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How Koch Industries makes billions corrupting government and polluting for free

By Joe Romm on March 3, 2011 at 9:19 am

"How Koch Industries makes billions corrupting government and polluting for free"

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In most Orwellian op-ed of the year, pollutocrat Charles Koch has the chutzpah to attack “crony capitalism.”  The Kochs wrote the book on crony capitalism, as ThinkProgress explains in this cross-post.

In an opinion piece published this week, Koch Industries CEO Charles Koch promised to continue to finance anti-government, right-wing front groups. Koch writes that the “purpose of business is to efficiently convert resources into products and services that make people’s lives better.” But when it comes to Koch’s carcinogenic pollution and carbon emissions, the purpose of Koch’s political giving is to avoid any financial responsibility “” no matter who gets hurt. Koch Industries has cornered the market in monetizing some of the most dirty industrial businesses. Koch imports oil from the Middle East, refines high-carbon Canadian crude, maintains coal-burning plants, owns one of the largest oil pipeline networks in America, runs environmentally hazardous lumber mills, produces toxic chemicals, and manufacturers fertilizer. The University of Masschusetts Amherst has scored Koch as among the top ten worst air polluters for its carcinogenic chemicals.

Much of the entire Koch political machine is geared towards ensuring that Koch Industries never has to compensate the people and ecosystems damaged by Koch Industries pollution. Koch front groups “” from Tea Party groups to think tanks “” have diligently promoted Koch Industries’ bottom line by denying global warming, fighting regulations on Koch’s cancer-causing chemicals, and snuffing out investigations into Koch’s environmental crimes:

- In 1990, as both Republicans and Democrats proposed a cap and trade system to address acid rain, Koch financed a front group called “Concerned Citizens for the Environment” to battle proposed regulations. The Pittsburgh Post-Gazette reported that the group “has no citizen membership of its own,” but produced studies arguing that acid rain was a myth and that deregulation would benefit the environment. Koch refineries and factories, top emitters of acid rain-causing toxins, were impacted by the successful cap and trade system. A front group founded by David Koch, Citizens for a Sound Economy (which later changed its name to Americans for Prosperity), also battled regulations designed to combat acid rain, labeling the problem a “myth.”

- Koch Industries vastly expanded its political giving in reaction to revelations that the company had systematically stolen oil from Native American reservations and federal lands. Sen. Bob Dole (R-KS), a personal friend of the Koch brothers and top recipient of Koch money, sponsored legislation to suppress an investigation into the oil thefts. Over 50 Koch Industries employees later testified that indeed the “Koch Method” of manipulating data to surreptitiously take Native American oil resulted in an estimated 300 million gallons of oil the company received for free. Koch later settled for $25 million in penalties.

- Between 1995 and 1997 there were over 300 reported oil spills at pipelines owned and operated by Koch, which caused an estimated three million gallons of oil into lakes and streams in six states. David Koch helped Sen. Bob Dole (R-KS) raise over $150,000 for his campaign, and was rewarded with Dole-sponsored legislation that would have helped Koch Industries avoid serious penalties for the oil spills. On January 13, 2000, the government settled that case for $35 million in fines.

- In 1997, the EPA proposed strengthening rules governing air pollution, regulating particles from coal plants and industrial plants which cause tens of thousands of premature deaths a year. Again, because Koch’s factories were impacted by the regulations, Koch-funded front groups sprung into action. Koch’s Citizens for a Sound Economy front group ran ads claiming (Koch Industries created) particle pollution isn’t harmful. One ad featured a “pediatrician” who says increased rates of asthma are not caused by the toxic particles, but rather by “dust mites, stuff like that.” Another ad from CSE claimed the EPA regulations would ban fireworks and backyard grills. “Imagine that,” the ad stated, “a new government regulation that takes away our freedom to, huh, celebrate our freedom.”

- Koch funneled large amounts of donations into electing George Bush in 2000 (even sending Koch-linked lobbyists to help disrupt the Florida recount). At the time, Koch Industries faced a 97-count federal indictment charging it with concealing illegal releases of 91 metric tons of benzene, known to cause leukemia, from its refinery in Corpus Christi, Texas. When Bush took office, his Justice Department dropped 88 of the charges and settled the case for a small amount of money.

- As the Wonk Room’s Brad Johnson has reported, Koch Industries emits over 300 million tons of greenhouse gases a year. That is why, as a Greenpeace study has found, Koch Industries has pumped about $50 million into dozens of front groups denying the existence of climate change. To block EPA regulations of Koch’s carbon pollution, Koch fronts, like Americans for Prosperity, the Hot Air Tour, and the Regulation Reality Tour, have expanded their lobbying to children.

