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Home , Brian Darling, Charles Stimson, Clare Boothe Luce Award, Midge Decter, Robert Bluey, Robert Moffit

What leaders say about Heritage’s plan for:

Am e r i c a n Dr e a m

“Getting our country’s fiscal house in order is no easy task. Thankfully, our friends at have done the hard work of thinking through and creating public policies that get government under control and save the American dream for this generation and the next.” — Senator Jim DeMint (R-S.C.)

“The analysis of our fiscal problems is compelling, and the proposed solution is bold and imaginative.” — Ambassador

“The Heritage Foundation’s plan to save the American dream would create economic certainty for businesses by putting our nation on a more stable economic course and giving businesses the freedom to expand.” — Andrew F. Puzder, CEO of CKE Restaurants Inc. (Hardee’s and Carl’s Jr.)

“… a plan that truly reforms… This plan is the cure for our ‘disease.’” — Cal Thomas, Syndicated Columnist

“Comprehensive tax reform is an essential element of restoring fiscal sanity and spurring economic growth in the country. The Heritage Foundation’s proposal moves the country’s tax code in the right direction toward a more low-rate, .” — Arthur B. Laffer, Ph.D., the Father of Supply-Side Economics

“America does not have to be a country in decline. Do we have choices to make? Yes. And I encourage anyone who is serious about making the right choices to read The Heritage Foundation’s plan to fix the debt, cut spending, and restore prosperity.” — Steve , Editor-in-Chief, Forbes magazine

214 Avenue N.E. n Washington, D.C. 20002 n (202) 546-4400 n heritage.org Am e r i c a n Dr e a m

The heritage foundation 2011 Annual Report Our Mission To formulate and promote conservative public policies based on the principles of free enterprise, , individual freedom, traditional American values and a strong national defense.

Board of Trustees Honorary Chairman and Thomas A. Saunders III, Chairman Trustee Emeritus David R. Brown, M.D. Richard M. Scaife, Vice Chairman J. Frederic Rench, Secretary Honorary Trustees Kathryn Davis Meg Allen The Hon. Frank Shakespeare Douglas F. Allison Patron of The Heritage Foundation Larry P. Arnn, Ph.D. The Right Honourable The Baroness Thatcher, The Hon. Belden Bell LG, PC, OM, FRS Midge Decter Senior Management Edwin J. Feulner, Ph.D. Edwin J. Feulner, Ph.D., President Steve Forbes Phillip N. Truluck, Executive Vice President Robert J. Herbold David Addington, Vice President Todd W. Herrick Stuart M. Butler, Ph.D., Distinguished Fellow Jerry Hume Becky Norton Dunlop, Vice President Kay Coles James John Fogarty, Vice President Michael G. Franc, Vice President The Hon. J. William Middendorf II Michael M. Gonzalez, Vice President Abby Moffat Kim R. Holmes, Ph.D., Vice President Nersi Nazari, Ph.D. III, Reagan Distinguished Fellow Robert Pennington Ted E. Schelenski, Vice President William E. Simon, Jr. Matthew Spalding, Ph.D., Vice President Brian Tracy Michael Spiller, Vice President Phillip N. Truluck John Von Kannon, Vice President and Senior Counselor Barb Van Andel-Gaby Genevieve Wood, Vice President Marion G. Wells Robert E. Russell, Jr., Counselor

As a nonprofit 501(c)3 organization, we rely on the financial contributions of the general public: individuals, foundations and corporations. We accept no government funds and perform no contract work. We welcome your support.

The Heritage Foundation n 214 Massachusetts Avenue N.E. n Washington, D.C. 20002 n (202) 546-4400 n heritage.org Am e r i c a n Dr e a m

Message from the Chairman and the President Saving the American Dream America can still be the nation it was meant to be, a land where freedom, opportunity, prosperity and civil society flourish. Photo: iStock Photo iStock Photo:

merica 2011… Saving the American Dream—a plan to fix the debt, cut Washington kept on spending money at a spending and restore prosperity. A breakneck pace, and the national debt ballooned This plan eliminates today’s federal tax code, replacing accordingly. Federal regulators saddled a still struggling it with a new, flat tax. It sharply downsizes government, economy with tens of billions of dollars in new compliance leaves patients—rather than bureaucrats—in control of costs, sometimes exercising powers not authorized by health care decisions and fully funds our national defense. Congress or the Constitution. It balances the nation’s budget within a decade—and keeps Facing the prospect of pending tax hikes, higher energy it balanced. And it starts paying down the national debt. costs and expensive health mandates, employers shelved expansion plans and banked trillions in cash that might have fueled an economic recovery. Millions of unemployed were left frustrated and increasingly desperate. Geer Chas Photo: It was an alarming year. As always, Heritage was there—wading into every significant policy debate, from repealing Obamacare to providing for a responsible national defense. But these challenging times demanded even more. And so we framed a higher-level debate—one that will determine the path America will pursue in the future and the relationship between our government and “We, the people.” Heritage President Saving the American Dream welcomes the DAR Heritage mapped out a clear vision for America’s future: Constitution Hall We want a nation where hard work is rewarded, not audience to the Nov. punished; where our children and grandchildren are free 22 GOP presidential of crushing national debt; where a social safety net protects candidates debate on national security, co- the least among us. sponsored with CNN In 2011 we developed a policy package that can make and the American our vision a reality. We call our comprehensive proposal Enterprise Institute.

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Amid friends and family, Heritage Vice Chairman and longtime trustee Richard M. Scaife receives the Award—Heritage’s highest honor—from President Edwin Feulner (right), May 19

in Pittsburgh. Photography Merriman Justin Photo:

Though essentially an economic reform plan, Saving producers. Along the way, we were even awarded one of the American Dream serves a high moral purpose. Absent ’s “Emmys,” when his television audience reform, future generations will be impoverished by voted Saving the American Dream the best plan for crushing public debt and punitive tax rates. We who have restoring fiscal sanity. lived the American Dream must assure it will be preserved On Capitol Hill, our sister organization—Heritage for those who follow us. Action for America—explained the details of reform and advised staffers drafting language that will introduce Heritage in Action elements of the package—and even the entire plan—as The months spent in formulating the plan were only legislation. Some lawmakers couldn’t wait. Rep. the beginning. Heritage energetically marketed its Jim Jordan (R-Ohio) and Sen. Jim DeMint (R-S.C.) provisions to lawmakers and public opinion leaders. introduced bills that would overhaul the nation’s We traveled the nation, meeting with editorial boards, welfare programs in the plan’s image. syndicated columnists, radio and TV broadcasters and Heritage events in Washington and across the coun-

2 the heritage foundation 2011 ANNUAL REPORT Am e r i c a n Dr e a m “Presidents will come and go, but there will always be

a Heritage Foundation.” — Photo: David Bohrer David Photo: Photo: Michelle McMinn Photography, Inc. Photography, McMinn Michelle Photo: Heritage Chairman Thomas Saunders (left) and President Edwin Feulner Former Vice President Dick Cheney, wearing his Clare Boothe (right) congratulate , Chairman of , at the Annual Luce Award medallion, acknowledges the applause of more than Leadership Conference and Board Meeting in Palm Beach, Fla. Ailes 1,000 Heritage donors at the Oct. 13 President’s Club banquet in received the Clare Boothe Luce Award at that gathering April 9 . Washington. try began reframing the national debate over spending, Preparing the Battlefield debt, taxes and health care. By year’s end, entitlement 2012 will be “a time for choosing”—politically as well as reform was looking less and less like a deadly “third in policy debates. As the campaign season got underway rail” of politics. As Congress prepared to break for in 2011, Heritage elevated the public discussion—and Christmas recess, Rep. (R-Wis.) and Sen. Ron the media coverage—above the usual “horse race” Wyden (D-Ore.) announced that they would start the speculation. Working in partnership with national media New Year with a proposed reform for premi- outlets, we put together a series of panel discussions prior um support similar to recommendations in Saving the to the GOP presidential debates in , Nevada, New American Dream. Hampshire and . The topic: What issues are most important to conservatives, and what do they hope to learn from these debates? To throw more light on the appallingly neglected issue of national security, we partnered with the American Enterprise Institute (AEI) and CNN to host the Nov. 22 GOP presidential candidates debate at DAR Constitution Hall here in Wash- ington. The debate focused exclusively on de- fense and foreign policy questions, all posed by

The Heritage Foundation Board of Trustees (from left): Midge Decter; Robert J. Herbold; Meg Allen; Robert Pennington; Brian Tracy; Richard M. Scaife, Vice Chairman; David R. Brown, Trustee Emeritus; Abby Moffat; Nersi Nazari; Douglas F. Allison; Thomas A. Saunders III, Chairman; Edwin J. Feulner; Jerry Hume; Phillip N. Truluck; J. Frederic Rench, Secretary; Barb Van Andel-Gaby; Larry P. Arnn; J. William Middendorf II; Kay Coles James; Belden Bell; Todd W. Herrick; Marion G. Wells; Steve Forbes. (Not pictured: Photo: Frasierphoto.com William E. Simon, Jr.)

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Edwin Meese, Heritage’s Distinguished Fellow, accepts the ’s Vision and Leadership Award Oct. 8 at the Values Voter Summit in Washington.

Heritage and AEI experts. Not only was the format unprecedented, but pundits from across the political spectrum called it the most serious and substantive debate yet. Long before that debate, Heritage Action pressed the case to fund defense at levels needed to guard against foreseeable threats, rather than declare a “peace dividend” and plunder Pentagon accounts to preserve dubious domestic programs. At year’s end, Sens. John Photo: Light Productions Photography Productions Light Photo: Kyl (R-Ariz.), Kelly Ayotte (R-N.H.), Lindsey Graham (R-S.C.) and John McCain (R-Ariz.) administration’s infatuation with the “balanced” announced they would introduce legislation to block a approach of raising taxes in the Budget Control Act of half-trillion-dollar cut in defense funding triggered by 2011. Heritage and Heritage Action insisted that the the failure of the deficit “super committee.” Instead, solution to overspending is less spending, not higher their bill would produce the desired savings elsewhere. taxes. The final budget bill excluded tax increases. Our new investigative reporting unit pried a heavily Getting Results redacted copy of the Yucca Mountain safety evaluation Throughout 2011 Heritage contributed to many report from the Nuclear Regulatory Commission (NRC). satisfying victories. Some, like the approval of three long-negotiated free-trade agreements, were years in the making. Others, like the administration’s decision to Heritage “By the Numbers” shelve a new “Christmas tree tax,” came within hours of 2011 Production Heritage picking up the cudgels. n 188 public lectures One of the most satisfying wins came when n 346 WebMemos congressional conservatives stood firm against the n 131 Backgrounders n 14 Legal Memoranda In Memoriam n 3 White Papers n 5 moot court sessions for Supreme Court advocates n 30 issue briefings for candidates n 47 congressional testimonies n 1 GOP presidential candidate debate 2011 Communications n 9.6 million visitors to Heritage.org n 3,508 radio interviews n 1,339 television interviews Photos: Chas Geer Chas Photos: n 1,400+ commentaries in major print outlets Tony Blankley n 6.1 million visitors to “The Foundry” blog Jan. 21, 1948 – Jan. 7, 2012 Feb. 27, 1933 – Sept. 14, 2011 n Journalist, public servant, Former U.S. Senator and 225,000 “Morning Bell” e-newsletter subscribers Visiting Fellow in National Heritage’s first Chung Ju-Yung n 400,000 Heritage Facebook friends Security Communications. Fellow for Policy Studies. n 162,000 Heritage Twitter followers

4 the heritage foundation 2011 ANNUAL REPORT Am e r i c a n Dr e a m Photo: David Hills Photography Hills David Photo: Heritage Senior Management (from left): David Addington, Vice President; John Fogarty, Vice President; Ted E. Schelenski, Vice President; Becky Norton Dunlop, Vice President; Kim R. Holmes, Vice President; Phillip N. Truluck, Executive Vice President (front); Matthew Spalding, Vice President; Michael M. Gonzalez, Vice President; Michael Spiller, Vice President; Edwin J. Feulner, President; Stuart M. Butler, Distinguished Fellow; Genevieve Wood, Vice President; Edwin Meese III, Reagan Fellow; Derrick Morgan, Chief of Staff; Michael G. Franc, Vice President; John Von Kannon, Vice President and Senior Counselor. (Not pictured: Robert E. Russell Jr., Counselor) We discovered that the report showed Yucca to be a Club to honor author and journalist M. Stanton Evans for safe storage facility. Our exposé put the NRC on the his decades of service to the conservative movement. defensive—both for initially redacting the report’s But it is to our members that we pay our highest trib- conclusion and for stalling approval of the site—and ute. Throughout this alarming year, we drew inspiration sparked a congressional hearing. Energy Secretary and support from your steadfast dedication to saving Steven Chu and NRC Chairman Gregory Jaczko were the American Dream. We welcomed nearly 100,000 new questioned on both points at the hearing. supporters in 2011, and contributions reached an all- time high. Honors Won, Honors Given Our members—new and old—are the soul of The Heritage won new honors in 2011. Institutionally, Heritage Foundation, still the most influential think tank we received the highest possible rating from Charity in America. To you we extend our most sincere thanks. Navigator for “sound fiscal management and Sincerely, commitment to accountability and transparency.” And, at the Values Voter Summit, our Ronald Reagan Distinguished Fellow Edwin Meese received the 2011 Vision and Leadership Award. We bestowed several richly deserved honors, as well: n Clare Boothe Luce Awards—honoring dedication to the conservative movement —went to Roger Ailes in April, Richard M. Scaife in May and Dick Cheney in October, n Dr. Hal Scherz, founder of Docs 4 Patient Care,

won our Henry Salvatori Prize for American Frasierphoto.com Photo: Photography Hills David Photo: Citizenship, and n Sixth Circuit Court of Appeals Chief Judge Alice M. Batchelder received our “Defender of the Constitution” award. Thomas A. Saunders III Edwin J. Feulner We also hosted a tribute dinner at the National Press Chairman President

2011 ANNUAL REPORT the heritage foundation 5 Am e r i c a n Dr e a m Photo: Chas Geer Chas Photo: House Budget Committee Chairman Paul Ryan (R-Wis.) garnered national headlines with his Oct. 26 speech at Heritage entitled “Saving the American Idea.”

First Principles Foundation of the Dream The Founding Fathers had a dream: a nation founded not on raw power, but on eternal principles—that all men are created equal, that they are endowed with God-given, unalienable rights to life, liberty and the pursuit of happiness. oreover, the Founders believed that government its billowing sails, government has hauled up more existed solely to secure those rights and that its canvas. From 2008 through 2011, Washington embarked Mpower derived solely from the consent of the on an unprecedented spending binge. In the process, governed. From these few principles flow the freedoms our leaders have assumed statist powers found nowhere and the opportunities that make the American Dream in the Constitution. possible. The Heritage Foundation has met this reckless Today that dream is in danger. Eight decades of expansion of government with a defiantNo! Battling “progressive” policy have vastly expanded government’s against these ruinous encroachments on the American power, its demands on our pocketbooks and its Dream, we launched a major counteroffensive in 2011. reach into our everyday activities. Mushrooming First, we made some organizational changes. With “entitlements” are driving America down the path to America’s First Principles imperiled, we determined to economic ruin. But rather than change course and trim roll out heavier artillery in defense of those principles.

