The Koch Brothers' Secret Bank

Search form

The Koch Brothers' Secret Bank

The Koch Brothers' Secret Bank
Mon, 9/16/2013 - by MIKE ALLEN and JIM VANDEHEI
This article originally appeared on Politico

An Arlington, Va.-based conservative group, whose existence until now was unknown to almost everyone in politics, raised and spent $250 million in 2012 to shape political and policy debate nationwide.

The group, Freedom Partners, and its president, Marc Short, serve as an outlet for the ideas and funds of the mysterious Koch brothers, cutting checks as large as $63 million to groups promoting conservative causes, according to an IRS document to be filed shortly.

The 38-page IRS filing amounts to the Rosetta Stone of the vast web of conservative groups — some prominent, some obscure — that spend time, money and resources to influence public debate, especially over Obamacare.

The group has about 200 donors, each paying at least $100,000 in annual dues. It raised $256 million in the year after its creation in November 2011, the document shows. And it made grants of $236 million — meaning a totally unknown group was the largest sugar daddy for conservative groups in the last election, second in total spending only to Karl Rove’s American Crossroads and Crossroads GPS, which together spent about $300 million.

Short, a soft-spoken but ferociously conservative 43-year-old operative, provided us a draft of a forthcoming IRS filing that will soon be available to the public. Short, like most in the Koch empire, feels wealthy conservative activists such as Charles and David Koch get a bum rap from the media. So, Short wants to ease his groups and their cause out of the shadows.

“There’s a mystery around us that makes an interesting story,” Short said in an interview in his conference room. “There’s also a vilification that happens that gets exaggerated when your opposition thinks you’re secretive. Our members are proud to be part of [the organization].”

Democrats have their own vast web of secretive funders — and Short is right: Few liberals got as much scrutiny as the Koch brothers over the past few years.

But the “proud” donors are not so proud they will publicly identify themselves as donors. Short refused to open up about the men and women behind the quarter-billion-dollar fund, beyond saying that Koch-linked entities provided a “minority” of the funds and that the largest single donor gave about $25 million.

Freedom Partners is organized under the same section of the Tax Code as a trade association, a 501(c)6, which allows the group to conceal its donors from public release, although the amounts and recipients of its major grants are public.

The filing offers a rare tour of the conservative movement and how it gets its funds:

• Center to Protect Patient Rights, a group that vehemently opposes Obamacare: a total of $115 million, from three grants.

• Americans for Prosperity, an organizing and advocacy group that is courted by Republican presidential candidates: $32.3 million.

• The 60 Plus Association, a free-market seniors group that also opposes Obamacare: $15.7 million.

• American Future Fund, an Iowa group that spent a lot of money on ads in 2012, many for Mitt Romney: $13.6 million.

• Concerned Women for America Legislative Action Committee, which gets involved in a number of social policy debates: $8.2 million.

• Themis Trust, a Koch-based voter database that is made available to other conservative organizations: $5.8 million.

• Public Notice, a fiscal policy think tank: $5.5 million.

• Generation Opportunity, a group for “liberty-loving” young people: $5 million.

• The LIBRE Initiative, which targets a free-market message to Hispanic immigrants: $3.1 million.

• The National Rifle Association: $3.5 million.

• The U.S. Chamber of Commerce: $2 million.

• American Energy Alliance: $1.5 million.

• And several groups — including the State Tea Party Express, the Tea Party Patriots and Heritage Action for America — got less than $1 million each.

Members are drawn from the Koch brothers’ semiannual conferences, a 10-year-old tradition that draws top politicians — including, last month, House Majority Leader Eric Cantor (R-Va.) and House Budget Committee Chairman Paul Ryan (R-Wis.). Many seminar attendees also give directly to Koch-approved groups, and the Freedom Partners funds do not include the Kochs’ many gifts to university think tanks.

