Kochland Page 81

  The halting effort to pass it was carried forward by Paul Ryan: Transcript of “Trump’s Takeover,” Frontline; Alana Abramson, “Read Paul Ryan’s Response to the Republican Health Care Bill Failure,” Time online, last modified March 24, 2017.

  Charles and David Koch stepped in: Kevin Robillard, “Koch Network Pledges to Defend Republicans Who Vote Against GOP Health Bill,” Politico online, last modified March 22, 2017; “Maze of Money,” visual map of Koch Industries political financial network, Center for Responsive Politics, last modified January 7, 2014.

  This tactic carried risks: Teachout, interview by author, 2017; Zephyr Teachout, Corruption in America: From Benjamin Franklin’s Snuff Box to Citizens United (Cambridge, MA: Harvard University Press, 2014).

  The bill showed passing signs of life: “White House Officials Offer Change to Failed Healthcare Bill—But Is It Enough?,” Associated Press, April 4, 2017; “House Freedom Caucus Announces Support for House AHCA Bill with MacArthur Amendment,” statement from House Freedom Caucus, April 26, 2017; Elizabeth Mann Levesque and Molly E. Reynolds, “The AHCA’s MacArthur Amendment: Unusual Politics, Unusual Policy,” Brookings Institution online, last modified May 12, 2017; Thomas Kaplan and Robert Pear, “House Passes Measure to Repeal and Replace the Affordable Care Act,” New York Times, May 4, 2017.

  Ryan’s mistake was caused by seemingly good intentions: Rachael Bade and Josh Dawsey, “Ryan Bucks White House, Setting Up Clash on Taxes,” Politico online, last modified May 22, 2017; Michelle Fox, “Border Adjustment Tax Is ‘Critical’ Part of Tax Reform, Chief GOP Tax Writer Says,” CNBC.com, last modified May 25, 2017.

  It is easy to see why Paul Ryan would have been seduced: Stephen Ohlemacher, “GOP Running into Opposition from GOP on Tax Overhaul,” Associated Press, February 3, 2017; Matt O’Brien, “Tax Cuts Are Easy; Tax Reform, and Not Losing Revenue, Is the Tough Part,” Washington Post, March 29, 2017; Scott Greenberg and Scott A. Hodge, “FAQs About the Border Adjustment,” Tax Foundation online, last modified January 30, 2017; Kyle Pomerleau, “What Is the Distributional Impact of a Destination-Based Cash-Flow Tax?,” Tax Foundation online, last modified January 18, 2017; “Trump Eyes Border Tax on Imports to Pay for Wall,” Congressional Quarterly News, January 26, 2017.

  Charles Koch opposed the BAT: Philip K. Verleger Jr. et al., “Border Adjustment Import Taxation: Impact on the US Crude Oil and Petroleum Product Markets,” white paper, Brattle Group, Cambridge, MA, December 16, 2016.

  BAT posed . . . Koch Industries’ oil refinery in Pine Bend: Liz Hampton and Catherine Ngai, “Border Tax Ideas Roil Oil Markets, Favor Gulf Coast Refiners,” Reuters, January 27, 2017; “US Oil Lobby ‘Concerned’ About Import Tax Plan,” Oil Daily, January 5, 2017; “Koch-Backed Group Pledges to Fight Controversial Border Tax,” Daily Oil Bulletin, January 31, 2017; Jim Geraghty, “Koch Network Ready for a Fight on the Border Adjustment Tax,” National Review, January 29, 2017.

  Koch Industries bought 9.55 million barrels of Canadian crude: Oil import figures taken from Energy Information Administration database, “Company Level Imports.” The author is deeply grateful to Liz Hampton, energy reporter at Thomson Reuters, for steering him to this database when he called for help. Tar sands oil prices are taken from the database of Alberta government, “Oil Prices.” Also Nick Cunningham, “Canadian Oil Prices Plunge to $30,” OilPrice.com, last modified December 16, 2017; Verleger et al., “Border Adjustment Import Taxation.”

  The Koch political network moved against: “Koch Kicks Off Lobbying Salvo Against GOP Tax Proposal,” O’Dwyer’s 31, no. 5 (May 2017): 84; “How the Koch Network Is Derailing House GOP’s Border Tax,” Congressional Quarterly News, May 19, 2017; Nicholas Confessore and Alan Rappeport, “Divide in G.O.P. Now Threatens Trump Tax Plan,” New York Times, April 2, 2017; “Spending Surges in Lobbying’s Top 50,” Hill, August 2, 2017; “US Oil Lobby ‘Concerned’ ”; “Koch-Backed Group Pledges to Fight”; Geraghty, “Koch Network Ready for a Fight.”

