By Phil Mattera,
Dirt Diggers Digest
Charles and David Koch and their
Koch Industries conglomerate, long known for an unapologetic defense of
unfettered capitalism and hard-right politics, are said to be going soft.
The
brothers are taking pains to associate themselves with more progressive policies
such as criminal justice reform, while their corporation has been running feel-good ads highlighting
its purported commitment to enlightened principles such as sustainability.
At the same time, the Kochs are
depicting themselves as backers of supposedly responsible Republican
presidential candidates and shunning iconoclastic front-runner Donald
Trump.
The Koch charm offensive does have its limits. A slew of groupsfunded by the billionaires are at the forefront of the campaign against the Obama Administration’s Clean Power Plan and are doing their best to defend fossil fuels. When it comes to environmental policy, the Kochs are still in the stone age.
That position is not merely a
matter of ideology. Their opposition to environmental and other safety
regulations amounts to a defense of the way the Kochs do business.
This was made clear to me in some
work I’ve been doing on a new research tool called Violation Tracker that my
colleagues and I at Good Jobs First are preparing.
Patterned on our Subsidy
Tracker, the new resource will take company-specific data on regulatory
violations and link the individual entries to the parent corporations of the
culprits. This will allow us to present violation totals for large firms and
show which of them are the most frequent offenders.
The initial version of Violation
Tracker, which will be released this fall, will cover data from the
Environmental Protection Agency, the Occupational Safety & Health
Administration and a few other federal health and safety agencies. Coverage on
wage and hour violations, financial sector transgressions and other forms of
corporate misconduct will come later.
A preliminary tally of EPA and
OSHA data from the past five years indicates that units of Koch Industries have
been hit with more than $3.5 million in penalties. The biggest amount comes
from Flint Hills Resources, the conglomerate’s oil refining arm. For example,
in 2014 the company had to pay $350,000 and sign a consent decree to resolve EPA allegations
that it was violating the Clean Air Act through flaring and leaking equipment.
Georgia-Pacific, the Koch
Industries forest products company, received more than $600,000 in penalties
during the five-year period. These included $60,000 in penalties proposed in January by OSHA in connection
with worker exposure to formaldehyde and other dangerous substances.
In 2013 the fertilizer company
Koch Nitrogen had to pay $380,000 to settle allegations that its facilities in
Iowa and Kansas violated the Clean Air Act.
Regulatory violations by Koch
businesses began before the five-year period that will be initially covered in
Violation Tracker.
For instance, in 2000 the Justice
Department and the EPA announced that Koch Industries would pay what was then a
record civil environmental fine of $30 million to settle charges relating to
more than 300 oil spills.
Along with the penalty, Koch agreed to spend $5
million on environmental projects in Texas, Kansas and Oklahoma, the states
where most of its spills had occurred. In announcing the settlement, EPA head
Carol Browner said that Koch had quit inspecting its
pipelines and instead found flaws by waiting for ruptures to happen.
Later in 2000, DOJ and the EPA
announced that Koch Industries would pay a penalty of $4.5 million in
connection with Clean Air Act violations at its refineries in Minnesota and
Texas. The company also agreed to spend up to $80 million to install improved
pollution-control equipment at the facilities.
In a third major environmental
case against Koch that year, a federal grand jury in Texas returned a 97-count
indictment against the company and four of its employees for violating federal
air pollution and hazardous waste laws in connection with benzene emissions at
the Koch refinery near Corpus Christi.
The company was reportedly facing
potential penalties of some $350 million, but in early 2001 the newly installed
Bush Administration’s Justice Department negotiated a settlement in which many of
the charges were dropped and the company pled guilty to concealing violations
of air quality laws and paid just $10 million in criminal fines and $10 million
for environmental projects in the Corpus Christi area.
In 2002 Koch Petroleum Group, the
Koch entity involved in most of these environment problems, was renamed Flint
Hills Resources. That name change was as cosmetic as the current charm
offensive.
If the Kochs really want to
improve their reputation, they should go beyond public relations and make
fundamental alterations in their business practices.