Friday, February 25, 2011

It's the Kochtopus!!! Ohhh Noez!!

I actually began a post on this topic about 6 months ago, but life got in the way and I never ended up completing it as intended. It's a good thing I didn't, however, because a few great recent posts from economist Steve Horwitz have done most of my work for me.

For the last several years, the left in the United States has made a boogeyman out of David & Charles Koch... Better known as the nefarious "Koch Brothers".

Most of the complaints against them might as well have been written by a single person, for all the creativity & originality they possess... and I'm talking about the favored writers at joints like the NY Times, Mother Jones, Talking Points Memo, Huffington Post, Daily Koz and other professional "journalists" all the way down to any number of my liberal/leftist friends.

Charles & David Koch
The claim is simple: The "billionaire Koch brothers", who's money comes from the most evil of all businesses, oil (zomg!), are using their limitless money to fund "right-wing" causes that enrich themselves and their (Republican) buddies at the expense of everyone else. Not only that, but they are doing so in secret, backing and controlling their puppet organizations like the Tea Party or now, even Wisconsin Governor, Scott Walker.

Here's a few quotes so you can see for yourself what people are saying about them right now. For instance... in the wake of Wisonsin's public-sector union battle, plenty of people have come out claiming that the Koch brothers are behind it all.

In the article, "Wisconsin Gov. Scott Walker: Funded by the Koch Bros.", Andy Kroll of Mother Jones writes:
"Charles and David Koch are conservative titans of industry who have infamously used their vast wealth to undermine President Obama and fight legislation they detest, such as the cap-and-trade climate bill, the health care reform act, and the economic stimulus package. For years, the billionaires have made extensive political donations to Republican candidates across the country and have provided millions of dollars to astroturf right-wing organizations. Koch Industries' political action committee has doled out more than $2.6 million to candidates. And one prominent beneficiary of the Koch brothers' largess is Scott Walker."
From the New York Times piece, "Billionaire Brothers’ Money Plays Role in Wisconsin Dispute", Eric Lipton claims:
"To Bob Edgar, a former House Democrat who is now president of Common Cause, a liberal group that has been critical of what it sees as the rising influence of corporate interests in American politics, the Koch brothers are using their money to create a fa├žade of grass-roots support for their favorite causes.

“This is a dangerous moment in America history,” Mr. Edgar said. “It is not that these folks don’t have a right to participate in politics. But they are moving democracy into the control of more wealthy corporate hands.”"
Rick Unger, at re-blogged more from Mother Jones, while calling the political advocacy organization, Americans for Prosperity, "a Tea Party group that is a Koch brothers front", in spite of the fact that AFP has been around on its own since 2004, and which has roots going back to the organization, "Citizens for a Sound Economy", which formed in 1984... thus predating the "Tea Party" movement in the US by oh, I dunno... about 25 years!

But no, seriously... It's just "astro-turf" for the Tea Party.

That said, it is obviously true that AFP is supported by the Koch brothers, but... "a front"? Really? The word "front" implies secrecy and wrong-doing, like how a Chinese restaurant might be a "front" for the Triad Gang. Or as a dictionary might put it:
n. a person or thing that serves as a cover or disguise for some other activity, especially one of a secret, disreputable, or illegal nature; a blind: The store was a front for foreign agents.
So for an organization founded by the Koch brothers (and others) essentially 3 decades ago, which is unabashedly and openly supported with Koch money (and not even all that much, quite frankly... a few million dollars over the last 5 years to run a nation-wide organization) and for an organization who's chairman is David Koch himself, they're being remarkably unsubtle if they meant their backing to be hidden from the public view.

The secrecy meme is one of the more insidious accusations, while also being one of the most hilarious. David Koch ran for vice president under the Libertarian Party banner back in 1980... It's not like his views should come as a surprise to anyone, except for people who have approximately no clue what they're talking about.

Problem is, the "secrecy" bit is a lynchpin to the whole case against the Koch brothers, isn't it?

If they're just out in the open, using their own money to support causes they honestly believe in, that would naturally reflect the right to free speech in a "free country", would it not? We all like to believe America is a place where different people are allowed to express their opinions, and support causes that they see fit, so everything being out in the open is just part of the marketplace of ideas.

But if they are being sneaky about it... Well... That's different! Then it's not "free speech" at all, but devious corruption. At least, that's the prevailing view.