  The attack was well fashioned: Comprehensive Tax Reform: Un-Rigging the US Economy (Arlington, VA: Americans for Prosperity, May 2017); Americans for Prosperity, “The Problem with a Border Tax,” video, 1:12, February 17, 2017; Pomerleau, “What Is the Distributional Impact?”

  In fighting . . . out of step with Republican voters: Jonathan Swan, “Inside the Freedom Caucus Meeting on Border Adjustment,” Axios, last modified February 7, 2017; “Interview with North Carolina Congressman Mark Meadows,” CEO Wire, February 7, 2017; “Trump Eyes Border Tax.”

  after Meadows made his comments . . . Kevin Brady: “Koch-Backed Group Pledges to Fight Controversial Border”; Caitlin Owens, “Rep. Meadows Likely a ‘No’ on Border Adjustment Tax,” Axios, last modified February 13, 2017.

  Paul Ryan was unbending . . . tax reform: Bade and Dawsey, “Ryan Bucks White House”; “How the Koch Network Is Derailing.”

  This thinking . . . articulated in 1977 by Murray Rothbard: Rothbard, “Toward a Strategy,” 13–14.

  As Americans for Prosperity . . . to help shape the tax bill: Marc Short, interviews by author, 2018.

  Paul Ryan and Kevin Brady released a statement: Damian Paletta, “Speaker Ryan Admits Defeat, Giving Up on Border Adjustment Tax,” Washington Post, July 27, 2017.

  AFP released a statement, crowing about its achievement: “AFP’s Defeat of the Border Adjustment Tax Clears the Way for Principled Tax Reform,” statement from Americans for Prosperity, July 31, 2017; “The Koch Brothers Put a Knife in Border Adjustment,” Congressional Quarterly News, June 1, 2017.

  Americans for Prosperity rented out a large event space: Notes and audio recording from Americans for Prosperity event, 2017.

  The tax bill passed . . . signed into law before Christmas: Thomas Kaplan and Alan Rappeport, “Republican Tax Bill Passes Senate in 51–48 Vote,” New York Times, December 19, 2017; Heather Long, “The Final GOP Tax Bill Is Complete. Here’s What Is in It,” Washington Post, December 15, 2017; Danielle Kurzleben, “Charts: See How Much of GOP Tax Cuts Will Go to the Middle Class,” NPR online, last modified December 19, 2017; “Tax Cuts Will Cross All Income Lines but Disappear by 2027,” CBS News and Associated Press, December 19, 2017; Tom Kertscher, “House Tax Plan: Permanent Tax Cuts for the Rich, Eventually Tax Hikes for All Middle-Class Families?,” PolitiFact, last modified December 15, 2017.

  the bill looked very much like the typical tax bill that Mark Meadows described: Distributional Analysis of the Conference Agreement for the Tax Cut and Jobs Act (Washington, DC: Tax Policy Center report, December 18, 2017); Borys Krawczeniuk, “Congressional Candidates Talk Tax Cuts, Jobs,” Associated Press, October 21, 2018; Analysis: Koch Brothers Could Get up to $1.4 Billion Tax Cut from Law They Helped Pass (Washington, DC: Americans for Tax Fairness, January 24, 2018).

  Koch’s block-and-tackle strategy was paying dividends: Michelle Ye Hee Lee, “Paul Ryan Credits Koch Network for Supporting GOP’s Tax Overhaul,” Washington Post, January 28, 2018.

  the Trump administration’s transition team . . . described their effort in military terms: Two senior EPA officials speaking on background, interviews by author, 2017–18; EPA “Landing Team” roster, reviewed by author, 2018.

  the Tuesday before Thanksgiving . . . arrived at EPA headquarters: Two senior EPA officials speaking on background, interviews by author, 2017–18; Gayathri Vaidyanathan, “How to Get a Skeptic to Believe in Climate Change? Scientists Are Studying That,” ClimateWire, last modified August 8, 2016.

  this put Ebell directly at odds with the career staff at the EPA: Senior EPA official speaking on background, interviews by author, 2018.

  When Myron Ebell finally arrived . . . two senior EPA officials: Ibid.

  This influence was apparent . . . at the EPA: Two senior EPA officials speaking on background, interviews by author, 2017–18; EPA “beachhead” roster reviewed by author, 2018.

  Schnare was an imposing presence: David Schnare, two senior EPA officials speaking on background, interviews by author, 2017–1
8.

  Schnare came up with a plan to get rid of it: Schnare, interviews by author, 2018. Descriptions of EPA headquarters taken from notes and photos during reporting trip, 2017.

  Schnare’s office was on this floor: Schnare, two senior EPA officials speaking on background, interviews by author, 2017–18.

  Schnare’s forty-seven-page transition plan: “Agency Action Plan”: US Environmental Protection Agency. This document is undated but was provided to the author in 2017.

  The new EPA administrator would carry out these policies: “How Senators Voted on Scott Pruitt for EPA Administrator,” New York Times, February 17, 2017.

