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From the Directors From the directors The Adam Smith Institute is one of the world’s leading To promote these same ideals today, the Adam Smith policy think tanks. Yet our aim is not just to think about Institute has assembled Westminster’s most talented and public policy: our aim is to change events. effective policy team. In the last year, they have trebled our media exposure. We are doing more, and better- Clear principles assist us in that aim: freedom, choice, com- quality, events than ever before. Sales and downloads of petitive markets, smaller and less costly government. On such our reports are at a record high. Hundreds of thousands foundations we build innovative and practical initiatives, using of people read our blog. And our outreach to young reports, events and the media to transform the public debate. people is second to none. Our name comes from the great Scottish economist Adam The indebtedness and over-centralization of government Smith (1723- 1790), whose book The Wealth of Nations are of course huge threats to economic and personal showed the importance of a free economy and a free freedom. But, working alongside policymakers and with the society. It became the blueprint for a century of free trade, backing of our many loyal supporters, that is something we growth and prosperity. can change. Dr Madsen Pirie, President Dr Eamonn Butler, Director Tom Clougherty, Executive Director The Adam Smith Institute 02 ANNUAL REVIEW 2010 History and Mission Statement Contents The Adam Smith Institute was founded in the 1970s, as competition and enterprise. And yet in many ways govern- post-war socialism reached its high-watermark. Then, ment is bigger and more intrusive than ever, whether it is Policy areas as now, its purpose was to educate the public about free regulating businesses, interfering with lifestyle choices, Tax and Spending 04 markets and economic policy, and to inject sound ideas or undermining historic civil liberties. Meanwhile public Reforming the State 06 into the public debate. It has always been a practical think- spending has grown out of control, and Britain faces a tank rather than an academic organization, and despite fiscal crisis unprecedented in peacetime. In short, there are Education and Culture 08 its strict political independence, it has endeavored to work many battles still to be won. Liberty and Free Markets 10 with policymakers to deliver real change, and to make free market ideas reality. In its early days, the Institute was The Adam Smith Institute has a number of overarching Events 12 known for its pioneering work on privatization, deregulation, objectives: to make liberty a consideration in every political and tax reform, and for its advocacy of internal markets in argument; to win once-and-for-all the intellectual arguments Investing in our Future – Students 14 healthcare and education. against Keynesian economic policy; and to make people Media Outreach 16 realize that our current fiscal path is completely unsustain- New Media Engagement 18 As well as engaging in traditional think tank activities – able, as demographic change begins to take its toll on the Staff 20 like conducting research, publishing reports, and holding welfare state. It has a number of policy areas on which it is seminars and conferences – the Institute has also, through- actively campaigning for radical, free market solutions – like Looking Forward to 2011 22 out its history, paid a great deal of attention to developing flat taxes, free banking, and consumer-directed healthcare. Support the ASI 23 the next generation of policymakers and opinion formers, with its well known and highly regarded youth programmes Ronald Reagan once said, “Freedom is a fragile thing and is forming a major part of its activities. The Adam Smith never more than one generation away from extinction. It is Institute also prides itself on being forward-looking and not ours by inheritance; it must be fought for and defended media-savvy, and being quick to embrace new technology constantly by each generation, for it comes only once to a and new opportunities to promote its ideas. people. Those who have known freedom and lost it, have never known it again.” Those words encapsulate the role of Today the Adam Smith Institute faces new challenges. The the Adam Smith Institute: it exists to fight for freedom, to industrial landscape has changed beyond recognition since defend it where necessary, and to extend it where possible. the 1970s. Communism has fallen. And most politicians It is a task the Institute takes very seriously. at least pay lip service to the free market ideas of choice, The Adam Smith Institute The Adam Smith Institute 04 ANNUAL REVIEW 2010 ANNUAL REVIEW 2010 05 POLICY AREA: Tax and Spending The Adam Smith Institute has always supported low taxes and balanced budgets, and in 2010 – with taxes going up and spending spiraling out of control – these issues