This line of attack was most famously put into place by Jane Mayer's exceptionally long hit-piece in the New Yorker, titled "Covert Operations", from August of last year, which really kicked up all of the new hatred and fear-mongering. That article was 10 pages long online, so I think a few different excerpts may be appropriate:
"The Kochs are longtime libertarians who believe in drastically lower personal and corporate taxes, minimal social services for the needy, and much less oversight of industry—especially environmental regulation. These views dovetail with the brothers’ corporate interests."
Mayer acknowledges that plenty of rich people do the same things, but she explains the difference:
"Of course, Democrats give money, too. Their most prominent donor, the financier George Soros, runs a foundation, the Open Society Institute, that has spent as much as a hundred million dollars a year in America. Soros has also made generous private contributions to various Democratic campaigns, including Obama’s. But Michael Vachon, his spokesman, argued that Soros’s giving is transparent, and that “none of his contributions are in the service of his own economic interests.” The Kochs have given millions of dollars to nonprofit groups that criticize environmental regulation and support lower taxes for industry. Gus diZerega, the former friend, suggested that the Kochs’ youthful idealism about libertarianism had largely devolved into a rationale for corporate self-interest. He said of Charles, “Perhaps he has confused making money with freedom.”

Some critics have suggested that the Kochs’ approach has subverted the purpose of tax-exempt giving.”
See... That's the key.

George Soros is fine, because Soros' funds projects that "aren't in his self interest", and he does so "out in the open".

Never mind that an expansive state is the best friend big business has ever had. Never mind that a government with top-down authority over regulating all aspects of our economy is extremely easy for big businesses & rich people to manipulate and "capture", as well as frequently becoming the generator of enormous economic "rents".

Jane Mayer's failure to understand economics is directly proportional to her failure to understand why uncritically taking the word of George Soros' spokesman regarding his commitment to altruism is utter bollocks. Soros' business & financial interests are inextricably entwined with having a bigger, more powerful state... Just as Warren Buffett's financial interests were unquestionably advanced by his support of massive stimulus, bailouts & the reduction of interest rates/monetary expansion.

The funny thing is, while corporate interests benefit immensely from a bigger, more powerful government - the same is actually not true in the reverse.

The Koch brothers' funding of any truly free-market cause actually opens their company and its subsidiaries up to substantial competition, it would ultimately eliminate the possibility of subsidies and bailouts, and erode away the special protections corporations have against losses. Additionally, markets are pluralistic and additive, while government is zero-sum - so all of the expansions of the state do is make legally prescribed winners & losers, rather than winners and slightly lesser winners, as happens in the market (in general).

So it is with great poetic justice that I'm forced to suggest that if anyone is being particularly self-interested and greedy in his or her policy advocacy - it's people like Soros, not the Kochs.

Why people persist on believing that a powerful state is a "check" on powerful business interests, instead of its greatest ally, is truly one of life's great mysteries. The truth is that free markets are the worst thing for big businesses - and they know it, which is precisely why most lobby in favor of rules (on their competitors), subsidies, and tariffs instead of arguing against them.

But anyway... Moving on...

One of the more curious aspects about the Kochs, according to Mayer & others, is that they are alternatively "conservatives", "libertarians", and even "anarchists". No qualifications are made to explain the differences between entirely incompatible ideas. But that's the over-arching theme... Much like at any time when big numbers and emotionalized arguments are used for effect, the thing that's scrupulously missing from all of the critiques is intellectual depth and context.

Fortunately, I will now provide some of that for you.

First of all.. Libertarianism & conservativism are different ideas, as are political (capital "L") Libertarians and Republicans. Note that most professional Republicans (and Democrats!) support the PATRIOT Act. Whereas... as Radley Balko wrote today:
"Curiously missing [from Jonathan Chait's New Republic article - and from Jane Mayer's piece for that matter], however, is the $20 million donation the Kochs made to the ACLU to fight the Bush administration over the PATRIOT Act. Browsing various accounts of the Kochs political spending over the years, that $20 million appears to be substantially more than the Kochs have contributed to all political candidates combined for at least the last 15 years. (Their gifts to the arts and other non-political charities exceeds what they've spent on politics many times over.)"
Funny, isn't it?

Evil conservative "Republicans" giving $20 million to put an end to the PATRIOT Act. Why in the world would they do that? Republicans wrote it, campaign on it, and vote for its extension year after year (as do the folks on Team D, just to be clear).

Radley was responding to Jonathan Chait's claim that the Koch brothers...
"happily put their money behind candidates and intellectuals who agree with their economic agenda but disagree with their social agenda. They will never put their money behind candidates or intellectuals of whom the reverse is true."
Fail, as usual Mr. Chait.

