MGG Pillai Search Vincent Tan News Commentary
Tan Sri Vincent Tan, a friend of the UMNO establishment then but not ... They are in a hurry for they will lose their influence when the prime minister retires. ... Sri Vincent Tan and T.Ananda Krishnan do: the number of child-care centres, ... The T. Ananda Krishans, the Tan Sri Francis Yeohs, the Tan Sri Vincent ...
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bid for the UEM Group and the PLUS highway concessionaire via his flagship MMC Corp has heightened perception that the billionaire tycoon is amassing unusually large stakes in strategic national economic assets.
Syed Mokhtar-linked companies already control the sugar and rice sectors, two ports (Johor Port and Port of Tanjung Pelepas), an airport (Senai Airport), the nation’s largest independent power producer (Malakoff Corp) and water treatment plants (Aliran Ihsan Resources).
Observers and critics have pointed out that a PLUS acquisition, which operates the 973km North South Highway from Thailand to Singapore, could further concentrate ownership of critical national infrastructure in the hands of a private businessman.
Another Syed Mokhtar (picture) concern — automotive group DRB Hicom — told reporters last month that it is not actively looking to buy Proton Holdings Berhad but did not discount the possibility of doing so.
This followed speculation that it had been given the nod by the government to acquire the national car maker.
The Malaysian Insider also learnt that Syed Mokhtar had written to the government to buy 1,200 hectares out of the 3,000 hectares of Rubber Research Institute (RRI) land in Sungei Buloh to be developed by the Najib administration under his Economic Transformation Programme (ETP).
At an EPA hearing last summer, representatives from Koch Industries argued that moderate levels of the toxic chemical dioxin should not be designated as a cancer risk for humans.
When members of Congress sought higher security at chemical plants to guard against terrorist attacks, Koch Industries lobbyists prowled Capitol Hill to voice their opposition.
And when Congress moved to strengthen regulation of the financial markets after recent collapses, Koch Industries — a major commodities and derivatives trader — deployed a phalanx of lobbyists to resist proposed changes.
Charles and David Koch, the owners of the country’s second-largest private corporation, are libertarians of long standing, who contend that government regulations, taxes and subsidies stifle individual initiative and hamper American competitiveness. In recent years, the Kochs have played an increasingly public role as financial angels for conservative causes, politicians and foundations.
What’s not so well-known is the activity of Koch Industries in the trenches in Washington, where a Center for Public Integrity examination of lobbying disclosure files and federal regulatory records reveals a lobbying steamroller for the company’s interests, at times in conflict with its public pose.
The money that Koch (pronounced “coke”) has spent on lobbying in Washington has soared in recent years, from $857,000 in 2004 to $20 million in 2008. The Kochs then spent another $20.5 million over the next two years to influence federal policy, as the company’s lobbyists and officials sought to mold, gut or kill more than 100 prospective bills or regulations.
On a trip to Delhi late last year, I asked a friend knowledgeable about the goings-on in the corridors of power: "What's Niira Radia up to these days?" He laughed wrly: "Cabinet ministers may or may not attend meetings called by Manmohan Singh but if Niira calls for a dinner at her farmhouse, all ministers would be in attendance." He also said: "She's doing good, but with India-China business relations opening up, the lady is keen to catch this business as well. It seems that she knows the wife of a very important Chinese leader at a personal level."
Whether Radia was able to leverage this Chinese connection I do not know but clearly my friend's description was an exaggeration in the manner cartoonists emphasize a particular physical feature of their subject. Nonetheless, it demonstrated the importance of the lady in the power circles of Delhi.
The Radia tapes now demonstrate this truth starkly: how several top honchos in the media, business and government were eating out of her hand. The question is, what is the charm that the lady wove to make public figures so keen to gossip with her about important matters of the state and do her bidding or at least pretend to?
First, though styled a public relations consultant, Niira was only so in the broad sense of the word. She was a consultant with one foot in the corporate sector and the other in the government like virtually no one before in independent India.
In the good old days preceding liberalisation, there were liaison officers that corporates hired to remain on the right side of officers of the government or netas. They were low-profile: unseen and unheard of, and went about their jobs without much ado. Anyway, with the government and the public sector controlling the commanding heights of the economy, there was not much to do: getting some files cleared by the babu of the industry ministry, securing a purchase order from the DGS&D (directorate general of supply and disposal) or lobby with the finance ministry for duty change (import or excise duty or both) before the budget. Sometimes these liaison officers would get questions planted in Parliament through an obliging MP.