6 the heritage foundation 2011 ANNUAL REPORT Am e r i c a n Dr e a m Photos: Chas Geer Chas Photos: At an April 21 lecture on his book Righteous Indignation, “new media” pioneer teases ’s Dana Milbank (in chair, lower left). Breitbart, a good friend of Heritage’s, died 10 months later.

Kate O’Beirne, President of the Institute, confers with Matthew Spalding, Heritage’s Vice President for American Studies, before speaking to congressional staffers enrolled in our James Madison Fellows Program.

Accordingly, we rechristened our Center for American Constitutional Guidance for Lawmakers, a series of papers Studies as the B. Kenneth Simon Center for Principles to help Washington follow a new rule requiring lawmakers and Politics and promoted its director, Matthew Spalding, to file a statement of constitutional authority with every to a new Senior Management post: Vice President for bill they sponsor. American Studies. The Simon Center also debuted New Common Sense, While the Left derided Tea Party members as “terror- an e-newsletter that relates current policy battles to ists,” “racists” and “Nazis,” we proudly co-sponsored Ohio’s America’s First Principles. The new publication found a state Tea Party convention in July. There, we distributed receptive audience. By year’s end, it boasted more than more than 3,000 Heritage books, booklets and essays. 22,250 subscribers. Spalding conducted a seminar for more than 70 Tea Party Marking Constitution Day, Sept. 17, we partnered leaders, grounding them in First Principles and explaining with Classical Conversations, a home-schooling support how they serve as a trusty compass to deal effectively with organization, to distribute 20,000 copies of Heritage’s today’s policy challenges. Earlier, he had provided simi- pocket Constitution and Declaration of Independence at lar training for state activists and Tea Party leaders from celebrations around the nation. Texas, Oklahoma, Louisiana and Arkansas. Heritage experts spoke about First Principles before When word went out that Spalding’s We Still Hold 4,000 at CPAC’s September regional meeting in Florida, These Truths had gone into its third printing, more than and before 3,000 at the October Values Voter Summit in 100 Tea Party coordinators in 23 states requested copies of Washington, D.C. the book and the Leader’s Guide. By year’s end, more than Bottom line: It was a year of rallying to repel the 4,000 individuals had purchased the materials needed to Left’s attacks on America’s First Principles. And defend hold a We Still Hold These Truths study group. them we must, for they are the strongest ramparts of We didn’t forget Congress. The Simon Center launched freedom.

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Entitlements Saving the American Dream In 1893, five-year-old Baline and his family fled persecution in and came to New York. In their windowless basement flat on the lower East Side, Israel often heard his mother murmur, “God bless America.”

s an adult, Israel became a composer. And his n recasts Social Security, Medicare and Medicaid mother’s prayerful phrase inspired one of his into financially sustainable programs that, for the most beloved songs. first time ever, guarantee no retiree will slip into A poverty; Israel Baline was Irving Berlin, one of countless millions who lived the American Dream—and n creates a new flat tax that replaces all other federal celebrated it. taxes, including the ; Today, however, a fiscal nightmare threatens to n fully funds national defense while balancing the overwhelm the American Dream. Were he to arrive federal budget within 10 years without raising in New York today, little Israel Baline would inherit taxes, and a share of national debt totaling more than $36,000. n permanently reduces federal spending to 18.5 That debt grows by $3 billion a day. Our three biggest percent of GDP. (It was 23 percent last year.) entitlement programs alone have piled up unfunded We call this groundbreaking plan, simply, Saving the obligations running into scores of trillions of dollars. American Dream. Heritage is fully committed to preserving the dream for Stuart Butler, director of our Center for Policy Inno- future generations. And so, in 2011, we unveiled one of our vation, premiered the plan at the 2011 Fiscal Summit or- most ambitious proposals yet—a comprehensive plan that: ganized by the Peter G. Peterson Foundation. Heritage n cuts the size of our federal government by about was one of six policy organizations offering proposals half within 25 years; to address America’s fiscal crisis. Independent analyses Photo: Face to Face Photography Face to Face Photo: Stuart Butler (second from right), Director of our Center for Policy Innovation, presents Heritage’s “Saving the American Dream” plan at the 2011 Fiscal Summit convened May 25 by the Peter G. Peterson Foundation.

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of all six plans commissioned by the Peterson Foundation determined that Saving the American Dream generated the lowest level of federal spending, the least taxation and the largest reduction in the national debt. Having bested the competition, we began marketing our plan, not just to Capitol Hill, but to Ameri- cans everywhere. We created a website, savingthedream.org, to explain how our approach benefits all segments of society: families, low-income workers, entrepreneurs, millennials, baby boomers and retir- Photo: Carpe Vita Photography Vita Carpe Photo: ees. Our Strategic Marketing team Alison Fraser, Director of the Roe Institute for Economic Policy Studies, outlines our plan for Saving produced a suite of promotional the American Dream at a Dec. 5 gathering of Heritage members in Dallas. brochures, booklets and videos that In floor debate over were widely used at conferences a Balanced Budget around the country. Amendment, Senate Heritage experts reviewed the Finance Committee plan with editorialists at major Ranking Member D.C. media including Congressional , R-Utah, deploys a graphic from Quarterly, USA Today, The Wall Heritage’s 2011 Budget Street Journal, The Washington Chart Book to show Examiner, The Washington Post and that annual interest . They briefed payments on the top syndicated columnists like Cal national debt already exceed spending Thomas and Robert Samuelson. on most federal Then they fanned out to explain the departments. plan to editorial boards and other opinion leaders across America. Butler toured New England, Saving the American Dream Plan meeting with the , Quickly Reverses Course of Debt Boston Globe, Christian Science President Obama’s 2012 budget proposal would drive debt to 87 percent of the economy Monitor, Providence Journal and by 2021. In contrast, The Heritage Foundation’s Saving the American Dream plan would others. Meanwhile, Alison Acosta lower debt to 58 percent of Gross Domestic Product in 10 years. Fraser, director of our Roe Institute DEBT AS A PERCENTAGE OF GDP 87.4% of Economic Policy Studies, headed 90% PRESIDENT West. In one week, she hit The Dal- OBAMA’S 80% BUDGET las Morning News, Arizona Repub- lic, Las Vegas Journal-Review, Los 70% Angeles Times, Investor’s Business 60% HERITAGE Daily and Orange County Register. Average, 1981–2010: PLAN 50% 40.6% 58.2% Then she swung east to New York, 26.1% briefing reporters and producers at 40% CNBC, CNN, Bloomberg, FOX News 30% Channel and more. 20% Butler visited Israel Baline’s 1980 1985 1990 1995 2000 2005 2010 2015 2020 adoptive hometown, too. In a Sources: Congressional Budget Office, White House Office of Management and Budget, Heritage Foundation calculations based on current projections. televised face-off on FOX’s “Stossel,” his presentation of Saving the

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Stuart Butler shows off John Stossel’s Emmy. The News host had offered the statuette to the think tank offering the best plan—as voted by viewers—for solving the nation’s

fiscal crisis. Geer Chas Photo:

American Dream trounced the fiscal reform proposals $16.394 trillion from four other think tanks… and Butler walked off with Additional $1.2 trillio n one of host John Stossel’s “Emmys.” projected in 2012 All the while, of course, we promoted the $15 $500 billion added Sept. 21 plan’s recommendations on the Hill, briefing key trillion $400 billion added Aug. 2 $14.294 Representatives like Budget Committee Chairman Paul trillion Ryan (R-Wis.) and Senators such as ranking Finance as of The Budget Control Committee member Orrin Hatch (R-Utah) and Joint February Act Increases the Debt 12, 2010 Economic Committee members Jim DeMint (R-S.C.) Limit by $2.1 Trillion and Mike Lee (R-Utah). In dozens of follow-up meetings The Budget Control Act of with senior staff, Heritage analysts dove into the details. $10 2011—the product of debt Amid all this activity, the House approved, 235-189, limit negotiations in August Ryan’s “Path to Prosperity” budget plan. It contained 2011—allows Congress and the precisely the kind of Medicare and health reforms President to raise the debt limit proposed in Saving the American Dream. in three tranches. The first $900 By year’s end, strategically chosen components of billion increase has already Heritage’s plan—including welfare as well as Medicare occurred. Because the Super reforms—had been proposed in both the House and $5 Committee failed to reach an Senate, paving the way for future introduction of the agreement, automatic budget entire plan. cuts totaling $1.2 trillion will In all the meetings—under the dome, in studio or be triggered beginning in 2013. inside editorial boardrooms—we harped on one truly Then the debt limit can also fundamental fact: The impending fiscal crisis reflects be increased by $1.2 trillion to a spending problem, not a revenue problem; it must be $16.394 trillion. solved on the spending side of the ledger. $0 And no matter how deep in the weeds we went to solve technical policy challenges, we never lost sight Sources: U.S. Department of the Treasury, Office of Management and Budget, and Congressional Research Service. of the goal: Saving the American Dream for future generations.

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Protect America Defending the Dream Many “progressives” view national defense as just another government function… one that pinches spending on their pet social programs. But defending America is a constitutional duty. Photo: Chas Geer Chas Photo:

eritage believes the budget should provide what’s Former Defense Secretary thanks two of the Air needed to safeguard our nation against current Force’s finest while signing copies of his memoir after a Feb. 22 lecture in and future threats, not simply reflect what’s left Heritage’s Allison Auditorium. Next to Rumsfeld is Lectures and Seminars H Director John Hilboldt. over after everything else has been funded. This was the theme of our yearlong “Defending Defense” initiative. We also pressed the message in countless Capitol Hill It actually started Oct. 4, 2010, with a Wall Street briefings and seminars. In just one remarkable session, Journal column by Heritage President Edwin Feulner, Heritage experts James Carafano, Baker Spring and American Enterprise Institute (AEI) President Arthur Mackenzie Eaglen briefed more than 100 Hill staffers on Brooks and Foreign Policy Initiative Director William “Defense 101: An Overview of Defense Policy and Budgets.” Kristol. In “Peace Doesn’t Keep Itself” they argued that And we testified 10 times before congressional committees the soaring deficits of recent years arise from huge spikes about the need to maintain a strong national defense. in domestic—not defense—spending. Moreover, we need With congressional liberals determined to gut the to rebuild our war-depleted inventories and make the in- military budget, we decided to take the issues—and our vestments in military modernization needed to counter concerns—to the American people. And so, in partnership emerging threats. with AEI and CNN, we sponsored a nationally televised It was a theme we hit again and again throughout the debate among GOP presidential candidates. The event, year, not just in our Protect America Month lecture series, held in DAR Constitution Hall, dealt exclusively with but in a series of influential reports prepared by our De- foreign and defense policy issues. fending Defense coalition for incoming Defense Secretary More than 9 million viewers watched the live debate Leon Panetta. on CNN, and millions more viewed it on CNN en Español,

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Protect America Month Proclaiming May to be “Protect A major theme of these events: America Month,” Heritage We should base defense spending sponsored a series of high-powered on what’s needed to meet current events driving home the need to and foreseeable threats to our make strong defense a national national security. priority, even with a lagging Just what is needed and how much economy. In 2011 we went outside will it cost? That’s what Reps. West, the Beltway, holding events to Duncan Hunter (R-Calif.) and Trent reach opinion leaders in New York Franks (R-Ariz.) asked Heritage in the and Houston. Headliners included weeks leading up to Protect America former Defense Secretary Donald Month. Our experts answered those Rumsfeld; Gen. Peter Pace, former

critical questions in the Special Geer Chas Photo: chairman of the Joint Chiefs of Staff; Report: “A Strong National Defense: Rep. Allen West, R-Fla., describes “The 21st Sen. Kelly Ayotte (R-N.H.) and Rep. The Armed Forces America Needs Century Battlefield” in his closing address Allen West (R-Fla.). and What They Will Cost.” May 31 for Protect America Month.

CNN International, American Forces Network and President Kim Holmes, Carafano and Spring led Congress C-SPAN’s multiple rebroadcasts. Heritage members got to add several improving amendments to the treaty. One, into the spirit, organizing more than 200 debate-watching offered by Sen. Jim DeMint (R-S.C.), commits the U.S. to parties around the nation. The debate won rave reviews— strengthening missile defenses. and raised awareness of this critical issue. And Rep. Michael Turner (R-Ohio), chairman of the Of course, Heritage was active on many defense matters House Strategic Forces Subcommittee, introduced the during the year. For example, we led the charge in pointing New START Implementation Act, which included Spring’s out the dangers inherent in the New START treaty, recommendations on missile defenses and nuclear which requires the U.S. to cut its nuclear stockpiles while weapons modernization. The successful test of a missile letting Russia increase its inventory. Briefings by Vice interceptor weeks earlier bolstered Spring’s longstanding

Lisa Curtis, Senior Research Fellow in our Asian Studies Center, testifies Sept. 14 before a House subcommittee on U.S.-India counterterrorism efforts. Photo: Face to Face Photography Face to Face Photo: Photo: Face to Face Photography Face to Face Photo: His features masked, House Armed Services Committee Chairman former CIA spy Reza Howard P. “Buck” McKeon, R-Calif. (left), Kahlili joins Senior is greeted by Kim Holmes, Heritage Vice Research Fellow James President for Foreign and Defense Policy Phillips in a May 25 Studies, as he arrives May 5 to give the panel discussion of the opening address for Protect America Month. growing nuclear threat from Iran. Photo: Chas Geer

12 the heritage foundation 2011 ANNUAL REPORT Am e r i c a n Dr e a m recommendation for further development of a missile to counter Defense Spending Has Declined longer-range ballistic missiles. As Entitlement Spending Has Increased Our determined and well- Spending on national defense, a core constitutional function of government, has declined organized opposition to New START significantly over time, despite wars in Iraq and Afghanistan. Spending on the three major surprised the internationalist entitlements—Social Security, Medicare and Medicaid—has more than tripled. crowd. Rather than risk another PERCENTAGE OF GDP 10% bruising battle, administration 1976 was Entitlements officials wound up shelving plans to the first year (Social Security, entitlement Medicare, Medicaid) push for ratification of two other, 8% spending 10% exceeded equally objectionable pacts: the defense spending Comprehensive Test Ban Treaty and 6% 7.4% the Law of the Sea Treaty. National On the homeland security front, Defense 4% 2.5% a report from the Government 5% Accountability Office recommended 2% reform of homeland security grants— 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 something first proposed by Heritage 2011 figures are estimates several years ago. Source: White House Office of Management and Budget. And Homeland Security Secretary Janet Napolitano announced the U.S. would no longer try Rep. Buck McKeon (R-Calif.), chairman of the House to screen 100 percent of freight containers entering U.S. Armed Services Committee, to craft new legislation on ports. Heritage had long argued the effort would waste detaining terrorists. Through many articles and media money and cripple global trade. DHS also adopted our interviews, Stimson explained why terrorist detainees longstanding recommendation to reform the color-coded should be tried before military commissions, not criminal terror alert system, a complex mess that provided endless courts. In accord with our recommendations, the Obama jokes for TV comedians. administration ultimately reversed itself, announcing it Senior Legal Fellow Charles Stimson worked with would resume military commission trials.

