Outlined Summary of Dark Money by Jane Mayer

Summary of Dark Money by Jane Mayer (paperback pg#s)

“Extractive” industries – oil, gas, and mining – rely on government permits, tax laws, etc. for access to public lands and help with their profits but are among the biggest attackers of government regulation [21] – particularly environmental regulation
Charles Koch (with his younger brother, David Koch, who died in 2019)
1. As of 2024, Julia Koch (David’s wife) & family, 23rd of the world’s richest at $64.3 billion; Charles Koch & family, 25th of the world’s richest at $58.5 billion
  1. In 2009, the brothers had been 6th and 7th richest in the world, with $14 billion each
2. Around the age of 30, Charles entered the apartment of the oldest brother, Fred Jr., without his permission and found compromising personal information to blackmail Jr., as Fred Sr. was in fragile health, dying two years later in 1967, as told in a sworn deposition of the youngest brother Bill. Charles, the second oldest of the four brothers, pressured Fred Jr. to turn over his shares of the family company to his three younger brothers. Otherwise, Charles would expose Fred Jr. as a homosexual to their father, injuring his health and resulting in Fred Jr.’s disinheritance [58]
3. About 16 years later, in 1983, Charles and David bought out their two other brothers’ shares for about $1.1 billion to become 80% owners of Koch Industries, split evenly. But fraternal litigation continued for 17 more years. [61]
4. After the 1962 publication of Rachel Carson’s Silent Spring, exposing the devastating environmental fallout from irresponsible chemical practices, Congress passed the Clean Air Act, the Clean Water Act, the Toxic Substances Control Act, and other laws creating the modern regulatory state. [90]
5. In 1970, legislation created the Environmental Protection Agency and the Occupational Safety and Health Administration. In developing regulations, the EPA was directed to weigh only one concern – public health. Costs to industry were deemed irrelevant. [90]
6. Charles transformed his private foundation into the Cato Institute [date? 106], giving $10-20 million of tax-deductible donations over its first 3 years to the nation’s first libertarian think tank. [106] Ed Crane, Cato’s president, “would always call Wichita and run everything by Charles. It was quite clear that Koch was in charge.” [107]
  1. Ed Crane quotes his conversation with Charles Koch to start the Cato Institute, “I said my bank account was empty. He said, ‘How much do you need?’ [Crane:] ’A libertarian think tank along the model of Brookings or AEI might be nice’. [Koch:] ’I’ll give it to you’.” [107]
7. Owner (sole?) of Koch Industries
  1. Second largest private company in America
    1. Owning: [5]
      1. four thousand miles of pipelines [5]
      2. oil refineries in Alaska, Texas and Minnesota [5]
      3. the Georgia-Pacific lumber and paper company [5]
      4. coal [5] (the C. Reiss Coal Company [264]
      5. chemicals [5]
      6. Fertilizer, petroleum coke manufacturing, timber, leases on over a million acres of untapped Canadian oil sands [264]
      7. huge traders in commodities futures [5]
    2. His father Fred Koch became rich by building oil refineries for the Stalin and Hitler regimes in the 1930s [34-37]
    3. By 1975, the government had charged the company with violating federal oil price controls and overcharging $10 million for propane gas. [106]
    4. In 1989, the U.S. Senate released a scathing report accusing Koch of “a widespread and sophisticated scheme to steal crude oil from Indians and others through fraudulent mis-measuring”. [159] Senate investigators said “It wasn’t like politics; it was like investigating organized crime”. [160] One witness noted, “They’ve got more money than many small countries do” [161] The report was the result of other oil companies secretly turning Koch in for cheating, since they did not have substantial measurement problems. [159]
    5. In 1995, the Justice Department sued Koch for lying about leaking millions of gallons of oil from its pipelines and storage facilities in 6 different states. [154] Federal investigators documented over 300 oil spills during the previous 5 years, including one 100,000 gallon crude oil spill that left a 12 mile long slick in the bay off of Corpus Christi, not far from the Koch refinery. [154] Angela O’Connell, the lead federal prosecutor, suspected her trash was being searched and her phone bugged, but in the end, she prevailed when Koch Industries agreed to pay a $30 million fine, the biggest in history to that point, for violations of the Clean Water Act. [154-155]
    6. In 1999, the jury awarded plaintiff Danny Smalley almost three times his requested $100 million in damages for the death of his daughter from the explosion of butane gas from one of Koch’s corroded pipelines, $296 million – the largest wrongful death award on record. [156-159]
    7. After the 1989 Senate report, Bill Koch, the youngest Koch brother, was told by one news outlet that his two older brothers could go to jail but replied “Then lock ‘em up! I did not want my family, my legacy, my father’s legacy, to be based on organized crime.” [161] He had sued his brothers for allegedly deliberately undervaluing the company and cheating him of his fair share of the family fortune. [162] So after the following criminal prosecution failed, Bill filed a whistle-blower lawsuit under the False Claims Act against Koch Industries [163-164] and found a former employee who worked his way up from a “gauger” measuring crude oil when buying from suppliers to senior management, Phil Dubose, to take the stand about “the Koch Method” who testified:
      1. “They were just mis-measuring crude oil from the Indian reservations as they did all over the U.S. If you bought crude, you’d shorten the gauge. They’d show you how. They had meters in the field. They’d recalibrate them, so if it showed a barrel, they’d say it was just three-quarters of a barrel when they were buying it. You did it in different ways. You cheated. If we sold a barge with fifteen hundred barrels, you’d say it was two thousand. It all involved weights and measurements, and they had their thumb on the scale. That was the Koch Method.” [166]
      2. “The Kochs never did play by the rules. They had their own playing field. They just didn’t abide by anything. Not the EPA or anything else. They constantly polluted. If they got fined, it didn’t matter because they made so much money doing it. We never reported things like busted pipeline out in the field. Otherwise, we’d get fined. When we spilled oil, we never reported the real amount. We were told to do that, to keep our costs down. The Kochs expected us to lie and try to cover it up.” [167] A book, Sons of Wichita by Daniel Schulman, details their serial lawbreaking. [154]
      3. “You don’t have to be a genius like Bill Gates to make money the way they did. They just did it by breaking the rules all over the country.” [167]
      4. When the lawsuit settled for $25 million (less than the potential $200 million) with most going to the federal government and a quarter going to Bill plus his legal fees, Dubose said, “It was the first time they were defeated. We won because they didn’t have a weapon as big as the one we used. The truth.” [168]
    8. By mid-2001 the warring brothers reached a ceasefire known as the “global settlement”, where Charles, David, and Bill agreed to no further litigation and a binding non-disparagement clause that imposed hefty escalating financial penalties for violations. [168]
    9. EPA ranked Koch Industries as one of only three companies in America that was simultaneously a top ten polluter of air, water and climate [date? xiv]
    10. Koch Industries alone routinely released some 24 million tons of carbon dioxide into the atmosphere a year. [264]
    11. In 2010, despite some improvement, Koch Industries was still rated one of the top ten air polluters in the United States, by Political Economy Research Institute at the University of Massachusetts Amherst. [168]
    12. In 2012, the EPA’s database revealed Koch Industries was the #1 producer of toxic waste – 950 million pounds. [168-169], [338] It also released 56.8 million pounds of hazardous materials into the air, water, and soil, making it the country’s 5th largest polluter. [338]
    13. After the lawsuits and prosecutions, the Kochs sold off many of their most troublesome pipelines, paring their holdings down to 4000 miles, and moved heavily into the finance sector, trading commodities and derivatives, where regulations and oversight were weaker. [169] They diversified rapidly, acquiring DuPont’s synthetic textile division, Invest, for $4.1 billion in 2004, making them the world’s producers of Lycra and other well-known brands such as StainMaster carpet. [169] In 2005, they bought out Georgia-Pacific, the huge wood-products company, for $21 billion, making them one of the world’s biggest manufacturers of plywood, laminates, and ubiquitous paper products like Dixie cups, Brawny paper towels, and Quilted Northern toilet paper, as well as a major producer of formaldehyde. [169]
8. Corporate lobbying [xvi] legal organizations, lobbyists [xviii]
  1. By 1990, enterprising conservative and libertarian activists were wearing a path to Wichita to pitch their proposals to Charles Koch in hopes of his patronage. [178]
    1. In 1991, William “Chip” Mellor, III, a former Reagan administration lawyer, proposed an aggressive, right-wing public interest law firm that would litigate against government regulations in favor of “economic liberty”. [178] Charles Koch said, “Here’s what I’m going to do. I’ll give you up to $500,000 a year for three years, each year, but you’ll have to come back each year and demonstrate that you’ve met these milestones that you’ve set out to accomplish and I will evaluate it on a yearly basis, and there’s no guarantees.” [178] The legal group, the Institute for Justice, went on to bring numerous successful cases against government regulations, including campaign-finance laws, several of which reached the Supreme Court. [178]
  2. From 1998-2008, Koch Industries spent more than $50 million on lobbying. [1998-2008, 179]
  3. Another member of the Koch network, Richard DeVos ($5.7 billion) [no date, 21], cofounder of Amway, Michigan-based MLM empire, led similar efforts to take political action and change laws after pleading guilty to defrauding the Canadian government (from 1965-1978 [285]) of $22 million in customs duties in 1982. [20]
    1. In 1980, Richard DeVos and Jay Van Andel, cofounders of Amway, became the top spenders on behalf of Ronald Reagan’s presidential candidacy. [285] By 1981, Richard DeVos was the finance chair of the Republican National Committee (RNC), which Jay Van Andel headed the U.S. Chamber of Commerce. [285]
    2. Amway gave $2.5 million to the Republican Party during the 1994 midterm elections, which was the largest known soft money donation from a corporation in the country’s history. [287]
    3. Richard Junior, known as Dick, married the other royal family of Michigan’s Dutch Reformed community, Betsy Prince, whose father, Edgar Prince, founded an auto parts manufacturing company that sold for $1.35 billion in cash in 1996, while her brother, Erik Prince, founded the global security firm Blackwater, which reporter Jeremy Scahill described as “the world’s most powerful mercenary army”. [287]
    4. Betsy DeVos eventually became the chairwoman of Michigan’s Republican Party.
    5. The DeVos family funded legal challenges to various campaign finance laws for years. In 1997, Betsy DeVos became a founding member of the James Madison Center for Free Speech, a nonprofit organization whose only goal was to end all restrictions on money in politics. [288] Its honorary chairman was Senator Mitch McConnell, a savvy and prodigious fundraiser. [288] By designating itself a nonprofit charitable group, the Madison Center enabled the DeVos Family Foundation and other supporters to take tax deductions for subsidizing long-shot lawsuits that might never have been attempted otherwise. [289]
      1. Betsy DeVos wrote, “My family is the largest single contributor of soft money [e.g. for “issue” ads] to the national Republican Party … We do expect some things in return”. [289]
      2. As a Republican running for office in Kentucky in the 1970s, McConnell admitted, “[A] spending edge is the only thing that gives a Republican a chance to compete”. [288] In a Senate debate on proposed campaign finance restrictions, McConnell repeatedly told colleagues, “If we stop this thing, we can control the institution for the next 20 years”. [288]
9. Politically tinged nonprofit spending [xvi] think tanks, academic programs, front groups [xviii]
  1. Between 1998-2008, Charles Koch’s private fund, the Charles G. Koch Charitable Foundation, made more than $48 million in tax-deductible grants, primarily to groups promoting his political views. [179] The Claude R. Lambe Charitable Foundation, controlled by Charles and his wife Liz, with two company executives and an accountant, similarly made more than $28 million in tax-deductible grants. [179] David Koch’s fund, the David H. Koch Charitable Foundation, made more than $120 million in tax-deductible grants – many to cultural and scientific projects rather than political. [179]
  2. Academic programs – the “intellectual track within the DC-New York corridor” to influence elite opinion with op-ed pieces, lawsuits, and expert think tank studies [235-236]
    1. Charles Koch wanted to focus on “attracting youth” because “this is the only group that is open to a radically different social philosophy” [68] through educational indoctrination, with free-market curricula and even video games promoting his ideology pitched to prospects as young as grade school. [68]
      1. He believed that government interference in the economy was what had caused the last Great Depression. [210] “Bankers, brokers and businessmen” had been falsely blamed. [210] The true culprits to him were Herbert Hoover and Franklin Roosevelt, whom he regarded as dangerous liberals. [210]
    2. “He advocated funding private institutes within prestigious universities, where influence over hiring decisions and other forms of control could be exerted by donors while hiding the radicalism of their aims. [69] “It would be necessary to use ambiguous and misleading names, obscure the true agenda, and conceal the means of control. This is the method that Charles Koch would soon practice in his charitable giving, and later in his political actions” [69]
    3. “In order to alter the direction of America, they realized they would have to “influence the areas where policy ideas percolate from: academia and think tanks”” [71] “Cumulatively, the many-tentacled ideological machine they built came to be known as the Kochtopus”. [71]
    4. By 1981, the Kochs’ donations of $30 million largely funded the Mercatus Center, a think tank located on the George Mason University campus, a public university, advertised as “the world’s premier university source for market-oriented ideas – bridging the gap between academic ideas and real-world problems”. [182] Clayton Coppin, who taught history at George Mason and compiled Charles’s political activities for Bill Koch, characterized the Mercatus Center as “a lobbying group disguised as a disinterested academic program” that enabled Charles to “have a tax deduction for financing a group, which for all practical purposes is a lobbying group for his corporate interest”. [183]
    5. In the same building as the Mercatus Center was another heavily Koch-funded institute, chaired by Charles Koch, the Institute for Humane Studies. [183] Its founder had called taxes “theft”, welfare “immoral”, and opposed court-ordered remedies to racial segregation. [183] The aim of the IHS was to cultivate and subsidize the next generation’s libertarian scholars. [183] Charles reportedly demanded better metrics with which to monitor students’ political views. [183] To the dismay of some faculty members, applicants’ essays had to be run through computers in order to count the number of times they mentioned the free-market icons Ayn Rand and Milton Friedman. [183] Students were tested at the beginning and the end of each week for ideological improvement. [183] The institute also housed the Charles G. Koch summer internship program, a paid fellowship placing students who shared the Kochs’ views in like-minded nonprofit groups, where they could join the libertarian network. [183]
    6. By 2004, the Wall Street Journal dubbed the Mercatus Center as “the most important think tank you’ve never heard of” and noted that 14 of the 23 regulations that President George W. Bush placed on a “hit list” had been suggested by Mercatus scholars. [186]
    7. Thomas McGarrity, a law professor at the University of Texas who specialized in environmental issues, argued that “Koch has been constantly in trouble with the EPA and Mercatus has constantly hammered on the agency”. [187] One environmental lawyer who clashed repeatedly with the Mercatus Center dismissed it as a lobbying show dressed up as a nonprofit, calling it “a means of laundering economic aims”. [187] The lawyer explained the strategy: “You take the 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”. [187]
    8. For example, a top official at the Mercatus Center made a pro-smog argument that “by blocking the sun, smog cut down on cases of skin cancer. She claimed that if pollution were controlled, it would cause up to 11,000 additional cases of skin cancer”. [187]
    9. Wendy Gramm, wife of Senator Phil Gramm, head of Mercatus’ Regulatory Studies Program, pushed for the Enron Loophole, exempting the type of energy derivatives from which Enron profited from regulatory oversight. [188] Senator Gramm crafted a deregulatory bill made to order for Enron and Koch, called the Commodity Futures Modernization Act. [188] In 2001, Enron collapsed in a heap of bogus financial statements and fraudulent accounting practices. [188] But Wendy Gramm had pocketed up to $1.8 million from Enron the year after arguing for the loophole. [188] It emerged that before going under, Enron had made substantial campaign contributions to Senator Gramm, while its chairman, Kenneth Lay, had given money to the Mercatus Center. [188]
    10. By 2008, George Mason University was both the largest single recipient of Koch funds for higher education and the largest research university in Virginia [189]
  3. In 1998, the American Petroleum Institute colluded with top oil executives and conservative think tank officials on a secret plan to spend $2 million to confuse the press and the public about the growing scientific consensus on global warming. [255] The plan called for recruiting skeptical scientists and training them in public relations so that they could act as spokesmen, thereby adding legitimacy and cover to the industry’s agenda. [255]
  4. Kert Davies, the director of research at Greenpeace, the liberal environmental group, spent months trying to trace the funds flowing into a web of nonprofit organizations and talking heads, all denying the reality of global warming as if working from the same script. [251] What he discovered was that from 2005-2008, a single source, the Kochs, poured almost $25 million into dozens of different organizations fighting climate reforms. [251] His research showed that Charles and David had outspent, by a factor of three, what was then the world’s largest public oil company, ExxonMobil [251] In a 2010 report, Greenpeace crowned Koch Industries the “kingpin of climate science denial”. [251]
    1. The first peer-reviewed academic study on climate science denial by Robert Brulle, Drexel professor of sociology and environmental science, discovered that between 2003-2010, more than half a billion ($558 million) dollars had been spent on a massive “campaign to manipulate and mislead the public about the threat posed by climate change”, funded by 140 conservative foundations – in essence, a corporate lobbying campaign disguised as a tax-exempt philanthropic endeavor. [251]
      1. The money went to think tanks, advocacy groups, trade associations, other foundations, and academic and legal programs. [251]
      2. However, 3/4 of the funds for this “climate change counter-movement” were untraceable. [252] Brulle said, “Powerful funders are supporting the campaign to deny scientific findings about global warming and raise public doubts about the roots and remedies of this massive global threat. At the very least, American voters deserve to know who is behind these efforts.” [252]
      3. But by the time Obama took office, some had gone even more underground. Rather than funding directly, a growing number of conservative foundations and donors had begun directing their contributions through an organization called DonorsTrust. [253] Founded in 1999 by Whitney Ball, a West Virginia libertarian who had overseen development of the Koch-founded Cato Institute, it made contributions appear to go to a “donor-advised fund” rather than the more controversial groups she would later distribute the funds into. [253] This way, the donors’ names were erased from the money trail – meanwhile, the donors retained the same if not bigger charitable tax deductions. [253]
        