There were also public relations officers that corporates had on their rolls to write and disseminate press releases. These PROs had limited roles because the media was by and large shy of giving any publicity to private sector companies viewing this as needless advertising. Of course, there were full-fledged PR departments in public sector organisations that besides plugging for their chairmen and managing directors also performed sundry other work such as looking after company guesthouses.
Liberalisation brought about a sea change in the business environment. For the first time, public relation firms began to be established (actually the first ones came about just before the reforms process began). Corporates, all at sea in this new paradigm and apprehensive that their business would go down the tube in the new competitive environment, hired public relations companies that promised the moon in terms of build-up in the media. In reality, all they managed was to stand as middlemen between corporates and journalists. But that is another story.
Contrary to expectations, though liberalisation led to delicensing, it did not mean less of government. Now the private sector was being allowed into sectors hitherto out of bounds for the private sector, like power, mining, telecom and oil & gas. Industry-friendly policies were required for all these complex sectors about whose operations Indian babus had no idea. If not anything, then – from the point of view of industry – babus had to be educated, otherwise they would come up with "impractical" policies (at least in the details). This led to the birth of industry-specific organisations that lobbied for policy changes in specific sectors. It also led to the need for a new kind of professionals who would lobby for policy changes sought by individual corporates. Many public relations companies also mulled over diversifying into this business but most of them were deterred because this was a totally different ballgame.
It is at this stage that Nira Radia (she became Niira with a double "i" later, possibly for numerological reasons) burst forth on to the scene. This was the end of the 1990s. Having lived in London, she probably thought lobbying offered a great business opportunity. However, because lobbying was not considered a legitimate business, she set up a public relations firm with the Tata Group as her first client. The Tatas, with about 100 companies under their belt, offered considerable leverage to Radia. With her aggressive ends-justify-means approach, she was able to exploit this strength by selling unconventional ideas to her clients: like if the media gives bad coverage, stop advertising in the offending media. With the media business becoming more costly and cutthroat post-liberalisation, media organisations had to sit up and at least take note of this new reality. Radia, the perfect middlewoman, also portended to cut off access to her clients if you wrote anything uncomplimentary about them. That she practised these beliefs is apparent from her taped conversations: in one such conversation she threatens to boycott PTI! (Of course, this did not work out.)
It also goes without saying that with her smart and winning ways, Radia was able to charm at least some editors and was able to enlist the support of many journalists. This is besides many public figures who were ready to do business with her. For journalists looking for stories, with her (by now) extensive contacts, she was also able to supply great news material to them. As a result, many had virtually become supplicants to her. It won't be off the mark to conclude that at least some of them were on her payroll.
The government has said that it began tapping her phones because it suspected that she worked for some foreign agents. I doubt whether that is the case. But yes, with a lady with such extensive contacts it would make sense for them to engage her.
Whether Radia was able to leverage this Chinese connection I do not know but clearly my friend's description was an exaggeration in the manner cartoonists emphasize a particular physical feature of their subject. Nonetheless, it demonstrated the importance of the lady in the power circles of Delhi.
The Radia tapes now demonstrate this truth starkly: how several top honchos in the media, business and government were eating out of her hand. The question is, what is the charm that the lady wove to make public figures so keen to gossip with her about important matters of the state and do her bidding or at least pretend to?
First, though styled a public relations consultant, Niira was only so in the broad sense of the word. She was a consultant with one foot in the corporate sector and the other in the government like virtually no one before in independent India.
In the good old days preceding liberalisation, there were liaison officers that corporates hired to remain on the right side of officers of the government or netas. They were low-profile: unseen and unheard of, and went about their jobs without much ado. Anyway, with the government and the public sector controlling the commanding heights of the economy, there was not much to do: getting some files cleared by the babu of the industry ministry, securing a purchase order from the DGS&D (directorate general of supply and disposal) or lobby with the finance ministry for duty change (import or excise duty or both) before the budget. Sometimes these liaison officers would get questions planted in Parliament through an obliging MP.
There were also public relations officers that corporates had on their rolls to write and disseminate press releases. These PROs had limited roles because the media was by and large shy of giving any publicity to private sector companies viewing this as needless advertising. Of course, there were full-fledged PR departments in public sector organisations that besides plugging for their chairmen and managing directors also performed sundry other work such as looking after company guesthouses.
Liberalisation brought about a sea change in the business environment. For the first time, public relation firms began to be established (actually the first ones came about just before the reforms process began). Corporates, all at sea in this new paradigm and apprehensive that their business would go down the tube in the new competitive environment, hired public relations companies that promised the moon in terms of build-up in the media. In reality, all they managed was to stand as middlemen between corporates and journalists. But that is another story.
