Inside the Koch Brothers' Secret Billionaire Summit
This article originally appeared in The Nation.
Charles and David Koch wrapped up their annual summer seminar on June 16 in Dana Point, California, at the St. Regis Monarch Bay resort—a fitting location for two men whose combined net worth is more than $100 billion, according to the Bloomberg Billionaires Index. The highly secretive mega-donor conference, called “American Courage: Our Commitment to a Free Society,” featured a who’s who of Republican political elites. According to conference documents obtained through a source who was in attendance, Representatives Tom Cotton (AR), Cory Gardner (CO) and Jim Jordan (OH) were present, as were Senators Mitch McConnell (KY) and Marco Rubio (FL). Cotton, Gardner and McConnell are all running for the Senate this year; Jordan for re-election in the House. Rubio is widely considered a major contender for a 2016 presidential run. According to the documents, the conference attendees discussed strategy on campaign finance, climate change, healthcare, higher education and opportunities for taking control of the Senate. (The draft agenda is available for viewing here.)
According to another source who also attended the conference, 300 individuals—worth at least a billion each—were present. This source said that the explicit goal was to raise $500 million to take the Senate in the 2014 midterms and another $500 million “to make sure Hillary Clinton is never president.” Three hundred billionaires in attendance is likely an exaggeration; to put that figure in perspective, there are 492 total billionaires in the United States by Forbes’s count. The Koch network raised an estimated $407 million in the 2012 presidential election, according to an analysis by The Washington Post and the Center for Responsive Politics.
The official conference lasted two days, Sunday and Monday, but several events for top donors occurred on Saturday. According to conference documents, Representatives Tom Cotton and Jim Jordan were to join a group of top donors for a post-golf lunch discussion. A special dinner was scheduled at La Casa Pacifica—the former home of President Richard Nixon that has come to be known as “The Western White House”—with Rich DeVos, the Amway co-founder, owner of the Orlando Magic and frequent Koch collaborator. The menu offered “oven roasted Angus natural filet mignon served in a fresh green peppercorn sauce served with braised fennel with truffle, asparagus tips, vegetable and mint quinoa” among other dishes prepared by Master Chef Maurice Brazier.
La Casa Pacifica is currently owned by Gavin Herbert, the founder of the pharmaceutical company Allergan and a Republican heavyweight. Herbert is a GOP donor and Nixon confidant, and Allergan is a major funder of the American Legislative Exchange Council, the conservative powerhouse behind model legislation that would bust unions, repeal environmental protections, require voter ID and increase access to guns and justify their use in Stand Your Ground cases.
On Sunday, Representative Jordan, Senate minority leader McConnell and Koch legal operative Mark Holden held a strategy discussion titled “Free Speech: Defending First-Amendment Rights” for a small, invite-only group. McConnell was slated to address the full crowd in a talk by the same name later in the afternoon. Earlier this month, McConnell clashed with Senate majority leader Harry Reid in a Senate Judiciary Committee hearing on Reid’s proposed constitutional amendment to get big money out of politics. The billionaire Koch brothers have been popular targets for Reid’s ire.
On the issue of campaign finance reform, Republicans argue that money equals speech and therefore regulating money in elections abridges first amendment free speech rights. The Democratic framework is that in a world where money equals speech, the rich are able to silence the poor and corrupt the political process. (Disclosure: I cover campaign finance reform extensively and work with Money Out/Voters In, a coalition of grassroots activists seeking to overturn Citizens United.)
Intriguing in its ambiguity was the “Energy: Changing the Narrative” session, presumably meant to change the narrative of climate change to one of energy independence. Panelists listed include Nancy Pfotenhauer, the president of MediaSpeak Strategies and former director of the Washington office of Koch Industries; Hubbel Relat, a former associate director of the Center for Freedom and Prosperity Foundation; and Karen Steward, the Director of Research at Freedom Partners—none of whom are scientists. According to The Daily Beast, the Kochs are investing large sums in “a new energy initiative with what looks like a deregulatory, pro-consumer spin” to combat President Obama’s new regulations on carbon dioxide emissions and liberal billionaire Tom Steyer’s $100 million commitment to fight climate change. It is not hard to see why the Kochs, as the owners of a large carbon-based energy conglomerate with interests in oil, natural gas and coal, are some of the most vocal climate deniers. In 2013, Forbes listed Koch Industries as the second largest privately held company in the country.