        A similar liberal donor-advised fund, the Tides Foundation, existed, but DonorsTrust as the conservative response soon had 4 times the funds and a far more strategic board. [253] Its directors consisted of the top officials of some of the most important organizations in the conservative movement, including the American Enterprise Institute, the Heritage Foundation and the Institute for Justice, the libertarian legal center whose start was funded by Charles Koch. [253]
        
        In 2010, its single largest grant was $7.4 million to the Americans for Prosperity Foundation (AFP), chaired by David Koch. [253] This grant was 40% of the AFP’s funding that year, belying the notion that it was a genuine grassroots organization. [253]
      4. Dr. James Baker, former head of the National Oceanic and Atmospheric Administration, said in 2005, “There’s a better scientific consensus on [global warming] than on any issues I know – except maybe Newton’s second law of thermodynamics”. [255]
  5. Front groups, to simulate the appearance of popular public support [236], track two [235]
    1. 501(c)(4)’s are tax-exempt “social welfare” organizations that can participate in politics so long as it is not the group’s primary focus, and can hide the identities of their donors from the public, reporting them only to the IRS, which is especially appealing to wealthy individuals who want to influence politics without public attention, like members of the Koch network. [230]
    2. Citizens for a Sound Economy (CSE) -> was a Koch-funded (at least $7.9 million from 1986-1993) conservative nonprofit group fighting for less government. [195] While appearing to be an authentic political groups with concerned citizens like Ralph Nader’s Public Interest Research Groups, it was a fake populist movement secretly manufactured by corporate sponsors or “Astroturf” as the synthetic group came to be known. [195] In reality, big business industrialists would run the group “to sell ideas”. [196]
      1. In 1990, CSE created a spinoff, Citizens for the Environment, which called acid rain and other environmental problems “myths”. [197] When the Pittsburgh Post-Gazette investigated the matter, it discovered that the spinoff group had “no citizen membership of its own”. [197] “They always said they had 250,000 members” but it didn’t mean they carried cards or paid dues, but that they’d contributed money at one point. [197]
      2. In 1992, CSE was involved in a plan to stage a Tea Party protest. However, when tobacco companies were exposed for funding the protest to fight cigarette taxes, the event was cancelled. [207]
      3. In 1993, CSE ran advertisements, staged media events, and targeted political opponents to attack Clinton’s proposed tax on energy, which would have taxed fossil fuel use but exempted renewable energy sources. [197]
      4. CSE then ran deeply misleading ads, showing owners of car washes and other mom and pop small businesses against Clinton’s proposed tax increase on high earners, implying that the tax was aimed at the middle class when in fact it would only affect the wealthiest 4 percent. [198]
      5. However, CSE split due to rivalries over control at the end of 2003, according to Dick Armey, the former Republican House majority leader from Texas who chaired CSE after leaving Congress. [198]
      6. So in 2003, the Kochs inaugurated the first of their twice-a-year donor summits, originally designed to offload the costs of Koch Industries’ environmental and regulatory fights onto others, according to one insider. [199]
    3. Americans for Prosperity (AFP) was then created by David Koch and Richard Fink (Charles Koch’s “grand strategist” [439]) out of the remains of CSE. [199] Like CSE, the new organization had different divisions with different tax statuses [200].
      1. Americans for Prosperity Foundation (AFP), whose board members included both David Koch and Richard Fink, was a 501(c)(3) educational organization, which could not participate in electoral politics and donations to it could be written off as tax-deductible charitable gifts. [200]
      2. Another was an advocacy organization of the same name, the Koch’s primary political advocacy group [xvii], Americans for Prosperity (AFP), that was a 501(c)(4) “social welfare” group, meaning it could participate in electoral politics as long as this was not its “primary” activity. [200]
        
        2012, a paid staff of 450 [xvii]
        
        By 2016, the Kochs’ private network of political groups had a bigger payroll than the Republican National Committee with 1,600 paid staffers in 35 states, boasting that their operation covered 80% of the population [xvii]
        
        The Kochs hired the two cofounders of Century Strategies, a campaign-consulting firm with close business ties to Jack Abramoff, the lobbyist who went to prison for defrauding Native American casino owners of millions of dollars, to run the political side of the operation: Ralph Reed, former head of the Christian Coalition, regarded as the religious Right’s savviest political operative [200] – and a fellow political veteran, Tim Phillips, who had helped create a religious sounding organization that handled casino cash for Abramoff. [200]
        
        In 2004, Americans for Prosperity (AFP) proposed a radical anti tax measure called the Taxpayer Bill of Rights. [219] The measure placed drastic restrictions on state legislators, requiring all tax increases to first be approved by public referenda. [219] The group chose Kansas as its first battleground as the Kochs were fighting a proposed tax increase in their home state. [219] The AFP spent a record amount of money on TV ads and the tax increase was defeated. [219]
        