The Debate America Deserved The idea of having think-tank executives and scholars ask the questions worked marvelously well. The queries were much deeper and more substantive than those the candidates typically get from political journalists and handpicked “regular voters.” —James Taranto,

Finally, America was brought a serious, adult debate where substance was served up from beginning to end. —Eric Golub, The Washington Times

… a substantive debate that brought to the fore Geer Chas Photo: differences among candidates on a variety of foreign Heritage President Edwin Feulner and AEI President Arthur Brooks policy issues … (left) prep the audience at DAR Constitution Hall minutes before eight Republican presidential candidates take the stage for a national —Jim Rutenberg and Jeff Zeleny, security debate telecast worldwide by CNN.

… the questions were pointed, sobering and even educational… —Noah Rothman, ology.com

… probably the most substantive and serious presidential debate of this election cycle. —Michael Barone, The

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Health Care Fighting the Government Takeover of Health The numbers are frightening. In 2010, Americans spent $2.6 trillion on health care—one-sixth of total GDP. edicare enrollment rose to 47.5 million. By 2030 that number will reach 80 million, and Mgovernment will control half of all health care Fighting the Government Takeover of Health spending—if current policies remain in place. That’s just one reason Heritage is working so hard to educate Congress about the odious side effects arising from the 2010 passage of the Patient Protection and (PPACA, or “Obamacare”). This law would put most Americans into a government-run health system. In spring 2011, we published a 15-paper series making “The Case Against Obamacare.” The analyses showed, from a variety of vantage points, why PPACA must be repealed and outlined a host of market-based reforms to get health care right. Heritage also explored ways to limit PPACA-induced damage until full repeal was possible. Our research demonstrated that, by exercising its “power of the purse,” Congress could effectively block key provisions of the law from going into effect. Congressional oversight could also Photo: Chas Geer Chas Photo: Maine Gov. Paul LePage, in a July 18 lecture at Heritage, describes how his impede implementation of onerous regulations issued in state repealed a failed government-run health care plan and replaced it furtherance of the new law. with market-based insurance reforms. Distinguished Fellow Ernest Istook authored a series

Helping States Get Health Reform Right Heritage wasn’t alone in its criticism of state reform issues with DC-based for resisting the federal takeover of the Patient Protection and health reporters, Owcharenko led a of their health systems and Affordable Care Act (PPACA) or parade of reform-minded governors implementing better reforms to its conviction that states—rather into Heritage lecture halls. Utah Gov. benefit their citizens. than federal bureaucrats—would Gary Herbert spoke on “Fighting for Senior Research Fellow Edmund be better able to determine how Real Health Reform: States Know Haislmaier testified before the best to help their citizens get What Is Best for States.” Maine Pennsylvania and legisla- quality, affordable health care. Nina Gov. Paul LePage explained how he tures on ways to create effective Owcharenko, Director of our Center dismantled Maine’s Obamacare-like health insurance exchanges. But for Health Policy Studies, led her health policies. Sen. Orrin Hatch most of the year we toiled behind team in educating state officials (R-Utah) wrapped up the series with the scenes, traveling to more than a about policy alternatives that would a lecture on “Empowering the States: dozen states where leaders sought allow them to escape the shackles of A Path to Reforming Medicaid.” to create pro-market health care one-size-fits-all PPACA regulations. In November, Heritage hosted alternatives before the most oner- After joining Indiana Gov. Mitch leaders from 19 states who ous provisions of PPACA take effect Daniels for a roundtable discussion gathered to discuss strategies in 2014.

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Why Obamacare Is Wrong for America Robert Moffit, a Senior Fellow in Heritage’s Center for Policy Innovation, has long specialized in health care and Medicare reform. In 2011, he teamed with three outside health policy experts to co-author Why ObamaCare Is Wrong for America. The book presents a comprehensive— and compelling—case against this misguided attempt to place American health care under government control. More than 100 attended the book release in March at the National Press Club. The four authors presented detailed overviews of the book in a panel discussion that ran more than an hour and aired five times on C-SPAN’s “Book

TV.” The video was also placed on “Book TV’s” website for online viewing. Geer Chas Photo: Senior Fellow Robert Moffit warms to his topic Shortly afterward, the book earned plaudits on Capitol Hill. Sen. John at the March 24 book event at the National Barrasso (R-Wyo.) even lauded it in a speech on the Senate floor. Press Club. of papers and commentaries exposing a dirty fiscal secret of the PPACA: The bill itself authorized mandatory appropriations totaling $100 billion to implement the bill. Worse, this pre-approved spending was not subject to the regular appropriations process. Following Istook’s recommendations, the House Energy and Commerce Committee approved five pieces of legislation to de-fund these auto-piloted expenditures. Stuart Butler, Director of our Center for Policy Innovation, traveled widely to brief opinion leaders on major problems with the PPACA and explain the advantages of pursuing a health system centered on private, competitive markets and consumer choice. He brought the message to a variety of venues including Harvard University’s retreat for new Members of Congress, the Commonwealth Fund Retreat for Hill staff, the U.S. Government Accountability Office… even the World Health Congress. Butler’s colleague, Senior Fellow Robert Moffit, also addressed key outside-the-Beltway groups Geer Chas Photo: Nina Owcharenko, Director of our Center for Health Policy Studies, fields ranging from Tea Party conventions to professional a question on how states can pursue practical, affordable, consumer- conferences of the Southern Medical Association and centered health care reforms. the American Legislative Exchange Council. Back in Washington, Moffit conducted numerous Hill briefings she put it, there is “no viable path forward for CLASS on PPACA, including a “Hill 101” seminar organized implementation at this time.” by Heritage Action for America that drew scores of Our Center for Legal and Judicial Studies also joined congressional staffers. the PPACA legal debate, filing its first-ever friend- In March, Heritage published “Secretary Sebelius of-the-court brief in the 11th Circuit challenge to the Cannot Fix CLASS,” a prescient paper warning Congress law. The administration’s brief in that case quoted a that CLASS—a new, long-term health care program prior Heritage lecture out of context to support its tucked away in PPACA—was fiscally unsustainable. It position. Our brief exposed that distortion and clarified could only compound the nation’s fiscal problems. Seven Heritage’s real policy position. It concluded that the months later, Health and Human Services Secretary individual mandate in PPACA is “unwise policy and ... Kathleen Sebelius announced she was suspending the unconstitutional legislation.” There should be no CLASS program “indefinitely.” Her reason? There misunderstanding of our views when the U.S. Supreme was no possible way to make the numbers work. Or, as Court hears the case in 2012.

2011 ANNUAL REPORT the heritage foundation 15 Am e r i c a n Dr e a m Photos: Chas Geer Chas Photos: Sen. John Cornyn, R-Texas, delivers the keynote speech during our July Three former U.S. Attorneys General (from left)—Edwin Meese, John 19 conference on protecting military voting rights. Ashcroft and Michael Mukasey—headline Heritage’s Oct. 18 Preserve the Constitution event on wartime powers.

Rule of Law Preserving the As colonists, the Founders had experienced life under an arbitrary and capricious regime, one in which might made right. It’s why they were determined to create a government with limited powers constrained by the rule of law. or democracy to survive, the law must protect the Chairman of the Joint Chiefs. More than 160 attended, right to vote and the integrity of the electoral pro- including several state government Secretaries of Fcess. Perversely, in modern America, those called State—the officials responsible for making sure that upon to defend our liberties overseas are among those our warriors overseas get their in time to be cast most likely to be disenfranchised. Too often, state of- and counted. ficials send out absentee ballots too late for military per- Von Spakovsky also defended the right of all Americans sonnel manning the front lines to get their votes counted. not to have their votes negated by fraudulent ballots. In To redress this situation, Sen. John Barrasso (R-Wyo.) scores of newspaper commentaries and broadcasts, he laid introduced the Military and Overseas Voters’ Relief Act. out incontrovertible facts disputing Justice Department Based on model legislation drafted by Heritage legal contentions that Voter ID requirements disenfranchise scholars Hans von Spakovsky and Charles Stimson, the bill the poor and suppress voter turnout. would amend current law to guarantee U.S. citizens abroad At the state level, von Spakovsky and Robert Alt, an opportunity to vote. Director of our Rule of Law Programs, conducted a series We also convened a half-day conference on the issue, of state tort reform conferences to lay a foundation for featuring speakers such as Sen. John Cornyn (R-Texas) effective reform legislation in 2012. Partnering with and Adm. Edmund P. Giambastiani, former Vice state-based think tanks such as the Georgia Public

16 the heritage foundation 2011 ANNUAL REPORT Am e r i c a n Dr e a m Photos: Chas Geer Chas Photos: At our July 19 conference, West Virginia Secretary of State Natalie Tennant Sen. Mike Lee, R-Utah (left), exchanges thoughts with audience provides a state perspective on maximizing opportunities for military members after his Sept. 15 speech outlining objections to the UN’s Law of personnel to vote. the Sea Treaty.

Policy Foundation and the Illinois Policy Institute, these We also continued our fight against overcriminal- events drew enthusiastic audiences of state lawmakers, ization—the massive expansion of criminal penalties committee chairmen and Executive Branch officials for acts best dealt with in civil courts. In the spring, we committed to commonsense reform of civil law. published a Criminal Law Checklist for Federal Legisla- tors delineating the questions Congress should ask and answer before attaching criminal penalties to a law. Our nine-month collaboration with Wall Street Jour- nal reporters produced a series of front-page stories on overcriminalization. The series highlighted several cases that Heritage had investigated and documented in our research studies. Editorials in The Wall Street Journal and Washington Times endorsed one of our key procedural recommen- dations—that all federal criminal legislation be referred to the House Judiciary Committee. In the fall, our brief- ing with the National Association of Criminal Defense

Photo: Brandon Stewart Brandon Photo: Lawyers, entitled “Have You Committed a Felony To- day?” drew more than 130 Capitol Hill staffers. The Long Arm of Overcriminalization To keep Hill staffers, legal professionals and any In 1997, racing legend Bobby Unser appeared in others interested in staying current on the most criminal court. He faced a $5,000 fine and six months important cases moving through the courts and in federal prison. Why? He got lost in a blizzard. A emerging legal issues of note, we launched Liberty Heritage video tells the story at http://blog.heritage. and Justice for All in September. By year’s end, the org/2011/03/14/bobby-unser-vs-the-feds/ biweekly e-newsletter boasted more than 15,000 subscribers.

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American Leadership Leading Other Nations to Dream of Freedom As the administration introduced the novel concept of “leading from behind,” Heritage stepped up efforts to restore America’s role as a true leader among nations.

he year opened with release of our 16th annual Index of Economic Freedom, a nation-by-nation measure Tof economic freedom. Given the benefits that flow from advances in economic freedom—from prosperity to environmental improvement to individual well-being— easing repressive economic policies is vitally important. Unfortunately, the 2011 report was not positive. Washington’s deficit spending, combined with heavy- handed intervention in financial and industrial markets, pushed the U.S. rating to a three-year low. Denmark passed us in the global rankings—a fact cited frequently by House Majority Leader Eric Cantor (R-Va.) in floor speeches calling for reduced government interference in the economy. The Index attracted extensive media attention, and the interactive website (http://www.heritage.org/index) set a new record for traffic. Experts from our Center for International Trade and Economics circled the globe, presenting Index findings and promoting economic

Photo: Chas Geer Chas Photo: freedom from Hong Kong to Honduras, from Costa Rica to In the 2011 installment of Heritage’s B. C. Lee Lecture Series, Sen. Joseph Kiev, from Tokyo to Tbilisi. Leiberman, I-Conn., discusses “Peace Through Strength: The Imperative of In November, Sen. (I-Conn.) delivered American Leadership in Asia” in Allison Auditorium. our annual B.C. Lee lecture, the 15th in this series that

Helle Dale: Dynamo for Public Diplomacy Helle Dale, Heritage’s Senior Fellow for Public Diplomacy, proved an influential voice for global freedom throughout 2011. In February, she testified before Congress on the future of Voice of America (VOA). The Broadcasting Board of Governors (BBG) had proposed shifting all VOA programs to the Internet. Citing ’s strict censorship of Internet communications, Dale stressed the need to maintain Chinese radio broadcasts. Following her testimony, the BBG launched a strategic review of its policies, and Congress appropriated funds specifically to

Photo: Chas Geer Chas Photo: keep the radio broadcasts going. The BBG later adopted another Dale recommendation: to keep the Office of Cuba Broadcasting in Miami rather than move it to Washington. And, by year’s end, the State Department adopted her advice to provide dissidents, from Iran to China, with technology that can bypass government-imposed Internet restrictions.

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Tracking China’s Investments

WORLDWIDE

$172.4B

$85.1B

$60.2B

$38B $35.2B $25.2B $10.2B $8.6B $8.4B $443.2B 2005 2006 2007 2008 2009 2010 2011 TOTAL =$6B YEARLY TOTALS CIRCLE SIZE REPRESENTS TOTAL INVESTMENT CHINA’S WORLDWIDE INVESTMENTS AND CONTRACTS Our Asian Studies Center’s China Global Investment Tracker, created by Senior Research Fellow Derek Scissors, was featured in Barron’s and on the BBC. A comprehensive dataset of large Chinese investments and contracts worldwide, the Tracker informed economic news stories throughout the year, prompting requests for more in- formation from the New York Federal Reserve and the U.S. trade representative. focuses on the importance of American leadership in the allowing dictator states to import and export all the guns Asia-Pacific region. He emphasized the need to ratify they want. When the administration signaled interest in free-trade agreements with other nations — a policy long this agreement, Ted R. Bromund, our advocated by Heritage. Senior Research Fellow, helped the office of Sen. Jerry Mo- As the year drew to a close, Congress seemed to be ran (R-Kan.) draft a letter urging its rejection. Signed by 45 getting the message. It ratified free-trade agreements with GOP Senators, the missive inspired a similar letter signed Colombia, Panama and South Korea. The three pacts are by 13 Democratic Senators. The treaty went nowhere. expected to boost U.S. exports and increase GDP by $12 billion a year. The , meanwhile, continued to be a font of wasteful spending, a coddler of despots and a source of pernicious international pacts. One such pact, the U.N. Arms Trade Treaty, poses Second Amendment risks while

Brett Schaefer, UN Watchdog­ In papers, congressional briefings and testimony before the House Foreign Affairs Committee, Brett Schaefer, Heritage’s Jay Kingham Fellow in International Regulatory Affairs, exposed U.N. budgetary issues that led directly to legislation aimed at cutting U.S. contributions to irresponsible international organizations. Photo: Chas Geer Chas Photo:

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Energy & Environment Pursuing Rational Energy and Environmental Policy The American Dream runs on energy, and government of late has gone overboard on failed energy policies. Exhibit A: the scandalous waste of taxpayer funds on Solyndra, the now defunct solar-energy company.

ur energy team made sure policymakers learned drew their sponsorship of the bill, and the NAT GAS Act the hard lessons of this folly. In commentaries fell into legislative limbo. Oin The Washington Post and USA Today and in In November Rep. Mike Pompeo (R-Kan.) introduced numerous broadcast appearances, Heritage experts ex- the Energy Freedom and Economic Prosperity Act. It plained why using government subsidies to pick winners would roll back energy tax subsidies and reduce corporate and losers in the marketplace leads inevitably to crony tax rates on energy producers—moving them all out of capitalism, corruption and distorted markets. the federal trough and into competitive markets. The bill Throughout the spring, energy analysts Jack Spencer reflected the persistent work of Spencer and Loris making and Nicolas Loris responded to numerous congressional the case against all energy subsidies. inquiries about the pending NAT GAS Act, H.R. 1380, a bill Just as misguided and destructive as subsidies is over- stuffed with subsidies. They met with Hill staff to translate regulation. In response to the Environmental Protection conservative principles into sensible energy and environ- Agency’s inflated estimate of benefits derived from regu- mental policy. Meanwhile, Heritage Action for America lations issued under the Clear Air Act, Regulatory Affairs joined with 40 other groups to issue an open letter oppos- Research Fellow Diane Katz exposed the agency’s flawed ing energy subsidies of any kind. Fifteen members with- methodology and other errors underlying those claims. Photo: Face to Face Photography Face to Face Photo: In an Oct. 27 House joint subcommittee hearing, Jack Spencer, Heritage’s Senior Research Fellow in Nuclear Energy Policy, assesses draft recommendations from the Blue Ribbon Commission on America’s Nuclear Future.

