PROFILE THE KOCH BROTHERS:WHAT'S THE WORLD coming to when a billionaire can't buy a presidential candidate or shut down a labour union?
This was not a good week for the richest brothers in the US, Charles and David Koch (pronounced Coke), respectively chief executive and executive vice-president of Koch Industries, the oil, gas and chemical conglomerate that is believed to be the world’s second-largest privately held company, with an estimated annual revenue of $100 billion (€73 billion).
The Koch brothers’ attempts to choose the Republican presidential nominee are endangered by the sexual harassment scandal involving candidate Herman Cain, and a union-bashing law they sponsored in Ohio was repealed by voters.
The brothers’ combined personal fortune of $50 billion is surpassed in the US only by those of Bill Gates and Warren Buffett. For more than three decades the Koch brothers, now in their 70s, have been éminences grises in conservative politics, synonymous with big, secret money and manipulation. They are believed to have given more than $100 million to right-wing causes, at least half of it to discredit scientific evidence of climate change. They have given even more to philanthropy, especially the arts and cancer research.
A University of Massachusetts study last year named Koch Industries as one of the top-10 air polluters in the US. David Koch has argued that global warming is a good thing, as “Earth will be able to support enormously more people because far greater land area will be available to produce food”.
An article published by Bloomberg News and the Washington Postin October recounted the alleged misdeeds of Koch Industries going back to the late 1980s. These included bribing officials abroad to gain contracts, selling petrochemical equipment to Iran (albeit legally), liability for a pipeline explosion that killed two teenagers in Texas, falsifying records about the amount of oil extracted from Native American lands, and lying about emissions of carcinogenic benzene at a refinery. Koch Industries complained bitterly about the article and posted a rebuttal on KochFacts.com.
The Koch brothers were the invisible hand behind the rise of the supposedly grassroots movement known as the Tea Party. Under cover of the Supreme Court’s Citizens United decision, which allows unlimited anonymous corporate donations to political campaigns, the Koch brothers reportedly intend to spend up to $200 million (€147 million) to defeat Barack Obama’s bid for re-election to the presidency.
“If not us, who?” Charles Koch wrote in a letter inviting wealthy Republicans to a strategy session in Rancho Mirage, California, to plot the downfall of Obama. The Republican hopeful Herman Cain attended that meeting, in January this year. “It is up to us to combat what is now the greatest assault on American freedom and prosperity in our lifetimes,” Koch added.
David Koch calls Obama “a hard-core socialist”. At a speech in Colorado last June, Charles Koch predicted that the 2012 contest will be “the mother of all wars”, a battle “for the life or death of this country”. In the run-up to last year’s midterm elections, which the Republicans won, Obama warned that groups with “benign-sounding” names, such as Americans for Prosperity – founded by David Koch in 2004 – were in danger of carrying out “a corporate takeover of our democracy”.
The meteoric rise of Herman Cain, former chief executive of Godfather’s Pizza and, until this week, Republican frontrunner, is a case in point. After a spell as chief lobbyist for the National Restaurant Association in Washington, Cain was hired by Mark Block (now Cain’s campaign manager) when Block headed the Wisconsin branch of Americans for Prosperity. Block founded an offshoot of Americans for Prosperity called Prosperity USA. It financed the early stages of Cain’s campaign, apparently in violation of election laws which forbid tax-exempt non-profits from financing campaigns.
In a keynote address to an Americans for Prosperity gala at the Washington Convention Centre last weekend, Cain declared: “I am the Koch brothers’ brother from another mother, and proud of it.”
David Koch leaped from his front-row seat, punched his fist in the air and danced a little jig while the audience cheered. When Cain left the stage, Koch walked out behind him.
While guests tried to eat their Tribute to Ronald Reagan dinner, close to 1,000 demonstrators from the Occupy movement pressed up against the glass walls and attempted to push through the glass doors when guests entered or departed. Some of the demonstrators covered their faces with masks or bandannas.
Amid scuffles and chaos, David Koch, the $25-billion man whose name was being chanted in a protest song, walked calmly out the front door, surrounded by friends and bodyguards, apparently unrecognised by protesters.