        In 2008, the AFP registered a website called TaxPayerTeaParty.com to use its network of 50-some staffers to plan rallies across the country as part of the Nationwide Tea Party with other libertarians. [221] They set a date for the first national Tea Party protests, February 27. [221]
    4. FreedomWorks, the estranged sibling (spinoff of CSE) of Americans for Prosperity (AFP), played the biggest early role in the Tea Party, funded by donations from companies such as Philip Morris and billionaires like Scaife. [223] FreedomWorks counseled on how to plan rallies, political direction on what issues to protest e.g. Obama’s stimulus spending, suggested slogans and signs and sponsored a daily conference call with over 50 Tea Party activists around the country to coordinate their efforts, soon providing a professional support team of 9 for the operation. [224]
      1. They gave the nascent Tea Party movement organization and political direction, without which it might have frittered away like the Occupy movement. [224]
        
        e.g. Center to Protect Patient Rights (CPPR) [231] attack ads targeted states of the members of the Senate Finance Committee which was writing the health care bill and whose support would be needed to vote it out of the committee, creating fake “smokers’ rights” groups [234]
        
        e.g. Doug Goodyear (former top aide to Jim Ellis at Ramhurst [301])’s public relations firm, DCI Group, professionalized “Astroturf” campaigns on behalf of big money interests, starting with the industry that really set the standard for deceptive advertising, tobacco. [235]
        