Short says his members are “concerned that the nation that they grew up in and that their businesses have flourished in will not be there for their children and grandchildren,” and are “committed to trying to restore what they view are free markets in a free society in America.” Many, he said, are “Horatio Alger-type stories,” most of them not household names, who got rich after starting small businesses, from service to manufacturing to information technology: “They are really worried about the country that’s going to be left for their future generations.”

Freedom Partners now has 48 employees. The executive director is Richard Ribbentrop, a former head of the New York Stock Exchange’s Washington office, who was chief of staff to former Sen. Kay Bailey Hutchison and longtime legislative director to Sen. Phil Gramm, both Texas Republicans. At Hutchison’s office, Ribbentrop hired Short, who succeeded him as chief of staff. Short later was chief of staff to then-Rep. Mike Pence (R-Ind.), who was chairman of the House Republican Conference, and is now governor of Indiana. The Freedom Partners vice president of strategic communications is James Davis, who was communications director of the 2012 Republican National Convention.

The group has five directors: Short; Wayne Gable, a longtime Koch Industries employee who was the new group’s first director and holds a Ph.D. in economics from George Mason University; Richard Fink, a Ph.D. in economics who is president of the Charles G. Koch Charitable Foundation; Kevin Gentry, a Koch official and vice chairman of the Republican Party of Virginia; and Nestor Weigand, a board member of Regal Entertainment Group and former president of the National Association of Realtors.

We asked Short what he has to show for all that money spent in 2012, when Republicans failed at a within-reach effort to take back the Senate and Romney left the GOP in a deep hole by getting wiped out among some demographic groups, including Hispanic and Asian voters. “Our members are committed to the long term,” Short said, “not to one individual cycle.”

Kenneth P. Vogel contributed.

Originally published by Politico

Article Tabs

One of the slogans of the Occupy movement was "capitalism isn't working." Now, in an epic, groundbreaking new book, French economist Thomas Piketty explains why the movement was right.

As credit card companies try and spur consumer spending in the United States with introductory perks and cash rewards, they have raised interest rates on other customers to a remarkable 21 percent.

Inmates will refuse work, calling for education, rehabilitation and an end to overcrowding, life sentences without parole – and “the free labor system.”

Oil spills are the reality of transporting oil – and in the Pacific Northwest, where workers from the fishing to tourism industries depend on oil-free waterways, the threat is all the more grave.

The rage and nihilism that come from the frustrations of American life are expressed through violence.

Revolts are shaking the world, bursting in the most unexpected places, but they rarely take power. Is the big explosion still coming?

Posted 5 days 3 hours ago

The Vermont Senate passed a bill to require labeling on all GMO foods sold in the state – signaling a wave of nationwide victories against the Gene Giants may be underway.

Posted 5 days 3 hours ago

Life in tent encampments, vehicles, motels, and storage units - REAL CHANGE focuses on four men who sell Real Change News, a street newspaper in Seattle. Follow ROBERT, GEORGE, DANIEL, and BUDDY as they navigate the less visible side of homelessness in America. Despite their struggles, they persevere. Each sells newspapers to get by.

Posted 6 days 3 hours ago

From climate change to Crimea, the natural gas industry is supreme at exploiting crisis for private gain.

Posted 5 days 3 hours ago

A right-wing Canadian outfit funded by the Kochs wants to privatize the Canadian health care system – and Prime Minister Stephen Harper is now steering policy that way.

Posted 5 days 4 hours ago

A new report looks at 10 U.S. corporations that used an array of tax loopholes and corporate subsidies to slash their tax bills.

A provision was recently added to the state budget preventing those in law enforcement and similar government agencies from buying surveillance drones for two years.

Once again, the U.K. capital's house prices are soaring, further widening the gap between the city's rich and poor.

The campaign aims to halt public investments in the fossil fuel industry.

In the tradition of forest defenders in the Northwest and mountain defenders in Appalachia, the Texas campaign to block the Keystone XL pipeline has embraced escalated direct action performed by people across the social and political spectrum.

Sign Up