WHAT MISSOURIANS NEED TO KNOW ABOUT

THE SHOW-ME INSTITUTE

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ORGANIZATIONAL OVERVIEW

The Show-Me Institute (SMI) was co-founded in 2005 by Rex Sinquefield, a billionaire GOP donor who has bankrolled numerous campaigns and ballot initiatives to advance his extreme political agenda, and wealthy conservative Crosby Kemper III. SMI was immediately praised by like-minded ideologues, such as Ethelmae Humphreys, Dick Armey of FreedomWorks, disgraced former Speaker Rod Jetton and Tracie Sharp of the State Policy Network for providing the air of unbiased research to advance their right wing agenda. The Show-Me Institute is organized as a 501(c)(3) nonprofit corporation headquartered in Saint Louis, Missouri. Annual receipts for the organization exceeded $1.4M in 2010 and 2011, the most recent years for which 990 tax forms are available.

FRANCHISE OF RIGHT-WING, KOCH BROTHERS-FUNDED 'STATE POLICY NETWORK' From its first year of operation, the Show-Me Institute has been a formal member of the State Policy Network (SPN), a national network of like-minded 'think tanks' that promote disinformation and American Legislative Exchange Council (ALEC) agendas in state Capitols. SPN is an umbrella group of conservative think tanks across the United States, founded in 1992 by Thomas Roe (of the Roe Foundation and South Carolina Policy Council). In addition to its state think tank affiliates, many other national right-wing organizations are associate members of SPN, including the American Legislative Exchange Council (ALEC), Americans for Prosperity, the Cato Institute, the Franklin Center, the Heritage Foundation, the Heartland Institute, and the National Right to Work Legal Defense Foundation. SPN has played a major role in supporting ALEC, serving as a “chairman” level sponsor of the 2011 ALEC Annual Conference and acting as a voting member of several task forces. Since its founding, SPN has been funded by conservative organizations including the Koch-funded Donors Trust/Donors Capital Fund, the Bradley Foundation, the Roe Foundation, and the Kochs’ Claude R. Lambe Charitable Foundation. SPN gave $87,951.49 to the Show Me Institute in 2007, according to its 2007 990 tax form, and may have moved additional funds and resources to SMI in subsequent years.

CONNECTIONS TO KOCH BROTHERS Charles and David Koch, each worth about $25 billion, could be the most influential pair of private citizens in the United States. These brothers have accumulated their fortune through Koch Industries, an oil refining, chemical, paper products and financial services company with revenues of some $100 billion per year. Together and with like-minded allies, the Koch Brothers use their billions to manipulate some in the public into voting for their right-wing agenda and to push policies that strip protections for people's health.

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While its support from Sinquefield is well known, the Show-Me Institute has also received significant funding from entities associated with the Kochs. The Koch-funded Donors Capital Fund has provided at least $567,941 to SMI since its founding. SMI has also received funding from other out-of-state right-wing organizations such as the Roe Foundation, the State Policy Network, and the Cato Institute. Documented support from national right-wing organizations includes:

Donors Funding Years

Donors Capital Fund $567,941 2005-2010

JM Foundation $20,000 2006

Jaquelin Hume Foundation $100,000 2007-2010

Roe Foundation $60,000 2007-2011

State Policy Network $87, 951 2007

Castle Rock Foundation $20,000 2008-2011

Cato Institute $50,000 2006

Source: American Bridge Conservative Transparency Project SMI also participates in the Charles G. Koch Summer Fellowship Program, through which it can receive funding for summer interns. In addition, SMI research fellow and Southern Illinois University at Edwardsville Professor Rik Hafer received an $8,000 grant from the Charles Koch Foundation in October 2012 to fund curriculum changes in the SIUE School of Business. (Targeted News Service, “Hafer Receives Charles Koch Foundation Grant for SIUE School of Business,” October 11, 2012)

