THE NEWS: Bloomberg News recently published a scathing indictment of the Koch brothers, two modern-day tycoons who have used their considerable financial clout to finance tea party activities and corporate lobbying campaigns, while engaging in business practices that can best be described as questionable.
THE PROVOCATION: The following is a compendium of pertinent facts about the Koch (pronounced "coke") brothers, who have fought against efforts to curb global warming while promoting corporate interests, undermining labor unions and funding ultra-conservative groups. The material gathered here is condensed from information provided in the Bloomberg piece, as well as in articles by The New York Times, Los Angeles Times, ThinkProgress and other sources.
What emerges is a picture of a 21st century Andrew Carnegie in David Koch - a philanthropist who has spent millions to fund charitable enterprises but has put even more money on far less noble endeavors: 1) Paying fines for his company's illegal business practices and 2) Funding political efforts that will ultimately undermine the welfare of corporate employees and the public at large.
The list that follows is designed to serve as an easy reference source of material on the Koch brothers and their activities.
- David Koch, born May 3, 1940
- Charles Koch, born Nov. 1, 1935
- Political philosophy: Libertarian
- Net worth: $22 billion each (their combined wealth is surpassed only by Bill Gates and Warren Buffett among Americans).
- Position: Co-owners, Koch Industries.
- Annual revenue: $110 billion
- Products: Dixie Cups, Brawney Paper Towels, Quilted Northern bath tissue and other Georgia-Pacific products; Lycra fiber; Stainmaster carpets.
- Koch also operates:
- Refineries in Texas, Alaska and Minnesota that can process 800,000 barrels of oil a day.
- More than 400 miles of crude oil, petroleum, chemical and natural gas pipelines.
- Koch Minerals, which markets and trades more than 40 million tons of coke, coal, cement and similar products annually.
- Koch Fertilizer, which has the capacity to market and distribute more than 10 million tons of nitrogen fertilizer products a year.
- Koch Agriculture Co., which owns 15,000 head of cattle on three ranches in Texas, Montana and Kansas.
- The Koch brothers' father, Fred Koch, once served on the top board of the John Birch Society.
- David Koch ran for vice president on the Libertarian ticket with Ed Clark in 1980. The ticket promised to abolish:
- Social security
- Minimum-wage laws
- Corporate taxes
- Regulatory agencies including the SEC, FTC, EPA, OSHA and Interstate Commerce Commission.
- According to Bloomberg, "virtually every Republican candidate for president - including Texas Governor Rick Perry and Minnesota Congresswoman Michele Bachmann - has solicited the group's support."
- Bloomberg: "The brothers have backed a foundation that has trained thousands of tea party activists."
- The Koch political action committee, KochPAC, donated $50,000 to Perry's gubernatorial campaign last year.
- Oil and gas lobbying expenditures for Koch Industries from January 2006 to December 2009 totaled $37.9 million.
- Koch Industries is closely tied to tea party favorite Herman Cain, ThinkProgress reports. Cain once held an official position in the Koch-funded organization Americans for Prosperity. His chief of staff, Mark Block, also served as president of that same group's Wisconsin chapter.
- The Koch brothers have hosted lavish conferences at places like the Rancho Las Palmas Resort & Spa in Palm Springs to talk strategy with conservative stalwarts such as commentators Glenn Beck, Rush Limbaugh; Supreme Court Justices Antonin Scalia and Clarence Thomas; and Republican Sens. Jim DeMint, Bobby Jindal, Tom Coburn, Paul Ryan, Haley Barbour and Mike Pence.
- Dick Armey's FreedomWorks, a major sponsor of the tea party movement, received $12 million from Koch family foundations.
- Koch Industries named one of the top 10 U.S. polluters by the University of Massachusetts at Amherst’s Political Economy Research Institute in 2010.
- Koch Industries proclaimed the "kingpin of climate science denial" by Greenpeace in 2010.
- Koch brothers spent more than ExxonMobil between 2005 and 2008 fighting to defeat climate change legislation.
- Koch brothers labeled "the nation's most prominent funders of efforts to prevent curbs on fossil-fuel burning" in an article by Los Angeles Times reporter Margot Roosevelt.