Surely that's not enough though. These are evil oil tycoons, right? So clearly, their token (if you call a cool $20,000,000 "token") donation to the ACLU is just PR money. Fortunately, there was a fabulous Reddit post the other day that just sat down & made a gloriously sarcastic list of a few of the causes these horrible "Republicans" put their money behind:
"The KOCH brothers must be stopped. They gave $40K to Scott Walker, the MAX allowed by state law. That's small potatoes compared to the $100+ million they give to other organizations. These organizations will terrify you. If the anti-union thing weren't enough, here are bigger and better reasons to stop the evil Kochs. They are trying to:
  1. decriminalize drugs,
  2. legalize gay marriage,
  3. repeal the Patriot Act,
  4. end the police state,
  5. cut defense spending.
Who hates the police? Only the criminals using drugs, amirite? We need the Patriot Act to allow government to go through our emails and tap our phones to catch people who smoke marijuana and put them in prison. Oh, it's also good for terrorists.

Wikipedia shows Koch Family Foundations supporting causes like:
  1. CATO Institute
  2. Reason Foundation
  3. cancer research ($150 million to M.I.T. - STOP THEM! KEEP CANCER ALIVE!)
  4. ballet (because seriously: F***. THAT. S***.)"
Yeah, it's pretty obvious these Koch guys are teh EVIL!

You know what else they have paid for - at least in part - through their support of organizations like the Institute for Justice?

How about helping this family fight the government's irrational & cruel prohibition of compensating bone marrow donors - so that three young girls' lives will be spared from a horrible & debilitating disease?

How about going up against collusion between private developers and big government, unscrupulously using Eminent Domain to evict people from their homes, and transfer their private property to other private citizens by force?

Or maybe you'd be surprised to learn that those awful Republican billionaires want to stop police officers from seizing people's property without even a shred of Due Process and then reselling it for personal/departmental gain?

Now... Admittedly, these three films all have something in common. It's pretty personally relevant too...

That's right, I scored each of the above three films. And I'm not going to lie, being a part of producing these shorts is something that I am most proud of in all my life.
The David Koch Theatre at Lincoln Center

Koch-supported organizations include many who I've worked with, and who have supported my work over the last few years. I'll say right here that I'm really not a big fan of their donations to Republican political candidates (or to really any political candidates at all), but the general thrust of their advocacy I have always been able to get behind.


Well... Because apart from the boogeyman status they've received by a lot of wholly ignorant individuals, the vast majority of their supported foundations and causes do profoundly good work. Please, watch the videos above... They were produced with a little bit of Koch money.

They've also spent a staggering sum of money on arts, research & education in New York City and elsewhere... So, sorry my NYC liberal friends... A lot of the things you love simply wouldn't exist without them.

For instance, just to look at David Koch's contributions - he's given:
  1. $100 Million to renovating Lincoln Center
  2. $10 Million to the Metropolitan Museum of Art
  3. $6 Million to the American Ballet (where David is a Trustee)
  4. $15 Million to the National Museum of Natural History for an entire exhibit on human evolution (another bastion of conservatism!)
  5. $20 Million to the American Museum of Natural History
  6. $7 Million to the PBS program "NOVA" (which is fabulous)
This is not to mention the (holy S***!!!) contribution of well over $231 Million dollars to fund research to cure cancer. 

Nor does it include the $68 Million he gave Deerfield Academy to found a center for mathematics, science & technology, or the $10 Million given to the Cold Spring Harbor Laboratory... The list of contributions to phenomenal causes seems just about endless - and whatever you think about their politics, their contributions to political candidates is literally a tiny drop in an ocean of charitable giving.

So... Really, guys? Really Mother Jones? New Yorker? New York Times? The New Republic? The Nation? 


These guys - people who have given hundreds of millions of dollars to preventing death by horrible disease, to combating police state abuses, to ending the "war on drugs", the "war on terror", to preventing big private developers from bulldozing poor neighborhoods just so they can put up a new luxury condo, and people who have come out in favor of gay marriage, and of everybody's right to choose their own lifestyles; and who have even given millions to fund science education, from PBS programs to evolutionary biology - are your great "conservative" boogeymen?

No really... Take a second and let that sink in. This is the fight the left wants to have?

But this is what I'm saying... In all of the hit-pieces on these guys, there is utterly not a shred of context given - and that's the only way they can make the Kochs seem like the reprehensible "Republicans" that their story line needs them to be.

Take a second and compare the $10-11 Million or so they've given to political candidates over the last decade or more to the list I just compiled.


After all this hubbub about Public Sector Unions vs. the Taxpayers (and Governor Walker) in Wisconsin, and the articles that blame the Koch brothers for Walker's actions, Koch Industries did publish an official response. And you know what I like about it?

