Th Height of Conservative Hypocrisy

The Wall Street Journal    

Koch brother Charles singles out banks in blasting corporate welfare

Bloomberg

Charles Koch.

PatrickO'Connor

DANA POINT, Calif.—Charles Koch, the billionaire industrialist who co-founded a sprawling web of conservative interest groups, opened his biannual conference here Saturday by calling for an end to corporate welfare and singling out “big banks” as a primary offender.

The press-shy 79-year-old chief executive of Koch Industries took the nation’s biggest banks to task for accepting “massive bailouts” and cheap loans from the Federal Reserve in return for the federal government wielding increased influence over how they run their businesses.

The comments came at a cocktail reception kicking off the latest gathering of wealthy conservatives assembled by Koch and his brother David. In brief remarks welcoming donors to the event at the St. Regis Monarch Beach resort, Charles Koch challenged the assembled business leaders to encourage other corporate chieftains to “start opposing rather than promoting corporate welfare.”

This year’s event at the seaside resort drew roughly 450 donors who have contributed at least $100,000 to the various initiatives funded by the Koch brothers, including 146 first-time givers, the most ever. Five Republican presidential contenders will also make the trip to audition before an audience of well-heeled conservatives. And a number of newly elected senators strolled the lawn during the opening session, including Cory Gardner of Colorado and Ben Sasse of Nebraska.

But in a related article.........................

REPORT: How Koch Industries Makes Billions By Demanding Bailouts And Taxpayer Subsidies (Part 1)

by Lee Fang

Koch Industries, the international conglomerate owned by Charles and David Koch, is not only the second largest private company in America, it is the most politically active. As ThinkProgress has carefully documented over the last three years, Koch groups have spent tens of millions to influence government policy — from financing the Tea Parties, to funding junk academic studies, to undisclosed attack ads against Democrats, to groups promoting climate change denial, to a large network of state-based and national think tanks. In an opinion column for the Wall Street Journal today, Koch Industries CEO Charles Koch fired back at his critics, who have grown more vocal as it has become clear that Koch groups are providing the political muscle for Gov. Scott Walker’s (R-WI) union-busting power grab.

In his piece, Charles portrays himself as simply an ideological advocate, and says his money to political groups is only meant to “enhance true economic freedom.” He chides special interests that have “successfully lobbied for special favors,” claiming “crony capitalism is much easier than competing in an open market.” But in reality, the focus of the Koch political machine is geared towards “crony capitalism” — corrupting government to make Charles and his brother David Koch richer. Koch’s Tea Party libertarianism is actually a thin veneer for the company’s long running history of winning special deals from the government and manipulating the market to pad Koch profits:

The dirty secret of Koch Industries is its birth under the centrally-planned Soviet Union. Fred Koch, the founder of the company and father of David and Charles, helped construct fifteen oil refineries for Joseph Stalin before expanding the business in the United States.

— As Yasha Levine has reported, Koch exploits a number of government programs for profit. For instance, Georgia Pacific, a timber company subsidiary of Koch Industries, uses taxpayer money provided by the U.S. Forestry Service to provide their loggers with taxpayer-funded roads and access to virgin growth forests. “Logging companies such as Georgia-Pacific strip lands bare, destroy vast acreages and pay only a small fee to the federal government in proportion to what they take from the public,” according to the Institute for Public Accuracy. Levine also notes that Koch’s cattle ranching company, Matador Cattle Company, uses a New Deal program to profit off federal land for free.

— Koch Industries won massive government contracts using their close relationship with the Bush administration. The Bush administration, in a deal even conservatives alleged was a quid pro quo because of Koch’s campaign donations, handed Koch Industries a lucrative contract to supply the nation’s Strategic Petroleum Reserve with 8 million barrels of crude oil. The SPR deal, done initially in 2002, was renewed in 2004 by Bush administration officials. During the occupation of Iraq, Koch won significant contracts to buy Iraqi crude oil.

— Although Koch campaigned vigorously against health reform — running attack ads, sponsoring anti-health reform Tea Parties, and comparing health reform to the Holocaust — Koch Industries applied for health reform subsidies made possible by the Obama administration.

The Koch brothers have claimed that they oppose government intervention in the market, but Koch Industries lobbies aggressively for taxpayer handouts. In Alaska, blogger Andrew Halcro reported that a Koch subsidiary in Fairbanks asked Gov. Sarah Palin’s administration to use taxpayer money to bail out one of their failing refinery.