        Unlike lobbying firms, which have to disclose some information, public relations firms exerting pressure can hide the money trail. [236]
      2. The protestors in turn gave the billionaire donors something they’d had trouble buying – the numbers needed to lend their agenda the air of legitimacy. [224]
      3. FreedomWorks signed a deal with Glenn Beck, the incendiary right-wing Fox News television host and Tea Party superstar, for annual payments that eventually topped $1 million for reading “embedded content” written by FreedomWorks staff. [224-225] Glenn Beck blended the promotional material seamlessly into his monologue, as if it were his own opinion. [225] This arrangement was reported on tax disclosures as “advertising services”. [225]
      4. Founder Dick Armey said, “Instead of earning the media, they were paying for it.” [225] Beck reached a daily audience of 2 million, disseminating the ideas of early conservative extremists like Fred Koch on a whole new scale. [225]
    5. The ideal was “a never-ending campaign”. [208] Karl Rove, the operative whom George W. Bush called the “architect” of his 2004 reelection, had long dreamed of creating a conservative political machine outside the traditional political parties’ control that could be funded by virtually unlimited private fortunes. [208] His hope was to draft conservative donors of all stripes into creating a self-financed militia that could be called into action without the transparency, legal restrictions, or accountability that circumscribed conventional campaigns. [208]
10. “Down ballot” campaign contributions in state and local races [xvi] ad campaigns, candidates they supported [xviii]
  1. Political contributions from oil, gas, and coal companies became increasingly polarized as scientific consensus grew in support of global warming. [258] In 1990, the oil and gas industry’s political giving was 60% Republican, 40% Democrat. [258] By the middle of the Bush years, 80% was going to Republicans. [258] For coal mining firms, the giving percentage was 90% to Republicans. [258]
  2. In 1998, business outspent labor by a ratio of twelve to one in campaign spending [176]
  3. From 1998-2008, Koch Industries’s political action committee, Koch-PAC, donated $8 million to political campaigns, more than 80% Republican. [179]
  4. Bob Dole, Kansas senator, had David Koch serve as the vice chair of his 1996 presidential campaign against Bill Clinton as the Koch family became his third largest financial backer. [174] Dole failed to indemnify companies like theirs from potential tens of millions of dollars of federal legal fines from regulatory violations, but succeeded in getting Koch Industries an exemption from a new real estate depreciation schedule, saving it millions. [175]
  5. Oklahoma Republican Senator Don Nickles, a social and fiscal conservative who received many campaign contributions from Koch Industries over the years and whose lobbying firm was later hired by the company, failed to stop the 1989 Senate investigative report [160] but succeeded in shutting down a later criminal case against the company in Oklahoma City by the U.S. Attorney’s office after key Koch documents mysteriously disappeared. [161-163]
  6. James Inhofe, Oklahoma Republican Senator, who received serial campaign donations from Koch Industries PAC [259], who would later demand an investigation into climate scientist Michael Mann [270], had a spokesman, Marc Morano, who worked for a conservative news outlet funded in part by the Scaife, Bradley, and Olin Foundations [259] and had a role in promoting the claims of the Swift Boat Veterans for Truth, a group smearing John Kerry’s military record during his 2004 presidential campaign. [259]
    1. In 2006, he moved on to “swiftboating” scientists like Michael Mann, a leading figure in climate change research and tenured meteorology and geosciences professor at Penn State University [243] by calling him a “charlatan” and part of the “climate con”, “a lavishly funded climate machine that is lobbying for laws and uses every bit of data or new study to proclaim ‘it’s worse than we thought’ or ‘we must act now’” [260] despite himself not having a science background, having studied political science at George Mason University. [260]
    2. “Gridlock is the greatest friend a global warming skeptic has, because that’s all you really want. There’s no legislation we’re championing. We’re the negative force. We are just trying to stop stuff”, Morano said. [276]
  7. The fossil fuel industry threw its weight behind George W. Bush – the coal industry in particular playing a major role in delivering West Virginia’s five electoral votes to Bush in 2000, sealing a victory that would have gone to Al Gore had he carried the formerly Democratic state instead. [260] “State political veterans and top White House staffers concur that it was basically a coal-fired victory,” the Wall Street Journal wrote. [260] Vice President Dick Cheney, a former CEO of the oil-field equipment and services company Halliburton, personally took charge of energy policy. [260] The 2005 energy bill, which Hillary Clinton dubbed the “Dick Cheney Lobbyist Energy Bill” offered enormous subsidies and tax breaks for fossil-fuel intensive companies. [260] It exempted mercury emissions from regulation under the Clean Air Act, but that was later overturned by the courts. [260] Fracking was exempted from regulation under the Safe Drinking Water Act over objections from the EPA and the fracking industry boomed [260-261]. Within 5 years, Devon Energy, Larry Nichols’ company would rank as the 4th largest producer of natural gas in the United States. [261] Harold Hamm would become a multibillionaire. [261] Cheney’s former company Halliburton also became a major player in the fracking industry, illustrating that free-market advocates greatly benefited from government favors. [261]
  8. In all, the Bush energy act contained some $6 billion in oil and gas subsidies and $9 billion in coal subsidies. [261] The Kochs routinely cast themselves as libertarians who deplored government taxes, regulations and subsidies, but records show they took full advantage of the special tax credits and subsidies available to oil, ethanol, and pipeline business. [261] In addition, their companies benefited from nearly $100 million in government contracts in the decade after 2000, according to a study by Media Matters, a liberal watchdog group. [261]
  9. When Al Gore was featured in the 2007 documentary An Inconvenient Truth featuring Michael Mann’s hockey stick graph [261], the entire conservative media sphere was enlisted to fight it. [262] Fox Television and conservative talk radio hosts portrayed climate scientists as swindlers pushing a radical, partisan, and anti-American agenda. [262] Allied think tanks pumped out books, position papers, testimony in Congress and talk show tours. [262] Theda Skocpol, Harvard political scientist [259], estimated, “Climate denial got disseminated deliberately and rapidly from think tank tomes to the daily media fare of about 30-40% of the U.S. populace”. [262]
  10. As Obama took office, America derived over 85% of its total energy from oil, gas, and coal. [263] Under Obama, Lisa Jackson, the EPA administrator, announced that she intended to treat greenhouse gas emissions as hazardous pollutants, regulating them for the first time under the Clean Air Act [263] and the Democrats planned to introduce the long-incubating cap-and-trade bill to limit greenhouse gas emissions. [263]
  11. In response, AFP created the “Carlton”, “the wealthy eco-hypocrite” ad saying, “I inherited my money and attended fancy schools. I own three homes and five cars, but always talk with my rich friends about saving the planet. And I want Congress to spend billions on programs in the name of global warming and green energy, even if it causes massive unemployment, higher energy bills, and digs people like you even deeper into the recession. Who knows? Maybe I’ll even make money off of it!” [264]
  12. In truth, David Koch, the founder and funder of AFP, had inherited hundreds of millions of dollars, attended Deerfield Academy, owned four homes (a ski lodge in Aspen; a Belle Epoque mansion, Villa el Sarmiento, in Palm Beach; a sprawling house in the Hamptons; and an eighteen-room duplex at 740 Park Avenue in Manhattan), and drove, among other cars, a Land Rover and a Ferrari. [264] Any financial penalty that government placed on carbon pollution would threaten both their immediate profit margins and the long-term value of the enormous investments they had in still-untapped fossil fuel reserves. [264]
  13. To combat the cap-and-trade bill, offshoots of the AFP sent “Carbon Cops” to Tea Party rallies, pretending to be EPA officials warning that backyard barbecues, churches and lawn mowers were going to be shut down due to new, stricter interpretations of the Clean Air Act. [265-266]
  14. They even bombarded the congressional office of Tom Perriello, a freshman Democratic congressman from Charlottesville, Virginia with forged letters and faxes from “constituents”, claiming to be members of the “NAACP” and “American Association of University Women”, arguing that cap-and-trade would raise electric bills, hurting the poor, that were in fact sent by Bonner and Associates, a Washington-based public relations firm hired by a coal industry trade group. [266]
  15. Next, the U.S. Chamber of Commerce, the American Petroleum Institute and other industry representative created a “grassroots” group called Energy Citizens to join Tea Party organizations in packing town halls with protestors heckling supporters of cap-and-trade with calls of “traitor” and “hoax”. [266]
  16. In fact, the nonpartisan Congressional Budget Office put out an authoritative study that demonstrated that the average cost to Americans would be the same as buying a postage stamp a day. [267]
  17. In the meantime, Inhofe and other Republicans who received Koch campaign donations demanded an investigation into Michael Mann, one of the world’s leading climate scientists, and Virginia’s attorney general, Ken Cuccinelli, a graduate of the George Mason School of Law, subpoenaed Mann’s former employer, the University of Virginia, for all records related to his academic research. [270] In addition to being attacked by conservative talk radio hosts and websites, colleagues of Mann were offered a $10,000 reward for dirt on him, “confidentiality assured” by a self-described former CIA officer. [271] A think tank named the National Center for Public Policy Research led a campaign to get Mann’s National Science Foundation grants revoked, and two conservative nonprofit law firms, the Southeastern Legal Foundation and the Landmark Legal Foundation brought legal actions aimed at Mann, all funded by the same family fortunes of Bradley, Olin, and Scaife through their private charitable foundations [272] and he began receiving death threats in his inbox. [273] Mann said, “In the scientific community, the degree of confidence in climate change is rising. In the public, it’s either steady or falling. There’s a divergence. That wedge is what the industry has bought”. [273]
  18. The House passed a bill to cap and trade carbon dioxide emissions on June 26, 2009 [267] but the opposition only intensified as TV ads appeared saying, “There is no scientific evidence that CO2 is a pollutant. In fact, higher CO2 levels than we have today would help the earth’s ecosystems”. [268] The ads were paid for by a group called CO2 Is Green, which, according to Steven Mufson, energy reporter for The Washington Post, was funded by Corbin Robertson, owner of the country’s largest private cache of coal. [268]. Robertson’s company Quintana’s address and top officers were found to have incorporated another front group, the Coalition for Responsible Regulation, which took legal action to stop regulations of greenhouse gases. [268]
  19. The cap and trade bill moved to the Senate but when Lindsay Graham, an independent-minded Republican from South Carolina backed out of co-sponsoring the legislation after American Solutions, funded by Koch donors such as Larry Nichols of Devon Energy launched a negative campaign against him in his home state, then Harry Reid, the Democratic majority leader from Nevada also refused to bring the legislation to the Senate floor for a vote. [275-276]
  20. In March 2010, the David H. Koch Hall of Human Origins at the Smithsonian’s National Museum of Natural History opened an exhibition included an interactive game which suggested that if the climate on earth became intolerable, people might build “underground cities” and develop “short, compact bodies” or “curved spines” so that “moving around in tight spaces will be no problem”. [265]
  21. On January 21, 2010, the Court announced its 5-4 decision in the Citizens United case, overturning a century of restrictions banning corporations and unions from unlimited spending on political candidates, as long as the money was to outside groups that were technically independent. To reach the verdicts, the Court accepted the argument that corporations had the same right to free speech as citizens, preceded by SpeechNow which overturned the same limits for individuals as well. [280]
    1. Bradley Smith, leader of the SpeechNow suit, also founded the Center for Competitive Politics, conservative group. [292] Smith was a radically anti regulatory lawyer who pushed for zero public disclosure of political spending. [292] IRS records showed that in 2009 his center was supported by several conservative foundations including the Bradley Foundation [292] The Institute of Justice was also involved. [292-293]
    2. The SpeechNow litigation was heavily underwritten by Fred Young, a libertarian retiree in Wisconsin who made tens of millions of dollars by selling his father’s firm, Young Radiator Company, after outsourcing the jobs of unionized workers to non-union states. Young served on the boards of the Koch-backed Reason Foundation and Cato Institute and was a regular attendee at the Kochs’ donor summits. [293]
  22. George Soros [6], New York hedge fund magnate, who funneled more than $27 million into outside spending groups known as 527 groups prior to Citizens United, and threatened to spend his $7 billion fortune on defeating President Bush for his invasion of Iraq, withdrew from spectacular campaign funds after the Federal Election Commission fined both Democrats and Republicans for violations but remained an active donor, spending hundreds of millions on a network of human rights and civil liberties groups [290]
  23. After Citizens United, Fred Young contributed 80% of the money spent in 2010 by SpeechNow.org‘s super PAC, including TV ads targeting Wisconsin Democratic senator Russ Feingold, the Senate’s premier supporter of strict campaign spending laws, who urged outside groups not to spend on his behalf and who was defeated [293]
  24. The budget for Kochs’ flagship group, Americans for Prosperity (AFP) and its foundation went from $2 million in 2004 and $15.2 million in 2008 to $40 million in 2010. [309]
  25. The Koch donor summits went from $13 million in June 2009 to almost $900 million at a single fundraising session in the years that followed. [293]
  26. In 2006, only 2% of “outside” political spending came from “social welfare” groups that hid their donors. [305] In 2010, this rose to 40%, masking hundreds of millions of dollars. [305]
  27. For the 2014 elections, the Koch network poured over $100 million into competitive races and almost twice that into other kinds of activism. [455] The largest disclosed donor in 2014 was Tom Steyer, the California hedge fund magnate turned environmental activist, with $74 million trying to elect candidates who pledged to fight global warming. [455] But the 100 biggest known donors in 2014 spent nearly as much money as the 4.75 million who contributed $200 or less, giving $323 million of disclosed money, not including the millions in unlimited, undisclosed money. [455] During the five years before a 2015 interview, the Koch network had contributed over $760 million to mysterious and ostensibly apolitical nonprofits such as the Freedom Partners Chamber of Commerce, the Center to Protect Patient Rights, and the TC4 Trust. [456]
  28. ***While amassing one of the most lucrative fortunes in the world, the Kochs had also created an ideological assembly line justifying it. Now they had added a powerful political machine to protect it. They had hired top-level operatives, financed their own voter data bank, commissioned state-of-the-art polling, and created a fund-raising operation that enlisted hundreds of other wealthy Americans to help pay for it. They had also forged a coalition of some 17 allied conservative groups with niche constituencies who would mask their centralized source of funding and carry their message. To mobilize Latino voters, they formed a group called the Libre Initiative. To reach conservative women, they funded the Concerned Women for America. For millennials, they formed Generation Opportunity. To cover up fingerprints on television attack ads, they hid behind the American Future Fund and other front groups. Their network’s money also flowed to gun groups, retirees, veterans, antilabor groups, antitax groups, evangelical Christian groups, and even $4.5 million for something called the Center for Shared Services, which coordinated tasks such as office space rentals and paperwork for the others. Americans for Prosperity (AFP), meanwhile, organized chapters all across the country. The Kochs had established what was in effect their own private political party. *** Secrecy permeated every level of the operation. One former Koch executive, Ben Pratt, who became the chief operating officer of the voter data bank, Themis, used a quotation from Salvador Dali on his personal blog that could have served as the enterprise’s motto: “The secret of my influence is that it has always remained a secret.” [384-385]***
  29. A former Democrat, Ed Gillespie, was a top national political tactician who became the chairman of the Republican National Committee in 2003 at the age of 41 and who, as founder of Quinn Gillespie & Associates, a bipartisan lobbying firm, made as much as $19 million. [297] Within weeks of Citizens United, Gillespie met Karl Rove, his fellow Bush White House alumnus, to plan a new shadow political machine. [297]
  30. With Obama dominating Washington, Gillespie looked to the states. [298] He knew that 2011 was a year in which many state legislatures would redraw the boundaries of their congressional districts based on a new census, a process that only took place once a decade. [298] So he aimed at a Republican takeover of governorships and legislatures across the country. [298] Then Republicans could redraw their states’ congressional districts in order to favor their candidates. [298] While the mechanics of state legislative races were abstruse and deadly dull to most people, to Gillespie, they were the key to a Republican comeback. [298] Gillespie called the plan “REDMAP” an acronym for the Redistricting Majority Project. [298] To implement it, he took over the Republican State Leadership Committee (RSLC), a nonprofit group that had previously functioned as a catchall bank account for corporations interested in influencing state laws. [298] All he needed was the money to put REDMAP into action and he got it by the end of 2010 – million dollar donations from tobacco companies Altria and Reynolds and huge donations from Walmart, the pharmaceutical industry, and donors like those at the Koch summit, adding up to $30 million, 3x its Democratic counterpart. [299]
    1. A second man for the new political operation was James Arthur “Art” Pope, a charter member of the Koch network, regular attendee of the Kochs’ secret planning summits, board member of both CSE and its successor AFP, [299] multimillionaire chairman and CEO of Variety Wholesalers, a family-owned discount-store conglomerate with hundreds of outlets up and down the mid-Atlantic and the South, with a seemingly inexhaustible command of political minutiae [299], who served up his home state of North Carolina, historically a pivotal swing state as a test case for REDMAP. [300] Obama had carried it narrowly in 2008 and remained popular in 2010. [300] Democrats dominated the state legislature; Republicans hadn’t controlled both houses of the North Carolina General Assembly for more than 100 years. [300] “Not since General Sherman”, the joke went. [300] Bob Geary, a political reporter for the Indy Week, an alternative newspaper in Durham, described him in his run for lieutenant governor in 1992 as “a terrible candidate … very introverted and pedantic”, but he was a master of arcane election law. [300]
    2. In the previous decade, Pope, his family and the family foundation had spent more than $40 million on pushing politics to the right. [299] Pope had given money to at least 27 of the groups supported by the Kochs, including organizations opposing environmental regulations, tax increases, unions, and campaign spending limits, such as the James Madison Center for Free Speech. [300]
    3. A third man for the new political operation was Jim Ellis, former “right-hand man” and executive director of his PAC, to Tom DeLay, the powerful House Republican leader from Texas who was infamous for his “K Street operation” which serviced corporate lobbyists while shaking them down for campaign contributions, who had a history of creating fake movements in support of unpopular corporations and causes [301].
  31. Meanwhile, Randy Kendrick, wife of Koch donor Earl “Ken” Kendrick, a West Virginian millionaire who founded Datatel, a computer software provider for colleges and universities, incorporated the Center to Protect Patient Rights (CPPR) on April 16, 2009 together with Sean Noble, her de facto political consultant, to oppose government healthcare and the Affordable Care Act (ACA) in particular [230-231].
    1. The House passed the Affordable Care Act (ACA), despite nasty Tea Party protests e.g. Tim Phillips, AFP’s president, organized a “Kill the Bill” protest on Capitol Hill accusing the Democrats of “trying to cram this 2,000 page bill down the throats of the American people” and a second Capitol Hill protest a few days later where protesters spat on a passing Democratic congressman, called Barney Frank, a gay representative from Massachusetts, a “faggot”, and shouted racist epithets at three black congressmen, John Lewis, Emanuel Cleaver, and Jim Cleaver). [302-303] In response to the ACA’s win in the House, Noble and other Koch operatives focused on taking over the House. [302-303]
    2. Funding for Noble’s CPPR quadrupled by the end of 2010 to $61.8 million. As with all such 501(c)(4) dark money [230] “social welfare” groups, under the tax code, the sources of its funding didn’t have to be publicly disclosed. [304] Another Koch-tied group, TC4 Trust, raised $42.7 million that year and routed 1/3 of that to CPPR through a method disguised on disclosure forms, bringing Sean Noble’s kitty up to almost $75 million. [304]
      1. TC4 defined itself as a free-market advocacy group whose “grant funds shall not be used for political activity” [353] but it soon was paying for polling and a public advocacy program aimed at shaping and selling the Republican budget. [353] Ed Goeas, the president of the Tarrance Group, a Republican polling company that worked on the budget project, said, “It wasn’t about developing policy, it was about selling it.” [353] The solution was to avoid using the word “cut” when talking about Medicare or Social Security. “There were discussion that you could deal with it as ‘getting your money’s worth out of the government’. You could talk about it as ‘more effective’ – but not as cutting it. It had to be about efficiencies’. That was a large part of it.” [353]
      2. Public Notice, one of the Koch Brothers’ groups according to Goeas, paid for the research and a public advocacy campaign describing the deficit as a looming catastrophe. [353]
  32. Sean Noble and CPPR focused on the House to oppose the ACA while Karl Rove used American Crossroads and its 501(c)(4), Crossroads GPS, to work on the Senate. [306] Ed Gillespie continued to focus on governorships and state legislatures, in accordance with his REDMAP strategy. [306]
  33. The operatives steered their funds to obscure, smaller groups to meet the legal requirement that no single public welfare group could spend more than half of its funds on elections. [306] Soon, to the unschooled eye, a rash of spontaneous attacks on Democrats appeared to be breaking out all across the country. [306] In reality, the effort was so centrally coordinated, as one participant put it, “there wasn’t one race in which there were multiple groups airing ads at the same time”. [306]
    1. Noble explained his methodology later to Eliana Johnson, Washington editor for the conservative publication National Review, with an Excel spreadsheet showing a list of Democratic congressmen “in order of their likelihood of defeat” which would grow to 105 by August. Then, he assigned each congressional district with a “win potential” of 1-5 and each candidate with a score of 1-40 “based on the voting record of each member and the composition of the district, among other things”, then sorting the 105 targeted candidates into “three tiers, based on the likelihood of a GOP victory” and disbursing the Koch network’s money accordingly. [307]
      1. For example, as explained to National Review, Noble chose the 60 Plus Association, a right-wing version of the senior citizens’ lobby AARP to air attack ads on Democrats in “Arizona’s 1st Congressional District, Florida’s 2nd and 24th, Indiana’s 2nd, Minnesota’s 8th, New York’s 20th, Ohio’s 16th, Pennsylvania’s 3rd, and Wisconsin’s 3rd and 8th Congressional Districts”. [307]
      2. He used Americans for Job Security to air ads in “New York’s 24th, North Carolina’s 2nd and 8th, Ohio’s 18th, and Virginia’s 9th Congressional District” [307] Despite being founded in 1997 by a million-dollar donation from the insurance industry, its physical office in Alexandria, VA was almost empty with only one employee, a 25 year old Republican campaign aide acquainted with Noble. [308] It was accused of being “a sham front group” by Public Citizen, a liberal group favoring tighter campaign finance regulations, and when charged with violations of fair election rules by Alaskan state officials, it settled for $20,000 with no admission of guilt [308] It was given $4.8 million in 2010 by Noble’s CPPR. [308]
      3. He used Iowa-based American Future Fund, a 501(c)(4) “social welfare” group, to air attack ads in Alabama’s 2nd, Colorado’s 7th, New Mexico’s 1st, and Washington’s 2nd Congressional Districts. [307] Though AFF was founded in 2008 by an Iowa Republican operative, Bruce Rastetter, one of the country’s largest ethanol producers, its tax records showed that 87% of its funds in 2009 and about 50% in 2010 came from Noble’s CPPR. [308]
  34. Rick Boucher, a conservative Democratic congressman representing the rural Virginia district encompassing Saltville, the Olin Corporation’s factory town that turned into a toxic waste dump, lost his seat to his Republican opponent, Morgan Griffith, after AFP and other conservative outside groups spent $2 million on attack ads against him. [309-310] He was a Virginia lawyer and strong ally of business interests who had been crucial to the passage of the cap-and-trade bill in the House, drafting much of the measure and then winning support for it from huge energy firms like Duke Energy and had represented the district for 28 years in the House and 8 more before that in the state senate. [309] He had given away so many goodies to the coal industry while negotiating the bill that many environmentalists were disgusted but the fact that he supported the bill angered conservative extremists such as the Virginia coal barons funding the Koch network. [309] He was exactly the kind of centrist that big, polarized political money was rendering extinct. [309]
    1. Boucher said, “This is Appalachia! It’s a cheap media market. That would have been like $10 million most other places. [His opponent] actually didn’t raise and spend much, but he didn’t have to, because the Koch groups carried his water”. [310]
  35. When House Democrats passed a bill (2010?), backed by President Obama, to eliminate the carried interest loophole (which allowed much of the income of hedge fund and private equity managers to be categorized as “interest” at less than half the income rate then applied to long-term gains), Stephen Schwarzman (estimated worth of $6.5 billion [year? 312]) and others were enraged. [311-313] Former Obama bundler Ken Griffin, founder and CEO of the Chicago-based hedge fund Citadel, turned Republican in what came known as the “Hedge Fund Switch”. These billionaires attended the Koch’s second summit of the year in Aspen (where of the 200 or so participants, with least 11 were on Forbes’ list of the 400 wealthiest Americans, had an estimated wealth of $129.1 billion) and pumped at least $10 million into groups boosting Republicans in the midterms, often without any public trace. [314]
    1. The Economic Policy Institute, a progressive think tank, estimated that this loophole cost the government over $6 billion a year – the cost of providing healthcare to 3 million children. [313] Of that total, $2 billion a year from the tax break went to just 25 individuals. [313]
  36. Even before the Republicans formally took control of the House, the president felt forced into making concessions on tax issues vital to the donor class. [354] In December 2010, he reached a deal that temporarily extended unemployment benefits for millions out of work and reducing payroll taxes and other help for the middle class in exchange for extending Bush-era income tax cuts benefitting the wealthy that had been set to expire. [354] Those cuts lowered the top income tax rate from 39.6% to 35%, and unearned income taxes mostly earned by the rich, for example, capital gains taxes from 20% to 15% and dividend taxes from 39.6% to 15%. As a result, many rich Americans were taxed at a lower rate than middle and working class earners. [354] Republican negotiators insisted on cuts on estate taxes costing the Treasury $23 billion and saving 6600 of the wealthiest taxpayers $1.5 million each. [357] The Kochs, DeVoses and 15 other of the richest families in the country including the Waltons of Walmart and the Mars candy clan, according to one 2006 report, had spent almost half a billion on lobbying for the “death tax” cuts since 1998, because the 17 families stood to save $71 billion. [357] Only .27% of all estates were wealthy enough to be affected by estate taxes. [357]
    1. In the beginning, the 16th Amendment which legalized the income tax was only levied on the very rich. [355] Rates were especially high in wartime when taxes were seen as the patriotic duty of the privileged, such as 77% for top earners in WWI, and 94% in WWII (which the Scaife family avoided with its trusts and foundations). [355]
    2. A 2008 study of the wealthiest 400 taxpayers showed they earned an average of $202 million and paid an effective tax rate of less than 20%. [354] 60% of their declared income derived from capital gains. [354]
  37. The Kochs’ AFP pledged to spend $45 million for the 2010 midterms, Karl Rove’s American Crossroads $52 million, and the U.S. Chamber of Commerce $75 million. [316-317]
  38. For the 2012 presidential campaign, the Kochs came up with a new nonprofit corporation, a 501(c)(6) business league, the Association for American Innovation (AAI) to collect donations, categorized as “membership dues” partially tax deductible as business expenses. [375] Donors could be both anonymous and outside the charitable scrutiny of the state attorneys general, further safeguarding secrecy. [375] During 2011 alone, tax records show that AAI had over $250 million, over a quarter of a billion. [375] AAI soon changed its name to Freedom Partners, funding the same political front groups that the Kochs used in the 2010 midterms, such as $115 million to Sean Noble’s Center to Protect Patient Rights (CPPR) and $32.3 million to David Koch’s Americans for Prosperity (AFP) from November 2011 to October 2012. [375]