20 the heritage foundation 2011 ANNUAL REPORT Am e r i c a n Dr e a m Photo: Face to Face Photography Face to Face Photo:

David Kreutzer, Research Fellow in Energy Economics and Climate Change, testifies on energy tax policy at a Sept. 22 hearing of two House Ways and Means subcommittees.

Heritage continued to lead the fight against unneces- sary regulation of greenhouse gases, forming a working group of organizations allied on the issue. As the House debated the Energy Tax Prevention Act, which would strip the EPA of authority to regulate CO2 emissions, Katz’s re- search work was cited often. David Kreutzer, our Research Fellow in Energy Economics and Climate Change, testified several times on how CO2 regulations would raise energy costs while reducing income and employment. Ultimately, the bill to rein in the EPA passed the House. Following Japan’s nuclear disaster, caused by an earthquake and tsunami, Heritage moved forward with a documentary analyzing the risks and benefits of nuclear power. Slated for release in 2012, the video acknowledges Is nuclear energy safe? Do we really need it? How the seriousness of the Japanese disaster and explains how do nuclear plants affect the people who work or safety systems in place at U.S. and other plants could have live nearby? What, exactly, are the risks? Heritage’s prevented a similar calamity under the same conditions. 39–minute documentary “Powering America” answers Sen. (R-Okla.) proposed groundbreaking these questions and more. legislation that drew heavily on research by Spencer and Lo- ris. It would allow the private sector to handle nuclear waste Educational and engaging, “Powering America” and close numerous offices in the Department of Energy. presents a behind-the-scenes look at how uranium And Spencer’s papers and testimony on the proposed mines, nuclear power plants and used-fuel recycling Yucca Mountain nuclear waste repository helped prevent facilities work around the globe. With production the administration from closing down the project. The completed in 2011, the film was slated for a spring House also barred any funding to end the Yucca program 2012 debut on The Documentary Channel, as well as a and called for the Nuclear Regulatory Commission to limited theatrical release. stop foot-dragging in its review.

2011 ANNUAL REPORT the heritage foundation 21 Am e r i c a n Dr e a m Photos: Chas Geer Chas Photos: At an Oct. 3 Heritage event, Rep. Darrell Issa (R-Calif.), Chairman of At a March 9 hearing of a House Health Subcommittee, Heritage the House Oversight and Government Reform Committee, calls for Distinguished Fellow Ernest Istook exhumes a host of mandatory restructuring the Postal Service to save taxpayers billions and bring the appropriations buried in the voluminous Obamacare legislation. agency back from insolvency.

Enterprise & Free Markets Freeing the Dream from Regulatory Shackles For foes of excessive government regulation, 2011 provided a target-rich environment. mid-year update of “Red Tape Rising,” Heritage’s In separate House and Senate hearings, James landmark report on the proliferation of stifling Gattuso, our Senior Research Fellow in Regulatory Policy, A federal regulation, documented the imposition testified on the problems caused by regulatory excess and of 15 new “major” regs in just the first six months of 2011. potential legislative remedies. Rep. Don Young (R-Alaska) Their price tag? One-time implementation costs of $6.5 introduced several regulatory reform bills incorporating billion and continuing costs of more than $5.8 billion many of Gattuso’s recommendations. annually. To keep up the drumbeat for regulatory reform, These findings attracted reams of press coverage, Gattuso launched a bimonthly column for Bloomberg- including a hard-hitting Wall Street Journal editorial. Government.com. And our blog, The Foundry, started They were also cited extensively on Capitol Hill, notably a weekly series, “Tales of the Red Tape,” dedicated to by Rep. Darrell Issa (R-Calif.), Chairman of the House exposing ridiculous new regulations that interfere with Oversight Committee. At his request, Heritage compiled Americans’ everyday activities. a list of the 20 most economically destructive regulations. The author of that series, Research Fellow Diane Katz, A leading liberal blog said the list “most neatly reflects wrote frequently on both federal and local government the priorities of the conservative movement… [and] attempts to regulate food in the . But perhaps reflects the intellectual center of gravity of the entire her most impactful piece drew attention to the obscure [conservative] movement.” We accepted the compliment. but onerous “Boiler MACT” rules that would severely

22 the heritage foundation 2011 ANNUAL REPORT Am e r i c a n Dr e a m affect any institution using industrial boilers. The EPA subsequently postponed implementation of those rules. The financial sector took a heavy hit from the regulators, due largely to last year’s Dodd-Frank bill. In 2011, Heritage focused on an especially egregious creature of Dodd-Frank: the so-called Consumer Financial Protection Bureau (CFPB). Time and again, we highlighted the powerful new agency’s total lack of congressional oversight and its “guaranteed” budget, exempt from the appropriations process. Ultimately, 44 Republican Senators declared redress- ing these problems a non-negotiable issue. They informed the president that, unless he worked with them to bring the CFPB budget “online” and to provide for congressional oversight, they would not confirm any nominee as CFPB di- rector. The White House balked, and the Senators held firm. In November the nomination of Richard Cordray failed. [Subsequently, in January 2012, President Obama took the unprecedented and unconstitutional step of appointing Cordray to the post, without senatorial advice and consent.] As the housing market continued to crater, Senior Research Fellow David John issued a paper calling for a truly bold move. No, not another expensive consumer Photo: Chas Geer Chas Photo: subsidy or industry bailout. John’s “Free the Housing Sen. Ron Wyden, D-Ore., (left), confers with Sen. Dan Coats, R-Ind., before Finance Market from Fannie Mae and Freddie Mac” made a Heritage seminar on bipartisan efforts to simplify and modernize the tax the case for eliminating these two market-distorting, code. Vice President for Domestic and Economic Policy David Addington government-sponsored entities. (background) hosted the April 7 event.

Christmas Tree Tax? Gone in a Day! It was Heritage’s swiftest victory of the year. Bigwigs at the National Christmas Tree Associa- tion tried three times to persuade tree growers to pony up 15 cents per tree to fund a marketing campaign. They failed. Many growers weren’t interested. So the association asked for a little government muscle. The Agriculture Department jumped at the chance, announcing it would ap- point a federal Christmas Tree Promotion Board to “enhance the image of Christmas trees” — with a 15-cent “fee” to pay the costs. Heritage Vice President David Addington blew the whistle on this federal folly in a Foundry post dubbing it the “Christmas Tree Tax.” Within hours, the linked to his post, breaking the news to millions. It sparked outrage… and a public uproar. Within 24 hours, the White House announced the fee was being

Photo: Dreamstime.com Photo: placed on “indefinite delay.”

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Family & Religion Bolstering the American Family and Self-Reliance The American Dream is built on strong families—the building blocks of civil society, the incubators of personal responsibility. Unfortunately, the welfare state has severely damaged the institution of family. Photo: Chas Geer Chas Photo: Rep. Jim Jordan, R-Ohio, Chairman of the Republican Study Committee, discusses his new welfare reform bill in a Jan. 25 speech in Allison Auditorium. Heritage anti-poverty expert Robert Rector “helped us tremendously,” Jordan noted.

t our January policy retreat for conservative assistance live in larger homes than most Europeans members of Congress, Heritage Senior Research and enjoy amenities unknown to—or beyond the means A Fellow Robert Rector stressed the need for of—most middle-class American families less than two comprehensive welfare reform. Two months later, Rep. decades ago. They used this data to press a key argument Jim Jordan (R-Ohio) introduced H.R. 1167, the Welfare of Saving the American Dream: that anti-poverty programs Reform Act of 2011. Its sweeping reforms largely reflect must focus on the truly needy. Rector’s work. By year’s end, Sen. Jim DeMint (R-S.C.) had “What is Poverty?” garnered coverage from newswires introduced a companion bill (S. 1904) in the Senate. and newspapers such as The Wall Street Journal and Throughout the year, Rector and his colleague Rachel Investor’s Business Daily and dozens of TV programs like Sheffield challenged the common misperception that most , Lou Dobbs and Bill O’Reilly. The paper itself Americans now defined as living in poverty are destitute, set new online readership records for Heritage research. hungry and homeless. Their paper, “Air Conditioning, In a new partnership with World Magazine, Cable TV and an Xbox: What is Poverty in the United Director Jennifer Marshall and her team of experts States Today?” noted that most Americans receiving public in the Richard & Helen DeVos Center for Religion &

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Domestic Policy Studies Director Jennifer Marshall confers with Robert Woodson, President of the National Center for Neighborhood Enterprise, during our Nov. 17 summit gathering experts from across the country to advance

Photo: Jeffrey Marshall / Pixelrally.com / Marshall Jeffrey Photo: conservative solutions to poverty.

Civil Society produced a dozen articles spotlighting bimonthly meetings of the Religious Liberty Forum, a conservative organizations and individuals using unique assembly of religious liberty scholars, litigators, innovative ways to help people escape poverty, find communicators and advocates in America. greater self-reliance and build stronger families. These In February Heritage relaunched our FamilyFacts.org success stories show that Heritage’s recommended website and started producing an ongoing series of one- approaches for reducing poverty truly work. minute radio spots that provide a “Family Fact of the Day” Understanding poverty is the first step toward solving from the site. By year’s end four prominent Christian radio the problem. In November Heritage took a second networks were airing the feature nationwide. step, convening an organizational conference of 80 conservative anti-poverty warriors—from state welfare agencies and nonprofit service organizations to leading “War on Poverty”… academics. One participant called it “the most impressive The costs keep on rising and authoritative gathering of conservatives concerned Total federal and state welfare spending has increased 13-fold about the poor in the last 20 years—perhaps ever.” It is the since Lyndon Johnson launched the “War on Poverty.” The beginning of a unified movement to restore civil society landmark 1996 welfare reforms stayed soaring costs only temporarily. and help the poor rise from poverty while retaining their human dignity and independence. TOTAL WELFARE SPENDING, BY PROGRAM TYPE, Recognizing the erosion of marriage as one of the IN 2008 INFLATION-ADJUSTED DOLLARS $800 greatest contributors to child poverty, we raised awareness Figures for 2008, in Billions of this critical issue with well-attended and highly $700 1996: TANF replaces AFDC Housing aid: $42 Food aid: $63 publicized child-poverty conferences in Georgia and $600 Indiana and in town hall meetings with Kansas Gov. Sam 1981: Reagan-era Other: $83 $500 welfare reforms Brownback. Cash: $154 $400 Our DeVos Center scholars wrote and spoke out against 1964: War on new assaults on traditional marriage, including New York’s $300 Poverty begins Medical care: $372 legalization of same-sex marriage, President Obama’s $200 decision to support repeal of the Defense of Marriage Total in 2008: $100 $714 Act and religious adoption agencies being forced to shut billion $0 down rather than violate their religious convictions about 1950 1960 1970 1980 1990 2000 2008

marriage. Meanwhile, Ronald Reagan Distinguished Source: The Heritage Foundation. Fellow Ed Meese and DeVos Center experts co-hosted

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Education Reaching for the Dream on the Wings of Education Liberals pronounced school choice dead in 2010. But 2011 became the Year of School Choice. ollowing a barrage of Heritage research, media appearances and commentaries, the nation’s capital Freinstituted its program. For the first time since Congress stopped funding in 2009, the D.C. Opportunity Scholarship Program offered hope—and a quality education—to new enrollees. School choice advanced broadly elsewhere, too. A dozen states created or expanded these programs in 2011. And Heritage pressed for even greater gains, hosting an August school choice conference for community leaders Geer Chas Photo: and local education officials in Little Rock, Ark. In this Senior Policy Analyst Lindsey Burke recounts the academic gains made by students who escape failing public schools, during a Jan. 26 event marking cradle of the 1960s civil rights movement, speakers National School Choice Week. including former Education Secretary Rod Paige and Heritage Visiting Fellow Virginia Walden Ford cast a national curriculum via the backdoor route of waiving school choice as today’s most pressing civil rights issue performance goals for states that agreed to adopt federally and the best hope for inner-city children to break free of established “core curriculum requirements.” In December, poverty and live the American Dream. Senior Policy Analyst Lindsey Burke debated advocates of Heritage fought for less federal meddling in education, a national core curriculum before the American Legislative exposing the Obama administration’s attempt to impose Exchange Council (ALEC), an organization of conservative state lawmakers. Her arguments inspired ALEC’s education committee to draft model legislation to help free Education Made Simple states from agreements to adopt national standards. When Sen. (D-Iowa) sought to reauthorize the Elementary and Secondary Education Act (ESEA) and burden local schools with an additional 400 pages of federal regulations, Heritage explained this folly in research papers and Hill briefings. And once Heritage Action for America joined the fight, the bid to expand federal control over local schools fizzled. Answering the endless demand for higher teacher salaries, our Center for Data Analysis crunched the numbers to reveal that teachers are not “woefully Heritage produced four “Education Made Simple” underpaid,” as Education Secretary Arne Duncan claims. videos, each addressing a key area of education policy: Rather, their amazingly generous benefits leave public unionization, spending, national standards and school school teachers far better compensated than similarly choice. Capitol Hill staffers and state think tanks are skilled private-sector workers. The research made using the videos to promote conservative reforms to headlines in USA Today and The Wall Street Journal. the education system. It also brought howls of protest—but no fact-based rebuttals—from the teachers’ unions.