— SolveClimate recently reported that Koch Industries will reap huge profits from the proposed Keystone XL Pipeline, which runs from Koch-owned tar sands mining centers in Canada to Koch-owned refineries in Texas. To build the pipeline, politicians throughout the Midwest, many of whom have received large Koch campaign donations, have used eminent domain — government seizures of private land. In Kansas, where Koch-funded officials advise Gov. Sam Brownback (R-KS) and the Republican legislature, the Keystone XL Pipeline is likely to receive a property tax exemption of ten years, a special loophole that will cost Kansas taxpayers about $50 million.

— Koch Industries has been the recipient of about $85 million in federal government contracts mostly from the Department of Defense. Koch also benefits directly from billions in taxpayer subsidies for oil companies and ethanol production.

Charles has compared himself to a libertarian “Martin Luther,” evangelizing to the world for their supply side cause. However, the tens of millions in campaign donations and the dozens of front groups funded by Koch work in tandem to promoting the business interests of Koch Industries.

Koch funds both socially conservative groups and socially liberal groups. However, Koch’s financing of front groups and political organizations all have one thing in common: every single Koch group attacks workers’ rights, promotes deregulation, and argues for radical supply side economics. Not only do the Koch’s front groups pad Koch Industries’ bottom line, they supply the Koch brother’s talking points. In fact, for his opinion piece today, Charles heavily relied on front groups he finances for statistics. The “freedom index” cited by Charles is a creation of the Koch-funded Heritage Foundation, and the erroneous “unfunded liabilities” claim was supplied by the Koch-funded National Center for Policy Analysis.

Koch Brothers Received Millions In Obamacare Subsidies

Charles and David Koch may have spent millions of dollars opposing President Obama’s Affordable Care Act, but that didn’t stop them from benefiting from the law. The Associated Press reported on Tuesday that Koch Industries received $1.4 million in subsidies from a $5 billion program established by the Affordable Care Act to help employers and states maintain coverage for individuals 55 and older who are not yet eligible for Medicare.
ThinkProgress first noticed that Koch applied for the program in August of 2010, along with other critics of the law, including state-run programs in Texas and more than a dozen members of the board of directors of the U.S. Chamber of Commerce, which has spent millions to support Republican causes.
Ironically, in 2011, House Republicans issued a press release characterizing the early retiree grants as “a $5 billion bailout fund for state governments, Fortune 500 companies, and Hollywood unions.” “Like many provisions and accounting gimmicks in the health care law, it has largely escaped public scrutiny because of the sheer volume of programs and spending crammed into the law without scrutiny or Congressional oversight,” the Republicans on the Energy and Commerce Committee wrote a year after Koch and other prominent funders applied and received grants from the program.
The Early Retiree provision resembles one passed by Republicans in 2003, which gave subsidies to employers who offered drug coverage to their retirees before the Medicare Part D program went into effect in 2006. As the New York Times explained, the goal then was the same as it is today, “to discourage those employers from terminating those programs, which would have saddled the government and seniors with higher costs.”
This isn’t the first time critics of the law have taken advantage of its provisions. Just last week, Republican members of Congress praised the Obama administration for keeping open a call center dedicated to enrolling people into the law after the initial enrollment period, while others have requested grants funded under the ACA. Texas Gov. Rick Perry (R) even encouraged some Texans to sign-up for coverage in the federally-run health care exchange in an effort to save the state money.

7 Ways the Koch Bros. Benefit from Corporate Welfare

By Yasha Levine

Mainstream America is finally getting to know the billionaire brothers backing the libertarian movement, thanks to a pair of dueling profiles in New York and The New Yorker. Now that we’ve heard about their charitable giving, David’s 240-foot mega-yacht and role as patrons of the Tea Party movement, it’s time to ask a more serious question: How libertarian are they?
The short answer…not very.
Charles and David Koch, the secretive billionaire brothers who own Koch Industries, the largest private oil company in America, have spent millions bankrolling free-market think tanks and pro-business politicians in order, as David Koch has put it, “to minimize the role of government, to maximize the role of private economy and to maximize personal freedoms.” But a closer look at their dealings reveals that for the past 35 years the brothers have never shied away from using government subsidies to maximize their own profits, even while endeavoring to limit government spending on anything else. Simply put: the Kochs have no problem with socialism — as long as they’re in on the action.
In 1977, Charles Koch founded the Cato Institute, an influential libertarian think tank, with the aim of injecting free-market ideas into the mainstream. The Kochs would go on to establish and fund a vast network of overlapping think tanks, institutes, foundations, media outlets, and lobby groups that would vilify centralized government and promote laissez-faire capitalism as the only route to economic prosperity. The Mercatus Center, Americans for Prosperity, Reason Magazine, the Federalist Society and the Heritage Foundation are just a few of the right-wing organizations that run on Koch cash today.


