New Yorker: The billionaire [Koch] brothers who are waging a war against Obama.
New Yorker: The billionaire [Koch] brothers who
are waging a war against Obama.
Source: http://newsgroups.derkeiler.com/Archive/Alt/alt.politics.bush/2010−08/msg00191.html
• From: sufaud
• Date: Sun, 29 Aug 2010 10:10:47 −0700 (PDT)
The New Yorker
A Reporter at Large
Covert Operations
The billionaire brothers who are waging a war against Obama.
by Jane Mayer August 30, 2010
PHOTO: http://www.newyorker.com/images/2010/08/30/p465/100830_r19927_p465.jpg
CAPTION: David H. Koch in 1996. He and his brother Charles are
lifelong libertarians and have quietly given more than a hundred
million dollars to right−wing causes.
On May 17th, a black−tie audience at the Metropolitan Opera House
applauded as a tall, jovial−looking billionaire took the stage. It was
the seventieth annual spring gala of American Ballet Theatre, and
David H. Koch was being celebrated for his generosity as a member of
the board of trustees; he had recently donated $2.5 million toward the
companys upcoming season, and had given many millions before that.
Koch received an award while flanked by two of the galas co−chairs,
Blaine Trump, in a peach−colored gown, and Caroline Kennedy
Schlossberg, in emerald green. Kennedys mother, Jacqueline Kennedy
Onassis, had been a patron of the ballet and, coincidentally, the
previous owner of a Fifth Avenue apartment that Koch had bought, in
1995, and then sold, eleven years later, for thirty−two million
dollars, having found it too small.
The gala marked the social ascent of Koch, who, at the age of seventy,
has become one of the citys most prominent philanthropists. In 2008,
he donated a hundred million dollars to modernize Lincoln Centers New
York State Theatre building, which now bears his name. He has given
twenty million to the American Museum of Natural History, whose
dinosaur wing is named for him. This spring, after noticing the
decrepit state of the fountains outside the Metropolitan Museum of
Art, Koch pledged at least ten million dollars for their renovation.
He is a trustee of the museum, perhaps the most coveted social prize
in the city, and serves on the board of Memorial Sloan−Kettering
Cancer Center, where, after he donated more than forty million
dollars, an endowed chair and a research center were named for him.
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New Yorker: The billionaire [Koch] brothers who are waging a war against Obama.
One dignitary was conspicuously absent from the gala: the events
third honorary co−chair, Michelle Obama. Her office said that a
scheduling conflict had prevented her from attending. Yet had the
First Lady shared the stage with Koch it might have created an awkward
tableau. In Washington, Koch is best known as part of a family that
has repeatedly funded stealth attacks on the federal government, and
on the Obama Administration in particular.
With his brother Charles, who is seventy−four, David Koch owns
virtually all of Koch Industries, a conglomerate, headquartered in
Wichita, Kansas, whose annual revenues are estimated to be a hundred
billion dollars. The company has grown spectacularly since their
father, Fred, died, in 1967, and the brothers took charge. The Kochs
operate oil refineries in Alaska, Texas, and Minnesota, and control
some four thousand miles of pipeline. Koch Industries owns Brawny
paper towels, Dixie cups, Georgia−Pacific lumber, Stainmaster carpet,
and Lycra, among other products. Forbes ranks it as the second−largest
private company in the country, after Cargill, and its consistent
profitability has made David and Charles Kochwho, years ago, bought
out two other brothersamong the richest men in America. Their
combined fortune of thirty−five billion dollars is exceeded only by
those of Bill Gates and Warren Buffett.
* from the issue
* cartoon bank
* e−mail this
The Kochs are longtime libertarians who believe in drastically lower
personal and corporate taxes, minimal social services for the needy,
and much less oversight of industryespecially environmental
regulation. These views dovetail with the brothers corporate
interests. In a study released this spring, the University of
Massachusetts at Amhersts Political Economy Research Institute named
Koch Industries one of the top ten air polluters in the United States.
And Greenpeace issued a report identifying the company as a kingpin
of climate science denial. The report showed that, from 2005 to 2008,
the Kochs vastly outdid ExxonMobil in giving money to organizations
fighting legislation related to climate change, underwriting a huge
network of foundations, think tanks, and political front groups.
Indeed, the brothers have funded opposition campaigns against so many
Obama Administration policiesfrom health−care reform to the economic−
stimulus programthat, in political circles, their ideological network
is known as the Kochtopus.
In a statement, Koch Industries said that the Greenpeace report
distorts the environmental record of our companies. And David Koch,
in a recent, admiring article about him in New York, protested that
the radical press had turned his family into whipping boys, and
had exaggerated its influence on American politics. But Charles Lewis,
the founder of the Center for Public Integrity, a nonpartisan watchdog
New Yorker: The billionaire [Koch] brothers who are waging a war against Obama. 2
New Yorker: The billionaire [Koch] brothers who are waging a war against Obama.
group, said, The Kochs are on a whole different level. Theres no one
else who has spent this much money. The sheer dimension of it is what
sets them apart. They have a pattern of lawbreaking, political
manipulation, and obfuscation. Ive been in Washington since
Watergate, and Ive never seen anything like it. They are the Standard
Oil of our times.
A few weeks after the Lincoln Center gala, the advocacy wing of the
Americans for Prosperity Foundationan organization that David Koch
started, in 2004held a different kind of gathering. Over the July 4th
weekend, a summit called Texas Defending the American Dream took place
in a chilly hotel ballroom in Austin. Though Koch freely promotes his
philanthropic ventures, he did not attend the summit, and his name was
not in evidence. And on this occasion the audience was roused not by a
dance performance but by a series of speakers denouncing President
Barack Obama. Peggy Venable, the organizer of the summit, warned that
Administration officials have a socialist vision for this country.
Five hundred people attended the summit, which served, in part, as a
training session for Tea Party activists in Texas. An advertisement
cast the event as a populist uprising against vested corporate power.
Today, the voices of average Americans are being drowned out by
lobbyists and special interests, it said. But you can do something
about it. The pitch made no mention of its corporate funders. The
White House has expressed frustration that such sponsors have largely
eluded public notice. David Axelrod, Obamas senior adviser, said,
What they dont say is that, in part, this is a grassroots citizens
movement brought to you by a bunch of oil billionaires.
In April, 2009, Melissa Cohlmia, a company spokesperson, denied that
the Kochs had direct links to the Tea Party, saying that Americans for
Prosperity is an independent organization and Koch companies do not
in any way direct their activities. Later, she issued a statement:
No funding has been provided by Koch companies, the Koch foundations,
or Charles Koch or David Koch specifically to support the tea
parties. David Koch told New York, Ive never been to a tea−party
event. No one representing the tea party has ever even approached me.
At the lectern in Austin, however, Venablea longtime political
operative who draws a salary from Americans for Prosperity, and who
has worked for Koch−funded political groups since 1994spoke less
warily. We love what the Tea Parties are doing, because thats how
were going to take back America! she declared, as the crowd cheered.
