Thursday, April 07, 2016

Dark Money: The Hidden History of the Billionaires Behind the Rise of the Radical Right

STOP THE PRESSES! Run, don't walk, to read Jane Mayer's Dark Money: The Hidden History of the Billionaires Behind the Rise of the Radical Right, which I just finished reading. Mayer, a reporter for the New Yorker since 1995, exposes the secret web of ultra-wealthy individuals, families and businesses, most notably the Koch Brothers, who have pushed, with enormous success, a radical libertarian agenda, which traces back to the John Birch Society, that – surprise! – aligns perfectly with their self-interest, most notably to pay lower taxes and reduce (ideally to zero) regulation of Koch Industries, the #1 producer of toxic waste in the country in 2012.


It is truly frightening how much power the "Koch Network" has – in many ways, it's larger and more influential than the Republican Party – and how it's used this power.


Here are excerpts from the NY Times' review of Meyer's book (my emphasis added):

"Dark Money," the result of Ms. Mayer's research, is a persuasive, timely and necessary story of the Koch brothers' empire. It may read overly long and include some familiar material, but only the most thoroughly documented, compendious account could do justice to the Kochs' bizarre and Byzantine family history and the scale and scope of their influence.

…The 1980 platform of the Libertarian Party, to which the Koch brothers provided financial support and on which David Koch ran for vice president, offered a preview of their anti-government zealotry. The Libertarians opposed federal income and capital gains taxes. They called for the repeal of campaign finance laws; they favored the abolition of Medicaid and Medicare and advocated the abolition of Social Security and the elimination of the Federal Election Commission, the Securities and Exchange Commission, the Environmental Protection Agency, the Food and Drug Administration and the Occupational Safety and Health Administration. "The platform was, in short," Ms. Mayer concludes, "an effort to repeal virtually every major political reform passed during the 20th century."

Not surprisingly, given the extremism of their views, which William F. Buckley Jr. characterized as "Anarcho-Totalitarianism," the Libertarians polled less than 1 percent of the votes. Ronald Reagan was elected president.

As Ms. Mayer notes, the Kochs, instead of accepting the voters' verdict, chose to spend money changing the way Americans voted. "During the next three decades," Ms. Mayer writes, "they contributed well over $100 million, much of it undisclosed, to dozens of seemingly independent organizations aimed at advancing their radical ideas."

…The Koch brothers and their allies insist, and no doubt believe, that their war on big government has been motivated by their commitment to the individual freedoms that government interferes with. Still, "it was impossible not to notice," Ms. Mayer writes, "that the political policies they embraced benefited their own bottom lines first and foremost. Lowering taxes and rolling back regulations, slashing the welfare state and obliterating the limits on campaign spending might or might not have helped others, but they most certainly strengthened the hand of extreme donors with extreme wealth."

One of the more startling revelations in Ms. Mayer's book concerns the number of billionaires in the Koch network who have had "serious past or ongoing legal problems" and whose companies have been fined for violations of the Clean Air and the Clean Water Acts. Koch Industries, she reports, has been perhaps the most flagrant and willful polluter and scofflaw. According to the Environmental Protection Agency's database, it was the No. 1 producer of toxic waste in the country in 2012.

If you don't have time to read the entire book, then I suggest reading the in-depth article Meyer published in the New Yorker in January (full text below), New Koch: The billionaire brothers are championing criminal-justice reform. Has their formula changed?, which mirrors her book. Here are excerpts:


Starting in 2010, a controversial series of rulings by the federal judiciary and the Supreme Court essentially licensed unlimited political spending by corporations, unions, and individuals. Charles and David—a seventy-five-year-old patron of the arts, who is the wealthiest resident of Manhattan—were unusually prepared to take advantage of this shift. They had set up a broad alliance of donors and advocacy organizations to support conservative candidates who share their "pro-business" opposition to regulation, entitlements, and taxes. This network has since become one of the most powerful political forces in the country: a libertarian advocacy group backed by the brothers, Americans for Prosperity, has directors in thirty-four states. According to Politico, twelve hundred people work full-time for the Koch network—more than three times the number of people who work for the Republican National Committee.


A new, data-filled study by the Harvard scholars Theda Skocpol and Alexander Hertel-Fernandez reports that the Kochs have established centralized command of a "nationally-federated, full-service, ideologically focused" machine that "operates on the scale of a national U.S. political party." The Koch network, they conclude, acts like a "force field," pulling Republican candidates and office-holders further to the right. Last week, the Times reported that funds from the Koch network are fuelling both ongoing rebellions against government control of Western land and the legal challenge to labor unions that is before the Supreme Court.