Koch Industries is America’s second-largest private corporation, with revenue of $100 billion in 2009, and 80,000 employees in 60 countries. According to Charles Koch, Koch Industries has grown 2,000-fold since he took over from his dad in 1967, transforming a middling oil transportation and refinement operation into a corporate mini-state involved in oil, petrochemicals, paper, agriculture and financial services. Worth just under $20 billion apiece, the brothers live like emperors. David Koch, 70, resides in a Park Avenue and likes to take a few weeks off every year to lounge on his 246-foot megayacht in the Mediterranean, which costs $500,000 a week to operate and has been rented out for pleasure cruises by Prince Charles.
Seventy-four-year-old Charles G. Koch, who runs the company from a compound in Wichita, Kansas, has attributed the company’s success to an unshakable belief in the power of the free-markets—a belief that he says can be traced back to an “intellectual epiphany” he experienced at a conference more than 40 years ago. There, Koch realized that free-market economics were an objective reality “as immutable as the laws that work in science,” he explained in 2006.
In its recent profile, the New Yorker called Charles and David Koch “the primary underwriters of hard-line libertarian politics in America.” But the magazine failed to mention that their free market philanthropy belies the immense profit they have made from corporate welfare.

1. SOCIALIST SHIPBUILDING

Two years before founding the influential Cato Institute, Charles Koch bought a supertanker from a communist regime. According to information in the Lehman Brothers business archives, as well as records found in a Croatian shipyard, in 1975, Koch Industries purchased ship from the Socialist Republic of Yugoslavia. The ship, a standard 274,330-ton dual use tanker, was named after the Kochs’ mother, Mary.
The purchase of a ship from Yugoslavia would not have been a big deal, had the Kochs not been the ones doing the buying. With the whole free world to choose from, why would a supposedly true-believer libertarian like Charles Koch buy a vessel produced in a communist country—and name it after his own dear mother, to boot? After all, didn’t Austrian school economist Ludwig Von Mises, an early influence on Charles’ intellectual journey to libertarianism, write in his 1933 seminal work, Socialism: An Economic and Sociological Analysis, that centrally planned economies are so inherently inefficient that “socialism must fail”?
It turned out that Yugoslavia’s highly-centralized economy was the opposite of inefficient—it was on fire. In the 1960s and 1970s, the country was churning out, among other things, low-cost, high-quality ships that were sold around the world. Even the old-school libertarian magazine The Freeman couldn’t help but praise the country’s economic performance, writing in 1988, “Many of Yugoslavia’s industries seemed highly competitive in world markets, and there were even astonishing reports that efficient Yugoslav shipbuilders wrested contracts away from the Japanese.”

2. VENEZUELAN FERTILIZER

In 1998, Koch Industries entered into a lucrative partnership with two state-owned companies–one Venezuelan, the other Italian–to open a massive $1 billion nitrogen-based fertilizer plant in Venezuela called Fertinitro.
A business venture with two state-run companies? How did Koch Industries find itself in this libertarian nightmare scenario? After all, Charles Koch’s own Cato Institute brain trust has been writing for decades that state-owned enterprises are less efficient and productive than private companies.
Fertilizer production requires massive amounts of natural gas, and obtaining it can account for 50 percent of operating costs. Luckily for Koch, Fertinitro’s semi-state-owned status allowed it to tap into a guaranteed supply of natural gas subsidized by the state. Steven Bodzin, a former Bloomberg journalist, found that “just on the natural gas, never mind the electricity or water subsidies, Koch profits from a direct Venezuelan government subsidy of $1.23 for every thousand cubic feet of gas consumed at Fertinitro.” For Koch Industries, whose role in the partnership is to unload half of the 6 million tons of fertilizer produced by Fertinitro every year on the American market, that equals up to $123.6 million in subsidies every year.
Savor the irony: While tea partiers wave Koch-funded placards comparing President Obama to Hugo Chavez, the Kochs are busy profiting off Chavez’s socialist economy—only to turn around and blame Venezuela’s poverty on Hugo Chavez’s socialist policies.