formed a key part of its research agenda. Tax was a priority issue for the Adam Smith Institute in responsibility, with Nigel Hawkins’ The Party is Over making 2010. As well as making the general case for lower, simpler, detailed proposals for eliminating the budget deficit by 2015. flatter taxes in numerous newspaper articles and media appearances, the Institute ran a campaign against the Britain’s long-term fiscal government’s plans to raise Capital Gains Tax – potentially problems are far more severe to as much as 50 percent. “ than most policymakers and The campaign was launched with a robust critique of economists realize the coalition proposals in the Mail on Sunday, which was followed up by two influential briefing papers prepared by ” Institute fellows Peter Young and Richard Teather. Both used Public spending is one policy area where the Adam Smith international evidence to show how raising Capital Gains Tax Institute has gone further than other think tanks and could hit government revenue as well as economic growth. commentators, showing that Britain’s long-term fiscal problems are far more severe than most policymakers and When the government announced that they would raise economists realize. Miles Saltiel’s On Borrowed Time laid Capital Gains Tax to 28 percent, while also expanding the this bare: even with the coalition’s cuts, Britain could face entrepreneurs’ allowance, ConservativeHome identified the an Irish-style fiscal crisis as early as 2019 as demographic Adam Smith Institute as one of the key players in making changes start to bite. them change course – a claim backed up by the hundreds of national and local media hits the campaign generated. Eamonn Butler’s Why Britain Needs an Economic Responsibility Act tackled this issue head on, calling for Of course, given that the government continued to borrow a series of legally binding restraints on government’s almost £20m per hour throughout 2010, public spending economic policy, including caps on spending and bor- was a big issue too. Here the Adam Smith Institute consist- rowing, referenda on tax rises, and transparency about ently made the case for spending cuts and renewed fiscal off-balance-sheet obligations. RIGHT: Capital Gains Tax coverage in Daily Express & City AM; cover of The Party is Over report; Dr Madsen Pirie’s article on flat tax for the Sunday Times; further CGT coverage in the Daily Mail and Daily Telegraph The Adam Smith Institute The Adam Smith Institute 06 ANNUAL REVIEW 2010 ANNUAL REVIEW 2010 07 POLICY AREA: Reforming the State The Adam Smith Institute is a leading proponent of market- oriented public service reform and privatization. But its publications also look at the big picture, exploring ways of completely transforming the role of government in our lives. One of the Adam Smith Institute’s key messages in 2010 On Work and Pensions, at least, the government looks set was that reducing public spending should be about more to implement many of the reforms that Adam Smith Institute than just ‘cuts’. Instead, it should be about taking a has been pushing for throughout its existence – like the uni- genuinely zero-base approach to government, sweeping versal credit, the work requirement, and the use of private away decades of legislative detritus, and focusing on organizations to get the unemployed back to work. Matthew those few, important things that we actually need the Triggs’ Welfare Reform: The Case for Radicalism, which was state to do. published in response to a government consultation, argued that the coalition should not shy away from overhauling the The Institute’s reformist approach was outlined in Eamonn benefits system. Butler’s Re-Booting Government, which compared the state to a computer that is overloaded with unwanted files and So far less progress has been made on regulation, but unnecessary applications, and called for Whitehall to be another 2010 report by Tim Ambler and Keith Boyfield fundamentally streamlined. suggested a way forward. Reforming the Regulators pro- posed that the UK’s regulators first return to their original, Tim Ambler, Keith Boyfield and Liam Ward-Proud picked purely economic role, before being merged into a single, up the same theme in Taxpayer Value: Rolling Back the competition-focused agency. State, which assessed the strategic objectives and staff levels of every government department. It suggested the Nigel Hawkins’ Privatization Revisited, meanwhile, called abolition of several departments, the jettison of countless on the government to launch a new wave of asset sales spending programmes, and a thirty percent reduction in – including its stakes in Lloyds-HBOS and RBS – which staffing. Particularly far-reaching proposals were made for could raise more than £90bn over the next five years. The reforming the Ministry of Defence and the Department of Adam Smith Institute is set to continue looking for imagina- Work and Pensions.
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