THE SHOW-ME INSTITUTE'S 'CHIEF ECONOMIST' RECEIVED HUGE SALARIES FROM THE ORGANIZATION ON TOP OF HIS 'KEN LAY CHAIR' SALARY AT THE UNIVERSITY OF MISSOURI. CAMPAIGN FINANCE RECORDS SHOW HE IS ALSO PAID REGULARLY TO GENERATE INDUSTRY-FRIENDLY STUDIES. Joseph Haslag is the Show-Me Institute's "Chief Economist," and is also the Kenneth Lay Chair in Economics at the University of Missouri-Columbia. Haslag's position at the University of Missouri was made possible by the University's most notorious alumnus, Ken Lay, and was vacant for four years before Haslag took the position. Beyond his $160,000 annual university salary, Haslag also received significant funds from the Show-Me Institute. Haslag was paid annual salaries of $120,000, $119,500 and $90,000 by SMI from 2008-2010. Public records show these Show-Me Institute salaries were paid on top of his annual University salaries of $135,000-$160,000. Beyond his SMI and University income, Haslag has also been paid by numerous ballot committees to provide research that advances their issue campaigns. Campaign clients include the MO Petroleum

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Marketers + Convenience Store Assoc PAC and Missourians for Equal Credit Opportunity (Payday Lenders’) PAC.

It is noteworthy that despite his considerable income and public benefits, Haslag has advocated against defined benefit retirement plans and against minimum wage increases.

CAMPAIGN FINANCE RECORDS SHOW SMI STAFFERS WORK DIRECTLY FOR REPUBLICAN AND IDEOLOGICAL CAMPAIGN EFFORTS. The Show-Me Institute's Communications Director, Rick Edlund, was a paid consultant for Cole McNary's unsuccessful campaign for Treasurer in 2012 and Sarah Steelman's failed US Senate bid. He was also paid to consult for the House Republican Campaign Committee in 2010, and worked for former Senator Jim Talent's 2000 campaign. Patrick Tuohey, SMI's "Western Missouri Field Manager," was press secretary for Steelman’s US Senate bid, previously served as Director of Communications for Frank Luntz’s polling firm, and manages (or managed) the Missourians for Responsible Government 501(c)(4) organization that has moved millions of dollars on behalf of the payday lending industry to protect the lenders' triple digit interest rates. Brenda Talent, SMI's Executive Director, is the spouse of Jim Talent, the former Republican Senator and Congressman. Former Show-Me Institute policy analyst Christine Harbin went on to become a research manager at ALEC and a federal policy analyst at the Koch-founded and funded Americans for Prosperity.

A KEY COG IN THE SINQUEFIELD MACHINE Rex Sinquefield is the President of the Show-Me Institute. The "belief tank" complements his issue campaigns, his affiliated public affairs firm, Pelopidas, and affiliated advocacy organization, United for Missouri. The output of the “belief tank” intentionally supports Sinquefield's larger goals of enacting regressive tax policy in Missouri and other states, privatizing public education and removing local control of local schools with statewide evaluation and hiring practices. Sinquefield's agenda is extreme and unpopular. Despite spending hundreds of thousands on political candidates, he has been mostly unsuccessful in persuading legislators to make his radical tax and education ideas into law. In 2012, Sinquefield faced widespread criticism after he expressed a belief that the public school system was intentionally designed by Ku Klux Klan members to hurt black children.

INTEGRATED AGENDAS: THE SHOW-ME INSTITUTE, ALEC & AMERICANS FOR PROSPERITY Though the organization promotes itself as Missouri-focused, the Show-Me Institute advocates for many of the same controversial policies as national right-wing organizations like the American Legislative Exchange Council (ALEC) and Americans for Prosperity (AFP), with which it shares common funders.