That's right... Context:
"Koch Industries’ Political Action Committee, KOCHPAC, contributed $43,000 to Gov. Scott Walker’s 2010 gubernatorial campaign – less than one-half of one percent of the $9.195 million raised by the Walker campaign.

Koch has always and will continue to support market-based policies that advance economic freedom, and we support candidates who do the same. This was the basis for Koch’s support of Gov. Walker's candidacy."
Read it again: Less than one half of one percent (0.47%, to be exact) of $9.195 Million raised by Walker's campaign. Scary! Koch Industries also responded to Jane Mayer's piece in a letter last year, parts of which are certainly worth noting here as well:
"The story incorrectly suggests that Charles Koch, David Koch and Koch Industries are secretly funding and participating in a shadowy political netherworld. Contrary to the article, the Kochs have openly supported economic freedom for decades and affixed their names to fellowships, foundations and endowed professorships. David Koch's biography on teh Americans for Prosperity Foundation website says he helped found the organization, "and also serves on the board of directors for the Reason Foundation and the CATO Institute". The Charles G. Koch Charitable Foundation website notes that Charles Koch "has continuously supported academic and public policy research (including a number of Nobel Prize winners) for more than 40 years" and says he founded or helped build organizations such as the Institute for Humane Studies, the Cato Institute, the Mercatus Center at George Mason University, the Bill of Rights Institute, and the Market-Based Management Institute."
The letter goes on to point out that:
"On the other hand, Ms. Mayer unquestioningly prints a statement from George Soros' spokesman Michael Vachon that "none of [Mr. Soros'] contributions are in the service of his own economic interests." This statement was directly contradicted by Mr. Soros himself in a 2004 New Yorker article by Ms. Mayer in which Mr. Soros noted that "[t]here are occasionally symbiotic moments between political and business interests." Mr. Soros then explained how his attempt to set up a public policy think tank in England led to an opportunity to break into the British bond market, which he said resulted in "one of the most rewarding weekends of my life... I made many millions."
There's actually a lot more worth reading in the letter, as it goes on to discuss some of the sources that Jane Mayer used in the New Yorker piece - such as Gus diZerega, who "has not spoken with Charles Koch in more than 30 years and has no current knowledge of the Koch family", and the fact that Mayer fails to mention that Bruce Bartlett lost his funding from the Koch family, and was naturally a bit disgruntled.

But I think most annoyingly of all, the letter goes on to point out that, while so much time & effort has been spent claiming that the Kochs are secretive about their funding by naming their organizations like "The Bill of Rights Institute" (which, honestly I don't get, since the Bill of Rights is pretty clear... See, my videos on the topic - linked on that organization's page, no less!), Mayer cites sources from a bunch of organizations with neutral sounding names herself... But which aren't actually so neutral, but in fact quite blatantly "left-leaning organizations funded by liberal philanthropists."

"...many sources in her article, including the Center for Public Integrity, the Constitutional Accountability Center, the Center for American Progress and"
For me... I must say, one of the things that I most loath about Democrats/liberals that I truly believe they are much worse about than Republicans in general, is this tendency to vociferously decry behavior when directed "against" their interests while utterly ignoring the fact that they engage in the same activities - and often times, even worse.

I make no secret of who I am and what I believe. I haven't gotten the impression that Charles or David Koch do either. The same cannot really be said for a lot of the writers I read from the "left". Certainly Jane Mayer paints herself as an intelligent, neutral investigator. As do a lot of "reporters" working for various news magazines.

But we all know they are not unbiased. They just don't like to share their biases with the public.

Finally... I'm going to put one last thing into context, because it's a myth worth exploding once & for all. An unfounded fear from many I know on the left has been that the Citizens United decision would lead to a wild free-for-all where evil billionaires like the Koch brothers and their businesses would control everything. So when the 2010 elections wrapped up and the Democrats lost a massive number of their positions in the legislature, the explanation was all ready to go.

Certainly, it was all the fault of big money interests! Then they trot out stories of the Koch brothers (since they're the best known villain), and cite the millions of dollars the pair have put into political advocacy. What they neglect to mention is that, as my economist buddy Steve Horwitz pointed out today:
"The top 21 donors to political campaigns in the last 20 years include 12 unions (if you count the NEA and AFT), all of which are strongly or leaning to the Democrats to the tune of about $327m. Koch Industries, those evil villains, come in 83rd place at $11m, 10% of which went to Democrats. So explain to me again how it is that the Kochs are buying elections and crushing the poor downtrodden weak unions?"
To make the case, he linked to - a site which anybody could check, but which apparently no one ever does (I do, regularly). Honestly, you need to just look at it yourself, but here's the top 25 donors... The fields, in order, are - rank, organization, total contributions, percentage of contributions to Democrats, then percentage to Republicans.