    1. Later, an initial 2015 plan to spend $889 million to purchase the presidency [xvi] was downgraded to $750 million, several hundred million to races beneath the presidential level [xvi]
  39. Foster Friess, the Wyoming mutual fund magnate, committed $3 million to found The Daily Caller in 2010, which Charles Koch’s foundation would later back as well, after a single luncheon conversation with Tucker Carlson, its prospective editor in chief, to be a conservative version of The Huffington Post. [320] In fact, it functioned more as an outlet for opposition research paid for by donors. (After The New Yorker published Jane Meyer’s investigative article on the Kochs, “Covert Operations”, The Daily Caller was the chosen receptacle for the retaliatory opposition research on her, but when leads proved false, they decided not to run it. [320]
  40. Bob Phillips, head of the North Carolina chapter of Common Cause, an organization for stricter controls on political money, concluded that the Citizens United decision was an even bigger “game changer” at the local level than at the national. [323] “Citizens United opened up the door. Now a candidate can literally be outspent by independent groups. We saw it in North Carolina, and a lot of the money was traced back to Art Pope”. [323] Chris Heagarty, a Democratic lawyer who ran for a legislative seat that fall in Raleigh, said, “If you put all of the Pope groups together, they and the North Carolina GOP spent more to defeat me than the guy who actually won. For an individual to have so much power is frightening. The government of North Carolina is for sale.” [323-324]
  41. Pope countered that his political spending was not bribery, which was “illegal, corrupt, and something I’ve fought hard against in North Carolina” but “education” of citizens. [324] Of the 22 local legislative races targeted by Pope, his family and their organizations in North Carolina in 2010, the Republicans won 18 in the historically Democratic state. [324-325] As he and Gillespie hoped, this placed both chambers of the general assembly firmly under Republican majorities for the first time since 1870. [325] According to the Institute for Southern Studies, 3/4 of the spending by independent groups in North Carolina’s 2010 state races came from accounts linked to Pope. [325] The total amount that Pope and his family and groups backed by him spent – $2.2 million – was not much by national standards but enough to exert crucial influence within one state, which would repeat across the nation. [325]
  42. The chairman of REDMAP, former Republican congressman, Tom Reynolds, later told Politico, “The Obama team has done some amazing things, those guys are really something, but the Democrats plain got skunked on the state houses”. [326]
  43. It’s likely given historical trends and an unemployment rate topping 9.5% that a Republican wave in 2010 was inevitable, but Noble had made so much progress that, by the final weeks in the campaign, he was aiming beyond his 3rd tier candidates at congressmen no one had ever believed were vulnerable. [327]
  44. On November 2, 2010, the Democrats suffered massive defeats, losing control of the House of Representatives. [327] Republicans gained 63 seats in the House – the largest such turnover since 1948 – and half a dozen seats in the Senate [327], making North Carolina, Michigan, Ohio, and Wisconsin newly Republican states. [328] At the state level, the Democratic losses were even more staggering, with Republicans gaining 675 seats. [327-328]
  45. The Ohio Republican, John Boehner, the new Speaker of the House, now had a caucus bursting with Tea Party enthusiasts who had ridden to power by attacking government in general and Obama in particular, several winning primaries against moderates. [327] Compromise wasn’t in their interest [327] Political scientist Lee Drutman, in a study for the nonpartisan Sunlight Foundation, found that increasingly concentrated wealth in America resulted in more polarization and extremism, especially on the right, the “radical rich”. [335] Very rich benefactors in the Republican Party were far more opposed to taxes and regulations than the rest of the country. [335] He said, “The more Republicans depend upon the 1% of the 1% of donors, the more conservative they tend to be”. [335]
  46. Harvard’s Theda Skocpol found that the House “took the biggest leap to the far right” since political scientists began recording quantitative measurements of legislators’ positions, as exemplified by the House Energy and Commerce Committee. [335] In the previous Congress, the Committee had been chaired by Henry Waxman, the liberal Democrat from California who had quarterbacked the House’s successful passage of the cap-and-trade bill that was defeated in the Senate. [336] Now, the committee was packed with Republicans owing huge campaign debts to the Kochs. [336] Koch Industries had donated to 22 of the committee’s 31 Republican members and 5 of its Democratic members. [336] Koch Industries PAC was the single largest oil and gas industry donor to members of the panel, outspending even ExxonMobil. [336]
  47. Congressman Morgan Griffith, victor over Rick Boucher in the district representing Saltville, Virginia, became a lead player in the House Republicans’ “war on the EPA” [336-337] and within a month after taking office, he and other House Republicans gutted the EPA’s budget by a punishing 27%, which was later modified to 16% with the Senate. [337] By then, the 1980 Superfund law charging polluters like the Olin Corporation for cleanup costs expired and the $3.8 billion accumulated in the fund had run out, leaving taxpayers rather than corporations to clean up the mess. [337]
  48. The Republicans tried to halt action on global warming, prevent the protection of any new endangered species, permit uranium mining adjacent to the Grand Canyon, deregulate mountaintop mining, prevent coal ash from being designated a form of air pollution, and proposed legislation requiring it to consider the costs of its regulations, without regard to the scientific and health benefits, which the editorial page of the Los Angeles Times said “rips the heart out of the 40-year-old Clean Air Act”. [340]
  49. Two months into their tenure, the House Energy and Commerce Committee Republicans led a crusade against alternative, renewable energy programs. [340-341] They successfully branded the government’s stimulus support for Solyndra, a California manufacturer of solar panels, and other clean energy firms as an Obama scandal, while some of Solyndra’s biggest backers were members of the conservative Walton family, the founders of Walmart. [341]
  50. By the end of 2011, only 20 of the 65 Republicans who responded to a survey were willing to say that they believed climate change was causing the planet to warm. [341] In 2009, Michigan congressman Fred Upton had said, “Climate change is a serious problem that necessitates serious solutions. I strongly believe that everything must be on the table as we seek to reduce carbon emissions”. [339] But in 2010, Upton, like many Republican moderates, faced a potentially career-killing primary challenge from the right. [339] He reversed his position by co-authoring an op-ed piece in The Wall Street Journal with Tim Phillips, AFP’s president, where they called the EPA’s plans to regulation carbon emissions “an unconstitutional power grab that will kill millions of jobs unless Congress steps in”, and he secured the chairmanship of the House Energy and Commerce Committee. [339-340] Robert Inglis of South Carolina, who accepted the growing scientific consensus on climate change, was defeated for violating “Republican orthodoxy”. [339] Tim Phillips, AFP’s president, said “We’ve made great headway. What it means for candidates on the Republican side is, if you … buy into green energy or you play footsie on this issue, you do so at your political peril”. [342]
  51. By 2011, Speaker Boehner, among the most powerful elected officials in the country, third in line in the order of presidential succession, traveled to New York to personally beseech David Koch for help with a Congressional stalemate regarding the debt ceiling. [366-367]
  52. When Koch donors met for their January 2011 summit, protestors swarmed the hitherto secret meeting for the first time. [342] A ragtag assortment of protestors waved signs saying “Koch Kills!” And “Uncloak the Kochs!” with 25 arrested and Politico reporter Kenneth Vogel threatened with arrest as well unless he left the premises immediately. [342] A golf partner said David Koch “spumed and sputtered” about The New Yorker and others scrutinizing the brothers, blaming the media for death threats and forcing his family to hire personal bodyguards. [343]
  53. They hired a new team of public relations advisers specializing in aggressive tactics, such as Michael Goldfarb, a Republican political operative, hired to improve the company’s image. [343] He founded an online publication called The Washington Free Beacon to practice “combat journalism” against “liberal gasbags” with the motto “Do unto them”. [343] One conservative journalist told The New Republic, “I mean no disrespect, and I like him personally, but he is the single shadiest person on the right”. [345] Philip Ellender, co-president of Koch Companies Public Sector, who oversaw the company’s lobbying and public relations operations in Washington and who had a reputation, as Politico put it, for using “tactics that helped cement the view that the Kochs play rough”, launched a website called KochFacts that waged ad hominem attacks, questioning the professionalism and integrity of reporters critical of the Kochs, ranging from The New York Times to Politico. [344]
  54. Jane Mayer’s article for The New Yorker about the Kochs, “Covert Operations: The billionaire brothers who are waging a war against Obama”, revealed in depth for the first time how the publicity-shy Koch brothers had stealthily leveraged their vast fortune to exert outsized influence over American politics and how their environmental and safety record was woefully at odds with their burnished images as selfless philanthropists. [345] After David Koch via The Daily Beast called the article “hateful”, “ludicrous” and “plain wrong” without specific complaints and requiring no corrections, [345] a well-informed source told Mayer that the Kochs were trying to counteract the story by undermining her and digging for “dirt, dirt, dirt. If they couldn’t find it, they’d create it”. [346]
    1. A private investigative firm was retained – Vigilant Resources International, whose founder and chairman, Howard Safir, had been NYC’s police commissioner under former mayor Rudy Giuliani, though they would neither “confirm nor deny” their work on her. [346] Although potentially ruinous claims of plagiarism were “alleged” by Jonathan Strong, a reporter for The Daily Caller [347], when the alleged reporters who were supposedly victims of Mayer refuted the allegations, The Daily Caller dropped the story. [347-349] Instead, Keith Kelly wrote a followup story entitled “Smear Disappears”, asking “Who is behind the apparently concerted campaign to smear the New Yorker’s Jane Mayer? The story is dead but the person or persons behind the allegations remains a shadowy mystery”. [349] The plagiarism play had been timed to try to stop The New Yorker from nominating the Koch story for a National Magazine Award, according to the New York Post. [349] Koch Industries’ general counsel, Holden, sent an unusual letter to the board of the American Society of Magazine Editors, trying to stop it from picking Mayer’s story for the prize, which it didn’t win anyway. [349]
  55. For 2012, Obama said, “[I]nequality distorts our democracy. It gives an outsized voice to the few who can afford high-priced lobbyists and unlimited campaign contributions, and it runs the risk of selling out our democracy to the highest bidder” [394] but faced with the prospect of $660 million of outside spending against him, he too began encouraging supporters to give to his super PAC, Priorities USA [395] and went after the Republican Party with Romney with anti-finance ads, [396] calling him a “job destroyer” and his firm “a vampire” despite protests of unfairness from finance donors. [396-397] Mother Jones revealed a secret recording made by a member of waitstaff at a high end fundraiser that May for Romney, where he assured his wealthy supporters that he didn’t care about the “47% of the people who will vote for the president no matter what” because “I’ll never convince them they should take personal responsibility for their lives” since they were people “dependent upon government, who believe they are victims, who believe government has a responsibility to care for them, who believe they are entitled to health care, food, to housing, you name it. … people who pay no income tax”. [398]
  56. Despite losing the presidential election, the Republicans cemented their control over the state legislatures with the redrawing of the boundaries of congressional districts so that despite getting fewer votes than Democrats, they won more congressional seats in states as well as holding onto the House of Representatives, despite a bigger 2012 turnout nationwide for Democrats. [410] The Republican State Leadership Committee (RSLC), the group used to run REDMAP, engaged their offshoot dark-money group called the State Government Leadership Foundation, a 501(c)(4) that could hide the identities of donors, [412] to use a program called Maptitude containing population details of every neighborhood, including the residents’ racial makeup, starting in North Carolina, to redistrict boundaries. [412-413] Republican legislators overseeing the redistricting held public hearings across the state but the SGLF never read any of those transcripts. [413] Their new map reduced the number of congressional seats that Democrats could win by packing minority voters into three districts with an already high concentration of African-American voters that they could “pack” together to lessen their effect on surrounding areas with more white and Republican voters. [413] Progressive groups sued, alleging the maps violated the Voting Rights Act, but after $2.3 million from the Koch’s AFP, Gillespie’s RSLC and Pope’s Variety Wholesalers poured in to support the reelection of one of the Republican judges, the state supreme court upheld the Republican-led redistricting plan. [413-414] By channeling donors’ money to largely overlooked state and local races, Republicans succeeded in not only advancing their political agenda but in wiping out a generation of lower-level Democratic office holders who could rise in the future. [414]
  57. The new Republican North Carolina general assembly enacted policies incubated by their think tanks – they slashed taxes on corporations and the wealthy while cutting benefits and services for the middle class and the poor, gutted environmental programs, sharply limited women’s access to abortion, backed a constitutional ban on gay marriage, and legalized concealed guns in bars and on playgrounds and school campuses as well as cumbersome new bureaucratic barriers to voting. [417] Specifically, it eliminated the earned income tax credit for low income workers and cut unemployment benefits so low that the state was not eligible for the $780 million in emergency federal unemployment aid it would have otherwise qualified for. [418] As a result, North Carolina, with the country’s 5th highest unemployment rate, soon offered the lowest unemployment benefits in the country. [418] At the same time, it repealed the estate tax, even though existing law exempted the first $5.25 million of inheritance from taxation and the change affected only 23 estates, which cost the state $300 million in its first 5 years. [418] The state rejected the free expanded Medicaid coverage for the needy that it was eligible for under the ACA, denying free health care for 500,000 uninsured low-income residents. [418] To make up for the funds lost in tax cuts, the legislature turned to raid its celebrated public education system – the one institution that had distinguished North Carolina from many southern states, eliminating teachers’ assistants, reducing teacher pay from 21st highest to 46th, and abolishing incentives for teachers to earn higher degrees, despite the overwhelming preference of voters to avoid these cuts by extending a temporary one-penny sales tax to sustain educational funding. [419] North Carolina’s esteemed state university system was next up for severe cuts by the Republican majority legislature, which was projected to cause tuition hikes, faculty layoffs, and fewer scholarships, even though the state’s constitution required that higher education be made “as free as practical” to all residents. [419] Employees of the John William Pope Center for Higher Education Policy accused the university of becoming a “niche for radicals”, its public funding “a boondoggle” and demanded the legislature “starve the beast”. [419] Instead, Pope offered to privately fund academic programs in subjects he favored, like Western civilization and free-market economics. [420] Pope gifted $500,000 to North Carolina State University, to fund lectures by conservatives. [420] Cat Warren, an English professor at North Carolina State, said “It’s sad and blatant. [Pope] succeeds in getting higher education defunded, and then uses those cutbacks as a way to increase leverage and influence over course content”. [420] The Republican state senate passed a bill requiring North Carolina’s high school students to study conservative principles that stressed “the constitutional limitations on government power to tax and spend” as part of American history in order to graduate in 2015. [420]
  58. In the fall of 2013, an obscure Republican freshman congressman from one of North Carolina’s newly gerrymandered districts would set in motion the shutdown of the federal government. [428] Gerrymandering had removed so many Democrats from the rural, mountainous 11th Congressional district that conservative Democrat Heath Shuler retired rather than waste time and money on a hopeless race, all but handing over the seat to Mark Meadows, a restaurant owner and Sunday-school Bible teacher, in 2012. [428] After only 8 months in office, Meadows made national headlines by sending an open letter to the Republican leaders of the House demanding they use the “power of the purse” to kill the ACA. [428-429] The ACA had already been upheld by the Supreme Court and affirmed when voters reelected Obama in 2012. [429]
  59. But Meadows argued that Republicans should sabotage the ACA by refusing to appropriate any funds for its implementation. [429] If they didn’t get their way, they would shut down the government. [429] By fall, Meadows had succeeded in getting more than 79 Republicans to sign onto this plan, forcing Speaker of the House John Boehner, who opposed the radical measure, to accede to their demands. [429] Meadows was hailed by his local Tea Party group as “our poster boy” and by CNN as the “architect” of the 2013 shutdown. [429] When the radicals refused to back down, bringing virtually the entire federal government to a halt for a full 16 days in October, leaving the country struggling to function without all but the most vital federal services. [429] Even the Washington Post columnist Charles Krauthammer, a conservative, called the renegades “the Suicide Caucus”. [429]
  60. Political extremists now had no incentive to compromise, even with their own party’s leadership. [429] Instead, the threats faced by Republican members from the new ultraconservative districts were primary challenges from even more conservative candidates. [429] Statistics showed that the 80 members of the Suicide Caucus represented only 18% of the country’s population and 1/3 of the Republican caucus in the House. [429]
  61. After failure from the Koch’s troubled data collection effort, Themis, in 2012, the Koch donors invested millions of dollars into i360, a state-of-the-art political data company and merged the two. [452] The operation hired 100 staffers and assembled detailed portraits of 250 million U.S. consumers and over 190 million active voters. [452-453] Field workers of the Koch’s many advocacy groups constantly updated the data to determine which voters were “persuadable” and bombard them with personalized communications aimed at motivating them to vote or stay home. [453]
  62. Before, the Republican National Committee handled voter files. [453] But the Kochs now had their own data bank, which many found easier to use and more sophisticated than the RNC’s. [453] Several top Republican candidates started to purchase i360’s data, even though they were more expensive, they were better. [453] Ironically, the Republican Party found itself sidelined and imperiled by the rapaciousness of its own biggest donors. [453] A source “close to the RNC” told Yahoo, “It’s pretty clear that they don’t want to work with the party but want to supplant it”. [453]
  63. AFP expanded to 550 paid staffers, with as many as 50 in a single pivotal state like Florida. [454] Koch-backed advocacy groups like Generation Opportunity and the LIBRE Initiative planted grassroots organizers wherever there were hotly contested elections. [454] The Koch network added Aegis Strategic to recruit and train candidates to avoid the misfits who plagued Republicans in 2012. [454] On November 4, 2014, Election Day proved a Republican triumph, with the GOP picking up 9 Senate seats, winning control of both congressional chambers. [454]
  64. By 2015, nonstarters were: addressing global warming, raising taxes or closing special loopholes on the runaway rich, while political movement for funding public services such as infrastructure or expanding the social safety net seemed to have disappeared. [459-460] The Kochs and their ultra-wealthy allies on the right had become arguably the single most effective special-interest group in the country. [461]
  65. Arthur Brooks, president of the American Enterprise Institute (AEI), said conservatives lost the 2012 election because only 1/3 of the public agreed with the statement that Republicans “care about people like you”. [436] Conservatives had an empathy problem. [436] Richard Fink, Charles Koch’s “grand strategist”, executive VP and board director of both Koch Industries and AFP, threw himself into a comprehensive internal review after the election, which analyzed 20 years of research into political opinions, based on 170,000 surveys from the US and abroad as well as many meetings and focus groups. [439]
  66. Leaked by Lauren Windsor, a young, little-known blogger who went from libertarianism to crusading against big money in politics, Fink told the donors at Koch’s semiannual June 2014 summit that their challenge was that the country was divided into three distinct parts: 1/3 already in support of Koch’s conservative, libertarian agenda, 1/3 liberals or “collectivists” who were beyond the Koch’s reach and 1/3 were the “middle 1/3” who “will determine the direction of the country” – “the battle for the future of the country is who can win the hearts and minds of the middle third” [439-440]
    1. He explained that the government-slashing agenda of the Koch network was a problem for the middle third. [440] “We want to decrease regulations. Why? It’s because we can make more profit, okay? Yeah, and cut government spending so we don’t have to pay so much in taxes. There’s truth in that”. [440] But the middle third of American voters were uncomfortable with positions that seemed motivated by greed. [440]
    2. Instead, they wanted a clean environment and health and high standards of living, as well as political and religious freedom and peace and security. [441]
    3. The improved pitch was to “launch a movement for well-being” – to preach that free markets were the way to happiness, while big government led to tyranny and fascism, because they caused dependency, which then caused psychological depression and then totalitarianism. [442] Interestingly enough, Koch was not worried that recently promoting his son, Chase, to the presidency of Koch Fertilizer would “cause dependency”, depression and totalitarianism, saying how his son had at “every step, he’s done it on his own”. [443]
    4. To this end, Fink explained that the Kochs would form and publicize partnerships with unlikely allies to “earn the respect and good feeling” of the middle third. [443] For example, Mark Holden, general counsel of Koch Industries, confirmed in an interview that the Kochs became active in criminal justice reform after the Clinton Justice Department charged Koch Industries in 2000 with environmental crimes regarding benzene, for which it paid a $20 million fine to avoid jail time for its employees. [443] So while supporting the National Association of Criminal Defense Lawyers, the Kochs added a partnership with the United Negro College Fund. [443-445]
    5. The Kochs also focused on education as a delivery system for the donors’ conservative ideology and as a long-range strategy to change the country’s political makeup. [447] A 2015 report by an Art Pope-connected nonprofit said, “Money talks loudly on college campuses”. [447-448] For example, former Cato Institute chairman, John Allison, oversaw grants to 63 colleges that all required the programs to teach his favorite philosopher, the celebrator of self-interest Ayn Rand. [448] At Florida State University, where a Koch foundation grant in 2008 gave the foundation a say in faculty hires, one undergraduate complained that his introductory economics class had a textbook cowritten by a former recipient of Koch funds, Russell Sobel, that argued that “climate change wasn’t caused by humans and isn’t a big issue”. [448]
      1. Charles also devised a nonprofit called the Young Entrepreneurs Academy which formed an agreement with the financially pressed Topeka school system to teach that Franklin Roosevelt didn’t alleviate the Depression, minimum wage laws and public assistance hurt the poor, lower pay for women was not discriminatory and that the government, rather than business, caused the 2008 recession. [448-449] The program was aimed at low-income areas and paid students to take additional courses online. [449]
  67. They didn’t want to merely win elections; they wanted to change how Americans thought [461] – which was to agree with Charles Koch when he said, in response to splitting a treat with others as a child, “I just want my fair share – which is all of it” [465]
11. Trump staff or shortlists who were major recipients of Koch campaign contributions
  1. Vice President and (past) chair of Trump’s transition team, Mike Pence, Koch’s first choice for 2012 presidency, e.g. $300,000 personally from David Koch over the four years before Trump chose Pence as his running mate [xiii]
    1. Denied the reality of climate change [xiii]
    2. Was in favor of privatizing Social Security [xiii]
  2. Pence’s senior adviser for transition team, Marc Short, had run Koch’s secretive donor club, Freedom Partners, the group Trump ridiculed during the campaign [xiii]
  3. Mike Pompeo, Republican congressman from Kansas, Trump’s nominee for CIA director, the single largest recipient of Koch campaign funds in Congress [xv] also known as “the congressman from Koch” [xvi]
  4. ~ Rebekah Mercer, member of Trump’s transition team, daughter of Robert Mercer, New York hedge fund manager who “out-Koched the Kochs” in 2014 [xvi]
  5. Michael McKenna, an early pick for Trump’s transition team regarding the Department of Energy, president of MWR Strategies, a lobbying firm who had worked for Koch Industries [xiv]
  6. Michael Catanzaro, headed “energy independence” for Trump’s transition team, partner at CGCN Group, a lobbying firm, named as a possible White House energy czar [xiv]
  7. Harold Hamm, billionaire founder of Continental Resources, an Oklahoma-based shale oil company known for its enormously lucrative fracking operation, charter member of the Kochs’ donor circle, reportedly advised Trump on energy issues and named for a potential cabinet post, like energy secretary [xiv]
  8. Myron Ebell, Trump’s pick to head his transition team for the EPA, formerly employed by Competitive Enterprise Institute, funded by fossil fuel interests [xiv]
12. The Koch network, Kochtopus, most donors in the top .1% or higher of the nation’s wealthiest citizens [8]
  1. Coal, oil, and gas magnates formed the nucleus of the Koch donor network. [246]
  2. Koch donors are mostly private owners of their businesses with no requirements for public disclosures to shareholders [22]
  3. The Koch summits for conservative donors twice a year started in 2003 [10], mainly to oppose any government action on climate change that would hurt their profits [11]; most agreed on opposing government regulation and taxation. [16]
  4. The summits began with 15 people in 2003 to include 18 billionaires in 2015 who alone were worth more than $214 billion [13] and about 400 of the richest people in the country [10-16?]
  5. 2016, bigger payroll than the Republican National Committee, with the aim of targeting 5 million voters in 8 states with key Senate races, to keep both houses of Congress under conservative Republican control and then to continue the sweep of state and local legislatures that began in 2010 [xvii] in Texas alone, 74 different races including county court commissioner [xviii]
  6. 1,600 paid staffers in 35 states to cover 80% of the population [xvii]
  7. Richard Mellon Scaife, heir to the Mellon banking and Gulf Oil fortunes [6] and Alcoa aluminum [73]
    1. Scaife’s memoir estimates that he helped bankroll at least 133 of the conservative movement’s 300 most important institutions. [93]
    2. In 1975, the Scaife Family Charitable Trust gave $195,000 to the new conservative think tank in Washington started in 1973 whose first donor was Joseph Coors, a scion of the archconservative Colorado-based Coors brewery family, the Heritage Foundation. From 1975-1985, Scaife became its largest backer, donating $10 million more [93] and by 1988, their donations totaled $23 million. [93]
      1. Previously, Scaife had been the largest donor to the American Enterprise Institute (AEI), the older, rival conservative think tank in Washington but preferred a research center that would actively lobby members of Congress before decisions were made instead of worrying about its nonprofit status [94]
      2. Unlike traditional research institutes e.g. the Brookings Institution, founded in 1916, whose mission was to be “free from any political or pecuniary interest” and mandated that scholars of many viewpoints populate its board [96], the Heritage Foundation prided itself on creating, selling, and injecting deeply conservative ideas into the American mainstream. [94]
      3. Oliver Smedley, cofounder of the grandfather of libertarian think tanks in London, the Institute of Economic Affairs as well as the Manhattan Institute in New York, said it was “imperative that we should give no indication in our literature that we are working to educate the public along certain lines which might be interpreted as having a political bias. In other words, if we said openly that we were re-teaching the economics of the free market, it might enable our enemies to question the charitableness of our motives”. [97]
      4. Instead in the 1970s, they would accuse existing establishment organizations committed to neutrality and public service like Brookings and the New York Times of equal “bias” in favor of the public interest and being liberal. [99]
        