Also on Sunday, conservative columnist Amity Shlaes was interviewed about her recent biography of Calvin Coolidge. Charles Murray, the libertarian political scientist and author of the controversial book The Bell Curve, gave dinner remarks. Other highlights included “Collectivism: Exploring Its Nature and Consequences” and “The Foundation for Progress,” which was broken down into several sessions, including “Part One: Drive the National Conversation,” “Part Two: Leverage Science and the Universities,” “Part Three: Advance in the States,” concluding with the aforementioned McConnell talk. Part One featured Michael Lomax, the president and CEO of the United Negro College Fund, which recently received a $25 million donation from the Kochs to create a special “Koch Scholars” program emphasizing entrepreneurialism and free markets. Lomax has faced a storm of criticism for taking the money, given the history of attacks by Koch-funded organizations on voting rights, which do the most harm to underprivileged minorities who typically vote Democratic.
On Monday morning, conservative radio host and former Koch operative Jeff Crank was to interview Representatives Cotton and Gardner in a session titled “The Senate: A Window of Policy Opportunity for Principled Leaders.” Senator Rubio was to hold a small group discussion on an unnamed topic that afternoon and headline what was called internally “The Immigrant Experience” dinner, closing out the conference. Some interesting entries include “Texas: Sustaining a Culture of Freedom in the Lone Star State” and “Well-Being: What It Is and Why It’s Important.”
A special invitation-only, small group strategy discussion called “Employee Outreach: Engaging Your Workforce in the Cause of Freedom” was also scheduled for Monday, led by Koch insiders Dale Gibbens and Philip Ellender. A previous Nation story has documented how Koch Industries politically pressured as many as 50,000 workers in the run-up to the 2010 elections.
All of this took place in the idyllic backdrop of Monarch Bay and the luxurious St. Regis resort, which boasts rooms ranging from $495 a night to unlisted amounts for its very best accommodations. Room rates offered to the conference ranged from $199 for staff to $2,000 for the Presidential Suites. Freedom Partners, the Kochs’ financing arm, coordinated the event with the cover name “T & R Annual Sales Conference” and bought out the hotel from noon on Saturday to noon on Tuesday. According to a source in attendance, Freedom Partners spent more than $870,000, which included large fees to shut down public access to the golf course, the Michael Mina restaurant Stonehill Tavern and Motif Restaurant. Attendees were responsible for their own room charges.
Security was tight from noon on Saturday throughout the remainder of the conference, with checkpoints at every entrance to the resort. At the front gate, security guards and multiple Koch employees brandishing iPads greeted incoming cars. Even more Koch employees, acting as escorts, met guests at the front door. Guests were asked to abide by a no-cell phone policy, and security was in place to enforce that policy at events.
St. Regis Monarch Bay also has residences in adjacent properties as part of the Monarch Bay Club. Owners normally have access to the hotel, but according to one, he was denied access under the pretense that the hotel had been bought out by a group of Obama supporters. (The president had delivered a commencement speech at nearby UC Irvine on Saturday).
The level of security leads one to wonder—why such secrecy if the Koch’s initiatives really are in the best interest of the public at large? Wouldn’t everyday Americans heartily embrace new proposals to improve the economy and their government? Maybe protecting the business interests of billionaires doesn’t quite square with an American public that is still under siege by high unemployment, stagnant wages and ongoing foreclosures. This conclave of billionaires is determined to roll back Obamacare and carbon restrictions and to render the remainder of the Obama presidency ineffectual. In an America where money equals speech, Koch is king.
The offices of Representatives Tom Cotton, Cory Gardner and Jim Jordan; Senators Mitch McConnell and Marco Rubio; and United Negro College Fund’s Michael Lomax did not respond to requests for comment.