In a subsequent interview, she described herself as an early member of
the movement, joking, I was part of the Tea Party before it was
cool! She explained that the role of Americans for Prosperity was to
help educate Tea Party activists on policy details, and to give them
next−step training after their rallies, so that their political
energy could be channelled more effectively. And she noted that
Americans for Prosperity had provided Tea Party activists with lists
of elected officials to target. She said of the Kochs, Theyre
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New Yorker: The billionaire [Koch] brothers who are waging a war against Obama.
certainly our people. Davids the chairman of our board. Ive
certainly met with them, and Im very appreciative of what they do.
Venable honored several Tea Party citizen leaders at the summit. The
Texas branch of Americans for Prosperity gave its Blogger of the Year
Award to a young woman named Sibyl West. On June 14th, West, writing
on her site, described Obama as the cokehead in chief. In an online
thread, West speculated that the President was exhibiting symptoms of
demonic possession (aka schizophrenia, etc.). The summit featured
several paid speakers, including Janine Turner, the actress best known
for her role on the television series Northern Exposure. She
declared, They dont want our children to know about their rights.
They dont want our children to know about a God!
During a catered lunch, Venable introduced Ted Cruz, a former
solicitor general of Texas, who told the crowd that Obama was the
most radical President ever to occupy the Oval Office, and had hidden
from voters a secret agendathe government taking over our economy
and our lives. Countering Obama, Cruz proclaimed, was the epic fight
of our generation! As the crowd rose to its feet and cheered, he
quoted the defiant words of a Texan at the Alamo: Victory, or death!
Americans for Prosperity has worked closely with the Tea Party since
the movements inception. In the weeks before the first Tax Day
protests, in April, 2009, Americans for Prosperity hosted a Web site
offering supporters Tea Party Talking Points. The Arizona branch
urged people to send tea bags to Obama; the Missouri branch urged
members to sign up for Taxpayer Tea Party Registration and provided
directions to nine protests. The group continues to stoke the
rebellion. The North Carolina branch recently launched a Tea Party
Finder Web site, advertised as a hub for all the Tea Parties in
North Carolina.
The anti−government fervor infusing the 2010 elections represents a
political triumph for the Kochs. By giving money to educate, fund,
and organize Tea Party protesters, they have helped turn their private
agenda into a mass movement. Bruce Bartlett, a conservative economist
and a historian, who once worked at the National Center for Policy
Analysis, a Dallas−based think tank that the Kochs fund, said, The
problem with the whole libertarian movement is that its been all
chiefs and no Indians. There havent been any actual people, like
voters, who give a crap about it. So the problem for the Kochs has
been trying to create a movement. With the emergence of the Tea
Party, he said, everyone suddenly sees that for the first time there
are Indians out therepeople who can provide real ideological power..
The Kochs, he said, are trying to shape and control and channel the
populist uprising into their own policies.
A Republican campaign consultant who has done research on behalf of
Charles and David Koch said of the Tea Party, The Koch brothers gave
the money that founded it. Its like they put the seeds in the ground.
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New Yorker: The billionaire [Koch] brothers who are waging a war against Obama.
Then the rainstorm comes, and the frogs come out of the mudand
theyre our candidates!
The Kochs and their political operatives declined requests for
interviews. Instead, a prominent New York public−relations executive
who is close with the Kochs put forward two friends: George Pataki,
the former governor of New York, and Mortimer Zuckerman, the publisher
and real−estate magnate. Pataki, a Republican who received campaign
donations from David Koch, called him a patriot who cares deeply
about his country. Zuckerman praised Davids gentle decency and the
range of his public interests.
The Republican campaign consultant said of the familys political
activities, To call them under the radar is an understatement. They
are underground! Another former Koch adviser said, Theyre smart.
This right−wing, redneck stuff works for them. They see this as a way
to get things done without getting dirty themselves. Rob Stein, a
Democratic political strategist who has studied the conservative
movements finances, said that the Kochs are at the epicenter of the
anti−Obama movement. But its not just about Obama. They would have
done the same to Hillary Clinton. They did the same with Bill Clinton.
They are out to destroy progressivism.
Oddly enough, the fiercely capitalist Koch family owes part of its
fortune to Joseph Stalin. Fred Koch was the son of a Dutch printer who
settled in Texas and ran a weekly newspaper. Fred attended M.I.T.,
where he earned a degree in chemical engineering. In 1927, he invented
a more efficient process for converting oil into gasoline, but,
according to family lore, Americas major oil companies regarded him
as a threat and shut him out of the industry. Unable to succeed at
home, Koch found work in the Soviet Union. In the nineteen−thirties,
his company trained Bolshevik engineers and helped Stalins regime set
up fifteen modern oil refineries. Over time, however, Stalin brutally
purged several of Kochs Soviet colleagues. Koch was deeply affected
by the experience, and regretted his collaboration. He returned to the
U.S. In the headquarters of his company, Rock Island Oil & Refining,
in Wichita, he kept photographs aimed at proving that some of those
Soviet refineries had been destroyed in the Second World War. Gus
diZerega, a former friend of Charles Koch, recalled, As the Soviets
became a stronger military power, Fred felt a certain amount of guilt
at having helped build them up. I think it bothered him a lot.
In 1958, Fred Koch became one of the original members of the John
Birch Society, the arch−conservative group known, in part, for a
highly skeptical view of governance and for spreading fears of a
Communist takeover. Members considered President Dwight D. Eisenhower
to be a Communist agent. In a self−published broadside, Koch claimed
that the Communists have infiltrated both the Democrat and Republican
Parties. He wrote admiringly of Benito Mussolinis suppression of
Communists in Italy, and disparagingly of the American civil−rights
movement. The colored man looms large in the Communist plan to take
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New Yorker: The billionaire [Koch] brothers who are waging a war against Obama.
over America, he warned. Welfare was a secret plot to attract rural
blacks to cities, where they would foment a vicious race war. In a
1963 speech that prefigures the Tea Partys talk of a secret socialist
plot, Koch predicted that Communists would infiltrate the highest
offices of government in the U.S. until the President is a Communist,
unknown to the rest of us.
Koch married Mary Robinson, the daughter of a Missouri physician, and
they had four sons: Freddie, Charles, and twins, David and William.
John Damgard, the president of the Futures Industry Association, was
Davids schoolmate and friend. He recalled that Fred Koch was a real
John Wayne type. Koch emphasized rugged pursuits, taking his sons big−
game hunting in Africa, and requiring them to do farm labor at the
family ranch. The Kochs lived in a stone mansion on a large compound
across from Wichitas country club; in the summer, the boys could hear
their friends splashing in the pool, but they were not allowed to join
them. By instilling a work ethic in me at an early age, my father did
me a big favor, although it didnt seem like a favor back then,
Charles has written. By the time I was eight, he made sure work
occupied most of my spare time. David Koch recalled that his father
also indoctrinated the boys politically. He was constantly speaking
to us children about what was wrong with government, he told Brian
Doherty, an editor of the libertarian magazine Reason, and the author
of Radicals for Capitalism, a 2007 history of the libertarian
movement. Its something I grew up witha fundamental point of view
that big government was bad, and imposition of government controls on
our lives and economic fortunes was not good.
