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The Kochs and the Keystone XL Pipeline

Billionaire brothers’ use of fronts for corporate donations to politicians was illegal until Citizens United decriminalized this game

Cross-posted from Vice magazine

Note: Robert F. Kennedy Jr. and his son Connor Kennedy were arrested Wednesday in Washington while protesting against approval of the Keystone XL Pipeline. Bobby Kennedy, my partner in these investigations, is a contributor to Billionaires & Ballot Bandits: Greg Palast investigates Karl Rove, the Koch Gang & their Buck Buddies, the book on which this report is based. 

photonameIn the early 1990s, FBI agents filmed Koch Oil men pilfering crude from the Osage
Reservation in Oklahoma. The US Justice Department drafted a criminal indictment
of Koch Industries

According to the transcript of the secretly recorded tape, Charles Koch was chuckling like a six-year old. Koch was having a hell of a laugh over pilfering a few hundred dollars’ worth of oil from a couple of dirt-poor Indians on the Osage Reservation.

Why did Koch, worth about $3 billion at the time (now $20 billion) need to boost a few bucks from some Indian in a trailer home? Koch answered:

“I want my fair share – and that’s all of it.”

Now “all of it” includes a pipeline, the Keystone XL, which would run the world’s filthiest oil, crude made from tar sands, down from Canada to his family’s refinery on the Gulf Coast of Texas.

Problem: The Keystone XL tar-oil tube would endanger the largest US water sources, vastly increase pollution in the USA and measurably heat the planet.

Solution: Congressman Tim Griffin.

Congressman Griffin is sponsoring the bill to force the Obama Administration to approve the XL Pipeline without the environmental review now required by law.

What’s odd is that Griffin represents Arkansas, a state with no stake in the Pipeline.

But the Kochs have a stake in Griffin. In his maiden run for Congress, Griffin was elected with an eye-popping $167,000 donation from the Kochs.  For $167,000, any congressman will wash your car — with their tongue.

For the Kochs, $167K is peanuts. Their political action operation, Americans for Prosperity, built a quarter billion dollar fund this past year, a sum never seen even in the US politics cash swamp.

 Global Warming Denial as a Profit Center

To answer the concerns about global warming raised by the XL and the Kochs’ oil business, the billionaire brothers have bankrolled a gold-plated campaign of global warming denial.

For example, Americans for Prosperity funded “Hot Air Tour” rallies across the US with the slogan, “Global Warming Alarmism:  Lost Jobs, Higher Taxes and Less Freedom.” More rallies were held by the Koch-funded FreedomWorks, a foundation which has seized control of the Tea Party movement — and redirected populist rage against plutocrats. FreedomWorks transformed the Tea Party into a used tea bag, dangling from the Kochs' string.

Break the Law then Re-make the Law

States on the pipeline’s route could block the Keystone XL, but the crucial extension will originate in Oklahoma where the Kochs have cowed all resistance to their needs.

The Kochs’ power to terrorize politicians in Oklahoma and the West originates in that case of Osage tribe’s missing oil.

FBI agents filmed Koch Oil men pilfering the crude, had witnesses to Koch’s directives to siphon the oil, and more. The US Justice Department drafted a criminal indictment of Koch Industries and Defendant “67C” (reportedly Charles Koch himself) for “Crime on an Indian Reservation” and racketeering, big-time jail-time offenses.

That’s when Koch Oil drilled down and struck Bob Dole, the nation’s most powerful Senator, the Republican Majority Leader.

Dole (representing Kansas), joined by a Koch-funded Senator from Oklahoma, Don Nickles, had the federal prosecutor who brought the case fired. Case closed except for a few million paid to the Osage for some of their stolen oil.

Dole ran for President using Koch money given to Dole’s not-for-profit foundation.  It was a cheap buy for the Kochs because it was illegal — so Dole, when caught, had to give it back.

But one Senator wouldn’t let the oil theft go: Dennis DeConcini, chairman of the Senate Special Committee on Investigations whose report concluded: “Koch Oil is the most dramatic example of an oil company stealing by deliberate mismeasurement and fraudulent reporting.”

The Kochs didn’t like that. And when the Kochs don’t like something, or someone, it’s notably more serious than a ‘thumbs down’ on your Facebook page. In 1996 (yes, I’ve been investigating the Kochs for that long), DeConcini told me the Kochs warned him that if he published and stood by the Senate’s and the FBI’s findings, the Kochs would destroy the Senator’s political career. They did.

Then there was the matter of the 97-count criminal indictment of Koch Oil for dumping poisonous crude sludge into rivers in six states.  The Kochs didn’t merely want to beat the rap — they wanted to continue dumping.

That would require buying a whole new Congress. No problemo, Pardner. In 1996, Koch Industries, through a fake front called Coalition for our Children’s Future, secretly funded millions of dollars in vicious attack ads against vulnerable Democrats just days before the election.

As a result, Republican Newt Gingrich kept his post as Speaker of the House of Representatives. Gingrich pushed an agenda he called “The Contract with America”, which would eliminate criminal sanctions for pollution and slash rules against polluting.  The Center for Public Integrity said it “seems to have been drafted and designed for Koch interests.”

Wrong. The Contract was drafted by the Kochs and crafted at the Heritage Foundation, a think-tank the Kochs founded.

Bill Clinton’s Administration, though nominally Democratic, went easy on Koch interests. Vice-President Al Gore especially, head of the Reinventing Government Commission, attacked regulations with more verve than Ronald Reagan or Margaret Thatcher.  Gore’s anti-regulation guidebook was the “Mandate for Change” drafted by the Democratic Leadership Council. It was the DLC that had launched the career of the previously unknown Bill Clinton, its first chair, and Al Gore’s career as well. The DLC was created with $100,000 of Koch money.

The Kochs use of fronts for corporate donations to politicians was plain illegal — until, in 2010, the US Supreme Court decriminalized this game in the Citizens United case. The lawyer for Citizens United is Ted Olson, whose day job is representing Koch Industries.

Note: The Kochs are bi-partisan employers.  They also retain lawyer Bob Strauss, former Chairman of the Democratic Party.

The Themis Machine

As if their billions, their think tanks, lawyers, fronts and political action fund were not enough to scare the bejeezus out of politicians, there is Themis. Themis, created by the Kochs, is the nation’s most sophisticated, detailed database on every American living, surpassing the most demonic dreams of the FBI.

Themis, for example, knows the last time you, Jack, downloaded porn.

Given their power and their Themis, is it really possible for a few greenies and some fact-afflicted scientists to stop the Kochs from jamming their pipeline right up our aquifers?

Absolutely. Indeed, that’s the only way it will be stopped, because the Kochs have already put the politicians in their pipe and smoked them.

On Sunday, February 17, there will be a rally in Washington, DC protesting the pipeline. Details here.

This is Part 2 of “The Koch Brothers, Hugo Chavez and the XL Pipeline.”  Part 1 explains that the Koch Oil refinery can only “crack” heavy crude from Venezuela—which costs $33 a barrel more than tar sands heavy oil.  But Canada’s cheap crude cannot get to Texas without a new, giant pipe.  XL would save the Kochs nearly $3 billion a year.

 

Greg Palast
Greg Palast is the author of Billionaires and Ballot Bandits, Vultures' Picnic and The New York Times bestsellers, Armed Madhouse and The Best Democracy Money Can Buy.

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