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SMI'S NATIONAL FUNDERS & AFFILIATIONS A review of national right-wing organizations' tax documents shows numerous donations and grants to the Show-Me Institute in recent years. KOCH BROTHER-FUNDED DONORS CAPITAL FUND

• Donors Capital Fund .................... $50,000.00 ..................... 2010 • Donors Capital Fund .................. $235,000.00 ..................... 2009 • Donors Capital Fund .................. $182,941.00 ..................... 2008 • Donors Capital Fund .................... $50,000.00 ..................... 2007 • Donors Capital Fund .................... $50,000.00 ..................... 2005

THE STATE POLICY NETWORK

• State Policy Network ................... $87,951.49 ..................... 2007 JAQUELIN HUME FOUNDATION

• Jaquelin Hume Foundation ......... $25,000.00 ..................... 2011 • Jaquelin Hume Foundation ......... $25,000.00 ..................... 2010 • Jaquelin Hume Foundation ......... $25,000.00 ..................... 2009 • Jaquelin Hume Foundation ......... $25,000.00 ..................... 2008 • Jaquelin Hume Foundation ......... $25,000.00 ..................... 2007

ROE FOUNDATION

• The Roe Foundation .................... $10,000.00 ..................... 2011 • The Roe Foundation .................... $10,000.00 ..................... 2010 • The Roe Foundation .................... $15,000.00 ..................... 2009 • The Roe Foundation .................... $15,000.00 ..................... 2008 • The Roe Foundation .................... $10,000.00 ..................... 2007

CATO INSTITUTE

• Cato Institute .............................. $50,000.00 ..................... 2006

CASTLE ROCK FOUNDATION • Castle Rock Foundation .............. $10,000.00 ..................... 2011 • Castle Rock Foundation .............. $10,000.00 ..................... 2008

JM FOUNDATION

• JM Foundation ............................ $20,000.00 ..................... 2006

Sources: Media Matters, Show-Me Institute; Sourcewatch, Show-Me Institute; American Bridge Conservative Transparency)

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NOTABLE SMI LEADERS & PERSONNEL

The Show-Me Institute calls itself a nonpartisan “educational institute dedicated to improving the quality of life for all citizens of Missouri” and to increasing “economic opportunity for ordinary Missourians.” However, it is led by wealthy conservatives and Republican campaign operatives who have advocated for policies that would harm ordinary Missourians.

REX SINQUEFIELD, PRESIDENT Rex Sinquefield, a notorious conservative donor in Missouri, co-founded the institute in 2006. In 2012, the New York Times reported that since 2008, when Missouri abolished campaign contribution limits, Sinquefield has donated more than $20 million to local candidates and political committees, largely to Republican and conservative causes and campaigns. More than half of Sinquefield's contributions, according to the article, have gone to advance his signature cause: eliminating state and local income taxes in Missouri, a major source of government revenue, and replacing them with sales taxes. The overwhelming majority of Sinquefield’s contributions on candidate elections go to Republican candidates and PACs, including the ‘Now or Never PAC’ that assisted Todd Akin’s US Senate campaign in 2012, Sarah Steelman’s US Senate campaign and other federal GOP candidates around the country. Sinquefield's private Sinquefield Family Foundation has given hundreds of thousands of dollars to the Koch Brothers’ Americans for Prosperity Foundation, millions to the Show-Me Institute, hundreds of thousands to the Children's Education Alliance of Missouri (CEAM) and thousands to the CATO Club.

ETHELMAE HUMPHREYS, FORMER BOARD MEMBER The Joplin-based Humphreys Family has given millions to right-wing causes across the country. Ethelmae and her children, David Humphreys and Sarah Humphreys Atkins, are members of the Koch Brothers’ exclusive ‘Million Dollar Donor Club.' Notable Humphreys Family donations include:

• $1,000,000 to the Restore Our Future Super PAC created to support the presidential candidacy of Mitt Romney in 2012. David Humphreys and Sarah Atkins both wrote $500,000 checks to the super PAC.

• $510,000 to embattled Wisconsin Governor Scott Walker in January 2012 from David Humphreys and Sarah Atkins.

• $250,000 to the anti-union “Protecting Michigan Taxpayers” campaign in October 2012 from Ethelmae Humphreys. The campaign opposed Proposal 2, a ballot proposal that would put collective bargaining protections in their state constitution.