Onstage in Wichita, Charles barely discussed his political spending. And he did not mention that, for the 2016 election cycle, he has organized a small circle of ultra-wealthy conservatives to spend nearly nine hundred million dollars on campaigns and advocacy—an unprecedented sum. The identities of the circle's other members have remained secret. This private jackpot is more than twice the sum that was spent by the Republican National Committee in the 2012 Presidential-election race. Most of the leading Republican Presidential candidates have attended gatherings of the donor circle in the hope of winning its financial backing.


The Koch brothers have been widely criticized by Democrats for their systematic attempt to use money to sway elections. In 2014, Guy Cecil, then the executive director of the Democratic Senatorial Campaign Committee, declared, "The Koch brothers are spending a fraction of their personal fortune to buy a Senate that is good for them and bad for almost every other family in America."


Rena Steinzor, a law professor at the University of Maryland, who argued for tougher treatment of corporate crime in her 2014 book, "Why Not Jail?," agrees with Uhlmann. "The Koch brothers are playing a long game that has as its ultimate goal reducing the federal government to a size so small it is difficult for us to comprehend," she warns. "It would literally be confined to currency, roads, and foreign affairs. Public-health protections would be gone."


Here are excerpts on how the Kochs are spending huge sums to improve their image:


…As the Kochs prepare to launch the most ambitious political effort of their lives, they appear to be undergoing the best image overhaul that their money can buy.


…"They are embarked on an extraordinary exercise in rebranding," David Axelrod, the former political adviser to President Barack Obama, said of the Kochs.


… Mike Paul, the president of Reputation Doctor, a public-relations firm based in Manhattan, also views efforts such as the libre Initiative as attempts to improve the Kochs' image. He points out that a string of huge legal judgments against Koch Industries had given the brothers a reputation as "the heads of the Toxic Empire." In 1999, a jury ordered the company to pay nearly three hundred million dollars—then the largest wrongful-death judgment of its kind in history—after one of its butane pipelines exploded, killing two teen-agers. (The company appealed, then settled the case for an undisclosed amount.) More recently, researchers at the University of Massachusetts Amherst, using statistics from the Environmental Protection Agency, found that Koch Industries was one of only three companies in America that ranked in the top thirty for air, water, and climate pollution. Paul suggested that the Kochs, in order "to win people over," decided that they had to "look more compassionate—and so their theme is that they care about the poor."


... as the Koch brothers planned their next moves they embraced Brooks's notion that, if conservatives wanted to stop being stereotyped as representing just the one per cent, they had to be seen as champions of the other ninety-nine per cent.


The need for a new sales pitch was urgent. Around the time that Arthur Brooks was advising conservatives to appear more compassionate, the Times reported on its front page that Koch Industries had piled thirty-foot-high mounds of petroleum coke—a by-product of oil refining that is sold abroad as fuel—next to a poor, inner-city neighborhood in Detroit. Residents complained that the filthy soot was coating everything. Gary Peters, then a Democratic congressman from Detroit and now a U.S. senator, recalls, "It was getting into residents' lungs in poor neighborhoods where people already had to put up with quite a lot."


Lastly, here are excerpts on how the Kochs are cynically partnering with liberal groups to bring about criminal justice reforms:


…Fink, during his speech to the donors, explained that another way to "earn the respect and good feeling" of the "middle third" was to publicize partnerships with unlikely allies. He talked up Koch Industries' partnerships with the United Negro College Fund and the National Association of Criminal Defense Lawyers, both of which the company had financially supported, on a smaller scale, for years.


In 2004, the company gave the National Association of Criminal Defense Lawyers money to help it start a new initiative that would focus on ways to strengthen white-collar-criminal defense. The initiative featured numerous joint projects with the conservative Heritage Foundation, which also was determined to combat "over-criminalization." The anti-government tenor of the effort meshed perfectly with the Kochs' outlook. As Holden puts it, "The criminal-justice system is a big-government program that has failed miserably."


David Uhlmann, who is now a law professor at the University of Michigan, argues, "The Koch brothers are not interested in criminal-justice reform because they suddenly became interested in the number of poor and minority Americans who are in prison. By their own admission, they became interested because they were prosecuted in Corpus Christi. They and their allies want to take us back to 1970, before the regulatory state."


Random trivia: The Koch brothers' father was one of the 11 founders of the John Birch Society in 1958 and, in the 1930s, helped create the initial family fortune by building oil refineries for Stalin and Hilter – the latter was a pet project of Hitler's and helped fuel the Nazi war machine.


For further reading, here is a link to Meyer's original piece on the Koch Brothers from August 2010, entitled Covert Operations: The billionaire brothers who are waging a war against Obama. The Kochs were so upset by the article that they hired six people plus a private investigative firm to dig up dirt to smear Meyer – fortunately with no success.

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