David attended Deerfield Academy, in Massachusetts, and Charles was
sent to military school. Charles, David, and William all earned
engineering degrees at their fathers alma mater, M.I.T., and later
joined the family company. Charles eventually assumed control, with
David as his deputy; Williams career at the company was less
successful. Freddie went to Harvard and studied playwriting at the
Yale School of Drama. His father reportedly disapproved of him, and
punished him financially. (Freddie, through a spokesperson, denied
this.)
In 1967, after Fred Koch died, of a heart attack, Charles renamed the
business Koch Industries, in honor of his father. Fred Kochs will
made his sons extraordinarily wealthy. David Koch joked about his good
fortune in a 2003 speech to alumni at Deerfield, where, after pledging
twenty−five million dollars, he was made the schools sole lifetime
trustee. He said, You might ask: How does David Koch happen to have
the wealth to be so generous? Well, let me tell you a story. It all
started when I was a little boy. One day, my father gave me an apple.
I soon sold it for five dollars and bought two apples and sold them
for ten. Then I bought four apples and sold them for twenty. Well,
this went on day after day, week after week, month after month, year
after year, until my father died and left me three hundred million
dollars!
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New Yorker: The billionaire [Koch] brothers who are waging a war against Obama.
David and Charles had absorbed their fathers conservative politics,
but they did not share all his views, according to diZerega, who
befriended Charles in the mid−sixties, after meeting him while
browsing in a John Birch Society bookstore in Wichita. Charles
eventually invited him to the Kochs mansion, to participate in an
informal political−discussion group. It was pretty clear that Charles
thought some of the Birch Society was bullshit, diZerega recalled.
DiZerega, who has lost touch with Charles, eventually abandoned right−
wing views, and became a political−science professor. He credits
Charles with opening his mind to political philosophy, which set him
on the path to academia; Charles is one of three people to whom he
dedicated his first book. But diZerega believes that the Koch brothers
have followed a wayward intellectual trajectory, transferring their
fathers paranoia about Soviet Communism to a distrust of the U.S.
government, and seeing its expansion, beginning with the New Deal, as
a tyrannical threat to freedom. In an essay, posted on Beliefnet,
diZerega writes, As state socialism failed . . . the target for many
within these organizations shifted to any kind of regulation at all.
Socialism kept being defined downwards.
Members of the John Birch Society developed an interest in a school of
Austrian economists who promoted free−market ideals. Charles and David
Koch were particularly influenced by the work of Friedrich von Hayek,
the author of The Road to Serfdom (1944), which argued that
centralized government planning led, inexorably, to totalitarianism.
Hayeks belief in unfettered capitalism has proved inspirational to
many conservatives, and to anti−Soviet dissidents; lately, Tea Party
supporters have championed his work. In June, the talk−radio host
Glenn Beck, who has supported the Tea Party rebellion, promoted The
Road to Serfdom on his show; the paperback soon became a No. 1 best−
seller on Amazon. (Beck appears to be a fan of the Kochs; in the midst
of a recent on−air parody of Al Gore, Beck said, without explanation,
I want to thank Charles Koch for this information. Beck declined to
elaborate on the relationship.)
Charles and David also became devotees of a more radical thinker,
Robert LeFevre, who favored the abolition of the state but didnt like
the label anarchist; he called himself an autarchist. LeFevre
liked to say that government is a disease masquerading as its own
cure. In 1956, he opened an institution called the Freedom School, in
Colorado Springs. Brian Doherty, of Reason, told me that LeFevre was
an anarchist figure who won Charless heart, and that the school was
a tiny world of people who thought the New Deal was a horrible
mistake. According to diZerega, Charles supported the school
financially, and even gave him money to take classes there.
Throughout the seventies, Charles and David continued to build Koch
Industries. In 1980, William, with assistance from Freddie, attempted
to take over the company from Charles, who, they felt, had assumed
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New Yorker: The billionaire [Koch] brothers who are waging a war against Obama.
autocratic control. In retaliation, the companys board, which
answered to Charles, fired William. (Charles runs it all with an iron
hand, Bruce Bartlett, the economist, told me.) Lawsuits were filed,
with William and Freddie on one side and Charles and David on the
other. In 1983, Charles and David bought out their brothers share in
the company for nearly a billion dollars. But the antagonism remained,
and litigation continued for seventeen more years, with the brothers
hiring rival private investigators; in 1990, they walked past one
another with stony expressions at their mothers funeral. Eventually,
Freddie moved to Monaco, which has no income tax. He bought historic
estates in France, Austria, and elsewhere, filling them with art,
antiques, opera scores, and literary manuscripts. William founded his
own energy company, Oxbow, and turned to yachting; he spent an
estimated sixty−five million dollars to win the Americas Cup, in
1992.
With Charles as the undisputed chairman and C.E.O., Koch Industries
expanded rapidly. Roger Altman, who heads the investment−banking firm
Evercore, told me that the companys performance has been beyond
phenomenal. Charles remained in Wichita, with his wife and two
children, guarding his privacy while supporting community charities.
David moved to New York City, where he is an executive vice−president
of the company and the C.E.O. of its Chemical Technology Group. A
financial expert who knows Koch Industries well told me, Charles is
the company. Charles runs it. David, described by associates as
affable and a bit of a lunk, enjoyed for years the life of a
wealthy bachelor. He rented a yacht in the South of France and bought
a waterfront home in Southampton, where he threw parties that the Web
site New York Social Diary likened to an East Coast version of Hugh
Hefners soirées. In 1996, he married Julia Flesher, a fashion
assistant. They live in a nine−thousand−square−foot duplex at 740 Park
Avenue, with their three children. Though Davids manner is more
cosmopolitan, and more genial, than that of Charles, Brian Doherty,
who has interviewed both brothers, couldnt think of a single issue on
which the brothers disagreed.
As their fortunes grew, Charles and David Koch became the primary
underwriters of hard−line libertarian politics in America. Charless
goal, as Doherty described it, was to tear the government out at the
root. The brothers first major public step came in 1979, when
Charles persuaded David, then thirty−nine, to run for public office.
They had become supporters of the Libertarian Party, and were backing
its Presidential candidate, Ed Clark, who was running against Ronald
Reagan from the right. Frustrated by the legal limits on campaign
donations, they contrived to place David on the ticket, in the Vice−
Presidential slot; upon becoming a candidate, he could lavish as much
of his personal fortune as he wished on the campaign. The tickets
slogan was The Libertarian Party has only one source of funds: You..
In fact, its primary source of funds was David Koch, who spent more
than two million dollars on the effort.
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New Yorker: The billionaire [Koch] brothers who are waging a war against Obama.