The last field shows which party has gotten the most donations from each organization. See if you can notice a pattern:

2AT&T Inc$46,292,67044%55%
3American Fedn of State, County & Municipal Employees$43,477,36198%1%  
4National Assn of Realtors$38,721,44149%50%
5Goldman Sachs$33,387,25261%37%
6American Assn for Justice$33,143,27990%8%  
7Intl Brotherhood of Electrical Workers$33,056,21697%2%  
8National Education Assn$32,024,61093%6%  
9Laborers Union$30,292,05092%7%  
10Teamsters Union$29,319,98293%6%  
11Carpenters & Joiners Union$29,265,80889%10% 
12Service Employees International Union$29,140,23295%3%  
13American Federation of Teachers$28,733,99198%0%  
14Communications Workers of America$28,376,30698%0%  
15Citigroup Inc$28,065,87450%49%
16American Medical Assn$27,597,82040%59%
17United Auto Workers$27,134,25298%0%  
18National Auto Dealers Assn$26,311,75832%67%
19Machinists & Aerospace Workers Union$26,229,47798%0%  
20United Parcel Service$25,290,03936%62%
21United Food & Commercial Workers Union$25,226,73398%1%  
22Altria Group$24,643,65127%72% 
23American Bankers Assn$24,048,22040%59%
24National Assn of Home Builders$23,461,90535%64%
25EMILY's List$23,391,76399%0%  

That's uh... A lot... a LOT of "donkeys", don't you think?

Yeah. It's a big pile of unions - we have the teachers, laborers, teamsters, carpenters, machinists, auto workers, auto dealers, food & commercial workers, service employees, electrical workers... and public sector workers even get the bronze medal!

Yet what has the story been for decades?

Big corporate interests (and to be sure, there are some on the list, big fat banks especially... banks which got bailed out in the last couple years, entirely against the wishes of people like me, and incidentally, the Koch brothers) are always the boogeymen. Always. Honestly... I'm kind of sick of it.

We hear the story of the big rich tycoons pumping in millions of dollars to support Republicans - because, as we all know, Republicans are the party for rich people... They've got the big bucks, and the Democrats have to fight on the popularity of their message.

Yeah... Not really at all.
I think it's really time for the mainstream left to quit their bitching and look at facts. Isn't that what they keep yapping about? They've been saying for the last 2-3 years now that "reality has a liberal bias", and "you can have your own opinion, but not your own facts", right? I hear this bollocks all the time!

There are countless leftist myths built up over the years about unions, government vs. big business, the New Deal... You name it... And many of those myths rely on people's ignorance of reality and of economics to remain viable. Well, guys... I know you're not going to magically understand economics overnight... But at the very least, I think it's really about time to drop the idiotic Koch fear-mongering.

I do hope I've done enough myth-busting for today. As I hope we've seen, the major reasons the Kochs are supposed to be evil-incarnate are:
  • They're "outspending" everyone in lobbying and campaign contributions - they aren't.
  • They're secretive about their beliefs, and "covert" about their political advocacy - wrong again.
  • They're ultra right-wing - not so much, unless the "right" is now in favor of legalizing pot, gay marriage ending military imperialism and educating kids in biology, science & math...
In each case, reality doesn't seem to be on the side of the liberal intelligensia at all...

Sorry guys... Truth is a harsh mistress.


Anonymous said...

So how much money have they given to Campaign for Liberty? Any of Ron Paul's presidential campaigns? ACLU? No wonder the PATRIOT ACT passed. Maybe if they gave some of that money to REAL libertarians, some good would result? Why don't they? Because they support foreign interventionism. Their mouthpiece Beck is testament to that. No non aggression principle, no liberty.

Sean W. Malone said...

Considering their deep disagreements, and long standing feud with the Ludwig von Mises Institute crowd, starting with Rothbard, but continuing with Lew Rockwell, I doubt they gave a ton to Ron Paul at any point.

But as I said above, they gave $20,000,000 to the ACLU specifically for them to combat the PATRIOT Act... that's about twice the amount they've given to all political candidates combined.

Again, I am not here to lavish praise on them for supporting specific politicians... in fact, if I had their money, you could bet on me not doing that ever... I would certainly never bankroll a campaign. I am just saying that it makes 0 sense for the left to make them into some scary, "conservative" boogeyman.