• $204,650 to the National Republican Senatorial Committee (NRSC) • $50,000 to the New Prosperity Foundation, a political organization created by former Bush

Pioneers to “shape Midwest elections.” • Undisclosed support from Ethelmae Humphreys for the Michigan-based Mackinac Center, an

overtly anti-union organization.

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JOSEPH HASLAG, CHIEF ECONOMIST Joseph Haslag is a professor and the Kenneth Lay Chair in economics at the University of Missouri Columbia. Haslag's position was made possible by the University's most notorious alumnus, Ken Lay, and was vacant for four years before Haslag took the position. He has been employed at the University of Missouri since 2002. Haslag’s annual university salaries are as follows:

• 2002 ...................... $86,195.00 • 2003 .................... $108,630.25 • 2004 .................... $112,384.44 • 2005 .................... $124,275.00 • 2006 .................... $139,720.58 • 2007 .................... $140,888.57

• 2008 .................... $158,334.00 • 2009 .................... $155,515.00 • 2010 .................... $178,750.00 • 2011 .................... $166,729.00 • 2012 .................... $171,230.84

Beyond his significant university salary, Haslag also received significant funds from the Show-Me Institute. In 2009, he was paid $119,500 as the SMI Executive Director, and in 2010, he was paid $90,000 as the organization's "Former Executive VP." Public records show these Show-Me Institute salaries were paid on top of his University salaries. In addition to his SMI and University income, Haslag has also been paid by numerous ballot committees to provide research that advances their issue campaigns. Campaign income includes:

• MO Petroleum Marketers + Convenience Store Assoc PAC .................................... $20,900 in 2012 • Missourians for Equal Credit Opportunity (payday lenders’ PAC) ............................ $3,750 in 2012 • MO Coalition For Lifesaving Cures ........................................................................... $937.50 in 2007 • MO Coalition For Lifesaving Cures ........................................................................... $25,000 in 2006 • Missourians Against Tax Abuse ................................................................................ $23,875 in 2006 • Committee To Improve Missouri Roads And Bridges ................................................ $3,000 in 2004

Tax files for the Sinquefield Family Foundation show Haslag was paid an additional $30,000 for research in 2005. Joseph Haslag is married to Sarah Haslag, who appears to have been SMI's Director of Development from March 2008 to December 2009. It is noteworthy that despite his considerable income and public benefits, Haslag has advocated against defined benefit retirement plans and against minimum wage increases.

CROSBY KEMPER III, CHAIRMAN AND CO-FOUNDER Crosby Kemper III is executive director of the Kansas City Public Library and former CEO of UMB Financial Corporation. He co-founded and is chairman of the Show-Me Institute.

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MICHAEL PODGURSKY, BOARD MEMBER Michael Podgursky is a professor of economics at the University of Missouri–Columbia, where he served as department chair from 1995 to 2005, and is a fellow of the George W. Bush Institute at Southern Methodist University. Podgursky's Curriculum Vitae on the University of Missouri website states he has provided Education and Economic Policy "Consulting" for the Sinquefield Family Foundation.

GERALD A. REYNOLDS, BOARD MEMBER Gerald A. Reynolds is general counsel, chief compliance officer, and corporate secretary for the LG&E and KU Energy company based in Louisville, Kentucky. He was a deputy associate attorney general in the U.S. Department of Justice. In 2004, George W. Bush named him chairman of the U.S. Commission on Civil Rights, and in 2002 appointed him assistant secretary of education for the Office of Civil Rights.

RICK EDLUND, COMMUNICATIONS DIRECTOR Rick Edlund is a GOP campaign consultant and former KPLR news anchor. He was a paid consultant for Cole McNary's failed 2012 campaign for Treasurer, Sarah Steelman's failed 2012 US Senate race, the House Republican Campaign Committee in 2010, and Jim Talent's 2000 campaign.