Contrary to expectations, though liberalisation led to delicensing, it did not mean less of government. Now the private sector was being allowed into sectors hitherto out of bounds for the private sector, like power, mining, telecom and oil & gas. Industry-friendly policies were required for all these complex sectors about whose operations Indian babus had no idea. If not anything, then – from the point of view of industry – babus had to be educated, otherwise they would come up with "impractical" policies (at least in the details). This led to the birth of industry-specific organisations that lobbied for policy changes in specific sectors. It also led to the need for a new kind of professionals who would lobby for policy changes sought by individual corporates. Many public relations companies also mulled over diversifying into this business but most of them were deterred because this was a totally different ballgame.
It is at this stage that Nira Radia (she became Niira with a double "i" later, possibly for numerological reasons) burst forth on to the scene. This was the end of the 1990s. Having lived in London, she probably thought lobbying offered a great business opportunity. However, because lobbying was not considered a legitimate business, she set up a public relations firm with the Tata Group as her first client. The Tatas, with about 100 companies under their belt, offered considerable leverage to Radia. With her aggressive ends-justify-means approach, she was able to exploit this strength by selling unconventional ideas to her clients: like if the media gives bad coverage, stop advertising in the offending media. With the media business becoming more costly and cutthroat post-liberalisation, media organisations had to sit up and at least take note of this new reality. Radia, the perfect middlewoman, also portended to cut off access to her clients if you wrote anything uncomplimentary about them. That she practised these beliefs is apparent from her taped conversations: in one such conversation she threatens to boycott PTI! (Of course, this did not work out.)
It also goes without saying that with her smart and winning ways, Radia was able to charm at least some editors and was able to enlist the support of many journalists. This is besides many public figures who were ready to do business with her. For journalists looking for stories, with her (by now) extensive contacts, she was also able to supply great news material to them. As a result, many had virtually become supplicants to her. It won't be off the mark to conclude that at least some of them were on her payroll.
The government has said that it began tapping her phones because it suspected that she worked for some foreign agents. I doubt whether that is the case. But yes, with a lady with such extensive contacts it would make sense for them to engage her.
'Candid' Tata, 'evasive' Radia appear before PAC in 2G probe
New Delhi, April 4 : Tata Group chairman Ratan Tata and corporate lobbyist Niira Radia were Monday questioned by parliament's Public Accounts Committee (PAC), probing alleged financial irregularities in the 2G spectrum allocation. Panel head M.M. Joshi said Radia was "evasive" in her replies while ...
2G scam: Tata 'candid', Radia 'evasive' before PAC
New Delhi, April 4 : Tata Group chairman Ratan Tata and corporate lobbyist Niira Radia were Monday questioned by parliament's Public Accounts Committee (PAC) in its search of the scam-tainted money trail in the 2G spectrum allocation by former communications minister Andimuthu Raja.
2G scam: Tata candid, Radia evasive before PAC
New Delhi, Apr 4 : Tata group head Ratan Tata and corporate lobbyist Niira Radia were quizzed by Indian Parliament's Public Accounts Committee (PAC) on Monday in connection with the 2G spectrum allocation scam.
Tata, Radia face PAC over 2G scam
New Delhi, Apr 4 : Tata group head Ratan Tata and corporate lobbyist Niira Radia appeared before Indian Parliament's Public Accounts Committee (PAC) on Monday in connection with the 2G spectrum allocation scam.
2G scam: Ratan Tata appears before PAC
New Delhi, Apr 4 : Industrialist Ratan Tata appeared before the Parliament's Public Accounts Committee (PAC) today for questioning in connection with the 2G spectrum scam.
2G scam: Tata, Radia appear before PAC
New Delhi, April 4 : Tata group chairman Ratan Tata and corporate lobbyist Niira Radia Monday appeared before parliament's Public Accounts Committee to testify in the probe into alleged financial irregularities in the allocation of 2G spectrum.
2G scam: Ratan Tata, Radia to appear before PAC
New Delhi, Apr 4 : Industrialist Ratan Tata and corporate lobbyist Niira Radia are scheduled to appear before Parliament''s Public Accounts Committee (PAC) today in connection with the alleged irregularities in the allocation of 2G spectrum.
Tata, Radia likely to appear before PAC Monday
New Delhi, April 3 : Tata group chairman Ratan Tata and corporate lobbyist Niira Radia are expected to appear before parliament's Public Accounts Committee (PAC) Monday to answer queries on the alleged irregularities in the allocation of 2G spectrum, an official source said Sunday.
Niira Radia tapes case: SC to hear Tata petition from Apr 19
New Delhi, Apr 1 : The Supreme Court will start from April 19 the regular hearing of the petition filed by industrialist Ratan Tata in the Niira Radia tapes conversation case.