Many of the ideas propounded in the 1980 campaign presaged the Tea
Party movement. Ed Clark told The Nation that libertarians were
getting ready to stage a very big tea party, because people were
sick to death of taxes. The Libertarian Party platform called for
the abolition of the F.B.I. and the C.I.A., as well as of federal
regulatory agencies, such as the Securities and Exchange Commission
and the Department of Energy. The Party wanted to end Social Security,
minimum−wage laws, gun control, and all personal and corporate income
taxes; it proposed the legalization of prostitution, recreational
drugs, and suicide. Government should be reduced to only one function:
the protection of individual rights. William F. Buckley, Jr., a more
traditional conservative, called the movement Anarcho−
Totalitarianism.
That November, the Libertarian ticket received only one per cent of
the vote. The brothers realized that their brand of politics didnt
sell at the ballot box. Charles Koch became openly scornful of
conventional politics. It tends to be a nasty, corrupting business,
he told a reporter at the time. Im interested in advancing
libertarian ideas. According to Dohertys book, the Kochs came to
regard elected politicians as merely actors playing out a script. A
longtime confidant of the Kochs told Doherty that the brothers wanted
to supply the themes and words for the scripts. In order to alter
the direction of America, they had to influence the areas where
policy ideas percolate from: academia and think tanks.
After the 1980 election, Charles and David Koch receded from the
public arena. But they poured more than a hundred million dollars into
dozens of seemingly independent organizations. Tax records indicate
that in 2008 the three main Koch family foundations gave money to
thirty−four political and policy organizations, three of which they
founded, and several of which they direct. The Kochs and their company
have given additional millions to political campaigns, advocacy
groups, and lobbyists. The familys subterranean financial role has
fuelled suspicion on the left; Lee Fang, of the liberal blog
ThinkProgress, has called the Kochs the billionaires behind the
hate.
Only the Kochs know precisely how much they have spent on politics.
Public tax records show that between 1998 and 2008 the Charles G. Koch
Charitable Foundation spent more than forty−eight million dollars. The
Claude R. Lambe Charitable Foundation, which is controlled by Charles
Koch and his wife, along with two company employees and an accountant,
spent more than twenty−eight million. The David H. Koch Charitable
Foundation spent more than a hundred and twenty million. Meanwhile,
since 1998 Koch Industries has spent more than fifty million dollars
on lobbying. Separately, the companys political−action committee,
KochPAC, has donated some eight million dollars to political
campaigns, more than eighty per cent of it to Republicans. So far in
2010, Koch Industries leads all other energy companies in political
contributions, as it has since 2006. In addition, during the past
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New Yorker: The billionaire [Koch] brothers who are waging a war against Obama.
dozen years the Kochs and other family members have personally spent
more than two million dollars on political contributions. In the
second quarter of 2010, David Koch was the biggest individual
contributor to the Republican Governors Association, with a million−
dollar donation. Other gifts by the Kochs may be untraceable; federal
tax law permits anonymous personal donations to politically active
nonprofit groups.
In recent decades, members of several industrial dynasties have spent
parts of their fortunes on a conservative agenda. In the nineteen−
eighties, the Olin family, which owns a chemicals−and−manufacturing
conglomerate, became known for funding right−leaning thinking in
academia, particularly in law schools. And during the nineties Richard
Mellon Scaife, a descendant of Andrew Mellon, spent millions
attempting to discredit President Bill Clinton. Ari Rabin−Havt, a vice−
president at the Democratic−leaning Web site Media Matters, said that
the Kochs effort is unusual, in its marshalling of corporate and
personal funds: Their role, in terms of financial commitments, is
staggering.
Of course, Democrats give money, too. Their most prominent donor, the
financier George Soros, runs a foundation, the Open Society Institute,
that has spent as much as a hundred million dollars a year in America.
Soros has also made generous private contributions to various
Democratic campaigns, including Obamas. But Michael Vachon, his
spokesman, argued that Soross giving is transparent, and that none
of his contributions are in the service of his own economic
interests. The Kochs have given millions of dollars to nonprofit
groups that criticize environmental regulation and support lower taxes
for industry. Gus diZerega, the former friend, suggested that the
Kochs youthful idealism about libertarianism had largely devolved
into a rationale for corporate self−interest. He said of Charles,
Perhaps he has confused making money with freedom.
Some critics have suggested that the Kochs approach has subverted the
purpose of tax−exempt giving. By law, charitable foundations must
conduct exclusively nonpartisan activities that promote the public
welfare. A 2004 report by the National Committee for Responsive
Philanthropy, a watchdog group, described the Kochs foundations as
being self−serving, concluding, These foundations give money to
nonprofit organizations that do research and advocacy on issues that
impact the profit margin of Koch Industries.
The Kochs have gone well beyond their immediate self−interest,
however, funding organizations that aim to push the country in a
libertarian direction. Among the institutions that they have
subsidized are the Institute for Justice, which files lawsuits
opposing state and federal regulations; the Institute for Humane
Studies, which underwrites libertarian academics; and the Bill of
Rights Institute, which promotes a conservative slant on the
Constitution. Many of the organizations funded by the Kochs employ
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New Yorker: The billionaire [Koch] brothers who are waging a war against Obama.
specialists who write position papers that are subsequently quoted by
politicians and pundits. David Koch has acknowledged that the family
exerts tight ideological control. If were going to give a lot of
money, well make darn sure they spend it in a way that goes along
with our intent, he told Doherty. And if they make a wrong turn and
start doing things we dont agree with, we withdraw funding.
The Kochs subsidization of a pro−corporate movement fulfills, in many
ways, the vision laid out in a secret 1971 memo that Lewis Powell,
then a Virginia attorney, wrote two months before he was nominated to
the Supreme Court. The antiwar movement had turned its anger on
defense contractors, such as Dow Chemical, and Ralph Nader was leading
a public−interest crusade against corporations. Powell, writing a
report for the U.S. Chamber of Commerce, urged American companies to
fight back. The greatest threat to free enterprise, he warned, was not
Communism or the New Left but, rather, respectable elements of
societyintellectuals, journalists, and scientists. To defeat them,
he wrote, business leaders needed to wage a long−term, unified
campaign to change public opinion.
Charles Koch seems to have approached both business and politics with
the deliberation of an engineer. To bring about social change, he
told Doherty, requires a strategy that is vertically and
horizontally integrated, spanning from idea creation to policy
development to education to grassroots organizations to lobbying to
litigation to political action. The project, he admitted, was
extremely ambitious. We have a radical philosophy, he said.
In 1977, the Kochs provided the funds to launch the nations first
libertarian think tank, the Cato Institute. According to the Center
for Public Integrity, between 1986 and 1993 the Koch family gave
eleven million dollars to the institute. Today, Cato has more than a
hundred full−time employees, and its experts and policy papers are
widely quoted and respected by the mainstream media. It describes
itself as nonpartisan, and its scholars have at times been critical of
both parties. But it has consistently pushed for corporate tax cuts,
reductions in social services, and laissez−faire environmental
policies.
When President Obama, in a 2008 speech, described the science on
global warming as beyond dispute, the Cato Institute took out a full−
page ad in the Times to contradict him. Catos resident scholars have
relentlessly criticized political attempts to stop global warming as
expensive, ineffective, and unnecessary. Ed Crane, the Cato
Institutes founder and president, told me that global−warming
theories give the government more control of the economy.
