good grasp of how this issue (tax hike) would affect the economy, he is rated as someone who could likely be used very effectively in any situation,
  • Greg Neuhaus (University of Michigan): Having participated in editorial briefings and testified on a Michigan smoking restriction bill, Neuhaus was considered by BT as an intelligent witness with a quiet, very effective delivery. Neuhaus was viewed as "excellent" in responding to legislators' questions. He knew his material and did not have to search for the answers in the study.

In Bill's view, it is very important for the economist witness to be a resident of the state in which he or she will testify. Industry opponents condemn The Institute for "big spending" when "outsiders" are brought into a state for a hearing.

[There is much more here on other similar expert 'resources'] http://legacy.library.ucsf.edu/tid/ifq15b00/pdf


1986 Aug 4 Bill Trisler (Regional VP of Chicago area) and Brooke Cheney (Ohio lobbyist with Governmental Policy Group in Columbus) have met with Bill Buckley of Washington DC's Tobacco Institute office re. plans for countering a cigarette excise tax increase in Cuyahoga County (Ohio) A Short-term project rolled out to counter the tax increase is to "Determine advisability and timing of retaining additional legal and/or bond market expertise ie) D'Angelo, Dr Papke, etc." Papke's contact was with Pete O'Grady the Tobacco Institute's retained legal counsel. http://legacy.library.ucsf.edu/tid/elh34b00/pdf


1986 Aug 18 The Regional Vice Presidents (RVPs) and Regional Directors (RDs) of the Tobacco Institute in charge of various areas have supplied comments on their Economic Witnesses. Six of the RVPs thought it important that the economist was a resident of the State, "Ideally associated with the State University", while three did not, provided they were "presented to the legislators by a 'credible... organization' (e.g. chambers of commerce, labour union)." [Provided they hid their tobacco industry backing behind a front organization.] The consolidated and encapsulated comments included:

Region III
Dwight Lee (University of Georgia):
A last-minute substitute to present legislative testimony, Professor Lee was rated as having little, if any, effectiveness at the hearing on smoking restrictions. He was not familiar and/or comfortable with the obviously canned testimony he presented. Lee, apparently viewed as a "stranger" by some midwestern legislators, may be more effectively utilized in the southern states.

James A. Papke (Purdue University):
This economist testified on a tax bill before the Ohio House Ways and Means Committee. Described as an "outstanding" witness with a good grasp of how this issue (tax hike) would affect the economy, he is rated as someone who could likely be used very effectively in any situation.

Greg Neuhaus [sic Neihaus] (University of Michigan):
Having participated in editorial briefings and testified on a Michigan smoking restriction bill, Neuhaus was considered an intelligent witness with a quiet, very effective delivery. Neuhaus was viewed as "excellent" in responding to legislators' questions. He knew his material and did not have to search for the answers in the study.

http://legacy.library.ucsf.edu/tid/lyp15b00/pdf


1986 Sep 26 The budget and accounts for the Tobacco Institute, sent to James Cherry (on the Committee of Counsel of the institute) shows that J Papke was paid $9,400 for his efforts in Ohio. http://legacy.library.ucsf.edu/tid/ctj44a00/pdf


1987 Jan The Herald-Argus editorial (La Porte, Wogan City) puts its weight behind the tobacco companies rather than taxes to support the education system.

The facts of tax inequities are there, Purdue economist James Papke notes in his study of Indiana taxes that Indiana households with $34,000 annual income pay about nine and a half percent toward taxes, while households with $100,000 income and more pay about six percent towards taxes,"

http://legacy.library.ucsf.edu/tid/lat32f00/pdf


Cigarette taxes . . .Regressive or Progressive?
Taxes are considered 'regressive' when they consume more of a low-paid worker's income than that of a person on a higher salary. Therefore all excises and all goods or services taxes are 'regressive' if they are imposed on essentials ... because they must be purchased by the poor as well as the rich.

    These economists mislead politicians and the public by labelling cigarette taxes "Regressive" without revealing the hidden assumption that cigarette costs do not influence buying behaviour. However we know that as the price of cigarettes rose the amount smoked by the poor decreased quite rapidly. The poor then spent less on tobacco; had fewer days of absenteeism; had fewer long-term health problems and fewer medical bills. So this excise tax was probably highly "Progressive" in both health and financial terms.

    The only problem was, the so-called national "Death Benefit" of smoking: both the smoker and their families survived longer. But the longevity of ex-smokers and their offspring made them more of a burden on society in their old age.

1987 Jan 1 The Indianpolis News carries a story "ISTA has $502 million program for education." The ISTA [Indiana State Teachers Association] has commissioned James Papke to conduct a study on the regressive nature of the state's taxes with a view to better budgeting for education.
[However his recommendations wouldn't have pleased the tobacco industry.] He recommends:

  • Income tax rise from 3 to 4%
  • Corporate income tax rates to equal personal rates
  • Local property rates
  • Excise tax on cigarettes up by 2 cents to 12.5 cents.