        “They introduced doubt into areas of settled academic and scientific scholarship, undermined genuinely unbiased experts [100] and gave politicians a menu of conflicting statistics and arguments from which to choose” [100] … The hazard … was that partisan shills would create “balance” based on fraudulent research and deceive the public about pressing issues in which their sponsors had financial interests.” [100]
      5. By the 1980s, Heritage Foundation’s other sponsors included Fortune 500 companies such as Amoco, Amway, Boeing, Chase Manhattan Bank, Chevron, Dow Chemical, Exxon, General Electric, General Motors, Mesa Petroleum, Mobil Oil, Pfizer, Philip Morris, Proctor & Gamble, R. J. Reynolds, Searle, Sears, Roebuck, SmithKline Beckman, Union Carbide, and Union Pacific. [108]
      6. By the early 1980s, the reversal of public opinion was so significant that Americans’ distrust of government for the first time surpassed their distrust of business. [108]
      7. By 1985, the Heritage Foundation’s budget equaled that of Brookings and AEI combined. [111] Scaife, whose total by then was $10 million, was contributing $1 million per year. [111]
      8. Paul Weyrich, cofounder of the Heritage Foundation, [94] created the Republican Study Committee, a caucus where the Heritage Foundation was the only outsider to caucus with Republican members of Congress. [108]
      9. Weyrich also created the American Legislative Exchange Council (ALEC), a group aimed at waging conservative fights in every state legislature in the country. [109]
        