26 the heritage foundation 2011 ANNUAL REPORT Am e r i c a n Dr e a m Photo: Chas Geer Chas Photo: Our spring 2011 interns gather in the Allison Foyer with Heritage President Edwin Feulner and staff of the Young Leaders Program. Sharing the Dream… and Passing It On “Without a heritage, every generation starts over.”

he Heritage Foundation takes that motto to heart. control fast. We also sponsored lectures for college That’s why we continuously seek the best and students on 47 campuses in 20 states and continued Tbrightest conservative college students to spend our popular series of video Web-chats (Virtual Think a semester interning with us in Washington. Here, they Tanks) through Facebook, featuring all 10 Leadership learn about the principles of conservatism and the ins- for America initiatives. and-outs of public policy research from leading experts. On Capitol Hill, 270 junior staffers attended our weekly We welcomed 57 interns in our spring program, 68 in the Heritage Congressional Fellowship sessions. By year’s summer session, and 59 in the fall, for a year’s total of 184. end, 34 had completed the entire course of study. We also And Heritage interns never had it so good. Seven years of added 36 new fellows to our James Madison Fellowship service accommodating 1,365 residents had left our intern program for senior Hill staff in 2011. Both programs focus apartments a bit worn around the edges in 2010. But our on instilling today’s rising political stars with the same 2011 class of interns happily occupied freshly refurbished principles that animated our nation’s Founders. rooms with new lighting, carpet, paint and furniture. As the new conservative members of the 112th Con- Our Young Leaders Program (YLP) briefed 73 visiting gress rolled into town, our Job Bank screened more groups of young people about conservative principles than 2,000 resumes, identified some 450 candidates and Heritage’s Leadership for America policy initiatives. for Capitol Hill positions, and distributed resumes to Expanding our outreach to young professionals, YLP attendees at Heritage’s New Member Orientation. Job hosted “Debt Paying Generation” events in North Bank candidates—conservatives all—subsequently land- Carolina, Ohio and Pennsylvania. These explained ed 130 Capitol Hill positions ranging from Chief of Staff the fiscal train wreck awaiting the next generation to Staff Assistant. We also provided resumes to six newly unless Washington gets its spending compulsion under elected Governors.

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2011 Named Interns David King Interns Samuel L. Westerman Interns Quinn Bongers, Northwestern University Kyle Rusciano, Yale University Laura Stanley, James Madison University Christopher Kloster, Washington and Lee University Pedro and Ann Wasmer Interns The Hamilton Roddis Foundation Interns Tomas Bethencourt, The Catholic University of America Harris Swayze, Mississippi College Andres Celedon, Georgia Institute of Technology Christopher Adcock, University of Kentucky Johan Perez, Santa Maria University Travis Tipton, Vanderbilt University Claire Leatherwood, Yale University The Ray Foundation Interns Tanner McNeill, University of Southern California Edward Walton, Wake Forest University Charles Morrison, Tufts University Daniel Riner, Florida State University Allison Fick, University of Florida The Nicholson Family Interns Dorothy Williams, Grove City College The H.N. and Frances C. Berger Foundation Brooks Spears, Hillsdale College Interns Brittany Cobb, Emory University Glenn Hall Interns Zachary Enos, Patrick Henry College Cody Moran, Azusa Pacific University Jennifer Gieselman, University of South Dakota Nicholas Bruno, Houston Baptist University Anatoliy Khomenko, Washington and Lee University Kevin Reagan, The George Washington University Jordan Saunders Intern Alyene Senger, Kent State University Sterling Beard, Dartmouth College Guido and Sue Pichini Intern L.C. Baxter, Arizona State University Heritage recognizes the following members who have named intern positions for 2012 and beyond: The Robert S. and Janet L. Miller Family Foundation Intern Mrs. Erma Jean Tracy Meera Yogesh, University of Tennessee at Martin Mary H. Campbell Foundation Kevin Kline Intern Pilgrim Foundation William Dawkins, Southern Methodist University Col. Charles B. and Sally G. Stevenson

Heritage interns join other guests in the Allison Foyer to hear commentator discuss her book “Demonic.” Next to the author: Vice President of Communications

Michael Gonzalez. Photography face to Face Photo:

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Fellows: Distinguished Distinguished Fellows Dreamers and Doers of The Heritage Foundation Stuart M. Butler, Ph.D. Distinguished Fellow and Director, Center for Policy Innovation

Elaine Chao Distinguished Fellow

Lee Edwards, Ph.D. Distinguished Fellow in Conservative Thought Photos: Face to Face Photography Face to Face Photos: Patrick Knudsen Kumi Yokoe Ernest Istook Distinguished Fellow e welcomed two new fel- Senior Visiting Fellow in our Asian lows during 2011. Patrick Studies Center. One of Japan’s leading Edwin Meese III Knudsen joined us in Au- authorities on the United States, Yo- W Ronald Reagan Distinguished gust as our Grover M. Hermann Senior koe has analyzed Japanese politics on Fellow in Federal Budgetary Affairs. CNN and BBC. She has also worked as Fellow in Public Policy and It’s familiar turf for Knudsen, who a political consultant for private busi- Chairman, Center for Legal and spent 20 years on the staff of the House nesses. Yokoe has written 10 books on Judicial Studies Budget Committee. Prior to that, he U.S. politics, including one on the role worked as a newspaper reporter and of American think tanks. She holds a Jim Talent editorial writer. Ph.D. in policy science from Chiba Uni- Distinguished Fellow Kumi Yokoe joined us in June as versity of Commerce near Tokyo.

Named Fellows of The Heritage Foundation Margaret Thatcher Senior Research Fellow Marilyn and Fred Guardabassi Fellow in Media Ted R. Bromund, Ph.D. and Public Policy Studies Kenneth McIntyre Chung Ju-Yung Fellow for Policy Studies Peter Brookes Mark A. Kolokotrones Fellow in Economic Freedom Ambassador Terry Miller David L. Coffey Fellow in Government Studies Danielle Doane Senior Analyst in Trade Policy Bryan Riley Norman B. Ture Senior Fellow in the Economics of Fiscal Policy Jay Kingham Fellow in International J.D. Foster, Ph.D. Regulatory Affairs Brett D. Schaefer Bernard and Barbara Lomas Fellow Steven Groves F.M. Kirby Research Fellow in National Security Policy Baker Spring Grover M. Hermann Fellow in Federal Budgetary Affairs Herbert and Joyce Morgan Senior Research Fellow Patrick Louis Knudsen Ronald D. Utt, Ph.D. Ronald Reagan Distinguished Fellow in Public Policy William E. Simon Fellow in Religion and a Free Society Edwin Meese III Ryan T. Anderson (named in 2012)

2011 ANNUAL REPORT the heritage foundation 29 Am e r i c a n Dr e a m Heritage Action in Action Created in 2010 to push for principled legislative action addressing our nation’s most critical problems, Heritage Action for America emerged as the tough new kid on the congressional block. rom the overarching issue of excessive spending When the 112th Congress convened in January, and debt to narrower issues like energy subsidies Heritage Action rallied lawmakers around full repeal of Fand trade, Heritage Action—an independent, 501 Obamacare. One of the first acts of the House was to pass (c)(4) —aggressively advanced the Heri- a repeal bill, 245-189. Subsequently, repeal became the tage policy vision. Along the way, it ruffled some feathers position of every GOP presidential candidate. among a Washington establishment still reluctant to dis- On federal spending, we pushed lawmakers to honor pense the strong medicine needed to cure our country’s their Pledge to America and roll back non-defense discre- problems. But by year’s end, it was clear: Heritage Action tionary spending to 2008 levels. Though we didn’t get quite got action. that far, we succeeded in gaining more cuts, allowing Budget Committee Chairman Paul Ryan to propose a budget even bolder than originally planned. Initially propos- ing $30 billion in cuts, light from Heritage research combined with heat from Heritage Action convinced the committee to raise the ante to $61 billion in cuts. In the summer battle over raising the debt ceil- ing, we insisted that any increase be accompanied by significant spending cuts and reforms to the budget process. Through- out the debt deal and sub- sequent naming of a “su- per committee,” Heritage Action promoted Heri- tage’s Saving the American Dream plan as the back- bone for serious reform. Our ideas were supported by many congressional conservatives and even gained traction with some moderates. Robert Rector’s welfare reform recommendations were introduced in both cham- bers, and bipartisan Medi- care reform incorporating Photo: Ashe Schow Ashe Photo: At a May 13 Capitol Hill press conference, Heritage Action for America CEO Michael Needham praises a bill our plan’s principles was to end all energy subsidies. Joining him are bill co-sponsors Rep. Mike Pompeo, R-Kan., and (obscured) Rep. slated for introduction in Raul Labrador, R-. early 2012.

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Hard Times Demand a Tough Scorecard Old Bulls in Congress are skilled at gaming the system, casting throwaway votes on inconsequential legislation so they can appear to be more conservative than they are. Heritage Action developed a new kind of Legislative Scorecard that cuts through the gamesmanship and holds members fully accountable. Monitoring their votes on bills that will—or could—make a real difference, Heritage Action rates lawmakers on the extent to which they uphold conservative policies. Other conservative organizations score only final up-or-down votes. The Heritage Action Scorecard scores a wider range of votes—often early procedural or amending votes that determine whether a bill will or will not be worth passing. As a result, some members used to receiving sky-high ratings from other conservative organizations were disappointed when they saw their far more down-to-earth, no-gamesmanship ratings from Heritage Action. While Heritage Action has no desire to “rile up” our allies, it has every intention of creating pressure so conservative- leaning members don’t fold on the tough votes. As Heritage Action’s Chief Operating Officer Tim Chapman explained to the Washington Examiner: “Our scorecard is certainly tough. But we believe it is fair and, just as important, very revealing with respect to how members vote on issues both big and small. Our objective is to continue to provide constructive pressure from the right in order to promote conservative ideas.” If its first full year of operation is any measure, Heritage Action is clearly up to the job.

When sorely needed free-trade agreements at last came before Congress, Heritage Action succeeded in beating back proposed expansions in Trade Adjustment Assistance, paving the way for passage of free-trade agreements with Colombia, Panama and South Korea. The Law of the Sea Treaty (LOST) was high on the administration’s wish list, yet the Senate refused to even bring it up for consideration. Why? Because Heritage’s policy arguments against the pact were persuasive and because Heritage Action’s fierce opposition to the New START treaty had forced the administration and its allies to expend so much political capital, they were unwilling to spend more on LOST. Heritage Action joined 40 other groups to call on Congress to reject all proposals for new energy subsi- dies. When a bipartisan group of lawmakers introduced the NAT GAS Act, Heritage Action patiently explained why tax subsidies for natural gas vehicles would only distort energy markets while benefiting a politically Photo: Chas Geer Chas Photo: favored few. Bill sponsors soon began jumping ship. By After providing an update of what’s happening on Capitol Hill, Jessica Ander- year’s end, 19 members had removed their names from son, Deputy Political Director of Heritage Action for America, learns what’s the bill—a Capitol Hill record. on member Gordon Crawford’s mind at the Oct. 14 President’s Club meeting.

2011 ANNUAL REPORT the heritage foundation 31 Am e r i c a n Dr e a m Heritage Members and Friends—Determined to Save the American Dream Heritage is its people, and in 2011 we gladly welcomed nearly 100,000 new members into our family. Thanks to their commitment, we remain far and away the most widely supported think tank in America, with some 700,000 active members.

rom Seattle to Naples, from Southern California to New FYork, from Pittsburgh to Houston to Chicago, we hosted more than 35 events in 26 cities. Speakers included such leaders as Donald Rumsfeld, Fred Barnes, Dinesh D’Souza, Victor Davis Hanson, Steve Moore, , Sean Hannity, Dan Henninger, Wisconsin Gov. Scott Walker and Gen. Peter Pace—and, of course, Heritage experts such as Michael Franc, Stuart Butler, Matthew Spalding and Distinguished Fellows Jim Talent and John Shadegg. Through these meetings we also encouraged thousands of local lead-

ers to wade into the public debate Inc. Photography McMinn Michelle Photo: and promote the conservative cause. Heritage Founder Russell D. Phelon asks a question at our Annual Leadership Conference and Board Those leaders, and a good many others Meeting, held last April at the Four Seasons Resort in Palm Beach, Fla.

Where Heritage Hosted Member Events in 2011: n Atlanta, GA n Nashville, TN n California n New York, NY Dana Point n North Carolina Huntington Beach Chapel Hill San Francisco Charlotte n Chicago, IL n Omaha, NE n Cincinnati, OH n Pittsburgh, PA n Denver, CO n Seattle, WA n Florida n St. Louis, MO Naples Palm Beach n Texas Dallas n Michigan Houston Photo: KPO Photo KPO Photo: Birmingham Heritage members greet House Majority Leader Eric Cantor, R-Va., at a Nov. 21 Jackson n Washington, DC gathering in Charlotte, N.C. Background: Heritage Senior Advisor for Special Projects Doug Stamps. n Minneapolis, MN n West Des Moines, IA

32 the heritage foundation 2011 ANNUAL REPORT Am e r i c a n Dr e a m as well, keep in touch with Heritage through a variety of channels: Membership Levels and Benefits n Our main website, heritage.org, Heritage welcomed nearly 100,000 new members last year. Our range of welcomed more than 9.6 million membership levels and benefits can accommodate all. visitors during 2011. n MyHeritage.org attracted more Level Starting at than 676,000 visitors. Basic $25 n The Foundry, our blog, drew 6.1 Patriots Club $100 million visitors—a 15% increase. Young President’s Club $250 n Morning Bell, our daily wake-up President’s Club $1,000 e-newsletter, saw subscriptions soar to a record 225,000. Executive Committee $2,500 n Our Facebook “friends” roster Premier President’s Club $5,000 reached 400,000… and kept Associate $10,000 right on growing. Executive Associate $25,000 n The ranks of our Twitter Premier Associate $50,000 followers swelled to 162,000. n Heritage Libertad, our Spanish- Founder $100,000 language website, drew more Trustees’ Circle $500,000 than 80,000 visitors, and won Chairman’s Circle $1,000,000 1,000 plus Facebook friends and For details on the benefits attached to each level, please call 1,000 plus Twitter followers in (800) 546-2843 or visit MyHeritage.org. the bargain.

Thank You for Your Leadership Five years into our Leadership for America Campaign, Heritage members have contributed gifts, pledges and commitments totaling more than $446 million. We’d like to recognize, here, the extraordinary generosity of those donors who have made contributions and commitments totaling $1 million or more, including: Allegheny Foundation Dr. John C. Hagan III, M.D. Estate of Joseph A. Prestele Mr. and Mrs. Douglas F. Allison Mr. and Mrs. Henry E. Haller Jr. Estate of Hans G. Rieger Mr. Stuart I. Anderson Hanwha Group Estate of Warren R. Rothwell Mr. and Mrs. Robert R. Aune Mr. Robert F. Hartsook Mr. and Mrs. John H. Rumpel Mr. Cloyce K. Avey The Grover Hermann Foundation Mr. and Mrs. Thomas A. Saunders III Mrs. Constance Blum Howard Charitable Foundation Mr. Richard M. Scaife Mr. and Mrs. Wayne F. Brady Estate of Stanley E. Huffman Sarah Scaife Foundation Mrs. Carole B. Brown Mr. John C. Huntington Mr. and Mrs. Mark Selko Mr. and Mrs. David W. Caldwel Mrs. Ruth Hyde Mr. and Mrs. Greg Sheehan The CHEAR Foundation Mr. and Mrs. Jerome Johnson Dr. Jeffrey B. Shellan, Ph.D. Mr. and Mrs. David L. Coffey Claude R. Lambe Charitable Foundation Estate of S. Harrow Smith Mr. and Mrs. Stephen Combs Mr. Ronald Lazof Estate of Lenore J. Stein The Richard and Helen DeVos Mr. and Mrs. James Lister Mr. Joseph D. Sullivan Foundation Mr. and Mrs. Robert W. Mair Mr. and Mrs. Brian S. Tracy Mr. and Mrs. Rick Gaby Mr. and Mrs. Jim E. McAlister Mr. Robert J. Ulrich Mrs. Gail Garbin Mr. and Mrs. W. Barry Moore Mr. Curt Von Wooster Mr. and Mrs. E. W. Gilbertson Mr. Herbert N. Morgan Dr. and Mrs. Leo G. Watson Mr. John D. Gottlick M. J. Murdock Charitable Trust Mrs. Marion G. Wells Mr. and Mrs. William Grewcock Mr. and Mrs. Robert C. Odle Jr. Mr. and Mrs. Norman G. Gunther Estate of Billie Pirnie Eight members have asked to Mr. and Mrs. John Raymond Haesler Estate of Doris A. Pistole remain anonymous.

