Dark Money

The Hidden History of the Billionaires Behind the Rise of the Radical Right
By Jane Mayer (New York: Doubleday, 2016)

By Ron Shirtliff (reviewer) | 2017-01-01 11:00:00

In January 2009, when the newly-elected Barack Obama was making his inaugural speech to a joyous crowd in Washington, another group in a posh California resort was organizing a secret meeting of some of the world’s richest men. They were there by the invitation of Charles Koch and his brother David, heirs to a massive fortune and controlling the second largest private corporation in America. Present were many of the fieldworkers of the radical right, the researchers, the journalists, selected Republican elected officials, and think-tank heads.

These were the people who served the libertarian rich in their quest for complete freedom to make money without regard for people, the environment, or any constraints such as taxes imposed by governments. But the most important guests were a select group of some eighteen billionaires who had inherited and accumulated great wealth, and who would be willing to write generous cheques to fight Obama and all that he stood for.

The Koch brothers were not new to the challenge of supporting libertarian ideas, and this was not the first such meeting. Over the years they had developed a group and a strategy to counter “what they called the “liberal agenda.”

In 1985 David Koch made a direct effort by running as a libertarian candidate for vice president of the United States. He received a trifling one percent of the popular vote. Determined to find a better way, the brothers and their group concluded that they had to change the hearts and minds of the American people. To do this they worked to set up what one might call a counter-education system. They created and supported a large network, dozens of charities, think tanks, academic chairs, and popular movements that were falsefront organizations with innocuous names like the Center to Protect Patients’ Rights.

Private foundations are an important tool of the rich to protect their money while using it to influence society in ways that suit their own interests. Some are positively benign, others less so. When you endow a foundation, under US law you must donate at least five percent of the assets in the trust every year to nonprofit organizations. Contributions to the trust are tax deductible, and after 20 years the capital sum may be passed on to the next generation without incurring inheritance tax.

In the meantime, the money may be invested as wished by those in charge of the trust, with the five percent going to the nonprofit organizations that they choose—or create. For example, the Institute for Humane Studies or the Heritage Foundation, with uncontroversial-sounding names, are actually created, supported, and act as fronts for the ideological interests of the Koch network of donors.

There are 100,000 foundations in the United States today, many of them supporting noble social objectives. But a significant number of them, as Jane Mayer documents, are coordinated and committed to what must be called extreme right-wing objectives. Their key objective after 2009 was to counter Obama by crippling his government.

To do this they needed to have lots of money to sponsor their secret army of right wing “charities.” Even before Citizens United came into existence the Koch brothers and friends had found another way to make invisible donations to the causes they held dear. Social welfare groups under tax code 501( c)(4) are allowed to keep the source of tax-free donations secret. While they were prohibited from spending more than 50% of their revenue on political action, they found ways to transfer funds to other “social welfare” groups which could then pass funds on to organizations such as the Centre to Protect Patient Rights to fight against Obama’s Affordable Health Care act.

This brief summary does not do anything like justice to the exacting and detailed research and writing of Jane Mayer. She seems to know every action of every player in this long and determined effort to protect the wealth and dominance of the super-rich libertarians and she documents every statement with sources.

The genesis of this book was a January 2010 New Yorker article by Mayer, in which she highlighted some of Koch brothers’ involvement in financing right-wing politics. In their usual style, the brothers set detectives on her to dig up some dirt. Finding nothing personal, the detectives instead arranged for an accusation of plagiarism to be published. The accusations were not only false, but also comically incompetent; still, it was more than enough motivation for Mayer to press on with a book-length exposé of the men and money behind America’s new political nightmare.

Reviewed by Ron Shirtliff, an editor of Peace.