Cato scholars have been particularly energetic in promoting the
Climategate scandal. Last year, private e−mails of climate scientists
at the University of East Anglia, in England, were mysteriously
leaked, and their exchanges appeared to suggest a willingness to
New Yorker: The billionaire [Koch] brothers who are waging a war against Obama. 11
New Yorker: The billionaire [Koch] brothers who are waging a war against Obama.
falsify data in order to buttress the idea that global warming is
real. In the two weeks after the e−mails went public, one Cato scholar
gave more than twenty media interviews trumpeting the alleged scandal.
But five independent inquiries have since exonerated the researchers,
and nothing was found in their e−mails or data to discredit the
scientific consensus on global warming.
Nevertheless, the controversy succeeded in spreading skepticism about
climate change. Even though the National Oceanic and Atmospheric
Administration recently issued a report concluding that the evidence
for global warming is unequivocal, more Americans are convinced than
at any time since 1997 that scientists have exaggerated the
seriousness of global warming. The Kochs promote this statistic on
their companys Web site but do not mention the role that their
funding has played in fostering such doubt.
In a 2002 memo, the Republican political consultant Frank Luntz wrote
that so long as voters believe there is no consensus about global
warming within the scientific community the status quo would prevail.
The key for opponents of environmental reform, he said, was to
question the sciencea public−relations strategy that the tobacco
industry used effectively for years to forestall regulation. The Kochs
have funded many sources of environmental skepticism, such as the
Heritage Foundation, which has argued that scientific facts gathered
in the past 10 years do not support the notion of catastrophic human−
made warming. The brothers have given money to more obscure groups,
too, such as the Independent Womens Forum, which opposes the
presentation of global warming as a scientific fact in American public
schools. Until 2008, the group was run by Nancy Pfotenhauer, a former
lobbyist for Koch Industries. Mary Beth Jarvis, a vice−president of a
Koch subsidiary, is on the groups board.
Naomi Oreskes, a professor of history and science studies at the
University of California, San Diego, is the co−author of Merchants of
Doubt, a new book that chronicles various attempts by American
industry to manipulate public opinion on science. She noted that the
Kochs, as the heads of a company with refineries and pipelines, have
a lot at stake. She added, If the answer is to phase out fossil
fuels, a different group of people are going to be making money, so we
shouldnt be surprised that theyre fighting tooth and nail..
David Koch told New York that he was unconvinced that global warming
has been caused by human activity. Even if it has been, he said, the
heating of the planet will be beneficial, resulting in longer growing
seasons in the Northern Hemisphere. The Earth will be able to support
enormously more people because far greater land area will be available
to produce food, he said.
In the mid−eighties, the Kochs provided millions of dollars to George
Mason University, in Arlington, Virginia, to set up another think
tank. Now known as the Mercatus Center, it promotes itself as the
New Yorker: The billionaire [Koch] brothers who are waging a war against Obama. 12
New Yorker: The billionaire [Koch] brothers who are waging a war against Obama.
worlds premier university source for market−oriented ideasbridging
the gap between academic ideas and real−world problems. Financial
records show that the Koch family foundations have contributed more
than thirty million dollars to George Mason, much of which has gone to
the Mercatus Center, a nonprofit organization. Its ground zero for
deregulation policy in Washington, Rob Stein, the Democratic
strategist, said. It is an unusual arrangement. George Mason is a
public university, and receives public funds, Stein noted. Virginia
is hosting an institution that the Kochs practically control.
The founder of the Mercatus Center is Richard Fink, formerly an
economist. Fink heads Koch Industries lobbying operation in
Washington. In addition, he is the president of the Charles G. Koch
Charitable Foundation, the president of the Claude R. Lambe Charitable
Foundation, a director of the Fred C. and Mary R. Koch Foundation, and
a director and co−founder, with David Koch, of the Americans for
Prosperity Foundation.
Fink, with his many titles, has become the central nervous system of
the Kochtopus. He appears to have supplanted Ed Crane, the head of the
Cato Institute, as the brothers main political lieutenant. Though
David remains on the board at Cato, Charles Koch has fallen out with
Crane. Associates suggested to me that Crane had been insufficiently
respectful of Charless management philosophy, which he distilled into
a book called The Science of Success, and trademarked under the name
Market−Based Management, or M.B.M. In the book, Charles recommends
instilling a companys corporate culture with the competitiveness of
the marketplace. Koch describes M.B.M. as a holistic system
containing five dimensions: vision, virtue and talents, knowledge
processes, decision rights and incentives. A top Cato Institute
official told me that Charles thinks hes a genius. Hes the emperor,
and hes convinced hes wearing clothes. Fink, by contrast, has been
far more embracing of Charless ideas. (Fink, like the Kochs, declined
to be interviewed.)
At a 1995 conference for philanthropists, Fink adopted the language of
economics when speaking about the Mercatus Centers purpose. He said
that grant−makers should use think tanks and political−action groups
to convert intellectual raw materials into policy products.
The Wall Street Journal has called the Mercatus Center the most
important think tank youve never heard of, and noted that fourteen
of the twenty−three regulations that President George W. Bush placed
on a hit list had been suggested first by Mercatus scholars. Fink
told the paper that the Kochs have other means of fighting [their]
battles, and that the Mercatus Center does not actively promote the
companys private interests. But Thomas McGarity, a law professor at
the University of Texas, who specializes in environmental issues, told
me that Koch has been constantly in trouble with the E.P.A., and
Mercatus has constantly hammered on the agency. An environmental
lawyer who has clashed with the Mercatus Center called it a means of
New Yorker: The billionaire [Koch] brothers who are waging a war against Obama. 13
New Yorker: The billionaire [Koch] brothers who are waging a war against Obama.
laundering economic aims. The lawyer explained the strategy: You
take corporate money and give it to a neutral−sounding think tank,
which hires people with pedigrees and academic degrees who put out
credible−seeming studies. But they all coincide perfectly with the
economic interests of their funders.
In 1997, for instance, the E.P.A. moved to reduce surface ozone, a
form of pollution caused, in part, by emissions from oil refineries.
Susan Dudley, an economist who became a top official at the Mercatus
Center, criticized the proposed rule. The E.P.A., she argued, had not
taken into account that smog−free skies would result in more cases of
skin cancer. She projected that if pollution were controlled it would
cause up to eleven thousand additional cases of skin cancer each year.
In 1999, the District of Columbia Circuit Court took up Dudleys smog
argument. Evaluating the E.P.A. rule, the court found that the E.P.A.
had explicitly disregarded the possible health benefits of ozone.
In another part of the opinion, the court ruled, 2−1, that the E.P.A.
had overstepped its authority in calibrating standards for ozone
emissions. As the Constitutional Accountability Center, a think tank,
revealed, the judges in the majority had previously attended legal
junkets, on a Montana ranch, that were arranged by the Foundation for
Research on Economics and the Environmenta group funded by Koch
family foundations. The judges have claimed that the ruling was
unaffected by their attendance.
