Monday, March 28, 2011

The Koch Brothers

I haven't mentioned the Koch brothers very often. I've seen them mentioned a lot but I didn't know much about them. The neoconservative Weekly Standard has a long article on them, The Paranoid Style in Liberal Politics.

I learned a lot of history about them that I didn't quite expect. They did inherit their father's business but they worked hard and expanded it greatly. They benefited from not starting from scratch, but seem to have mostly earned their keep. They've donated to a lot of different things but have certainly gotten involved in politics. They aren't really conservatives but are libertarians. I didn't realize in 1980 that David ran for vice president on the libertarian ticket and got 1% of the vote. Their father's company was mostly oil but they expanded it to many industries. They had some regulatory issues but seem to have cleaned up their act considerably (though this isn't a part of the article I have a lot of faith in, an award from Bush's EPA doesn't hold much weight with me). For an article that started out pretty reasonable there were a few things that I thought went off the rails, mostly these two paragraphs:

"Charles and David sensed that Bush’s failure would drive Americans into the arms of Barack Obama. The wars in Iraq and Afghanistan and the financial crisis of September 2008 made a toxic brew, and Americans turned to the young Democratic senator who promised hope and change. Change is what they got. Ask Charles Koch what he thinks about Obama and he looks like he’s just bit into a lemon. “He’s a dedicated egalitarian,” Charles said. “I’m not saying he’s a Marxist, but he’s internalized some Marxist models—that is, that business tends to be successful by exploiting its customers and workers.”

David agreed. “He’s the most radical president we’ve ever had as a nation,” he said, “and has done more damage to the free enterprise system and long-term prosperity than any president we’ve ever had.” David suggested the president’s radicalism was tied to his upbringing. “His father was a hard core economic socialist in Kenya,” he said. “Obama didn’t really interact with his father face-to-face very much, but was apparently from what I read a great admirer of his father’s points of view. So he had sort of antibusiness, anti-free enterprise influences affecting him almost all his life. It just shows you what a person with a silver tongue can achieve.”"

As FireDogLake points out, "Teddy Roosevelt sued monopolies, busted up trusts and seized millions of acres of land for the US government. FDR imposed unprecedented regulations on Wall Street, levied heavy taxes on the rich and created Social Security. Richard Nixon imposed wage and price controls, put the final nail in the coffin of the gold standard and established the EPA. Obama, on the other hand, continued the Bush TARP program, cut taxes and rescued the auto industry, resulting in record corporate profits. Marxist tyranny!"

Glenn Greenwald, after saying they were just a part of the oligarchy problem have, wrote in Billionaire self-pity and the Koch brothers that those few paragraphs showed "how delusional and extreme the Koch Brothers are". He then goes through it almost phrase by phrase. Still he says "There's no question in my mind that the unrestrained power over the political process and both political parties enjoyed by oligarchs is the single greatest political problem the country faces -- the overarching problem -- but in the scheme of corporate and oligarchical dominance, the Koch Brothers are a small part of that dynamic. Nor do I believe that they're motivated in their political activism by personal profit: for people with a net worth of $20 billion, there are vastly more efficient ways to convert one's wealth into greater wealth than spending money to influence public policy; I think they're True Believers."

An Economist blogger has a different perspective. W.W. has worked in libertarian think tanks including those funded by the Kochs for many years and says "The most interesting thing about the Kochs is not that they have spent so much of their fortunes on politics, because they haven't. What's interesting is that they seem to have spent their money so much more efficiently and effectively than most rich people interested in politics manage to do."

"Of the money the Kochs have spent on politics, broadly construed, the portion directed to campaigns really is negligible. Most of their money and attention has gone to ideological institution-building, and this form of spending has not been a traditional target of progressive regulatory zeal." He (I assume W. W. is a he) goes on to wonder about articles about rich people pushing liberal agendas. I don't know what he reads but even I seem to come across a lot of stuff about George Soros and the liberal controlled media.

Another thing in the Weekly Standard article that struck me was this: "The Kochs’ chief heresy, according to Mayer, was their dismissive attitude toward global warming alarmism. Charles and David were deemed “anti-science.” The brothers—both of whom held master’s degrees from MIT and ran successful companies that refined oil, produced chemicals, and manufactured polymers—scoffed at the accusation. “These people aren’t interested in science,” Charles said. “Science isn’t about consensus. Science is about skepticism, about challenging the status quo.” The Kochs believed the cost of a carbon-free economy would be too high. “There’s a direct correlation between the energy use of a country and its standard of living,” David said. “If your energy use is massively reduced, it’s going to damage your standard of living.” The available data didn’t justify the cost. “With the uncertainty and the politicization of the science so far,” Charles said, “to go spend trillions of dollars a year changing the whole world economy to satisfy something this uncertain, because you have some religious zealots like Al Gore going around preaching this—it doesn’t make sense.”"

Science is about being skeptical but it's also about repeating experiments and building a body of knowledge by consensus. People don't accept global warming theories because Al Gore told them to, people, accept it because science has accepted it. There are still many things to be understood but there's a vast body of evidence to show that the climate is warming and man is responsible and the IPCC reported that.


Karl said...

This view on global climate change mitigation is actually refreshing. It is not ignoring science, merely making a value judgment that the cost is not worth the assignable risk. It also suggests a new strategy to promote reform. I mean who cares about crazy weather, melting ice and dying species? What needs to be done is clearly demonstrate the effect of inaction on the bottom line v. the cost of mitigation. Better yet, we could devise a plan to allocate liability to offenders. If this can be done, it doesn't matter if the science is right or wrong. The risk side of the scale get heavier, so higher costs are justified.

Ok it will probably never happen, but look at the tobacco industry - it could do anything, until it couldn't.

Howard said...

But in this case the liability is great and hard to collect on and show direct causation. I agree that the effect of inaction needs to be better stated. I'm not sure how to measure the cost of the sea rising 20 feet. You'd think the tsunami videos on youtube would make that clear.

That was one of the issues in MA v EPA. Did the state have standing to bring to the case? For that to be yes, they had to show that auto-pollution was actually harming the state now. IIRC, the state went with they were losing some shoreline and not all the justices bought that.

The point of a carbon tax was to allocate the cost of greenhouse gases onto polluters so that a market solution would be found to save those costs. Now they just get to push those costs onto some future others (this is what economics calls externalities). That's much better than waiting for a non-reversable disaster to happen and expecting someone to pony up on a liability lawsuit. We saw how wall street dealt with those liabilities.

But no, taxes are bad. Ignoring (and denying) the problem and letting man-made natural disasters happen in the next decades is apparently good. Sigh.