The Koch brothers cultivate anonymity. David Koch likes to call their conglomerate “the largest company you’ve never heard of”. But their notoriety is growing. The liberal group Common Cause picketed the meeting at Rancho Mirage with banners saying “quarantine the Kochs”.
Now the Kochs’s “brother from another mother” is mired in a sexual-harassment scandal, and his ability to win the Republican nomination is in doubt. To add insult to injury, the citizens of Ohio voted by a 61 per cent majority on Tuesday to repeal a law that virtually revoked collective-bargaining rights for public-sector employees in that state. The law, and similar legislation in Wisconsin, was drafted by the American Legislative Exchange Council, which is funded by the Koch brothers.
Cain's floundering campaign and the set-back in the war on trade unions are not likely to deter the Kochs. They are about to launch a nationwide database called Themis, after the Greek goddess who imposed order on human affairs, according to the Guardianthis week. The brothers have invested $2.5 million (€1.8 million) in Themis, which gathers together all the the telephone numbers, e-mail addresses and personal information about occupation and income collected by conservative groups across the country.
It will be a formidable tool in next year’s election, comparable to the Catalyst system devised by the Democrats after they lost the 2004 presidential election.
David Koch embraced politics openly as the vice-presidential candidate for the Libertarian Party in 1980. As recounted in Jane Mayer’s in-depth investigation of the Koch Brothers, published by the New Yorker, the party platform called for the abolition of the FBI, the CIA, the Securities and Exchange Commission and the US department of energy. It wanted to end income and corporate tax, social security, the minimum wage and all gun control. In the name of personal liberty, it would have legalised prostitution and recreational drugs.
The Koch brothers revised their strategy after David's team won only 1 per cent of the vote. Brian Doherty, the editor of the libertarian magazine Reason, explained their plan in his book Radicals for Capitalism.
The Kochs see politicians as “actors playing out a script”, according to Doherty, and they want “to supply the themes and words for the scripts”. They have created what is known as the “Kochtopus”, a network of conservative organisations, including the Cato Institute, the Heritage Foundation and the Mercatus Center at George Mason University, in Virginia. These think tanks generate studies casting doubt on climate change or condemning government regulation.
Organisations such as Americans for Prosperity are more crude. At a meeting arranged by the group in Texas last year, and recounted by Mayer in the New Yorker, its blogger-of-the-year award was given to Sibyl West, a young woman who described Obama as the "cokehead in chief" and said he showed symptoms of "demonic possession (aka schizophrenia, etc)".
Since 2009 the Koch brothers have worked hard to undermine Obama. Americans for Prosperity staged “Porkulus” rallies to mock the president’s economic-stimulus plan. A bogus study by the Mercatus Center, which alleged that stimulus money was directed to Democratic districts, was quoted by the right-wing radio announcer Rush Limbaugh as proof that Obama used the money as a “slush fund.” Americans for Prosperity started a group called Patients United Now, which held hundreds of rallies against Obama’s healthcare Bill.
This orchestrated groundswell of opinion against Obama’s policies dissuaded Republican politicians from working with the president, and discouraged potential donors.
Charles Koch defended the brothers' anti-government crusade in the Wall Street Journallast winter. "Because of our activism, we've been vilified by various groups," he wrote. "Despite this criticism, we're determined to keep contributing . . . Even if it affects our business, as a matter of principle our company has been outspoken in defence of economic freedom. This country would be much better off if every company would do the same. Instead, we see far too many businesses that paint their tails white and run with the antelope."
Curriculum vitae
Who are they?Billionaire owners of Koch Industries and backers of the Tea Party and other right-wing movements.
Why are they in the news?The presidential campaign of Herman Cain, their brother from another mother, is beset with sexual-harassment allegations. And they are about to launch Themis, a database of conservative voters in the US.
Most appealing characteristicHundreds of millions of dollars in donations to philanthropic causes.
Least appealing characteristicTake your pick from secrecy, distortion of climate-change science and dirty tricks against Obama.
