Media pundits and expert economists are criticizing Sen. Elizabeth Warren (D., Mass.) and the Brookings Institution for the way in which the liberal think tank forced the resignation of a respected economist who opposed a regulation supported by Warren.
Additionally, questions have arisen about whether Brookings is enforcing internal rules regarding affiliation with the think tank evenhandedly in the wake of the dismissal.
Dr. Robert Litan, an economist and attorney who until recently was an unpaid nonresidential fellow at the liberal Brookings Institution, testified before the Senate Committee on Health, Education, Labor, and Pensions in July on a proposed Department of Labor regulation aimed at financial advisers supported by both Warren and the Obama administration. Litan, citing two major concerns, pushed back against the proposed regulation.
Nearly two months after Litan delivered his remarks, on Sept. 28, Warren sent a letter to Strobe Talbott, president of the Brookings Institution, demanding "information regarding financial conflicts of interest" and with questions "relating to the editorial and substantive content of studies to which the Brookings Institution and affiliates lend their names."
Warren argued that Litan did not provide sufficient enough evidence that his study was paid for by the Capital Group, one of the nation’s largest mutual fund organizations.
"Neither the editorial input of the financial industry into Dr. Litan’s and Dr. Singer’s work nor the exact amount of and sole nature of the industry’s financial support for this work were disclosed at the HELP hearing, and they have not previously been disclosed elsewhere," the letter said. "These disclosures are problematic: they raise significant questions about the impartiality of the study and its conclusions, and about why a Brooking-affiliated expert is allowed to use that affiliation to lend credibility to work that is both financially compensated and editorially compromised by an industry player seeking a specific conclusion."
However, Dr. Litan did disclose that the information presented during his testimony was on behalf of a study conducted for the Capital Group, as noted in a footnote within the transcript of his testimony. Warren received this document, as she sits on the committee that Litan testified before and was in attendance.
"The study was supported by the Capital Group, one of the largest mutual fund asset managers in the United States. Dr. Singer and I are solely responsible for the analysis and conclusions in the study," the footnote says.
Hours after Brookings received the letter from Warren, Litan resigned from his position of nonresidential senior fellow after 40 years of off-and-on affiliation with the think tank.
Brookings justified forcing Litan out by citing a rule the institution implemented in June that asks nonresidential fellows to use their primary affiliation and not their Brookings honorific.
"Dr. Litan co-signed a letter in June that said, ‘In the event you are asked to testify before Congress or any similar body, we ask that you do so using your primary organizational affiliation and not your Brookings honorific,’" David Nassar, vice president of communications at the Brookings Institution, told the Washington Free Beacon.
"Dr. Litan's failure to make clear that his testimony was based on work as a paid consultant, combined with his identifying himself as a Brookings affiliate, left the false impression that Brookings was connected with the report and the testimony. To prevent misperceptions of exactly this nature, Brookings had instituted the rule earlier this year."
Litan did not state during the testimony that he was in attendance on behalf of the think tank nor did he mention Brookings during his five-minute time period. His affiliation with Brookings was also never listed on the senate committee’s website.
The only mention of Brookings outside of his lengthy introduction given by Sen. Pat Roberts (R., Kansas), which included a list of affiliations and accomplishments, was in a footnote in which Litan separated his views from those of Brookings.
"The views expressed here are my own and do necessarily represent those of the Brookings Institution or the Capital Group, their officers, directors, trustees, or employees," the footnote says.
When asked by the Free Beacon if he had identified himself with Brookings in writing outside of the footnote, given he did not verbally mention the think tank, Litan responded, "Not in connection with the testimony."
Brookings initially mentioned it was concerned about the footnote to Litan in July, but did not mention it again until after Warren complained, Litan said in an email. The scholar speculated that Warren’s anger toward he and Brookings were animated by the fact that his study "exposed two major weaknesses in Labor’s proposal," in an op-ed for Fortune published October 5.
Since the time that Litan gave his remarks, another nonresidential senior fellow at the Brookings Institute, Richard Bejtlich, provided House testimony openly stating his Brookings affiliation during his remarks.
Bejtlich testified before the Armed Services Committee on Sept. 29, verbally stating his nonresidential senior fellow status. Bejtlich’s testimony is additionally posted on the think tank’s website.
Brookings defended his use of the title.
"Mr. Bejtlich specifically states that his employer is FireEye and that his testimony was based on work he does in the private sector," Nassar told the Free Beacon when asked about his mention of Brookings.
Bejtlich did not face any repercussions for stating the affiliation.
A group of five top Democratic economists came out in Litan’s defense after the dismissal, expressing concern over the tactics used against him.
The group chastised the way Warren handled the situation and said Brookings’ "complicity with it threatens ad hominem attack on any author who may be associated with an industry or interest whose views are contrary to hers."
"Those who differ with Litan instead should offer a substantive rebuttal to the paper in question, which would do much more to clarify the issue than implicitly depicting him as being inherently corrupted by the sponsorship of his work," the economists added in a letter obtained by the Hill.
Warren’s office did not respond to questions from the Free Beacon.
Correction: This post originally identified Richard Bejtlich as Robert Bejtlich.
UPDATE Oct 22 4:02 P.M.: Following publication of this article, Nassar, vice president of communications at the Brookings Institute, said Dr. Litan's affiliation was listed in his written testimony.
The writer states that Dr. Litan’s affiliation with Brookings was never listed on the Senate committee’s website. However, "Brookings Institution" was clearly listed as Dr. Litan's affiliation in his written testimony and in the hearing announcement, as noted in the letter from Senator Elizabeth Warren.
Dr. Litan’s testimony and the report on which it was based were not Brookings products. They were works he produced as a private contractor. While he disclosed corporate "support" for his research, he did not make clear that his testimony was based on work as a paid consultant for the firm Economists, Inc., leaving the false impression that it was done in his capacity as a Brookings nonresident scholar. Mr. Bejtlich, the other Brookings Nonresident Senior Fellow mentioned in your article, accurately identified himself as an employee of FireEye, Inc. and made it clear when he testified that his testimony had nothing to do with his relationship with Brookings.