  Pruitt arrived for work: Schnare, two senior EPA officials speaking on background, interviews by author, 2017–18.

  Almost immediately after he arrived . . . Pruitt apparently became convinced: Two senior EPA officials speaking on background, interviews by author, 2017–18; Liam Stack, “Scott Pruitt’s Wish List: Private Jets, Fancy Furniture, 24-Hour Security,” New York Times, April 6, 2018; Ethan Sacks, “EPA Chief Scott Pruitt’s $43K Soundproof Phone Booth Violated Federal Spending Laws, GAO Says,” NBC News online, last modified April 16, 2018.

  Pruitt’s . . . policy stances were well known: Eric Lipton, “Energy Firms in Secretive Alliance with Attorneys General,” New York Times, December 6, 2014.

  Pruitt’s political career . . . Oklahoma’s political culture: Two senior EPA officials speaking on background, interviews by author, 2017–18; Kevin Bogardus, “EPA Protesters Deemed Threat to Pruitt, Triggered Probe,” Greenwire, last modified January 23, 2018.

  When he returned . . . Pruitt seemed deeply shaken: Senior EPA official speaking on background, interview by author, 2018.

  Pruitt’s new leadership team . . . loyalists from Oklahoma: Schnare, former Pruitt staffer speaking on background, two senior EPA officials speaking on background, interviews by author, 2017–18.

  There were other problems with Pruitt: Schnare, interviews by author, 2018; Harvard Law School Regulatory Rollback Tracker database, 2018.

  Pruitt attended a ceremony . . . where he introduced President Trump: Video of Rose Garden press conference taken from C-Span archive.

  The withdrawal . . . conformed with Charles Koch’s views: Evan Osnos, “Trump vs. the Deep State,” New Yorker, May 21, 2018.

  it wasn’t clear how effective Pruitt was: Juliet Eilperin and Brady Dennis, “Amid Ethics Scrutiny, EPA’s Pruitt Also Finds His Regulatory Rollbacks Hitting Bumps,” Washington Post, May 20, 2018.

  In July of 2018, Pruitt resigned: Coral Davenport, Lisa Friedman, and Maggie Haberman, “EPA Chief Scott Pruitt Resigns Under a Cloud of Ethics Scandals,” New York Times, July 5, 2018; carbon, parts per million in atmosphere, taken from National Oceanic and Atmospheric Administration database.

  Koch’s political network . . . touted two big achievements that year: Koch seminar group memo: “Efforts in Government: Advancing Principled Public Policy.” This memo is undated and was first revealed by Lee Fang and Nick Surgey, “Koch Document Reveals Laundry List of Policy Victories Extracted from the Trump Administration,” Intercept online, last modified February 25, 2018.

  Inside the Trump administration, there was disdain for Charles Koch: Source speaking on background, interviews by author, 2017–18; Robert Draper, “Trump vs. Congress: Now What?,” New York Times Magazine, March 26, 2017.

  the Trump administration and the Koch network were like opposing chess players: James Hohmann and Matea Gold, “Koch Network to Spend $300 Million to $400 Million on Politics, Policy in 2018 Cycle,” Washington Post, January 28, 2017.

  The Koch network maximized its influence: Lisa Mascaro, “Vice President Mike Pence Stops In for an Unscheduled Chat with Billionaire Charles Koch,” Baltimore Sun, June 24, 2017; Kenneth P. Vogel and Eliana Johnson, “Trump’s Koch Administration,” Politico online, last modified November 28, 2016; John Frank, “Koch Brothers’ Conservative Network to Hold Retreat in Colorado Springs This Weekend,” Denver Post, June 23, 2017.

  Koch traveled to Palm Springs: Video of Charles Koch speech provided by Koch Industries, “Charles Koch: Opening Remarks (Palm Springs 2018),” video, 3:29, uploaded to YouTube by the Seminar Network on January 28, 2018.

  CHAPTER 25: CONTROL

  Charles Koch’s family compound in Wichita: Notes and photographs from reporting trip to Koch Industries headquarters and entryway to Charles Koch’s office, 2018; descriptions of Charles Koch’s office and the view from his desk taken from notes and photos taken in, 2015.

  the business leaders from Koch’s various divisions came . . . to report to Charles Koch: Packebush, Feilmeier, Hall, Markel, Koch Industries employees and executives speaking on background, interviews by author, 2013–18.

  as he listened to the division heads make their presentations: See previous endnotes. Georgia-Pacific profits taken from interview with Jim Hannan, 2016.

  Koch’s beliefs would have been validated in another way: Current and former Koch Industries employees and executives, interviews by author, 2013–18.