Ideas dont happen on their own, Matt Kibbe, the president of
FreedomWorks, a Tea Party advocacy group, told me. Throughout
history, ideas need patrons. The Koch brothers, after helping to
create Cato and Mercatus, concluded that think tanks alone were not
enough to effect change. They needed a mechanism to deliver those
ideas to the street, and to attract the publics support. In 1984,
David Koch and Richard Fink created yet another organization, and
Kibbe joined them. The group, Citizens for a Sound Economy, seemed
like a grassroots movement, but according to the Center for Public
Integrity it was sponsored principally by the Kochs, who provided $7.9
million between 1986 and 1993. Its mission, Kibbe said, was to take
these heavy ideas and translate them for mass America. . . . We read
the same literature Obama did about nonviolent revolutionsSaul
Alinsky, Gandhi, Martin Luther King. We studied the idea of the Boston
Tea Party as an example of nonviolent social change. We learned we
needed boots on the ground to sell ideas, not candidates. Within a
few years, the group had mobilized fifty paid field workers, in twenty−
six states, to rally voters behind the Kochs agenda. David and
Charles, according to one participant, were very controlling, very
top down. You cant build an organization with them. They run it.
Around this time, the brothers faced a political crisis. In 1989, the
Senate Select Committee on Indian Affairs investigated their business
and released a scathing report accusing Koch Oil of a widespread and
sophisticated scheme to steal crude oil from Indians and others
New Yorker: The billionaire [Koch] brothers who are waging a war against Obama. 14
New Yorker: The billionaire [Koch] brothers who are waging a war against Obama.
through fraudulent mismeasuring. The Kochs admitted that they had
improperly taken thirty−one million dollars worth of crude oil, but
said that it had been accidental. Charles Koch told committee
investigators that oil measurement is a very uncertain art.
To defend its reputation, Koch Industries hired Robert Strauss, then a
premier Washington lobbyist; the company soon opened an office in the
city. A grand jury was convened to investigate the allegations, but it
eventually disbanded, without issuing criminal charges. According to
the Senate report, after the committee hearings Koch operatives delved
into the personal lives of committee staffers, even questioning an ex−
wife. Senate investigators were upset by the Kochs tactics. Kenneth
Ballen, the counsel to the Senate committee, said, These people have
amassed such unaccountable power!
By 1993, when Bill Clinton became President, Citizens for a Sound
Economy had become a prototype for the kind of corporate−backed
opposition campaigns that have proliferated during the Obama era. The
group waged a successful assault on Clintons proposed B.T.U. tax on
energy, for instance, running advertisements, staging media events,
and targeting opponents. And it mobilized anti−tax rallies outside the
Capitolrallies that NPR described as designed to strike fear into
the hearts of wavering Democrats. Dan Glickman, a former Democratic
congressman from Wichita, who supported the B.T.U. tax, recalled, Id
been in Congress eighteen years. The Kochs actually engaged against me
and funded my opponent. They used a lot of resources and efforttheir
employees, too. Glickman suffered a surprise defeat. I cant prove
it, but I think I was probably their victim, he said.
The Kochs continued to disperse their money, creating slippery
organizations with generic−sounding names, and this made it difficult
to ascertain the extent of their influence in Washington. In 1990,
Citizens for a Sound Economy created a spinoff group, Citizens for the
Environment, which called acid rain and other environmental problems
myths. When the Pittsburgh Post−Gazette investigated the matter, it
discovered that the spinoff group had no citizen membership of its
own.
In 1997, another Senate investigation began looking into what a
minority report called an audacious plan to pour millions of dollars
in contributions into Republican campaigns nationwide without
disclosing the amount or source, in order to evade campaign−finance
laws. A shell corporation, Triad Management, had paid more than three
million dollars for attack ads in twenty−six House races and three
Senate races. More than half of the advertising money came from an
obscure nonprofit group, the Economic Education Trust. The Senate
committees minority report suggested that the trust was financed in
whole or in part by Charles and David Koch of Wichita, Kansas. The
brothers were suspected of having secretly paid for the attack ads,
most of which aired in states where Koch Industries did business. In
Kansas, where Triad Management was especially active, the funds may
New Yorker: The billionaire [Koch] brothers who are waging a war against Obama. 15
New Yorker: The billionaire [Koch] brothers who are waging a war against Obama.
have played a decisive role in four of six federal races. The Kochs,
when asked by reporters if they had given the money, refused to
comment. In 1998, however, the Wall Street Journal confirmed that a
consultant on the Kochs payroll had been involved in the scheme.
Charles Lewis, of the Center for Public Integrity, described the
scandal as historic. Triad was the first time a major corporation
used a cutouta front operationin a threatening way. Koch
Industries was the poster child of a company run amok.
During the Clinton Administration, the energy industry faced increased
scrutiny and regulation. In the mid−nineties, the Justice Department
filed two lawsuits against Koch Industries, claiming that it was
responsible for more than three hundred oil spills, which had released
an estimated three million gallons of oil into lakes and rivers. The
penalty was potentially as high as two hundred and fourteen million
dollars. In a settlement, Koch Industries paid a record thirty−million−
dollar civil fine, and agreed to spend five million dollars on
environmental projects.
In 1999, a jury found Koch Industries guilty of negligence and malice
in the deaths of two Texas teen−agers in an explosion that resulted
from a leaky underground butane pipeline. (In 2001, the company paid
an undisclosed settlement.) And in the final months of the Clinton
Presidency the Justice Department levelled a ninety−seven−count
indictment against the company, for covering up the discharge of
ninety−one tons of benzene, a carcinogen, from its refinery in Corpus
Christi, Texas. The company was liable for three hundred and fifty
million dollars in fines, and four Koch employees faced up to thirty−
five years in prison. The Koch Petroleum Group eventually pleaded
guilty to one criminal charge of covering up environmental violations,
including the falsification of documents, and paid a twenty−million−
dollar fine. David Uhlmann, a career prosecutor who, at the time,
headed the environmental−crimes section at the Justice Department,
described the suit as one of the most significant cases ever brought
under the Clean Air Act. He added, Environmental crimes are almost
always motivated by economics and arrogance, and in the Koch case
there was a healthy dose of both.
During the 2000 election campaign, Koch Industries spent some nine
hundred thousand dollars to support the candidacies of George W. Bush
and other Republicans. During the Bush years, Koch Industries and
other fossil−fuel companies enjoyed remarkable prosperity. The 2005
energy bill, which Hillary Clinton dubbed the Dick Cheney Lobbyist
Energy Bill, offered enormous subsidies and tax breaks for energy
companies. The Kochs have cast themselves as deficit hawks, but,
according to a study by Media Matters, their companies have benefitted
from nearly a hundred million dollars in government contracts since
2000.