- Investigations by the Los Angeles Times and the Wonk Room have found that the House Republican push to neuter the EPA is largely coordinated by Koch lobbyists. Koch front groups helped elect the new Republican Congress, and have closely worked with the new Republican chair of the Energy and Commerce committee, Rep. Fred Upton (R-MI). Koch allies in Congress have passed amendments to gut the EPA’s power to regulate greenhouse gas emissions, enforce the Clean Air Act, and even monitor other air and water pollutants. They also cut funding for the Intergovernmental Panel on Climate Change

- One Koch front, the “No Climate Tax Pledge,” has successfully manipulated the Republican primary process by demanding that Republicans sign a pledge against supporting clean energy solutions. This pernicious political ploy, along with millions in Koch campaign donations, has resulted in the majority of the Republican caucus now doubting the science underpinning climate change.

- After a lobbying campaign waged by Koch fronts Americans for Prosperity, Competitive Enterprise Institute, Cato Institute, and others to stop federal action on climate change, Koch fronts have worked to decimate state-level efforts to curb carbon emissions. As ThinkProgress first reported, Koch fronts were at the forefront of an effort last year to repeal California’s landmark clean energy law. Currently, Koch fronts, including the State Policy Network and the American Legislative Exchange Council, are working to revoke the Regional Greenhouse Gas Initiative in New England.

- Koch Industries is one of the largest producers of formaldehyde, a chemical that “several major scientific studies have concluded” causes cancer in human beings. Koch’s conservative front groups have battled proposed regulations on formaldehyde, and David Koch used his position on the National Institutes of Health to try to stop the EPA from classifying it as a “known carcinogen” in humans.

Gov. Scott Walker’s (R-WI) demand that he be allowed to sell off Wisconsin’s state owned power plants with no-bid contracts has fueled suspicion that Koch Industries might take advantage of the deal, especially given Koch’s support for the Walker campaign and his current power grab. But the more dangerous Koch Industries kickback from Walker is likely to be from his administration’s approach to environmental regulations. Koch owns several Georgia Pacific plants along the Fox River near Green Bay. These plants are notorious for dumping thousands of pounds of toxic waste into the river in the past, so it is discouraging that Walker’s administration has indicated that it will rollback environmental safeguards. If Walker allows Koch to pollute Wisconsin’s waterways, he is risking the lives and health of Wisconsin’s people.

In his book, the Science of Success, Charles pays tribute to libertarian scholar F.A. Hayek as one his role models. But Hayek famously wrote that pollution should be regulated not only for the “owner of the property in question or to those who are willing to submit to the damage,” but for society at large.

As one of the leading sources of carcinogenic chemicals and greenhouse gases, Koch’s financing of anti-regulation front groups is a back-door lobbying attempt to avoid having to pay for Koch Industries’ pollution. Refusing to pay for pollution is the core of the Koch business, and allows the company to make billions in illegitimate profits. Moreover, a business refusing to pay for its own pollution violates true libertarian principles.

– Lee Fang, in a TP cross-post

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22 Responses to How Koch Industries makes billions corrupting government and polluting for free

  1. Sasparilla says:

    These guys truly take selfishness, greed and avarice to new lows…in a class by themselves really (for the moment). Its hard to see where their efforts are going to be slowed down, let alone stopped and turned back.

  2. Lou Grinzo says:

    Sas: “Its hard to see where their efforts are going to be slowed down, let alone stopped and turned back.”

    My thought, exactly. We now live in the post-Citizens United Age, which will make it vastly more difficult to constrain such obscene behavior.

    I often wonder what would happen if we could zip back to the late 1700′s in a time machine, round up a bunch of the Founding Dudes, and bring them to 2011. They would be absolutely horrified at what we’d let the country they invented turn into. Jefferson, in particular, would be screaming at people to put down their iPods and iPads, turn off their big screen TVs, and join his militia. And I’d wager that one of the groups he’d be least happy with would be the Tea Party.

  3. denim says:

    “Moreover, a business refusing to pay for its own pollution violates true libertarian principles.”

    I take exception to that. A true libertarian would do no harm to his fellow man for a mere sum of money. What you describe is a liebertarian…a sociopath with no moral compass.

  4. 350 Now says:

    Maybe some of our youth are catching on faster than we are…

    http://imattermarch.org/

    three minute video – Mother’s Day, May 8, 2011 -wall street, main street, sesame street

    How could you possibly not participate?

  5. catman306 says:

    Yes, Sasparilla, even Ayn Rand herself would be appalled at where these guys have dragged her ‘virtue of selfishness’. She would see that her philosophy had been taken too far, to the place where it might destroy our whole ecosystem and civilization. A little selfishness might be tolerable, but not when pushed to this extreme.

    It’s now criminal.

  6. mike roddy says:

    Koch owned Georgia Pacific sells a lot of formaldehyde soaked products, and TP from old growth in Canada. I asked Greenpeace, RAN, and NRDC if they supported a Koch boycott. They answered in weasel words.

  7. Chad says:

    There are five ways for a corporation to increase its profits:

    1: Externalize costs, such as pollution
    2: Lobby for increased subsidies
    3: Gain monopolistic pricing power
    4: Use advertising to trick your customers into impulsive purchases of garbage they don’t need
    5: Make a better product at a lower price than the competition

    #5 is really hard, which is why corporations spend so much time working on #1-4. Only libertopian crazies think that #5 is dominant.