PATRICK TUOHEY, WESTERN MISSOURI FIELD MANAGER Patrick Tuohey joined the Show-Me Institute in January 2013 as the western Missouri field manager. He previously served as an aide to U.S. Rep. John L. Mica (R-FL) in Washington, DC. In 1995, Patrick became director of communications for Frank Luntz’s polling shop, representing the firm and its research to members of the U.S. Senate and House, as well as regularly attending congressional staff meetings. Tuohey is (or was) the owner of Market and Communications Research, Inc. (Marcom). Clients include Mobil, Monsanto, Merck, Bristol-Myers Squibb and Eli Lily. He was paid directly by Rep. Jay Barnes' campaign committee in 2012. Tuohey manages the Missourians for Responsible Government 501c4 organization that has moved millions of dollars on behalf of the payday lending industry to protect the lenders' triple digit interest rates.

JASON HANNASCH, FORMER VICE PRESIDENT Jason Hannasch, a founding staffer of the Show-Me Institute, was president of the now-defunct Missouri News Horizon, a Missouri affiliate of the Franklin Center for Government & Public Integrity. The Missouri Watchdog website is also a Franklin affiliate. The Franklin Center hosts conservative investigative reporting outlets that focus on the state legislature in states across the country. Many of the Center’s affiliates have been accused of faulty reporting and manufacturing news coverage to benefit its conservative interests. The Pew Research Center's Project for Excellence in Journalism, using a sliding scale of highly ideological, somewhat ideological and non-ideological, ranked the

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"Watchdog.org" franchise (the Franklin Center’s website in many states) "highly ideological." Since its founding, the Franklin Center has been funded by conservative organizations including the Koch-funded Donors Trust/Donors Capital Fund and the Bradley Foundation.

CHRISTINE HARBIN, FORMER POLICY ANALYST Former Show-Me Institute policy analyst Christine Harbin went on to become a research manager at the American Legislative Exchange Council (ALEC) and a federal policy analyst at the Koch-founded and funded Americans for Prosperity.

BRENDA TALENT, EXECUTIVE DIRECTOR Before joining the Show-Me Institute, Brenda Talent served as counsel to the Saint Louis law firm Bryan Cave. Her husband, Jim Talent, is a former U.S. senator and congressman.

PATRICK ISHMAEL, POLICY ANALYST Patrick Ishmael holds several degrees from Saint Louis University. Missouri Ethics Commission records how he was reimbursed for travel expenses by now Senator Rob Schaaf's campaign committee in 2010.

PAUL SMITH, DEVELOPMENT ASSISTANT Paul Smith is a former Republican campaign staffer and teacher. He is a 2010 graduate of Hillsdale College, where he received a B.A. in English literature and religious studies. Paul joined the development office of the Show-Me Institute in July 2012. He previously worked as an English teacher in South Korea. In 2011, he interned for the Ron Paul presidential campaign and the worked as a field director for the Ted Cruz's US Senate campaign in Texas.

DAVID STOKES, POLICY ANALYST David Stokes spent five years as assistant to Saint Louis County Councilman Kurt S. Odenwald and is a board member of the St. Louis County Pachyderm Club.

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INTEGRATED AGENDAS: THE SHOW-ME INSTITUTE, ALEC & AMERICANS FOR PROSPERITY

Though the organization promotes itself as Missouri-focused, the Show-Me Institute advocates for many of the same controversial policies as national right-wing organizations like the American Legislative Exchange Council (ALEC) and Americans for Prosperity (AFP), with which it shares common funders. As Missourians can see in the chart below, there is regular overlap in ideological advocacy between SMI, ALEC and AFP.

ISSUE SHOW-ME INSTITUTE AMERICAN LEGISLATIVE EXCHANGE COUNCIL (ALEC)

AMERICANS FOR PROSPERITY

Paycheck Deception

In April 2013, Show-Me’s Patrick Ishmael presented to the Missouri House Workforce Development and Workplace Safety Committee in favor of “paycheck protection” – better named “paycheck deception” – legislation.

ALEC’s Paycheck Protection Act is an attempt at union-busting by making it difficult for public employee unions to raise funds for political activities.

Missouri’s Americans for Prosperity chapter lists “paycheck protection” on its 2013 Legislative Agenda. AFP-MO also issued a press release in March 2013 “applauding” Sen. Dan Brown’s “leadership” on passing a paycheck deception bill.