- According to Bloomberg, Koch has received five criminal convictions for violating environmental rules in the U.S. and Canada since 1999, paying $400 million in fines between 1999 and 2003.
- Americans for Prosperity circulated a pledge among members of the House Energy and Commerce Committee to oppose the Obama administration's plan to regulate greenhouse gases. Nine of the 12 Republican committee members signed it.
- In 1999, a Koch unit in Minnesota, paid $8 million in fines and penalties after pleading guilty to two federal misdemeanors of violating the Clean Water Act. It used fire hydrants to pump a million-plus gallons of wastewater tainted with ammonia onto the ground.
- David Koch was quoted in a 2000 New York Magazine article as saying, global warming would help the planet "support enormously more people because a far greater land area will be available to produce food."
- Bloomberg reports that Koch Industries fired its own ethics officer after she reported a subsidiary in France had used bribes to win contracts. Ludmila Egorova-Farines said the practices "were not hidden at all." In the end, Bloomberg says, they were uncovered in six countries, and Koch later acknowledged that "those activities were violations of criminal law."
- According to Bloomberg, Koch has sold "millions of dollars of petrochemical equipment to Iran, a country the U.S. identifies as a sponsor of global terrorism."
- Koch's refinery unit paid $20 million in fines and penalties after a guilty plea to a 2001 felony charge of lying to regulators.
- Koch pipeline unit was found negligent in a butane pipeline blast that killed two teenagers. A Texas jury imposed a $296 million penalty in 1999.
- KoSa, a 50-50 joint venture between Koch and the Saba family of Mexico, paid a $28.5 million fine after pleading guilty to a felony restraint-of-trade charge in 2002.
- A Senate committee concluded that Koch was responsible for a scheme to take 1.95 million barrels of oil from Indian land in Oklahoma without paying for it in the late 1980s. The company was never indicted.
- In 1999, a civil jury found that Koch had made 24,587 false claims in buying oil, and that the company had underpaid the government for royalties on Native American land from 1985 to 1989, Bloomberg reports.
- Koch brothers gave more than $17 million between 1997 and 2008 to lobby for legislation opposing labor unions.
- KochPAC was the second-biggest donor to Scott Walker's 2010 campaign for governor of Wisconsin. Walker led the fight to limit collective bargaining for public employees in the state after his election.
One should mention that the David Koch has also made numerous charitable contributions and funded several community projects, not the least of which has been a $100 million pledge over 10 years to renovate the New York State Theater. He has also given the same amount to the Massachusetts Institute of Technology, along with tens of millions to medical, surgical and cancer centers across the country.
In this respect, he seems to be emulating, at least to some extent, a well-known business magnate and philanthropist from more than a century ago, Andrew Carnegie. The latter was known for his generous gifts to and establishment of public institutions, particularly Carnegie Hall and several public libraries. But he was also known, like Koch, for being a fierce opponent of labor rights. His employees worked long hours in often hazardous conditions, and some ended up dying on the job. Historians today debate whether Carnegie was a hero or a villain, but it seems unlikely there would have been much debate among his often underpaid, overworked employees.
The same goes for David Koch. He can try to ease his conscience with philanthropy, but if he's making that money off the sweat and tears of people who won't be able to ever enjoy the benefits of the health centers Koch is funding (for lack of affordable insurance) it's at best an empty gesture. And it's worse than that when one considers the hundreds of millions paid in government fines and lobbying efforts that are the very definition of self-serving. Koch brothers are no heroes. They are, like the sweatshop and factory owners of the 19th century, out to fatten their wallets at the expense of the rest of us. And just as Carnegie's workers reacted by protesting at Homestead (a work action brutally put down by private thugs hired by Carnegie's partner), the Occupy Wall Street crowd is reacting to corporate abuses by the likes of the Koch brothers by protesting today.
It seems that we who have refused to learn our lessons from the past are now forced to repeat them in an increasingly divided and contentious present.
* Nonetheless, it removed Egorova-Farines from the case for alleged incompetence. She sued, claiming wrongful termination. Koch has disputed the Bloomberg report.