  8. Sailesh Rao says:

    All those Koch billions come from we, the people, buying Koch industries products…

  9. Mimikatz says:

    Technology has created many ways to make the rich who abuse their position uncomfortable. It is not necessary to use crude methods of the past. The exposures here are a start. So are the exposures of the Chamber of Commerce plots to disrupt opponents. I do believe there is more brain power and creativity on our side and hope it is deployed to good use. Then one could always picket their homes Fred Phelps style, now that the Supremes have said upsetting speech is protected.

    The iMatter marches promoted by 350 are a good idea too. We need to be very creative in this struggle.

  10. ryan says:

    Anonymous actively probing Koch brothers’ corporate networks

    http://content.usatoday.com/communities/technologylive/post/2011/03/anonymous-actively-probing-koch-brothers-corporate-networks-/1

    “Click here to read about the pivotal role a 16-year-old girl played in that hack. The lightning rod in that caper — HBGary Federal CEO Aaron Barr — on Monday announced his resignation. Barr will go down in tech history as the disinformation expert who stirred Anonymous into a higher gear — by bragging that he had identified the group’s leaders and planning to expose them on Valentine’s Day at the Security B-Sides conference in San Francisco.”

  11. Robert H says:

    Wolves United for the Liberation of the Sheep from the Oppression of the Collies…

  12. Wit's End says:

    Love that pamphlet about acid rain! Industry propaganda denying the damage from pollution has apparently been so successful, even more so than climate change denial, that even our esteemed Dr. Romm doesn’t bother to list ozone as having an impact on crops on his last post, “Global food prices hit a new record high.” He asks the question:

    “What is driving up food prices to record levels?”

    The answer doesn’t even mention crop yield and quality losses from the ozone that results from fuel emissions – even though the most conservative scientific evidence places the losses at 10% annually, in the billions of dollars worth.

  13. Great posting. Your headline might just as well read “… and murdering our future.”

  14. Raul M. says:

    Catman 306 Polymers song of the ecology by
    Edutainer CSW

  15. Mark Shapiro says:

    What Robert H. said.

    Or, Koch brothers version of free market economics:

    they get the gold mine, we get the shaft.

  16. Mark Shapiro says:

    By the way, ” . . . sending Koch-linked lobbyists to help disrupt the Florida recount”

    Are those the same guys applauding Wisconsin Governor Walker?

    See Digby:

    http://digbysblog.blogspot.com/2011/03/joe-miller-republicans-remember-him.html

  17. Raul M. says:

    With great energy there is
    Wreaking The Sphere by Sonata Artica.

  18. Solar Jim says:

    Common Cause is working with the justice department to investigate the linkage of Supreme Court Citizens United votes (great Orwellian term) of justices Scalia and Thomas and their participation in Koch events and influence.

    Things do not go better with Koch.

    This is a bad movie. Can someone rewrite the script. Aren’t we supposed to have some kind of Constitution or something. Oh yea, that went out the window last century with the invention of speaking money. Your dollar bill says hello.

  19. Raul M. says:

    Thoughtful lyrics
    Ruhr-united feat. Leslie Morgan,
    Environment Umwelt Song:
    What’s forever anyway?

  20. TM says:

    I have heard much about the environmental harm caused by Koch Industries and their companies. I would just like to state first off that I am employed by Koch Industries. I don’t share most of the political beliefs of the Koch brothers but do know that the company spares no expense when it comes to being compliant with all safety and environmental regulations. I have worked for other companies that will try everything in their power to save money by cutting from those departments. It is actually more of a hassle as an employee to follow the requirements but it is not an option. I can honestly say I have never, by any member of management or corporate employees, got the sense that environmental safety is not important. That is just my two cents.

  21. Mulga Mumblebrain says:

    I’ve always been gobsmacked by how naked has been the misanthropy, greed and corruption of the capitalist mafiosi. Of course it has grown ever greater over time. In my country no politician dares rebuke a leading businessman for anything. To attack business even for destroying the last forest, polluting the last pristine stream, mining the beaches or even rendering fertile agricultural land sterile with coal seam gas extraction, invites a tirade of abuse from the MSM, and, increasingly, death threats from the deranged rabble who worship the process of their own destruction and its perpetrators. That’s my question of the week-why are we so docile as a tiny, evil, ruthless, psychopathic elite lead us and our children to the slaughter? It was asked of the victims of the Nazis too, but they resisted more than is generally acknowledged. And, as was asked in that previous, regretably, lesser (it is now plain), horror- where is God?

  22. llewelly says:

    mulga Mumblebrain says:
    March 3, 2011 at 11:57 pm:

    And, as was asked in that previous, regretably, lesser (it is now plain), horror- where is God?

    Nowhere to be seen. It is in our hands, as it has always been.