Privatizing Public Education

SMI has produced numerous reports and “studies” supporting privatizing public education through school vouchers and charter schools. The Show-Me Institute also published a report in 2012 calling for a Parent Trigger bill, a well-known ALEC bill.

Education privatization is a key component in ALEC’s extreme agenda. ALEC’s school voucher “models” include the Education Enterprise Zone Act and The Parent Choice Scholarship Program Act. ALEC’s charter school models include the Charter Schools Act and the Next Generation Charter Schools Act.

AFP-MO lists expanding charter schools and school vouchers on its 2013 Legislative Agenda. AFP is also connected to many of the national and state-based groups that push Parent Trigger legislation.

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ISSUE SHOW-ME INSTITUTE AMERICAN LEGISLATIVE EXCHANGE COUNCIL (ALEC)

AMERICANS FOR PROSPERITY

Finally, a Parent Trigger bill introduced in Missouri in 2012 (HB 393) is nearly identical to the ALEC model.

Teacher Tenure Deform

The Show-Me Institute has supported various changes to tenure that attack the rights of teachers in its reports and publications. In addition, Show-Me co-founder and President Rex Sinquefield is well-known for funding anti-tenure campaigns and organizations in Missouri, specifically through TeachGreat.org – an organization entirely funded by Sinquefield whose sole purpose is to repeal all teacher tenure laws.

ALEC has produced numerous “model” bills that attack teacher tenure, including the cleverly-named “Great Teachers and Leaders Act” and “Teacher Quality and Recognition Demonstration Act”

AFP-MO says Missouri needs to “examine tenure reform” in the education section of its 2013 Legislative Agenda.

Healthcare Reform & Medicaid Expansion

The Show-Me Institute has opposed the 2010 Affordable Care Act in its publications and reports, and Show-Me’s Dave Roland led a roundtable discussion on “ALEC’s Freedom of Choice in Heath Care Act” at an ALEC conference in April 2010. The Show-Me Institute is also strongly opposed to Gov. Nixon’s plan to expand Medicaid under the Affordable Care Act, which would provide healthcare to 260,000 Missourians. The

ALEC has issued several “model” bills against the 2010 Affordable Care Act, including the Freedom of Choice in Health Care Act and the Resolution Opposing Employer-Paid Health Care Mandates. ALEC’s Guide to Repeal Obamacare is a guide for state legislators to repeal the Affordable Care Act, urging them to reject Medicaid expansion and federal grants for Medicaid.

AFP-MO lists its opposition to Gov. Nixon’s plan to expand Medicaid under the Affordable Care Act in its 2013 Legislative Agenda.

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ISSUE SHOW-ME INSTITUTE AMERICAN LEGISLATIVE EXCHANGE COUNCIL (ALEC)

AMERICANS FOR PROSPERITY

institute has released several reports against Medicaid expansion and also testified to the state legislature against Medicaid expansion.

Minimum Wage

The Show-Me Institute has published several reports against raising the minimum wage in Missouri.

ALEC has produced several bill templates opposing minimum wage laws, including the Resolution in Opposition to any Increase in the Starting (Minimum) Wage and the Living Wage Mandate Preemption Act

Americans for Prosperity has opposed increasing or called for an all-out repeal of the minimum wage. In a 2012 report, AFP said minimum wage laws were simply “labor market barriers” and lawmakers should let “businesses freely decide” what to pay their employees.

Pension Deform

The Show-Me Institute has released several reports calling for the state to shift away from defined-benefit public pension plans to risky defined-contribution plans to solve the “unfunded liabilities” problem, including during legislative testimony in March 2013.

ALEC’s “Public Employees’ Portable Retirement Option (PRO) Act” is a move towards eliminating defined benefit pension plans for public employees that protect retirees.

AFP-MO lists addressing “unfunded liabilities” in its 2013 Legislative Agenda. AFP has also supported defined-contribution plans in other states, including in Michigan, Montana, Florida, Illinois, Pennsylvania, and Nebraska.