2011 ANNUAL REPORT the heritage foundation 33 Am e r i c a n Dr e a m

Preserving the Dream: The Heritage Legacy Society In writing the Constitution, America’s Founders were consciously establishing a legacy for future generations. Their explicit purpose, stated in the Preamble, was to “secure the blessing of liberty to ourselves and our posterity.” Today, members of the Heritage Legacy Society share the Founders’ noble concern for future generations. Co- chaired by Rae and Belden Bell of Marshall, Va., and Marion Wells of Ft. Lauderdale, Fla., the Legacy Society gratefully thanks the following 219 members who made commitments through their estate or other planned gifts in 2011.

Mr. Walter Adomkus Mr. Michael E. Giobbe, Jr. Capt. Randolph “Rocco” LCDR John R. Savory USN Mr. John M. Supino Ronald C. Allison, M.D. Mr. Deane S. Glen McLaughlin, USAF Ret. (Ret.) Ms. Mary G. Swartz Mr. and Mrs. Christopher M. Mr. Clarence D. Glover Mr. Ronald L. Mercer Mr. Paul Schmidt Mr. and Mrs. Donald Tashner Appleby Mr. and Mrs. Marvin H. Mr. and Mrs. Richard A. CAPT Raymond P. Schmidt Mr. and Mrs. W. Rich Terry Mrs. Margaret Yates Ashcraft Goehring Meyer Mr. and Mrs. Steven Schmitt Ms. Lisa K. Tesarik Mr. Vern Ashcroft Mr. and Mrs. Charles Wayne Mr. James A. Middleton Mr. Arnold A. Schneider Mr. Iype Tharian Ms. Jonna Augustine Gregg, Sr. Ms. Dae Miller Mr. Martin Scott Mrs. Lillie Tonkin Mr. and Mrs. Howard Avil Mr. and Mrs. Jerry Grossman Mr. and Mrs. Albert J. Miller Ms. Martha Sewell Mr. and Mrs. Dale Twining Mr. and Mrs. Donald J. Ball Ms. Marianne U. Gustafson Miss Ruth C. Miller Major John R. Singleton Mr. and Mrs. R. Pete Vann Mr. John Banks Mr. Raymund M. Haddock Ms. Nannette K. Moffett Mr. Ernest N. Smith Dr. Louise F. Wailus- Mr. Jerry Barbre Mr. and Mrs. Charles A. Ms. Katy Moss Mr. Larry Smith Suleiman Mr. and Mrs. James Bartels Hadley Mrs. Janet L. Moulton Mr. Ronald G. Smith Mrs. Mary Wassi Mr. John N. Bathurst Mr. Robert E. Hahn Mrs. Donna Munsey Mr. Edward Souders Mr. Thomas B. Watkins Mr. Lynn K. Beck Mr. Lynn Hall Mr. and Mrs. Thomas Murff Mr. and Mrs. Norman K. Mrs. Patricia Weldon Mr. Glen A. Bihler Dr. William A. Hall Lorenzo Murguia, M.D. Sowards Mrs. Betty Wilbur Mr. Ralph W. Blackford Mr. and Mrs. Burrell Mr. and Mrs. John C. Murphy Mr. and Mrs. Chad Mr. Joseph H. Wilkens Mr. John A. Blumgren Hammond Mr. and Mrs. George W. Speierman Mr. David Williams and Mrs. Mrs. Jean Bock Mrs. Cecilia V. Hanes Neiiendam Dr. Edwin C. Spencer Marie Martino Mr. Ira Breneman Mr. and Mrs. Gordon S. Mr. and Mrs. Devon Olson Mr. Edward H. Spiegelberg Ms. Virginia Williams Mr. and Mrs. Robert N. Hassing Mr. Joseph Oswald Dr. and Dr. Charles W. Mr. and Mrs. Jerold Willis Broderick Mr. and Mrs. Robert Mr. James A. Palmer Stansfield Ms. Elaine Zaske Ms. Martha H. Brooks Hathorne Rev. Dr. John Avery Palmer Ms. Ruth G. Stape Mr. and Mrs. Crist J. Brown Mr. John Heimkes and Mrs. Sherill Martinez Mr. Jerry A. Stebbins Seven Heritage Legacy Mr. Gary Brown Dr. Mary A. Herron Mr. Jack Papin Mr. Damien F. Stella Society members wish to Mr. Kent M. Brown Mr. John L. Hessler Mr. Douglas H. Parrot Mr. and Mrs. Jack Stone remain anonymous. Mr. and Mrs. Alfred Buescher Mrs. Diana Dee Hewett Mr. and Mrs. William L. Mr. and Mrs. Donald T. Bush Mr. and Mrs. Patrick Holeva Pascoe With gratitude, we honor the memory of those Heritage Ms. Janet Camaras Mr. Donald H. Hubbs Mr. and Mrs. Robert W. Mrs. Jessie J. Carlstedt Mr. Charles R. Huddleston Paulin Legacy Society members whose gifts we received in 2011: Mrs. Beverly T. Carter Mr. Lamont Hungershafer Mr. Alan Payne, Jr. Mrs. Lenore C. Anderson Mrs. Hazel Mordy G. L. Carter, Jr., Ph.D. Mr. R. K. Hunter Mr. John Peregrim Mr. Charles E. Aylstock Mr. Warren K. Moyle Mr. A. P. Cates Ms. Betty L. Hurle Mr. and Mrs. James A. Plute Mr. Thomas H. Berreman Ms. Dorothy Mullin Mrs. H. Colleen Cavanaugh Mr. G. William Hurley Mr. John S. Pollock Ms. Mary E. Biwer Mr. Rodney M. Norris Mrs. A. Elaine Chandler Mr. Ernie Imken Mrs. Dawn H. Potter Mrs. Billie I. Bowles Mr. Lewis C. Parr Mr. Harold S. Chapman Dr. Mary Sue Infante Mr. Aaron B. Powers Mr. T. Nash Broaddus Mr. and Mrs. John W. Mr. John H. Chiles Mr. W. R. Jackson, Jr. Mr. and Mrs. Jeff Powers Mr. Henry K. Brodersen Paulsen Mr. Fulton Chin Mr. Harry C. James Mr. Donald J. Pratt Mrs. Martha Brown Mr. Lawrence H. Peterson Mr. and Mrs. C. Michael Mr. David R. Jaynes Mrs. Grace E. Previto Mrs. Renee Campbell Mrs. Billie Pirnie Cisson Mr. Terrence Jenkins Mrs. Grady Price Mr. and Mrs. Marval L. Cazer Mrs. Doris A. Pistole Mrs. Judith Courter Mr. Arnold H. Johnson Ms. Ann Prothro Mrs. Erma Christensen Ms. Ashley V. Proctor Mr. Robert Craig Mr. and Mrs. Robert C. Mr. Brian M. Queen Ms. Josephine Comodo Mr. Mercer Rhodes Mrs. Gay Cummings Johnson Mr. and Mrs. Dick J. Randall Mr. Gerald E. Curry Mr. Johnie F. Jones Mr. and Mrs. Manson Reedal Ms. Marie Comodo Mr. Hans G. Rieger Mr. and Mrs. James Dawson Ms. June Kahrer Mr. and Mrs. Dan Regis Mr. John Kail Crane Mrs. Barbara Small Riester Mrs. Norma S. De Paiva Barbara Kastner Mr. and Mrs. Philip Rewerts Mr. Henry Eichholz Mr. Warren R. Rothwell Mr. James M. Deaver Mr. Michael Keisacker Mr. John Mike Rice Mr. and Mrs. James R. Evans Mr. Martin J. Schwager Mr. Allan B. DeMille Mr. Thomas M. Knepper Mr. Ed Richter Mr. Harry Fischer Mrs. Eva M. Sewall Mr. Ervin A. Derda Mr. Marvin C. Koeper Mrs. Josephine Ricketts Mrs. Jennie B. Gardner Mr. and Mrs. Stephen H. Mrs. Virginia Dickerson Mr. Thomas E. La Clair Mr. Gerald F. Riseley Dr. Frederick B. Greene Smith Dr. and Mrs. Alan H. Domina Ms. Patricia Lambert Mrs. Carolyn J. Ritchie Ms. Doris Hales Mrs. W. Quentin Smith Mrs. Joanne H. Duke Ms. Geraldine Lawless Mr. and Mrs. Charles H. Ms. Debra Hall Mr. Myron D. Stepath Mr. James Eller Mrs. Carol A. Lerch Robinson Mrs. Rose E. Henry Mr. and Mrs. Edward P. Ms. Virginia A. Fairfield Dr. Margaret A. Lessig Mr. Benjamin F. Rogers, Jr. Mr. George L. Hesse Stuart Mr. Joseph J. Famularo Mr. L. S. Liles Ms. Diann Ronald-Szabo Mr. Joe Huskins Mr. John Gordon Studebaker Mr. Homer Fassett Mr. Donald L. Lilly Ms. Carolyn G. Roshong Mrs. Russell Ingraham Ms. Christina F. Mr. Gary L. Finley Mr. Thomas F. Linnen Mr. and Mrs. Mark Rostvold Mr. John L. Greene Vanderwende Mr. Charles W. Fischer, Jr. Mrs. Maxine V. Loper Mr. W. F. Ruzicka Mr. and Mrs. Lloyd Kildoo Mr. and Mrs. Charles W. Mr. John R. Fisk Mr. and Mrs. Wayne B. Lowell Mrs. Alma J. Ryan Mr. Theodore Konis Walton Mrs. Mary Lou Frenzel Mr. Charles Lyford Mr. and Mrs. Sheldon Sacks Mrs. Ann W. LaFontaine Mr. Randall Warren Mr. Ernest Gajdusek Mrs. Marie G. MacGregor Mr. Peter M. Saint Germain Mr. James C. Lamkin Mr. Wilfred L. Was II Mr. Everett C. Garrett Mr. Robert D. Martz Mrs. Mary Salvo Mr. Carl R. Lezius Mr. John H. Watrous Ms. Virginia M. Gibson Mr. and Mrs. Marty Mr. and Mrs. Lyle Sandberg Mr. Ray E. McGowan Mrs. Marjorie Wellington Mrs. Betty Anne Spruill Matousek John C. Sandefur, M.D. Mr. Joseph J. Miller Ms. June T. Weston Gillingham Mrs. Nancy McDonald Mrs. Peter Moore Mrs. Marian White NOTE: Some donor listings on these pages reflect combined contributions to both The Heritage Foundation and Heritage Action for America.

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2011 Financial Statements STATEMENT OF FINANCIAL POSITION* STATEMENT OF ACTIVITIES* As of December 31, 2011 Year ended December 31, 2011

ASSETS: OPERATING REVENUES Cash & cash equivalents $ 3,494,032 Contributions: Receivables 7,701,143 Individuals $ 58,216,660 Prepayments & other assets 1,697,156 Foundations 12,460,227 Total current assets 12,892,331 Corporations 3,183,377 Total operating contributions 73,860,264

Investments 110,607,679 Investment withdrawal 4,517,000 Receivables, net 2,935,005 Program revenue 265,606 Plant, property & equipment, net 49,402,214 Rental & other income 2,482,858 Other assets 444,145 Total other operating income 7,265,464 Total long-term assets 163,389,043 TOTAL OPERATING REVENUE 81,125,728 TOTAL ASSETS $ 176,281,374 OPERATING EXPENSES LIABILITIES & NET ASSETS: Program expense: Accounts payable & accrued expenses $ 9,615,477 Research 27,996,046 Notes payable 3,442,622 Education 20,837,554 Total current liabilities 13,058,099 Media & government relations 11,887,724 Total program expense 60,721,324 Notes payable 1,600,000 Deferred obligations & planned gifts 16,219,748 Fundraising 16,366,404 Total long-term liabilities 17,819,748 Management & general 2,946,100 Total administrative expense 19,312,504

TOTAL LIABILITIES 30,877,847 TOTAL OPERATING EXPENSES 80,033,828 Unrestricted net assets: NET GAIN FROM OPERATIONS 1,091,900 Board designated 91,414,120 NON-OPERATING ACTIVITIES Undesignated 41,857,508 Restricted contributions 2,590,949 Temporarily restricted net assets 10,731,899 Change in restricted net assets (10,018,525) Permanently restricted net assets 1,400,000 Net unrealized investment losses (8,563,476) Total net assets 145,403,527 Investment withdrawal (4,517,000)

TOTAL NON-OPERATING ACTIVITIES (20,508,052) TOTAL LIABILITIES & NET ASSETS $ 176,281,374 DECREASE IN NET ASSETS (19,416,151) NET ASSETS- Beginning of year 164,819,678 2011 Operating Revenue NET ASSETS-End of year $ 145,403,527

Program Revenue 2011 Operating Expense & Other Income Management 8% & General Fundraising 4% 20%

Contributions Programs 91% 76%

NOTE: Some donor listings on these pages reflect combined contributions to both The Heritage Foundation and Heritage Action for America. *Preliminary results - final audited financial statements will be available on or after July 31, 2012.

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2011 Heritage Foundation Founders Chairman’s Circle The Armstrong Foundation Mr. and Mrs. William Grewcock Mr. and Mrs. Robert V. Pennington The Richard and Helen DeVos Foundation Mr. and Mrs. Stephen M. Barney The Grover Hermann Foundation The Robert S. & Star Pepper Foundation Mr. and Mrs. Rick Gaby Barney Family Foundation Mr. and Mrs. Harry P. Keegan III Mr. Russell D. Phelon Hanwha Group Mr. and Mrs. J. Bayard Boyle, Jr. Mr. and Mrs. Michael L. Keiser Mr. and Mrs. Dick J. Randall Howard Charitable Foundation Mr. and Mrs. Alfred Buescher F.M. Kirby Foundation, Inc. Mrs. Carolyn J. Ritchie Mr. and Mrs. Ronald Lazof Mr. and Mrs. Bailey F. Campbell Mr. Mark Kolokotrones The Roe Foundation Mr. Herbert N. Morgan Mr. and Mrs. Jack E. Caveney Mr. Thomas E. La Clair Searle Freedom Trust Sarah Scaife Foundation Mr. and Mrs. David L. Coffey The Lehrman Institute B.K. Simon Family Charitable Foundation Mr. and Mrs. Thomas W. Colbert, Sr. Mr. and Mrs. Robert W. Mair Mr. Larry H. Smead Trustee’s Circle Mr. and Mrs. Leo W. Cook Mr. and Mrs. Gregg Mamikunian Sorenson Legacy Foundation Mr. and Mrs. Howard Avil Adolph Coors Foundation Mr. and Mrs. George L. Mayer The Thirteen Foundation The CHEAR Foundation Donahue Family Foundation, Inc. Capt. Randolph “Rocco” McLaughlin, Mrs. Erma Jean Tracy Mr. and Mrs. Thomas A. Saunders III Free Enterprise America USAF Ret. Mr. and Mrs. Richard E. Uihlein Lillian S. Wells Foundation Mr. and Mrs. John W. Galbraith Mr. and Mrs. Robert S. Miller Mr. Robert J. Ulrich Founders General Electric Company The Morgan Family Trust Mrs. Marion G. Wells Aequus Institute General Mills M. J. Murdock Charitable Trust Mr. R. B. Zinser Amway Gleason Family Foundation Mr. and Mrs. Joe P. Murphy Mr. and Mrs. William L. Amos, Jr. Google, Inc. The Frederick and Julia Nonneman 15 Founders have asked to The Anschutz Foundation Mr. and Mrs. Leo G. Graham Foundation remain anonymous.