Recommendations were based on findings in a new study by Dr James K. Papke, director of the Center of Tax Policy Studies at Purdue University. Papke concluded that Indiana taxes are regressive in nature.

"In all measures of tax burden, Indiana is in the lowest ranking compared, to other states," Papke said during the press conference."lndiana currently is not using its full capacity of taxing." Papke's report was commissioned by ISTA.

http://legacy.library.ucsf.edu/tid/cgi44b00/pdf He also noted that the taxing system was already highly regressive (not just through excise taxes):

The facts of tax inequities are there. Purdue economist James Papke notes in his study of Indiana taxes that Indiana households with $30,000 annual Income pay about nine and a half percent toward taxes; while households with $100,000 income and more pay about six percent toward taxes.

http://legacy.library.ucsf.edu/tid/qsb30g00/pdf


1987 Jan 16 One of the tobacco industry's lawyer lobbyists writes to Bill Trisler in Indiana asking if he can get a copy of Papke's tax study, so they can get the Citizens for Tax Justice (CTJ) to prepare a report.

He was refering to the Indiana State Teachers Association (ISTA) recommendations for a wider tax structure (general sales taxes, rather than just excise on cigarettes).

Recommendations were based on findings in a new study by Dr James K. Papke///, director of the Center of Tax Policy Studies at Purdue University.

Papke concluded that Indiana taxes are regressive in nature. "In all measures of tax burden Indiana is in the lowest ranking compared, to other states," Papke said during the press conference."lndiana currently is not using its full capacity of taxing." Papke's report was commissioned by ISTA .

The governor proposes broadening the sales tax base to pay for his $372 million package. ISTA's $502 million education program calls for about $130 million more than the one requested by Gov. Robert Orr and State Superintendent of Public Instruction H. Dean Evans.

http://legacy.library.ucsf.edu/tid/cgi44b00/pdf

[He seems to have developed a conscience]


1987 Apr /E The National Council of State Legislators (NCLS) are holding their annual conference. [Mid-Western States?]. James Papke is speaking on "The Service Sector: Fair Prey for Taxation" This was before the Federal Budget and Taxation Committee and the Fiscal Affairs and Oversight Committee. http://legacy.library.ucsf.edu/tid/ohi25b00/pdf


1987 May 22 Bill Trisler sent his evaluation of economic witnesses for Region III to George Minshew at the Tobacco Institute.

INDIANA
Professor Cecil Bohanon, Department of Economics Ball State University, Muncie, Indiana
During the time of the mobilization for the defeat of the tax bills in the Indiana General Assembly, it was the wishes of our Indiana counsel that we not use an economic witness. Therefore, I made no attempt to make this contact.

Our counsel did express that, should an economic witness be useful, their choice would have been the following: Professor James A. Papke , Department of Economics Herman C. Krannert Graduate School of Management Purdue University, West Lafayette, Indiana PH: (317) 494-4442
This recommendation is due to the fact that we used this individual for testimony in Ohio, on behalf of the Institute, in 1986.

This individual was very effective and I have had the opportunity to communicate by phone, but never had the opportunity to "break bread" with him because of my schedule in the past year.

http://legacy.library.ucsf.edu/tid/ymn09a00/pdf


1987 Aug 3 As Director of Purdue University's Center for Capital Tax Policy Studies, he argued that while taxing consumer services to individuals is warranted, taxing business services could lead to double taxation and could discriminate against companies that rely on outside consultants. http://legacy.library.ucsf.edu/tid/rom97b00/pdf


1987 Sep (Summer) States ID newsletter carries an item:

Dr James Papke, professor of economics and director of the Tax Policy Center at Purdue University, strongly endorses sales taxes on consumer services. But he cautioned state legislators at their annual meeting in Indianapolis this July against taxing business to business services. "A sales tax is on consumption by the final consumer and should be used for that purpose," says Papke. He continues to say that a sales tax on business services is a hidden business tax and would distort prices.."There is no such thing as a benign business tax;" concluded Papke.

http://legacy.library.ucsf.edu/tid/gnh13c00/pdf

[Papke was probably far too independent for the tobacco industry. He was in favour of extending the excise taxes on goods, to services -- provided these weren't business services.]


1988 Apr 11 The California Taxpayers Association is promoting

A conference on business tax incentives and state economic development, co-sponsored by the National Tax Association [run by James Papke] and the Midwestern Legislative Conference of the Council of State Governments, will be held May 13 - 14 in Chicago. Among those making presentations at the conference will be Frederick Stocker, Executive Director of the National Tax Association; Robert Mattson, Director of Taxes for IBM; James Papke of Purdue University ; Howard Doerr, Executive Vice President of US West, and William R. Brown, President of the Council of State Chambers of Commerce.

http://legacy.library.ucsf.edu/tid/lza96d00/pdf