REPORT: How Koch Industries Makes Billions Corrupting Government And Polluting For Free
In an opinion piece published today responding to his critics, Koch Industries CEO Charles Koch promised to continue to finance anti-government, right-wing front groups. Charles 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, 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.
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