Federation of Connecticut Taxpayer Organizations

HARTFORD �The Yankee Institute's plan to remake Connecticut's political culture originates from the second floor of a nondescript, multifamily house on a quiet Hartford side street.

"The waterboarding happens in the basement,'' Executive Director Fergus Cullen jokes. In much the same vein, he mentions mind-control machines and computers capable of hacking into state workers' e-mail accounts.

To the Yankee Institute's ideological adversaries � largely labor leaders and liberals � it is no laughing matter. They say the free-enterprise think tank is part of a vast national movement, fueled by corporate donors and the billionaire Koch brothers, to demonize public employees and rescind their hard-won rights.

"They want you to believe they're just a handful of scholars working on free market principals. That sounds so safe,'' says Matt O'Connor, a spokesman for the coalition of unions representing 45,000 state workers. "But they are [linked to] powerful corporate interests who have been able to hijack the American dream. ... They are part of a well-orchestrated and well-funded effort ... to undermine working people in this country and further enrich and empower the very few folks at the top who have rewritten the rules for their benefit.''

Union leaders allege that the Yankee Institute played a key role in helping to scuttle a concession deal between state workers and Gov. Dannel P. Malloy. Especially damning is the allegation that the institute illegally tapped into the state e-mail system and spread misinformation about the proposal.

The accusation has triggered an inquiry by Attorney General George Jepsen, who declined to comment. "The inquiry is ongoing,'' says Jepsen spokeswoman Susan E. Kinsman. "We're working as quickly as possible to finish it."

The hacking allegation is "unequivocally not true,'' Cullen says. "They're accusing us of having hacked into the computer system, of having taken assumed identities, spreading misinformation and covering up our electronic tracks. ... It sounds like something out of 'Mission: Impossible.' ''

In contrast to the union's depiction of a sophisticated organization with ties to some of the nation's most influential conservative groups, Cullen paints the Yankee Institute as a shoestring operation, with 3.5 employees and an annual budget of about half a million dollars generated almost exclusively from individual donors living in Connecticut. "They are ascribing powers of influence to us that we wish we had,'' he says.

Cullen, a 39-year-old New Hampshire native with dark hair and the lean build of a distance runner, says the unions are having a "wag the dog" moment. The attack on the Yankee Institute is motivated, he says, by a desire on the part of union officials to deflect blame for their failure to sell the agreement to rank-and-file state workers.

"We're allowed to have honest disagreements about policy matters,'' Cullen says. "Where it crosses a disturbing line is where they can make accusations that have not a shred of evidence to support them and that triggers a government investigation. It seems to me they're trying to silence one of their most effective critics. We're basically the only organization in Connecticut that has been talking about the damaging effects of the public employee unions and the unsustainable impact it's having on taxes and budgets.''

Founded in 1984, the think tank has long embraced a philosophy that government should be small, taxes should be low, and a robust private sector is the key to economic growth. For part of its history, the Yankee Institute was a small, somewhat stodgy presence on the campus of Trinity College known for churning out academic papers on education and health care policy.

Cullen and Heath W. Fahle, the institute's policy director, arrived in 2009 with the charge of making the institute "more practical and maybe a little bit less academic and theoretical,'' says Cullen, who holds degrees from both Yale and Harvard,

Despite that Ivy League pedigree, Cullen is a veteran of the political trenches. A few months before graduating from Yale in 1994, he wrote an op-ed opposing higher gas taxes that ran in the New Haven Register.

The piece caught the eye of someone on John Rowland's campaign staff and soon, Cullen was "a junior mechanic" on the Rowland team. He worked for Rowland in the governor's office and also on his 1998 re-election bid, but Cullen says, "I wasn't from Waterbury so I was never going to be a Rowland insider."

After receiving a master's degree from Harvard's Kennedy School, Cullen went back to New Hampshire and started a home-contracting business. He also wrote editorials for the Union Leader, which led to his recruitment as the Granite State's Republican Party chairman, an unpaid post.

Though he has held the Yankee Institute job for the past two years, he continues to live in New Hampshire with his wife and their three young children.

The institute bills itself as non-partisan despite Cullen's connections to the Republican Party. Cullen says the group can be impartial � backing Malloy, a Democrat, when he sought changes to union contracts, and opposing Gov. M. Jodi Rell, a Republican, when she "rolled over" on tax increases.

The aim, says Cullen, is to have an impact.

"Politics is the art of the possible. � We aren't interested in pushing pipe dreams,'' he says. "Are we in favor of getting rid of the income tax? Yes, we are. Is it likely to happen anytime soon? No."

Since Cullen's arrival, the institute has hired investigative reporter Zachary Janowski, taken on a legal battle against publicly funded political campaigns, and launched a website, CT Sunlight, which publishes the salaries of state employees and other databases. It also runs the Raising Hale website, where Janowski's works appears.

Technology has allowed advocacy groups such as the Yankee Institute to assume some of the roles once filled by newspapers, said Rich Hanley, a professor and director of the graduate journalism program at Quinnipiac University.

"Advocacy groups can now go in and data-mine just as reporters do,'' Hanley said, though he is quick to add that the blog posts and stories produced by groups such as the Yankee Institute are "more public relations than objective journalism.''

The institute is driven by a desire for transparency, Cullen says, and that extends to its own finances. The Yankee Institute posts its financial statements on its website. "We certainly aren't obligated to do that but we believe in transparency for others and we believe in transparency for ourselves,'' he says.

At least, to a point: Cullen demurred when asked what his own salary is. The 2009 financial disclosure form � the most recent filing available � shows that he was paid $102,500, but that doesn't represent a full year's pay. "It's a little more than that,'' Cullen says when asked about his annual salary. "It will be subject to disclosure."

Contrary to the union's assertions that the Yankee Institute is flush with corporate donations, Cullen says the overwhelming majority of its half-million-dollar annual budget comes from individuals. "I can't say we receive zero corporate money because some of our supporters write a check from their business accounts,'' he says, "but it's like 1 or 2 percent.''

According to an internal research document compiled by the unions, the Yankee Institute received a $68,000 grant in 2006 from the Cato Institute, a libertarian think tank funded by Charles Koch.

There are other connections as well: Andrew J. Cowin, chairman of the Yankee Institute's board of directors, was affiliated with the Manhattan Institute, which has received grants from Koch Industries, according to the union. And the Yankee Institute's part-time director of operations, Jessica Buchanan, completed the Charles G. Koch Charitable Foundation Associate Program.

"If [the Yankee Institute] were just a hack and a blogger and someone who answers the phones that would be one thing,'' the union's O'Connor says, "but they have some powerful tentacles in Washington, Wall Street and of all places Kansas, where the Koch brothers are located.''

Cullen scoffs at attempts to tie the Yankee Institute to the Koch brothers, liberals' favorite villains. In blue state Connecticut, where powerful public employee unions have long had a warm relationship with Democratic lawmakers, it is the Yankee Institute that is the underdog, a lonely voice for the state's beleaguered taxpayers.

"I really am offended at this idea that only the unions are standing up for working people,'' Cullen says. "When the public employee unions are asking for more in state spending, that money is coming out of the pockets of working people across the state of Connecticut and we are standing up for them."

Fergus Cullen

Executive Director, Yankee Institute for Public Policy

860-297-4271 o

603-520-5450 c

fergus@yankeeinstitute.org

Located on the campus of Trinity College

PO Box 260660

Hartford, CT 06126--0660