2011 Heritage Foundation Associates Premier Associates Mr. Christopher Damon Haig Raytheon Company Ms. Betty A. Anderlik Mr. and Mrs. Edward M Ackerman Mr. and Mrs. Clay W. Hamlin, III Hamilton Roddis Foundation Richard F. Aster, Jr. Foundation Mr. and Mrs. Douglas F. Allison Mr. and Mrs. Burrell Hammond Mr. Eugene H. Roos Mr. and Mrs. Robert R. Aune Ms. Barbara Anderson Mr. and Mrs. John Nils Hanson Mr. Tony J. Saliba, Sr. The AWC Family Foundation Banbury Fund Hertog Foundation Saliba Family Charitable Foundation Mr. and Mrs. Glen H. Ballowe Mr. John N. Bathurst Mr. K. William Hess Shamrock Foundation Mrs. Barbara Barrett The Boeing Company The Holman Foundation, Inc. The Starr Foundation Bell Charitable Foundation Mr. Paul Boyle The Karakin Foundation Stiles-Nicholson Foundation H.N. and Frances C. Berger Foundation The Lynde and Harry Bradley Foundation Mr. and Mrs. Robert H. Kellen Mr. Cameron Sutton Mrs. Jean Bock G. L. Carter, Jr., Ph.D. Mr. Marvin C. Koeper Mr. and Mrs. Brian S. Tracy Mrs. Carole B. Brown Mr. and Mrs. Aubrey Chernick Mr. L. C. Martin, Jr. Mr. Michael S. Turner Miss Catherine M. Brown Mr. and Mrs. Miles Collier Ms. Nannette K. Moffett Mr. and Mrs. Jeff P. Van Dyke Mr. and Mrs. David W. Caldwell Donner Canadian Foundation Mr. and Mrs. Alan Orr Mr. and Mrs. R. Pete Vann Mr. and Mrs. Oliver T. Carr, Jr. The William H. Donner Foundation, Inc. Dian Graves Owen Foundation Visa International Mrs. Beverly T. Carter Mr. and Mrs. William S. Edgerly Charles Maxfield and Gloria F. Parrish Mr. Richard Wells Cerner Corporation ExxonMobil Foundation Mr. James A. West, Sr. Challenge Foundation Mr. and Mrs. Marvin H. Goehring Mr. and Mrs. James A. Patterson Chevron Corporation Mr. and Mrs. Robert M. Gordon The Dr. P. Phillips Foundation Executive Associates Mr. Fulton Chin Gardner Grout Foundation John William Pope Foundation Mr. and Mrs. Charles H. Adler The Chisholm Foundation Mrs. Dorothy Grove Mrs. Spelman Prentice Altria Client Services Mr. and Mrs. James H. Click, Jr. Photo: Gannon Visuals Gannon Photo: Photography Craighead Shealah Photo: Heritage Executive Associate Bruce Rastetter Associate Member Greg Duncan likes what he hears at a June 17 event in Dana Point, speaks at an Oct. 26 member event in Des Moines, Calif., featuring former Defense Secretary Donald Rumsfeld. Foreground: Heritage Regional Iowa, featuring Wisconsin Gov. Scott Walker. Manager DeEtte Jones.

36 the heritage foundation 2011 ANNUAL REPORT Am e r i c a n Dr e a m

Ms. Elizabeth Benedict Cole PhRMA Mr. J. Allen Baird Mr. Edward A. Clark Douglas and Maria DeVos Foundation Mr. and Mrs. Gary L. Pilgrim Mr. B. J. Baker Mr. James McConnell Clark Herbert H. and Barbara C. Dow Mr. and Mrs. James A. Plute Mr. Peter Barrett The George E. Coleman, Jr. Foundation Foundation Mrs. Grace E. Previto Mr. Art Barter Mr. James A. Collins Mrs. Joanne H. Duke Mr. Bruce Rastetter Mr. and Mrs. Ron Baukol Comcast Corporation Mr. Robert G. Engman Mr. and Mrs. Christopher M. Reid Mrs. Jane Varner Beard Mr. and Mrs. George Conrades Erickson Family Charitable Patrice Richardson, M.D. Mr. and Mrs. George Beck Consumer Electronics Association Foundation Mr. and Mrs. John Rivard Benwood Foundation Mr. and Mrs. Gerald A. Cook Fairchild-Martindale Foundation The Joyce and Donald Rumsfeld Mr. Robert J. Bertch Mr. and Mrs. Robert A. Cook Mr. B. E. Faulkner Foundation Mr. Nicholas Bez Corporate Press William Howard Flowers, Jr. Mrs. Mary Salvo Bialkin Family Foundation, Inc. Mr. and Mrs. Gary Coughlan Foundation, Inc. Satter Foundation Mrs. Betty L. Blake Mr. George W. Cowan Mrs. Mary Lou Frenzel Strong Foundation Trust Mr. Ronald Boone Mr. and Mrs. Garland Cox Mr. and Ms. Tracy Fu Sunmark Foundation The Louis L. Borick Foundation Mr. and Mrs. Gilbert C. Cox, Jr. Genworth Financial Mr. and Mrs. Kermit S. Sutton Mr. Mike Boylan Dr. James A. Crabtree Mr. Michael E. Giobbe, Jr. Mr. and Mrs. Gary L. Swenson Mr. and Mrs. Richard S. Braddock The Crail Foundation Mr. and Mrs. Jerome Green The Sidney A. Swensrud Foundation Mr. and Mrs. Theodore Brickman Mr. Michael F. Cronin Mr. and Mrs. Jerry Grossman Taiwan Foundation for Democracy Ms. Susan Bridges Mrs. Gay Cummings Mr. and Mrs. Harold E. Hamilton Mr. and Mrs. Raymon F. Thompson Briggs & Stratton Corporation Mr. William R. Dahlgren Mr. Charles H. Hoeflich Triad Foundation Inc. Foundation, Inc. Mrs. Jason S. Damron Mr. William H. Holden United Parcel Service Dr. and Mrs. Bart J. Broadman Mr. and Mrs. Paul L. Davis, Jr. Home Depot Mr. and Mrs. Wallace E. Volwiler Ms. Gretchen Brooks John R. and M. Margrite Davis Foundation Daniel and Pamella DeVos Foundation Issa Family Foundation Count and Countess Ferdinand von Galen Ms. Martha H. Brooks Mr. Roger G. Brooks, Sr. Dick and Betsy DeVos Foundation Mr. and Ms. Michael Jude Mr. and Mrs. Russell Wicks Mr. and Mrs. Craig R. Brown Gladys M. Dickson Charitable Trust The Karol Fund Mr. Joseph H. Wilkens Dr. and Mrs. David R. Brown Mr. and Mrs. Edward Dillon Mr. David A. King Mr. Donald M. Wilkinson Dr. Robert W. Browne Dodge Jones Foundation Mr. Gerald M. Kirke Dr. and Mrs. Charles J. Willey Mr. and Mrs. John Bruning Mrs. Joyce H. Doty Koch Companies Public Sector, LLC Mr. Randy Winegard Mr. Daniel W. Bunn Mr. and Mrs. Robert W. Drinkward The Fred A. Lennon Charitable Trust Mr. Keith C. Wold, Jr. Mr. and Mrs. David Burckel Mrs. Vivian N. DuBose Mrs. Carol A. Lerch Mr. and Mrs. Donald H. Young Peter and Gloria (Sella) Burich Fund Mr. Kenneth D. Duggin Lockheed Martin Corp. Mr. and Mrs. Thomas R. Zucker Mr. Mark A. Caldwell, Sr. Mr. James Dyer The Maclellan Foundation Inc. Mrs. Gillian N. Callaghan Eagle Information Mapping, Inc. Mario Family Foundation Associates Mr. James J. Callan Earhart Foundation Mr. J. Willard Marriott, Jr. Mr. David Joel Adams Mr. and Mrs. Stuart Campbell Mr. and Mrs. Robert J. Eaton Mr. and Mrs. Thomas L. McGrath Mr. Michael Alberga Mr. and Mrs. Donald Carter Mr. and Mrs. Douglas C. Edman Mr. Greg McNece Mr. Gilbert F. Amelio Mr. and Mrs. Ronald L. Carter Mrs. Patty A. Edwards Mr. and Mrs. Hal A. McVey American Foundation Mr. Richard Castiglia El Pomar Foundation (Colorado only) Mr. James B. McWethy Mr. and Mrs. George Anderson Castleman Family Foundation Eli Lilly and Company Foundation Mr. and Mrs. Michael T. Monahan Mr. and Mrs. Robert A. Anderson Mr. Robert Challey Mr. Robert W. Ellis The Morris Foundation Dr. and Mrs. Larry P. Arnn Ms. Gladys Choate, OFM Mr. and Mrs. John Endriz Northrop Grumman Corporation Mr. and Mrs. Caesar A. Arredondo Dr. and Mrs. Armeane M. Choksi Mr. and Mrs. Marshall Evans Lovett & Ruth Peters Foundation Mr. and Mrs. James J. Ascher Mr. Arthur Cinader Evenstad Family Foundation Philip Morris International Global Mr. William S. Atherton Civil Justice Reform Group Dr. and Mrs. Edwin J. Feulner Services Inc. The Babcock and Wilcox Company Mr. Robert A. Clack Mr. Paul J. Fisher Photo: David Bohrer David Photo: Inc. Photography McMinn Michelle Photo: Heritage Legacy Society Members Harry Hall (left) and David and Wisconsin Gov. Scott Walker (right) make for a Coffey enjoy a break during a Legacy Society seminar Sept. 12 in dynamic duo at the Palm Beach conference, as Linda Feulner follows Washington. the April 8 exchange.

2011 ANNUAL REPORT the heritage foundation 37 Am e r i c a n Dr e a m

Mr. John J. Fitzgerald, Jr. Charitable Foundation Mrs. Sara B. Fleming Mr. James P. Hicks Honoring Donor Intent Mr. John C. Foxley Ms. Margaret M. Hill Mr. John J. Frezza Mr. and Mrs. John L. Hillhouse, Jr. When giving to any nonprofit organization, you should Mr. and Mrs. Philip M. Friedmann Mr. and Mrs. Edson P. Holland be able to count on three things: Dr. Roald Fuglestad, M.D. Mr. Gary D. Hoover Mrs. Dulce M. Fuller Mr. and Mrs. Robert G. Horner n Your gift will be used to advance the organization’s Mr. Stanley E. Fulton Hufty Foundation Mr. J. James Gallagher The Huston Foundation mission. The Garber Family Foundation Mr. Paul J. Isaac Mr. and Mrs. Roland E. Garlinghouse John E. and Sue M. Jackson n Any restrictions you place on your gift will be Mr. Bob W. Garthwait, Jr. Charitable Trust honored. Mr. and Mrs. J. Patrick Gavaghan Mr. Kurt R. Jaggers Mr. Richard Geary Mr. Thomas P. Janas n You will to be treated with respect. Rollin M. Gerstacker Foundation Mr. Arnold H. Johnson Mr. Henry A. Getz Mr. and Mrs. Charles B. Johnson Unfortunately, many philanthropic organizations have Mr. and Mrs. Garnet A. Giles Mr. William H. Jones, Jr. Mr. Deane S. Glen Ms. Rebecca L. Julian broken faith with their donors. Mr. and Mrs. Tony Godfrey Kantner Foundation, Inc. Pierre F. and Enid Goodrich Foundation Mrs. Barbara D. Kasler At The Heritage Foundation, we regard your support Mr. Thomas S. Gordon John P. Kavooras Charitable Trust as a trust. We hold ourselves strictly accountable Mr. John Grayson Mr. Harry P. Keegan IV Mr. and Mrs. Terry Wayne Green Dr. and Mrs. Michael F. Kelley to you, and we pledge always to respect your The Albert M. and Lyda M. Green Ms. Neale W. Kempner philanthropic intent. Foundation Mr. and Mrs. Thomas L. Kempner Mr. Richard S. Griffith Kickapoo Springs Foundation The sanctity of donor intent is explicitly stated in our Mr. and Mrs. Curtis Grina Dr. Manley W. Kilgore Mr. Daniel L. Guild Mr. and Mrs. Broadus H. King, Jr. Articles of Incorporation. It provides that, should any Ms. Marianne U. Gustafson Mr. and Mrs. Peter Kinnear major donor desire a written contract clearly stating Mr. and Mrs. Ronald L. Haberkorn Mr. and Mrs. Donald H. Kirkland Mr. and Mrs. Charles A. Hadley Mr. and Mrs. True H. Knowles the purpose and intent of the donation and how it Henry E. Haller, Jr. Foundation Mr. and Mrs. Vincent Kolber shall be spent, Heritage will gladly sign it. Moreover, The Hamill Foundation Mr. and Mrs. Kevin S. Kookogey Mr. John S. Hamilton Mr. Richard T. Kotecki the president of Heritage is personally responsible for Miss Violet Hanna Mr. Frank W. Kozel answering donor questions and reporting expenditures Mr. Robert F. Hartsook Mr. and Mrs. Richard Kozlowski Mrs. Joanne B. Hatcher Mr. Robert Lamb of donor funds. Mr. and Mrs. Robert Hathorne Legett Foundation Mr. and Mrs. Jerry L. Hayden LeMans Corporation As always, we make this pledge to you: When you Ms. Reta K. Haynes Mr. Edward C. Levy, Jr. contribute to The Heritage Foundation, your intent as a Mr. and Mrs. Ron J. Hazlett Mr. and Mrs. Harold Levy C. J. Heilig Foundation Mr. and Mrs. John P. Lewis donor is never forsaken, never forgotten. The Herbold Foundation Dr. and Mrs. Robert T. Lewit, M.D. Albert and Ethel Herzstein Mr. and Mrs. Ed D. Ligon, Jr. Photo: Michelle McMinn Photography Inc. Photography McMinn Michelle Photo: Photography Craighead Shealah Photo: Heritage Trustee Todd Herrick (left) shares a courtyard conversation Associate Members Kenneth and Grace Evenstad welcome former with Executive Associate Member Ferdinand von Galen at the Annual Defense Secretary Donald Rumsfeld (right) to their home in Naples, Fla., Leadership Conference and Board Meeting. for a Heritage event Nov. 9.

