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February 06, 2014 11:03 AM Behind the Koch Veil

By Ed Kilgore

A big part of the veil surrounding David and Charles Koch and the manner in which they use politics to serve their corporate interests is the fairy-tale narrative they’ve written of themselves as corporate philanthropists with a wonky taste for libertarian vaporizing. Their mouthpieces are forever dismissing one of their most important projects, Americans for Prosperity, as just one of many groups the Kochs contribute to—you know, somewhere in the mix that runs from symphony orchestras to cancer research.

So when someone at one of the Kochs’ shadowy semi-annual “donor conferences” left behind some conference materials normally kept under lock and key, and MoJo’s Andy Kroll and Michael Schulman got ahold of them, we’re offered a peek behind that veil of secrecy and misdirection. And it’s about what we figured:

The document lists VIP donors—including John Schnatter, the founder of the Papa John’s pizza chain—who were scheduled for one-on-one meetings with representatives of the political, corporate, and philanthropic wings of Kochworld. The one-page document, provided to Mother Jones by a hotel guest who discovered it, offers a fascinating glimpse into the Kochs’ political machine and shows how closely intertwined it is with Koch Industries, their $115 billion conglomerate.
The more than 40 donors courted by the Kochs include hedge fund and private-equity billionaires, real estate tycoons, and executives of top corporations, including Jockey International and TRT Holdings, owner of Omni Hotels and Gold’s Gym. A number of them have never been identified as members of the Koch donor network, including Schnatter, one of the more prominent names on the list. An outspoken opponent of the Affordable Care Act, he is a longtime Republican donor who hosted a fundraiser for Mitt Romney’s presidential campaign. The document notes that the pizza mogul was scheduled to meet with Ryan Stowers, the director of higher education at the Charles G. Koch Foundation….
Other heavy hitters slated for meetings with the Koch brothers or their representatives included Carl Berg, a Silicon Valley real estate tycoon worth $1.1 billion; Ken Griffin, who founded the hedge fund Citadel and clocks in at No. 103 on the Forbes 400 (net worth, $4.4 billion); John W. Childs, a top private-equity investor; and Fred Klipsch, the chairman of the headphone and speaker company Klipsch Group.

If the Brothers, and Koch Industries, and Americans for Prosperity, and other Koch foundations and enterprises, are all operating on independent tracks, you’d never guess it from the way they interact seamlessly at these donor conferences:

The meeting list illustrates the interwoven nature of the Koch brothers’ corporate, political, and philanthropic activities. The donor meetings featured various senior Koch Industries executives, including the company’s chief financial officer, Steve Feilmeier. He was scheduled to join Charles Koch for a sit down with Berg. Charles Koch’s 36-year-old son, Chase, the president of Koch Fertilizer, was also scheduled to take part in a meeting with a donor named George Gibbs….
At least half of the one-on-one sessions involved representatives of Americans for Prosperity, the political advocacy group founded by the Koch brothers and their top political adviser and strategist, Richard Fink, a Koch Industries executive vice president and board member. The AFP officials called to duty for these discussions included AFP’s president Tim Phillips, chief operating officer Luke Hilgemann, vice president for state operations Teresa Oelke, and vice president for development Chris Fink (Richard Fink’s son). The state directors for AFP’s Wisconsin, Michigan, Pennsylvania, and Florida chapters were also slated for tête-à-têtes during the Koch summit….
In the past, Koch Industries has distanced itself from AFP and its political activities. The company has said the group is just one of “hundreds of organizations” that receive funding from the Kochs and that it operates “independently” of Koch Industries. But the document suggests a close collaboration between officials of Koch Industries, AFP, and Freedom Partners, whose staff and board are stacked with numerous current and former Koch Industries employees. Michael Lanzara and Jeff Noble, who transitioned over to Freedom Partners from Koch Companies Public Sector—the company’s legal, lobbying, and public affairs branch—were scheduled to meet with donors alongside AFP staffers. The Koch brothers and Richard Fink were also listed as taking part in some of these sessions. (Fink, a man of many hats within the Koch firmament, is also an AFP board member; David Koch chairs the board of the Americans for Prosperity Foundation.)

Why all these false fronts and hidden connections for a network in which all roads lead back to the Kochs and their mammoth conglomerate? Koch defenders typically claim the Brothers are justly worried about being persecuted by the Obama administration and various leftist class warriors. But they are pretty damn active for people who like to project themselves as public-minded entrepreneurs seeking merely to promote their ideas about “freedom:”

Heading into the midterm elections, AFP has emerged as one of the right’s most active and well-financed political outfits. In recent months, it has spent more than $20 million on ads clobbering congressional Democrats for supporting Obamacare. And the group is merely one piece of the Kochs’ massive political operation, which in size, scope, and fundraising prowess has come to resemble a political party in its own right. During the 2012 election cycle, in fact, the Koch network managed to raise as much as the Republican National Committee itself.

It’s increasingly clear that the Kochs’ efforts to hide their imperial aspirations are only fooling those who want to be fooled—or who want to fool those who don’t share their belief that massive political involvement is a matter of corporate self-defense. Be forewarned.

Ed Kilgore is a contributing writer to the Washington Monthly. He is managing editor for The Democratic Strategist and a senior fellow at the Progressive Policy Institute. Find him on Twitter: @ed_kilgore.

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