3. RANCHING

For the past fifty years, through its Matador Cattle Company subsidiary, Koch Industries has been quietly milking a New Deal program that allows ranchers to use federal land basically for free. Matador, one of the ten biggest domestic cattle ranching operations, has something in the neighborhood of 300,000 acres of grazing land for its cows—two-thirds of which belong to American taxpayers, who will never see a penny of profit.

4. LOGGING

In 2006, Koch Industries acquired pulp and paper giant Georgia-Pacific for a $21-billion cash payment, allowing the Koch brothers to tap into a whole new area of government largesse: the ability to log public forests for private gain and have taxpayers cover the operating costs. Not only can companies like Georgia-Pacific, which is the world’s leading manufacturer of paper products, exploit a publicly-shared resource without sharing the profits, but the U.S. Forestry Service subsidizes them to do it by forcing taxpayers to fund the construction of new logging roads that provide loggers with access to virgin growth—a nice welfare arrangement for the industry that costs taxpayers over $1 billion a year.
“Private logging of America’s National Forests is a heavily subsidized form of corporate welfare,” wrote Scott Silver, founder and executive director of Wild Wilderness, a conservation watchdog, at the time of the Georgia-Pacific’s sale to Koch Industries. “Logging companies such as Georgia-Pacific strip lands bare, destroy vast acreages and pay only a small fee to the federal government in proportion to what they take from the public.”

5. ETHANOL

Just two weeks ago, Koch Industries got into the ethanol business by buying two ethanol plants in Iowa. Other than defense, ethanol is possibly the most subsidized industry in America. Koch’s own Cato Institute has called ethanol a “boondoggle,” writing that “the dizzying array of federal, state and local subsidies, preferences and mandates for ethanol fuel are a sad reflection of how a mix of cynical politics and we-can-do-anything American naiveté can cloud minds and distort markets.” The institute has sharply criticized the billions of dollars in federal and state subsidies that are poured into the ethanol industry (between $5 billion and $6.8 billion in 2006 alone).
Koch Industries has traded ethanol for years on the commodities market, but their entry into the production side of the business puts them in a position to profit off the subsidies in a more direct manner.

6. EMINENT DOMAIN

Although highly diversified, Koch Industries’ vast network of oil and gas pipelines remains the company’s core business and main source of revenue. The exact size of their pipeline network is not known, but some estimate that Koch Industries operates anywhere between 35,000 and 50,000 miles of pipelines between Texas and Canada—enough plumbing to wrap around the globe twice or zigzag between New York and Los Angeles 15 times. How did the Kochs manage to build up a pipeline network of this magnitude? By getting the government to use its tyrannical powers of eminent domain to forcibly seize private property on Koch Industries’ behalf.
As far as libertarians are concerned, eminent domain is a socialist tyranny straight out of the Leninist playbook, as it recognizes the government as the real owner of all land and vests it with the power to expropriate private property for alleged public good. At the most fundamental level, libertarians believe that eminent domain invalidates the notion of private property rights, threatening not just prosperity, but freedom. Charles Koch is clear on this. “Countries that clearly define and protect individual private property rights stimulate investment and grow,” he writes in his book The Science of Success. “Those that threaten and confiscate private property lose capital and decline.”
But not all property rights are created equal. A Koch Industries oil pipeline recently built in Minnesota shows that Charles Koch does not see an is anything wrong with the government confiscating private property, as long as he stands to make a profit.
Completed in 2008, the 304-mile line now carries crude oil from the Canadian border to a Koch Industries refinery near the Twin Cities area via a two-foot-wide pipe. Company PR execs pitched the pipeline as a public benefit project, as it would increase Minnesota’s gasoline supply. But the 1,000-plus landowners who were forced to handover their private property so that Koch Industries could run its pipeline didn’t quite see it that way. “People’s rights were violated, and they never got their due process,” a farmer whose fields were going to be cut in two by the pipeline told a newspaper in 2007. “It’s wrong. People’s property is one of the most important things to their livelihood.”