In 2004, Citizens for a Sound Economy was accused of illegitimately
throwing its weight behind Bushs reëlection. The groups Oregon
New Yorker: The billionaire [Koch] brothers who are waging a war against Obama. 16
New Yorker: The billionaire [Koch] brothers who are waging a war against Obama.
branch had attempted to get Ralph Nader on the Presidential ballot, in
order to dilute Democratic support for John Kerry. Critics argued that
it was illegal for a tax−exempt nonprofit organization to donate its
services for partisan political purposes. (A complaint was filed with
the Federal Election Commission; it was dismissed.)
That year, internal rivalries at Citizens for a Sound Economy caused
the organization to split apart. David Koch and Fink started a new
group, Americans for Prosperity, and they hired Tim Phillips to run
it. Phillips was a political veteran who had worked with Ralph Reed,
the evangelical leader and Republican activist, co−founding Century
Strategies, a campaign−consulting company that became notorious for
its ties to the disgraced lobbyist Jack Abramoff. Phillipss online
biography describes him as an expert in grasstops and grassroots
political organizing. The Kochs choice of Phillips signalled an even
greater toughness. The conservative operative Grover Norquist, who is
known for praising throat slitters in politics, called Phillips a
grownup who can make things happen.
Last year, Phillips told the Financial Times that Americans for
Prosperity had only eight thousand registered members. Currently, its
Web site claims that the group has á.2 million activists. Whatever
its size, the Kochs political involvement has been intense; a former
employee of the Cato Institute told me that Americans for Prosperity
was micromanaged by the Kochs. And the brothers investment may well
have paid off: Americans for Prosperity, in concert with the familys
other organizations, has been instrumental in disrupting the Obama
Presidency.
In January, 2008, Charles Koch wrote in his company newsletter that
America could be on the verge of the greatest loss of liberty and
prosperity since the 1930s. That October, Americans for Prosperity
held a conference of conservative operatives at a Marriott hotel
outside Washington. Erick Erickson, the editor−in−chief of the
conservative blog RedState.com, took the lectern, thanked David Koch,
and vowed to unite and fight . . . the armies of the left! Soon
after Obama assumed office, Americans for Prosperity launched
Porkulus rallies against Obamas stimulus−spending measures. Then
the Mercatus Center released a report claiming that stimulus funds had
been directed disproportionately toward Democratic districts;
eventually, the author was forced to correct the report, but not
before Rush Limbaugh, citing the paper, had labelled Obamas program
a slush fund, and Fox News and other conservative outlets had echoed
the sentiment. (Phil Kerpen, the vice−president for policy at
Americans for Prosperity, is a contributor to the Fox News Web site.
Another officer at Americans for Prosperity, Walter Williams, often
guest−hosts for Limbaugh.)
Americans for Prosperity also created an offshoot, Patients United
Now, which organized what Phillips has estimated to be more than three
hundred rallies against health−care reform. At one rally, an effigy of
New Yorker: The billionaire [Koch] brothers who are waging a war against Obama. 17
New Yorker: The billionaire [Koch] brothers who are waging a war against Obama.
a Democratic congressman was hung; at another, protesters unfurled a
banner depicting corpses from Dachau. The group also helped organize
the Kill the Bill protests outside the Capitol, in March, where
Democratic supporters of health−care reform alleged that they were
spat on and cursed at. Phillips was a featured speaker.
Americans for Prosperity has held at least eighty events targeting cap−
and−trade legislation, which is aimed at making industries pay for the
air pollution that they create. Speakers for the group claimed, with
exaggeration, that even back−yard barbecues and kitchen stoves would
be taxed. The group was also involved in the attacks on Obamas green
jobs czar, Van Jones, and waged a crusade against international
climate talks. Casting his group as a champion of ordinary workers who
would be hurt by environmentalists, Phillips went to Copenhagen last
year and staged a protest outside the United Nations conference on
climate change, declaring, Were a grassroots organization.. . . . I
think its unfortunate when wealthy children of wealthy families . .. .
want to send unemployment rates in the United States up to twenty per
cent.
Grover Norquist, who holds a weekly meeting for conservative leaders
in Washington, including representatives from Americans for
Prosperity, told me that last summers raucous rallies were pivotal in
undermining Obamas agenda. The Republican leadership in Congress, he
said, couldnt have done it without August, when people went out on
the streets. It discouraged deal−makersRepublicans who might
otherwise have worked constructively with Obama. Moreover, the
appearance of growing public opposition to Obama affected corporate
donors on K Street. K Street is a three−billion−dollar weathervane,
Norquist said. When Obama was strong, the Chamber of Commerce said,
We can work with the Obama Administration. But that changed when
thousands of people went into the street and terrorized congressmen.
August is what changed it. Now that Obama is weak, people are getting
tough.
As the first anniversary of Obamas election approached, David Koch
came to the Washington area to attend a triumphant Americans for
Prosperity gathering. Obamas poll numbers were falling fast. Not a
single Republican senator was working with the Administration on
health care, or much else. Pundits were writing about Obamas
political ineptitude, and Tea Party groups were accusing the President
of initiating a government takeover. In a speech, Koch said, Days
like today bring to reality the vision of our board of directors when
we started this organization, five years ago. He went on, We
envisioned a mass movement, a state−based one, but national in scope,
of hundreds of thousands of American citizens from all walks of life
standing up and fighting for the economic freedoms that made our
nation the most prosperous society in history. . . . Thankfully, the
stirrings from California to Virginia, and from Texas to Michigan,
show that more and more of our fellow−citizens are beginning to see
the same truths as we do.
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New Yorker: The billionaire [Koch] brothers who are waging a war against Obama.
While Koch didnt explicitly embrace the Tea Party movement that day,
more recently he has come close to doing so, praising it for
demonstrating the powerful visceral hostility in the body politic
against the massive increase in government power, the massive efforts
to socialize this country. Charles Koch, in a newsletter sent to his
seventy thousand employees, compared the Obama Administration to the
regime of the Venezuelan strongman Hugo Chávez. The Kochs sense of
imperilment is somewhat puzzling. Income inequality in America is
greater than it has been since the nineteen−twenties, and since the
seventies the tax rates of the wealthiest have fallen more than those
of the middle class. Yet the brothers message has evidently resonated
with voters: a recent poll found that fifty−five per cent of Americans
agreed that Obama is a socialist.
Americans for Prosperity, meanwhile, has announced that it will spend
an additional forty−five million dollars before the midterm elections,
in November. Although the group is legally prohibited from directly
endorsing candidates, it nonetheless plans to target some fifty House
races and half a dozen Senate races, staging rallies, organizing door−
to−door canvassing, and running ads aimed at educating voters about
where candidates stand.
Though the Kochs have slowed Obamas momentum, their larger political
battle is far from won. Richard Fink, interviewed by FrumForum.com
this spring, said, If you look at where weve gone from the year 2000
to now, with the expansion of government spending and a debt burden
that threatens to bankrupt the country, it doesnt look very good at
all. He went on, It looks like the infrastructure that was built and
nurtured has not carried the day. He suggested that the Kochs needed
to get more into the practical, day−to−day issues of governing.
In 1991, David Koch was badly injured in a plane crash in Los Angeles.