  Invista, for example, was deeply troubled: Former Koch Industries executive speaking on background, interviews by author, 2018; notes and photos taken at Invista headquarters, 2018; “Plant Shut-Downs, Closings & Layoffs Profile—Invista,” taken from Nexis database, “Plant Shut-Downs, Closings & Layoffs,” November 27, 2017; Thad Moore, “In Winnsboro, One of South Carolina’s Oldest Surviving Textile Mills May Close,” Post and Courier (Charleston, SC), August 20, 2017; Casey White, “On the Chopping Block,” Shelby Star (NC), July 19, 2017; “New Owner for Derry Lycra Plant,” Irish News (Belfast, Ire.), October 31, 2017; Mike Pare, “Kordsa Slated to Acquire City’s Invista Plant,” Chattanooga Times Free Press (TN), April 1, 2017.

  The economy itself was shaky: Analysis based on general reporting by the author during 2018.

  Charles and David Koch were worth a combined $4.7 billion: “The Billionaires 1991,” Fortune, September 9, 1991; all Charles and David Koch net worth figures are taken from Forbes’ list of the four hundred richest people and billionaires, 2002, 2005, 2009, 2013, 2016, 2018; existence of shadow stock confirmed by current and former Koch Industries employees.

  This ownership structure . . . reflected the US economy: Emmanuel Saez and Gabriel Zucman, “Wealth Inequality in the United States since 1913: Evidence from Capitalized Income Data,” Quarterly Journal of Economics 131, no. 2 (May 1, 2016): 519–78; Christina M. Gibson-Davis and Christine Percheski, “Children and the Elderly: Wealth Inequality Among America’s Dependents,” Demography 55, no. 3 (June 2018): 1009–32.

  American labor market resembled the labor market inside Kochland: Analysis based on reporting cited in earlier chapters.

  This disparity . . . reflected the disparity in political power: Martin Gilens and Benjamin I. Page, “Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens,” Perspectives on Politics 12, no. 3 (September 2014): 564–81.

  Koch Industries was overhauled in the most significant restructuring since 2000: Koch Industries executive speaking on background, interview by author, 2018; Daniel McCoy, “CEOs of Georgia-Pacific and Flint Hills Resources Take On Larger Roles Within Koch Industries,” Wichita Business Journal, March 3, 2017; “Fischer Named GP CEO, Hannan to Assume New Role,” press release, Georgia-Pacific, March 2, 2017; Jim Hannan executive bio, Koch Industries newsroom, 2017; Brad Razook, executive bio, Koch Industries Newsroom, 2017.

  If any of these men became CEO, however: Analysis based on Chase Koch, Koch Industries executive speaking on background, interviews by author, 2018; descriptions of Koch Disruptive Technologies offices taken from notes and photos during reporting trip, 2018.

  Charles Koch sent his son a small folder of old papers: Chase Koch, interview by author, 2018; photo of undated note from Charles Koch to Chase Koch.

  If Charles Koch found meaning . . . seemed to derive largely from the “book project”: Rudd, Koch Industries executive speaking on background, interviews by auth
or, 2018.

  INDEX

  A note about the index: The pages referenced in this index refer to the page numbers in the print edition. Clicking on a page number will take you to the ebook location that corresponds to the beginning of that page in the print edition. For a comprehensive list of locations of any word or phrase, use your reading system’s search function.

  Aalto, Todd, 164, 167, 171, 174, 176, 177

  acetic acid, 103

  acid rain, 403

  acquisitions, 125–27, 192, 198–99, 222, 224–25, 293, 322, 583

  Corporate Development Board direction of, 295–97, 301, 583

  of Farmland Industries, 587, 298–305, 308, 466, 587

  of Georgia-Pacific, 313, 318–21, 323, 328, 345, 501, 518, 581

  of Guardian Industries, 483

  of Invista, 312, 318, 501

  mergers and, 45, 146, 198, 501

  of Pine Bend refinery, 50–51, 78, 294, 520

  private equity deals for, 295

  of pulp mills, 307, 309–12, 316, 318, 585

  of Purina Mills, 199, 201–2, 205, 320, 591

  Affordable Care Act (2010), see Obamacare

  Afghanistan, war in, 240

  Africa, clean energy infrastructure in, 456

  Agency for International Development, US, 456

  Agriculture, US Department of, (USDA), 270, 557

  Agrium, 300, 304–5

  Agrotain, 307

  Air Force, US, 87

  Alaska, shipping business in, 44

  Alt, Kerry, 327, 339–40

  Alt, Shirley, 340

  Amazon, 3, 332, 356

  America First, 543, 546, 549

  American Conservative Union, 451

  American Council for Capital Formation (ACCF), 447

  American Energy Alliance (AEA), 449

  American Greetings, 483

  American Health Care Act, 538–39

  American Legislative Exchange Council (ALEC), 268–69, 273–75, 481

  American Museum of Natural History, 344