7. STALIN

Before Fredrick Koch suddenly developed a pinko paranoia and helped start up the John Birch Society, he was making piles of cash laying the foundation of Soviet oil infrastructure in the 1920s and early 1930s. He designed and built refineries, hosted Soviet engineers for training in Wichita, Kansas, and made an invaluable contribution to the rapid industrialization of the Soviet Union during Joseph Stalin’s first Five-Year Plan. This is a touchy issue for the Koch family: without the Commie Reds providing his future seed capital, Koch Industries would not exist today—and neither would the Tea Parties.
When I wrote about the Koch family’s wealth and its connection to the Soviet Union in April 2010, libertarians rushed to the Kochs’ defense, arguing that business decisions made when they were children had no bearing on Charles and David Koch. They are not their father, and cannot be blamed for his sins―which is true. The brothers are better at the libertarian lie than their father ever was: their self-help libertarianism is more effective pro-billionaire propaganda than his racist Bircher rants. But while the tone may be different, the objective is very much the same: to con the American people into voting against their own interests.




The next time you hear Michele Bachmann (who’s a welfare queen in her own right) screaming at the top of her lungs that socialized healthcare is “reaching down the throat and ripping the guts out of freedom” or watch a Cato Institute shill on Meet the Press layout a case for why you should support the privatization of social security, remember: they aren’t hypocrites, they’re cons looking to rip you off.

Koch Brothers Should Return $157 Million in Government Subsidies -

The fossil fuel barons, Charles and David Koch, have long advocated for "economic freedom" and a smaller government. They have slammed "collectivism" and market distorting subsidies. In 2012, Charles Koch decried corporate welfare and “crony capitalism” in the pages of the Wall Street Journal: “Far too many well-connected businesses are feeding at the federal trough. By addressing corporate welfare as well as other forms of welfare, we would add a whole new level of understanding to the notion of entitlement reform,” he wrote. The Koch's “secret bank” Freedom Partners has spent hundreds of millions in elections in part to tackle “‘rent-seeking,’ ‘corporate welfare,’ and other forms of cronyism.” In 2014, the Koch-funded American Legislative Exchange Council (ALEC) rolled out a report on the “Unseen Cost of Tax Cronyism” and the Kochs launched a public broadside against corporate subsidies in a letter to Congress. The Kochs were so upset by programs, such as the Wind Production Tax Credit, that their chief lobbyists declared: “We oppose ALL subsidies, whether existing or proposed, including programs that benefit us.” Now Good Jobs First, a nonprofit watchdog on corporate subsidies, has provided the Kochs with an excellent opportunity to put their money where their mouth is.


Good Jobs First unveiled a new, upgraded version of the their Subsidy Tracker data base which aggregates subsidy recipient data from more than 700 state, local, and federal economic development programs.
Click on "Koch Industries" in their parent companies list and voila! $157 million in state and federal subsidies are revealed, with an additional $6.2 million in federal loan guarantees.
Louisiana has ponied up the most $77 million in subsidies for the Koch operations, followed by $25 million in Oregon, $21 million in Oklahoma, and $15 million in Iowa.
These are all states that could use the cash.
Surely Charles and David Koch don't want to sully themselves with subsidies? With a combined net worth estimated to be $82 billion dollars, they are two of richest men in the world.



and the clincher...................

The Koch-Keystone connection: Brothers are the largest lease holders in Canada’s oil sands. It's getting harder for the Koch brothers to insist that they have no financial stake in the pipeline                          

Lindsay Abrams


The Keystone XL pipeline isn’t just about oil and gas companies. It’s also about the Koch brothers and their vast influence over the Republican party. That influence extends as well to Canada’s oil sands, the the Washington Post reports: a subsidiary of Koch Industries, owned by bros Charles and David, is the land’s largest lease holder.
The parcel of land controlled by the Kochs covers 1.1 million acres, according to the International Forum on Globalization, a liberal think tank. That’s an area roughly the size of Delaware, and more than what’s owned by Royal Dutch Shell, Conoco Phillips, Suncor, Exxon Mobil, Chevron or any of the Chinese companies that have invested in the oil sands.
An earlier report from IGF put the Koch’s land holdings at nearly 2 million acres, an amount, it estimated, that put them in a position to reap as much as $100 billion from Keystone. This new report revises down the estimate, but an oil sands expert at the University of Alberta who was contacted by the post called the holdings “significant.” The Kochs, for their part, continue to insist that they have no financial stake in the pipeline — but it’s getting a lot harder to believe them.