38 the heritage foundation 2011 ANNUAL REPORT Am e r i c a n Dr e a m

Mr. David L. Liptak Mr. and Mrs. Todd S. Nicholson Mr. Robert E. Richardson Mr. and Mrs. Clifford L. Thomson Mr. Leonard Litwin Mr. David W. Niemiec Mrs. Josephine Ricketts Mr. and Mrs. Larry Timmerman Dr. and Mrs. Bernard T. Lomas The Ed Noble Family Advised Fund Mr. Gerald F. Riseley Tippins Foundation Mrs. Maxine V. Loper Dr. and Dr. John Nolte Rolls-Royce North America, Inc. Mr. and Mrs. Ronald Trzcinski Mr. William Lowndes III Mr. Ralph Nordick Mr. Sheldon Rose Mr. and Mrs. Ron Tucker Mr. and Mrs. Edward A. Lozick Mr. and Mrs. Donald J. Nores Mr. and Mrs. John B. Rothenberger Mr. J. Robert Tullis Mrs. Marie G. MacGregor Mr. and Mrs. David Oates Mr. and Mrs. Stanford Rothschild Ed Uihlein Family Foundation Mr. Wallace D. Malone, Jr. Mr. and Mrs. Herman J. Obermayer Mr. Raymond Rowland, Jr. Mr. Calvin K. Upp Mr. Pierson G. Mapes Mr. Michael P. O’Brien Arthur N. Rupe Foundation Steve & Cindy Van Andel Foundation The Markkula Foundation Mr. and Mrs. Rod Odom Mr. Jerome D. Ryan Mr. John K. Vanier MasterCard Worldwide Mr. Donald A. Oeters The Ryan Family Foundation Mr. and Mrs. Paul B. Venuto Mr. George S. Maxwell Mr. A. M. O’Hare Mr. and Mrs. Sheldon Sacks Miss Lynn W. Via Mr. and Mrs. Ralph P. Mayer Mr. and Mrs. James H. O’Neal Mr. Charles H. Sanford and Ms. Linda A. Mr. James R. Voss Mr. Walter McDonald Mr. and Mrs. James J. O’Neill Elliott Dr. and Mrs. Bill Wagner Philip M. McKenna Foundation, Inc. Mr. San W. Orr, Jr. Mr. and Mrs. P. K. Schilling Mr. Andrew Robert Walden Mr. Jim H. McManus, Jr. Mr. and Mrs. Robert Orscheln Dr. Joseph F. Schneider, Jr. Mr. Dale M. Walsh Mr. and Mrs. C. Edward McVaney Orscheln Management Company Mr. and Mrs. Robert H. Schwarzmann Mr. Richard C. Walter Mr. and Mrs. Norman J. Metcalfe Mr. and Mrs. Darryle L. Owens Mr. and Mrs. Donald R. Scifres Ms. Ardis Walters Mr. and Mrs. Edward Michener Dr. and Mrs. K. Nicholas Pandelidis Mr. Douglas Scrivner Mr. and Mrs. Pedro E. Wasmer The Honorable and Mrs. J. William C.N. and Maria Papadopoulos Foundation Mr. William C. Shanley III Mr. Charles Reynolds Watkins Middendorf II Mr. and Mrs. Douglas Parsons Mr. and Mrs. Greg Sheehan Katharine Audrey Webb Foundation Ms. Dae Miller Mr. and Mrs. William L. Pascoe Mr. and Mrs. Barry R. Shreiar The Weiler Foundation Mr. Harvey L. Miller Mr. Allen Pease Louis and Nellie Sieg Fund Mr. and Mrs. Ronald B. Weinel Mr. and Mrs. Ted Millice Mrs. Fula Pelitti Mr. and Mrs. Harold Siegel Mr. Duane M. Weise Gerrish H. Milliken Foundation William Penn Foundation Mr. Thomas Siegel Mr. and Mrs. John D. Weiss Mr. and Mrs. Keith Mitchell, Jr. Mr. and Mrs. Henry Perry Mr. Willis B. Skillman Mr. and Mrs. Richard Weiss Mr. John W. Mitchell Mrs. Phyllis Peters Mr. Ernest N. Smith Mr. Stephen D. Weiss Mr. Christopher S. Moody, Sr. Mr. and Mrs. Donald C. Peterson Mr. and Mrs. James Smith Mr. Ernie R. West Mr. Sam Moore Pfizer Inc. Mr. Owen R. Smith Samuel L. Westerman Foundation Mrs. Carol A. Morris Pilgrim Foundation Mr. Clark Smyth Ms. Jennifer L. Whitelaw Mortgage Insurance Companies of Dr. L. Harrison and Mrs. Janet Pillsbury Mr. and Mrs. Charles E. Spahr Mr. and Mrs. Paul H. Wick America Mrs. Janice C. Pinkston Mr. J. C. Sparkman Mr. and Mrs. Andrew L. Wilson Mr. James F. Mrazek The Honorable Jayne H. Plank Mr. R. Scott Spriggs Dr. Kent Wilson Mr. Ronald H. Muhlenkamp Mrs. Loretta Poindexter Dr. Charles W. Stansfield and Dr. Charlene Mr. and Mrs. James Wintersteen Mr. Terence H. Murphree Mr. and Mrs. Allen B. Porter Rivera Mr. Frank E. Witt Mrs. Suzanne P. Murphy Ms. Adrienne Price Ms. Diane J. Stites The Woodford Foundation Murrill Foundation, Inc. Ms. Ann Prothro Mr. and Mrs. Steven Stockdale Mr. Richard B. Wright MyWireless.org Mr. Andrew F. Puzder Mr. Joe Chat Sumner III Mr. and Mrs. Edward S. Young Mr. William J. Nasgovitz Mr. Vincent Mark Rafanelli Mr. John M. Supino Ms. Leslie Young Mr. L. C. Neely, Jr. Ms. Lillian Spang Rath Mr. Joseph Duane Swanson Ms. Elaine Zaske The Negaunee Foundation Ray Foundation Mr. Robert Sydow Mr. and Mrs. Peter C. Newell Mr. and Mrs. Charles D. Reite Tejon Exploration Company Mr. Van A. Nguyen Mr. Douglas M. Reiter Mr. and Mrs. Jerry J. Tepper 51 Associates have asked to Mr. and Mrs. Bruce S. Nicholas Mr. Paul M. Resnick Mr. and Mrs. Ronald Tesarik remain anonymous.

Executive Associate Member Barbara Barrett, former U.S. Ambassador to Finland, chats with Karl Rove, former White House strategist, at a Nov. 14 Heritage event in Scottsdale, Ariz.

Heritage Founders Michael and Jennifer Gleba take in the Palm Beach ocean view April 8 during the Annual Leadership Conference

Photo: Eric Draper Photography Draper Eric Photo: and Board Meeting. Inc. Photography McMinn Michelle Photo:

2011 ANNUAL REPORT the heritage foundation 39 Am e r i c a n Dr e a m Photo: Chas Geer Chas Photo:

Executive Vice President Phil Truluck (right) greets Premier President’s Club and

Photo: Michelle McMinn Photography Inc. Photography McMinn Michelle Photo: Heritage Legacy Society Wisconsin Gov. Scott Walker, left, warms to his topic in a chat April Member Rudolph Silc 8 with Heritage Premier Associate Cameron Sutton at the Annual at a President’s Club Leadership Conference and Board Meeting in Palm Beach. reception Oct. 12. Photo: Chas Geer Chas Photo: Photo: Chas Geer Chas Photo: Executive Committee Members Mark and Betty Neerhof join forces Oct. 12 with Heritage Counselor Heritage Associate Dr. Charles Willey (right) Robert E. Russell, Jr. (far left), Vice President Genevieve Wood (second from right) and Assistant compares notes with Senior Research Fellow Director of Major Gifts Steve DeBuhr (far right) at the President’s Club reception. Robert Moffit between President’s Club sessions. Photo: Chas Geer Chas Photo:

Heritage Associate and Legacy Society Member George R. Brown (left) has a word with Sen. Kelly Ayotte, R-N.H., after a President’s Club panel Oct. 13 also featuring economist John Blundell (seated) and Kate O’Beirne

(background), President Geer Chas Photo: of the National Review Rep. Sean Duffy, R-Wis., and his wife, Rachel, flank Young President’s Institute. Club members Brian and Chelsea Blackbird at a YPC breakfast Oct. 13.

40 the heritage foundation 2011 ANNUAL REPORT The Heritage Foundation Staff PRESIDENT’S OFFICE DOMESTIC AND William Poole Marvin Moon Sarah Ferguson Edwin Feulner ECONOMIC POLICY Jon Rodeback David Parker Christine Fogarty Derrick Morgan David Addington Karina Rollins Albert Potts Jessica Greer Kathleen Rowan Center for Data Analysis DISTINGUISHED FELLOWS Freida Warren Estefania Holler Robert Steele William Beach Elaine Chao Mariah Wenz Kristen Hoopes Missy Stephens Nahid Anaraki Lee Edwards Business Support Services Michelle Jehring Kenneth Sheffer Rea Hederman Ernest Istook Renault King Anne Judge EXECUTIVE VICE David Kreutzer John Shadegg George Adams Katherine Kraft PRESIDENT’S OFFICE John Ligon Jim Talent Berdie Carter Jacquelyn Monaghan Phillip Truluck David Muhlhausen Peter Murphy Tina Henry Amy Hart Jean Barry Guinevere Nell Eve Newell Anna Hui Uyen Hoang Jason Richwine Candace Porter Personnel Jinyoung Lee Matthew Hohman James Sherk Charlotte Schuyler Wesley Dyck Katie Smith Annette Keymist Patrick Tyrell Deon Moon Joseph Shattan Daniel Anastas LEADERSHIP FOR Aaron Thompson Matthew Adkins Center for Health AMERICA OPERATIONS GOVERNMENT STUDIES Mecca Turner Kristine Bramsen Policy Studies Genevieve Wood Michael Franc Samuel Walker Karen Cook Nina Owcharenko Christine Cheatum Dani Doane Nathaniel Ward Sean Doocey Edmund Haislmaier Laurie Craney Tierra Warren Alexander Eurich Kathryn Nix Creative Services Brian Darling Christopher Marcel Melissa Bluey James Dean Special Events Richard and Helen DeVos Becky Turco Elizabeth Brewer Elizabeth Hamrick Ann Bula Center on Religion and Alex Harker Matthew Bagnoli CENTER FOR POLICY Landon Zinda Civil Society Joseph Rusenko Brittany Balmer INNOVATION INFORMATION TECHNOLOGY Jennifer Marshall Doug Sampson Ann Beckwith Stuart Butler Kiki Bradley Michael Spiller Janine Brown Bob Moffit Strategic Marketing Lindsey Burke Information Systems Diane Calmus Pamela Ouzts Keesha Bullock Collette Caprara Mark Harris Leslie Gahagan DAVIS INSTITUTE FOR Christine Kim Joe Brichacek Lauren Kuhn Pamela Hughes Kibreab Berhe INTERNATIONAL STUDIES Grace Melton Robert Carter Nate Lance Kim Holmes Leslie Merkle Joshua Shepherd Vinh Nguyen Steven Weyrich Jadon Ephraim Alexis Hurter Ryan Messmore Michele Palmer COMMUNICATIONS Jan Smith Robert Rector Strategic Operations Kimberly Schultz Michael Gonzalez Allison Center Rachel Sheffield Brian Blake Seth Spaulding Georgianna Nutt Heath Hall for Foreign Sarah Torre Ryan Townsend Laura Trueman Broadcast Services Policy Studies Thomas A. Roe Institute for Jessica LaHousse Online Communications Matthew Streit James Carafano Economic Policy Studies Timothy McGovern Judy Mayka EXTERNAL RELATIONS Michaela Bendikova Alison Fraser Jeph Christoff Sarah Mills Peter Brookes Romina Boccia Becky Norton Dunlop Martha Galante Israel Ortega Yvette Campos Curtis Dubay Robert Gordon Isabel Isidro Hannah Sternberg Ariel Cohen JD Foster Mary Larson James Lawruk Center for Media and Helle Dale James Gattuso Coalition Relations John O’Keefe Public Policy Mackenzie Eaglen Emily Goff Bridgett Wagner Steve Sharman Robert Bluey Owen Graham David John Alex Adrianson Maria Sousa Lachlan Markay James Phillips Diane Katz Lori Mashburn Roger Spurzem Morgan Roach Patrick Knudsen Ryan Nichols DEVELOPMENT Editorial Services Baker Spring Nick Loris Michael Rigas John Fogarty James Weidman Ray Walser Jack Spencer Paul Gallagher Lectures and Seminars John Von Kannon Jessica Zuckerman Ronald Utt Marguerite Higgins John Hilboldt Christie Grennes Kenneth McIntyre Asian Studies Center CENTER FOR LEGAL AND Adam Brickley Robert Hartsook Rachael Slobodien Walter Lohman JUDICAL STUDIES Andrew Parks Michelle Lancto Dean Cheng Edwin Meese III Bernard Lomas David Weinberger Young Leaders Program Lisa Curtis Jason Snead Robert E. Russell Jr. Strategic Heather Pfitzenmaier Rebecca Graebner Communications Legal Center Angelise Schrader Major Gifts Elizabeth Hamrick Todd Gaziano Nick Reid Rory Cooper Bruce Klingner Robert Alt FINANCE AND OPERATIONS Anthony Campau Ericka Andersen Derek Scissors Stephanie Bortner Ted Schelenski Jessica Dean Mike Brownfield Robert Warshaw Christine Carletta Joanne White Rebecca Eddy de Broekert Brandon Stewart Kumi Yokoe Elizabeth Garvey Accounting Steven DeBuhr Todd Thurman Nicholas Zahn Jessica Kline Vern McHargue JB Horton HERITAGE ACTION FOR Center for Paul Larkin Jr. Keith Capp DeEtte Chatterton Jones AMERICA International Charles Stimson James Gabele Richard McAdams Michael Needham Trade and Hans von Spakovsky Alyson Miller Sandy Mikilia Timothy Chapman Economics AMERICAN STUDIES Sandra Noone Jay Rinehart Jessica Anderson Terry Miller Matthew Spalding Michele Pecora Leah Sammons Tripp Baird Charlotte Espinoza Mark Schreiber Doug Stamps Dustin Carmack Simon Center for Anthony Kim Edward Sharrer Jeffrey Trimbath Dwayne Carson Principles and Politics Bryan Riley Daniel Holler David Azerrad Administration Heritage Legacy Society James Roberts Erin Kanoy Leslie Grimard Eric Korsvall Michael Barvick Lisa Castellana Anna DeJarnette Jessica Martin

raphics: John Fleming Inc. G raphics: Graphics, rinting: Chroma Margaret Thatcher Michael Kelsey Joshua Robbins Center for Freedom Emily Dunham Roxana Laing Julia Shaw Ashley Schow Nile Gardiner Kevin Germany Lori McNicoll Ashley Varndell Russ Vought Theodore Bromund Dorothy Hodo Research Editors Membership Programs & Nathanael Yellis Steven Groves Ebony Hunter Richard Odermatt Grant Development Sally McNamara Antonio Machenguer John Fleming Carsten Walter Erica Munkwitz Oscar Mendez-Cedillos James Kidd Erin Bender (List current as of Brett Schaefer Maria Mendoza Amy Payne Gabriel Conger Dec. 31, 2011) Fred Flerlage P Flerlage D esign: Fred