        From 1973-1983, the Scaife and Mellon family trusts donated $500,000 to ALEC, constituting most of its budget. [109]
        
        The American Legislative Exchange Council (ALEC), created by Paul Weyrich, cofounder of the Heritage Foundation in the 1970’s [109], became a conservative corporate “bill mill” where thousands of businesses and trade groups paid expensive dues to attend closed-door conferences with local officials where they drafted model legislation that state legislators subsequently introduced as their own. [425-426] On average, ALEC produced about 1000 new bills a year, some 200 of which became state law. [426] ALEC was almost indistinguishable from a corporate lobbying operation, but defined itself as a tax-exempt 501(c)(3) “educational” organization. [426] For years, among ALEC’s most active members was the for-profit prison industry. [426] In 1995, ALEC began promoting mandatory-minimum sentences for drug offenses. [426] Two years later, Charles Koch bailed ALEC out financially with a $430,000 loan. [426]
      10. Weyrich cofounded “The Moral Majority” with Jerry Falwell, which brought social and religious conservatives into the pro-corporate fold. [110]
        
        Reagan delivered 61% of Heritage’s 1,270 policy proposals from its policy playbook, Mandate for Leadership. [110]
        
        Between 1981-1986, the top income tax was cut from 70% to 28%. Meanwhile, taxes on the bottom 4/5 rose. Economic inequality, which had flatlined, began to climb. [111]
  8. John M. Olin, chemical and munitions company titan [6] and Cornell graduate and former trustee [112]
    1. The Olin Corporation began in East Alton, Illinois in 1892 as a manufacturer of blasting powder for coal miners and then expanded into making small arms and ammunition, quintupling its revenues due to WWI and WWII due to its huge government contracts e.g. $40 million in profits from WWII alone. [115] After a 1954 merger with the Mathieson Chemical Corporation, it made everything from pharmaceuticals in its Squibb division to Winchester rifles and the hydrazine rocket fuel powering Neil Armstrong’s 1969 lunar landing. [116]
      1. But by 1973, the Olin Corporation was embroiled in serious, expensive litigation over its environmental practices [115] such as its production of DDT, of which it supplied 20% of the US total [116].
      2. In 1970, the New York Times reported that the U.S. Interior Department charged the Olin Corporation with dumping 26.6 pounds of mercury a day into the Niagara River in upstate New York. [117] Three former corporate officers were convicted of falsifying records in the case and the judge imposed the maximum available fine of $70,000. [117]
      3. However, Olin Corporation’s pollution was so extensive and intractable that it faced the prospect of tens if not hundreds of millions of dollars in cleanup costs, with no end in sight. [118]
        