He was the sole passenger in first class to survive. As he was
recovering, a routine physical exam led to the discovery of prostate
cancer. Koch received treatment, settled down, started a family, and
reconsidered his life. As he told Portfolio, When youre the only one
who survived in the front of the plane and everyone else diedyeah,
you think, My God, the good Lord spared me for some greater purpose.
My joke is that Ive been busy ever since, doing all the good work I
can think of, so He can have confidence in me.
Koch began giving spectacularly large donations to the arts and
sciences. And he became a patron of cancer research, focussing on
prostate cancer. In addition to his gifts to Sloan−Kettering, he gave
fifteen million dollars to New York−Presbyterian Hospital, a hundred
and twenty−five million to M.I.T. for cancer research, twenty million
to Johns Hopkins University, and twenty−five million to the M. D.
Anderson Cancer Center, in Houston. In response to his generosity,
Sloan−Kettering gave Koch its Excellence in Corporate Leadership
Award. In 2004, President Bush named him to the National Cancer
New Yorker: The billionaire [Koch] brothers who are waging a war against Obama. 19
New Yorker: The billionaire [Koch] brothers who are waging a war against Obama.
Advisory Board, which guides the National Cancer Institute.
Kochs corporate and political roles, however, may pose conflicts of
interest. For example, at the same time that David Koch has been
casting himself as a champion in the fight against cancer, Koch
Industries has been lobbying to prevent the E.P.A. from classifying
formaldehyde, which the company produces in great quantities, as a
known carcinogen in humans.
Scientists have long known that formaldehyde causes cancer in rats,
and several major scientific studies have concluded that formaldehyde
causes cancer in human beingsincluding one published last year by the
National Cancer Institute, on whose advisory board Koch sits. The
study tracked twenty−five thousand patients for an average of forty
years; subjects exposed to higher amounts of formaldehyde had
significantly higher rates of leukemia. These results helped lead an
expert panel within the National Institutes of Health to conclude that
formaldehyde should be categorized as a known carcinogen, and be
strictly controlled by the government. Corporations have resisted
regulations on formaldehyde for decades, however, and Koch Industries
has been a large funder of members of Congress who have stymied the
E.P.A., requiring it to defer new regulations until more studies are
completed.
Koch Industries became a major producer of the chemical in 2005, after
it bought Georgia−Pacific, the paper and wood−products company, for
twenty−one billion dollars. Georgia−Pacific manufactures formaldehyde
in its chemical division, and uses it to produce various wood
products, such as plywood and laminates. Its annual production
capacity for formaldehyde is 2.2 billion pounds. Last December,
Traylor Champion, Georgia−Pacifics vice−president of environmental
affairs, sent a formal letter of protest to federal health
authorities. He wrote that the company strongly disagrees with the
N.I.H. panels conclusion that formaldehyde should be treated as a
known human carcinogen. David Koch did not recuse himself from the
National Cancer Advisory Board, or divest himself of company stock,
while his company was directly lobbying the government to keep
formaldehyde on the market. (A board spokesperson said that the issue
of formaldehyde had not come up.)
James Huff, an associate director at the National Institute for
Environmental Health Sciences, a division of the N.I.H., told me that
it was disgusting for Koch to be serving on the National Cancer
Advisory Board: Its just not good for public health. Vested
interests should not be on the board. He went on, Those boards are
very important. Theyre very influential as to whether N.C.I. goes
into formaldehyde or not. Billions of dollars are involved in
formaldehyde.
Harold Varmus, the director of the National Cancer Institute, knows
David Koch from Memorial Sloan−Kettering, which he used to run. He
New Yorker: The billionaire [Koch] brothers who are waging a war against Obama. 20
New Yorker: The billionaire [Koch] brothers who are waging a war against Obama.
said that, at Sloan−Kettering, a lot of people who gave to us had
large business interests. The one thing we wouldnt tolerate in our
board members is tobacco. When told of Koch Industries stance on
formaldehyde, Varmus said that he was surprised.
The David H. Koch Hall of Human Origins, at the Smithsonians National
Museum of Natural History, is a multimedia exploration of the theory
that mankind evolved in response to climate change. At the main
entrance, viewers are confronted with a giant graph charting the
Earths temperature over the past ten million years, which notes that
it is far cooler now than it was ten thousand years ago. Overhead, the
text reads, HUMANS EVOLVED IN RESPONSE TO A CHANGING WORLD. The
message, as amplified by the exhibits Web site, is that key human
adaptations evolved in response to environmental instability. Only at
the end of the exhibit, under the headline OUR SURVIVAL CHALLENGE,
is it noted that levels of carbon dioxide are higher now than they
have ever been, and that they are projected to increase dramatically
in the next century. No cause is given for this development; no
mention is made of any possible role played by fossil fuels. The
exhibit makes it seem part of a natural continuum. The accompanying
text says, During the period in which humans evolved, Earths
temperature and the amount of carbon dioxide in the atmosphere
fluctuated together. An interactive game in the exhibit suggests that
humans will continue to adapt to climate change in the future. People
may build underground cities, developing short, compact bodies or
curved spines, so that moving around in tight spaces will be no
problem.
Such ideas uncannily echo the Koch message. The companys January
newsletter to employees, for instance, argues that fluctuations in
the earths climate predate humanity, and concludes, Since we cant
control Mother Nature, lets figure out how to get along with her
changes. Joseph Romm, a physicist who runs the Web site
ClimateProgress.org, is infuriated by the Smithsonians presentation.
The whole exhibit whitewashes the modern climate issue, he said. I
think the Kochs wanted to be seen as some sort of high−minded company,
associated with the greatest natural−history and science museum in the
country. But the truth is, the exhibit is underwritten by big−time
polluters, who are underground funders of action to stop efforts to
deal with this threat to humanity. I think the Smithsonian should have
drawn the line.
Cristián Samper, the museums director, said that the exhibit is not
about climate change, and described Koch as one of the best donors
weve had, in my tenure here, because hes very interested in the
content, but completely hands off. He noted, I dont know all the
details of his involvement in other issues.
The Kochs have long depended on the publics not knowing all the
details about them. They have been content to operate what David Koch
has called the largest company that youve never heard of. But with
New Yorker: The billionaire [Koch] brothers who are waging a war against Obama. 21
New Yorker: The billionaire [Koch] brothers who are waging a war against Obama.
the growing prominence of the Tea Party, and with increased awareness
of the Kochs ties to the movement, the brothers may find it harder to
deflect scrutiny. Recently, President Obama took aim at the Kochs
political network. Speaking at a Democratic National Committee fund−
raiser, in Austin, he warned supporters that the Supreme Courts
recent ruling in the Citizens United casewhich struck down laws
prohibiting direct corporate spending on campaignshad made it even
easier for big companies to hide behind groups with harmless−sounding
names like Americans for Prosperity. Obama said, They dont have to
say who, exactly, Americans for Prosperity are. You dont know if its
a foreign−controlled corporationor even, he added, a big oil
company. f
http://www.newyorker.com/reporting/2010/08/30/100830fa_fact_mayer
.
New Yorker: The billionaire [Koch] brothers who are waging a war against Obama. 22