        In Saltville, one of its company towns in Virginia, the company estimated it dumped about 100 pounds of mercury a day into public waterways from 1951-1970. [118] The cost of cleaning up Saltville was projected to be upwards of $35 million. [121] Facing increasing competition, battles with the United Mine Workers and new 1970 Virginia standards that it couldn’t meet, the Olin Corporation shut down the plant in 1972 and sold most of its real estate [119-120]. Soon after, the EPA designated Saltville one of the country’s first “Superfund” sites.
      4. The Olin Foundation underwrote 83% of the costs of all “Law and Economics” programs in American law schools, including Harvard, Yale, Chicago, Columbia, Cornell, Georgetown and the University of Virginia – a new approach to jurisprudence known as which stressed the need to analyze laws, including regulations, not just for fairness but also for their economic impact. [130-131] Other donations included an $18 million donation for the John M. Olin Center for Law, Economics, and Business at Harvard Law School [132] and $5.5 million in start up funds, along with other donors such as foundations tied to Scaife and the Kochs, for the Federalist Society in 1982, a powerful professional network of 42,000 right-leaning lawyers, across 150 law school campuses. [134]
  9. Harry and Lynde Bradley, midwesterners enriched by defense contracts [6]
    1. The Allen-Bradley company was a Milwaukee electronic manufacturer, which relied on government defense contracts for 70% of its business, with its business volume tripling during WWII. [141] It was bought by Rockwell International, America’s largest defense contractor, for $1.6 billion in cash.[140]
    2. This 1985 merger turned the assets of the Lynde and Harry Bradley Foundation from $14 million to over $290 million overnight, making it one of the 20 largest foundations in the country. [137]
    3. 2/3rd of its grants financed conservative intellectual activity from 600 graduate and post-graduate fellowships, right wing think tanks, conservative journals, and its own publishing house, Encounter Books. [138]
    4. Thanks to smart investments, by 2012, the Bradley Foundation’s assets reached over $630 million, enabling more than $32 million in grants that year alone [144] such as $250,000 Bradley Prizes for stars of the movement such as Fox News president, Roger Ailes. [144-145]
    5. The Bradley Foundation added Diane Hendricks and Art Pope to its board. [383]
  10. Coors brewing company of Colorado [6]
    1. The first donor to the Heritage Foundation in 1973 [94]
  11. DeVos family of Michigan, Amway founders [6]
  12. Steven A. Cohen ($10.3 billion) [no date, 17], SAC Capitol Advisors hedge fund which was criminally investigated for insider trading
  13. Paul Singer ($1.9 billion) [no date, 17], Elliott Management “vulture fund” [17]
  14. Stephen Schwartzman, Blackstone, his phenomenally successful private equity company [18], who made $677 million from selling some of his shares, retaining $7.8 billion of additional shares, triggering political opposition to the carried-interest tax loophole [18]
  15. Robert Mercer, cochair of Renaissance Technologies hedge fund [18]
  16. Ken Langone, billionaire cofounder of Home Depot, who decided to pay his friend Dick Grasso $139.5 million to be head of the New York Stock Exchange [19]
  17. Richard Strong, founder of Strong Capital Management mutual fund, banned from the financial industry for life after improperly timed trades for friends and family, paying $60 million in fines himself and $115 million from his company for related penalties [19]
  18. Philip Anschutz, a founder of Qwest Communications, Colorado oil and entertainment billionaire, dubbed America’s “greediest executive” by Fortune magazine in 2002 [20]
    1. Owner of the Washington Examiner and The Weekly Standard [68]
    2. Heir to a western oil-drilling fortune who himself discovered a fabled oil field on the Wyoming-Utah border in the 1980s, after which he diversified into ranches, railroads, and communications [247]
  19. Foster Friess, Wyoming mutual fund magnate, largest shareholder of The Daily Caller [320]
  20. Corbin Robertson Jr., grandson of one of the Texas’s most legendary oil barons, Hugh Roy Cullen. [246] His family built billion-dollar oil company, Quintana Resources Capital, owner of, by 2003 [246], the “largest private hoard in the nation – 21 billion tons of reserves” of coal according to Forbes [21], enough to fuel the entire country for 20 years [246]
    1. Linked to political front groups opposing the EPA, such as Plants Need CO2 [21]
  21. Richard Gilliam, coal magnate, head of Virginia mining concern Cumberland Resources [21], sold right before one of its mines killed 29 miners in the worse coal mine disaster in 40 years, making the buyer’s CEO the first coal baron to face criminal charges [22]
  22. J. Larry Nichols, “fracker”, cofounder / head [247] of the huge Oklahoma-based concern Devon Energy [22], later chairman of the American Petroleum Institute, the foremost trade association for the oil company [247]
  23. Harold Hamm ($8.2 billion in 2015) “fracker” founder [246] of Continental Resources, the biggest operator in North Dakota’s booming Bakken Shale [22]
  24. Sheldon Adelson ($31.4 billion) [no date, 23], founding chairman and chief executive of the Las Vegas Sands Corporation, the world’s largest gambling company, investigated by the Justice Department for bribery and violations of the Foreign Corrupt Practices Act [23]
  25. Richard Farmer ($2 billion) [no date, 24], chairman of the Cincinnati-based Cintas Corporation, the nation’s largest uniform supply company, which paid a record $2.76 million with OSHA for six safety citations including one fatality where a worker burned to death in an industrial dryer after getting caught on a conveyor belt, with over 170 safety violations since 2003 including 70 that “could cause death or serious physical harm” [23]
  26. Stephen Bechtel Jr. ($2.8 billion) [no date, 24], grandson of the founder of Bechtel, the 6th largest private company in the country, owing almost its entire existence to government patronage e.g. $39.2 billion from 2000-2009 in U.S. government contracts, $680 million to rebuild Iraq after the US invasion [24] Bechtel also made billions building refineries and pipelines in Saudi Arabia, Venezuela and elsewhere. [247]
  27. John Menard Jr., richest man in Wisconsin ($6 billion in 2010 [380]), Koch summit donor and $1.5 million donor to the Wisconsin Club for Growth, an outside dark-money group boosting Walker, whose chain of home improvement stores received $1.8 million in special tax credits when Walker became chair of a state economic development corporation as well as lessened enforcement actions against pollution [379-380]
    1. Scott Walker, first-term governor of Wisconsin, who had Koch Industries PAC as his 2nd largest campaign contributor [377] also the beneficiary of the Bradley brothers, Lynde and Harry, of Milwaukee. [378] Walker’s campaign manager, Michael Grebe, was the Bradley Foundation’s (with assets of over $612 million) president. [378]
  28. Diane Hendricks, richest woman in Wisconsin and Koch donor [381], cofounder of ABC Supply, the nation’s largest wholesale distributor of roofing, windows, and siding, with her husband Ken, Walker’s biggest backer, who paid no personal state income taxes in 2010 [381-382]
13. Other conservative organizations
  1. Hoover Institution at Stanford University [210]
  2. “Freedom Center” at the University of Arizona, founded by the Kochs, where the Kendrick Professor of Philosophy taught “freedom” to college students [228]
  3. State Policy Network [xiv], founded by Thomas A. Roe, an antiunion construction magnate from Greenville, South Carolina whose goal was to “capture the states”, with this national coalition of conservative state-based think tanks, whose budget was $83.2 million in 2011, numbering 64 by 2012, by taking a “catalogue” of “raw materials” and “services” from the national organization, similar to IKEA, and then using local chapters to assemble the ideological products at home. [425] Tracie Sharp, the president, said, “Pick what you need and customize it for what works best for you”. [425] SPN provided legislative research. [426]
  4. Franklin Center for Government and Public Integrity, partner with SPN, a “news” organization [427], 95% of its revenues in 2011 provided by DonorsTrust contributors [428]
  5. Council for National Policy, a secretive “little known club of a few hundred of the most powerful conservatives in the country [that] met behind closed doors in undisclosed locations for a confidential conference” three times a year, according to the New York Times, that including the DeVos family, Jerry Falwell, Phyllis Schlafly, Pat Robertson, and Wayne LaPierre of the National Rifle Association [286] as well as Foster Friess, the multimillionaire founder of a Wyoming mutual fund, Friess Associates [287]
  6. Civitas Institute and John Locke Foundation, founded by Art Pope and largely funded by the Pope family’s foundation, John William Pope Foundation [416] – 97% of Civitas’s funding since its founding in 2005 ($8 million) and 80% of John Locke’s, with the remainder mostly from tobacco companies and the two Koch family foundations [416]
  7. Competitive Enterprise Institute, an anti regulatory free-market think tank in Washington funded by the Bradley, Coors, Koch, and Scaife families, and chaired by Michael Greve, George Mason University law professor [430]
  8. Conservative Action Project, a collection of three dozen conservative groups who signed a “blueprint to defund Obamacare”, led by former attorney general Edwin Meese III, an aging standard-bearer of the conservative movement who was the Ronald Reagan chair at the Heritage Foundation, a board member at the Mercatus Center at George Mason University and a frequent attendee of the Koch donor summits [431]
  9. American Energy Alliance, a tax-exempt nonprofit advocating for corporate-friendly energy policies, given $1.5 million from Freedom Partners in 2012 [xiv]
  10. Americans for Tax Reform, antitax activist Grover Norquist’s organization [308]
  11. Americans for Limited Government, Howard Rich’s group [308]
  12. Real Jobs NC, a seemingly independent outside political group which received $200,000 in seed money from Pope in 2010 and $1.25 million from Ed Gillespie’s RSLC, responsible for “Go fish!” and “pork projects” attack ads that succeeded in unseating John Snow, a retired Democratic judge considered one of the most conservative Democrats in the general assembly, against a Republican opponent with minimal political experience by fewer than 200 votes, along with Civitas Action [321-322]
  13. Tully Friedman, chairman of the American Enterprise Institute, private equity tycoon [342]
  14. American Family Business Institute, a front group that attempted to cast the “death tax” break as necessary to preserve family farms, but failed to find one that qualified [357]
  15. Wyoming Liberty Group, conservative think tank founded by Gore-Tex fabric fortune Susan Gore, who attempted to legally adopt her ex-husband to enlarge her portion of her family’s trust [357]
  16. The Independent Women’s Forum, advocating for spending cuts [362]
  17. American Commitment, advocating for spending cuts [362]
14. Nonpartisan watchdog groups
  1. Center for Public Integrity, founder Charles Lewis [6]
15. Liberal watchdog groups
  1. Media Matters [261]
16. Watchdog groups
  1. National Committee for Responsive Philanthropy [180]
  2. Constitutional Accountability Center [187]
17. Liberal organizations
  1. Ford Foundation funded the Environmental Defense Fund and Natural Resources Defense Council and public interest litigation [122]
  2. Public Citizen, a liberal group favoring tighter campaign finance regulations [308]
  3. Democracy Alliance, a progressive counterweight to DonorsTrust, by Rob Stein, a Democratic activist
18. Nonprofits
  1. ProPublica, the nonprofit investigative reporting concern

Detours In Eden

Outlined Summary of Dark Money by Jane Mayer

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Outlined Summary of Dark Money by Jane Mayer

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