Supreme Court to hear Ratan Tata plea to stop Radia tapes
New Delhi, Apr 1 : The Supreme Court will hear Tata Group chairman Ratan Tata'' plea to stop further publication of the contents of corporate lobbyist Niira Radia tapes today.
2G Scam: PAC to quiz Tata, Ambani, Radia
New Delhi, Mar 28 : Industrialists Ratan Tata and Anil Ambani are expected to be quizzed by the Indian Parliament's Public Accounts Committee (PAC) over the 2G telecoms spectrum scam, said statements from their companies on Monday.
Public Accounts Committee summons Nira Radia, Tata
New Delhi, Mar 28 : Corporate lobbyist Niira Radia and Tata Group Chairperson Ratan Tata have been summoned by the Public Accounts Committee on April 4 in connection with its probe into the 2-G Spectrum allocation scam.
Parliamentary panel summons Radia, Tata on 2G
New Delhi, March 28 : The Public Accounts Committee (PAC) of parliament has issued summons to corporate lobbyist Niira Radia and Tata Group chairperson Ratan Tata for April 4 to discuss their alleged role in the 2-G spectrum allocation case.
Ratan Tata won't review his retirement decision
Jamshedpur, Mar 4 : Tata group chief Ratan Tata will not review his decision of retirement from the job next year.
Ratan Tata to review Tata Steel expansion project
Jamshedpur, Mar 1 : Tata Sons Chairman Ratan N Tata will review the progress of the ambitious expansion project of the sole operational Indian plant of Tata Steel here today.
2G scam: CBI grills Tata big fish
New Delhi, Feb 24 : A close aide of Ratan Tata and director of the Tata Group R K Krishna Kumar was quizzed by the Central Bureau of Investigation (CBI) for over six hours here on Thursday over the 2G spectrum scandal.
Radia Tapes: Ratan Tata seeks comprehensive probe
New Delhi, Feb 24 : Expressing his dissatisfaction over the government's "lackadaisical approach" in investigating leakage of tapes of telephonic conversation of corporate lobbyist Niira Radia with him and others, Tata group chairman Ratan Tata sought a comprehensive inquiry into it.
Chief Minister's denial of letter from Tata raises new set of ...
Chennai, Feb 16 : Opposition AIADMK General Secretary J Jayalalithaa today said Chief Minister and DMK leader M Karunanidhi's hasty denial of the letter from Ratan Tata, reportedly hand-delivered to him by Niira Radia, raises a new set of questions.
Karunanidhi denies receipt of Tata letter from Nira Radia
Chennai, Feb 13 : Tamil Nadu Chief Minister and DMK President M Karunanidhi denied having received a a letter from Corporate Lobbyist Nira Radi written by Industrialist Ratan Tata as claimed by Opposition leader J Jayalalithaa of the AIADMK.
Karunanidhi denies getting letter from Ratan Tata
Chennai, Feb 13 : Tamil Nadu Chief Minister and DMK president M. Karunanidhi Sunday denied receiving a letter from industrialist Ratan Tata, delivered by corporate lobbyist Niira Radia in 2007.
Tata flies in superhornet F-18
Bangalore, Feb 10 : With an unsatiable penchant for the flying machines, Tata Group Chairman Ratan Tata will not miss an opportunity, given a change to fly in a fighter aircraft.
Ratan Tata co-pilots Boeing fighter at air show
Bangalore, Feb 10 : Tata Group chairperson Ratan Tata Thursday co-piloted the Boeing fighter F/A-18 Super Hornet at the eighth edition of the AeroIndia military-cum-civil aviation trade expo here.
Ratan Tata to fly F/A-18 Super Hornet at Aero India
By Praful Kumar Singh, Bangalore, Feb 10 : Tata Group chairman, Ratan Tata, who is a keen aviation enthusiast, is not a man to miss Aero India and will fly in Boeing's fighter jet F/A-18 Super Hornet on Thursday at the biennial event.
Centre tells Supreme Court it is concerned over Tata, Radia tapes ...
New Delhi, Feb 1 : The Union Government today informed the Supreme Court that it was taking seriously the issue of leakage of Niira Radia and Ratan Tata conversation tapes.
New Delhi, April 4 : Tata Group chairman Ratan Tata and corporate lobbyist Niira Radia were Monday questioned by parliament's Public Accounts Committee (PAC), probing alleged financial irregularities in the 2G spectrum allocation. Panel head M.M. Joshi said Radia was "evasive" in her replies while ...
2G scam: Tata 'candid', Radia 'evasive' before PAC
New Delhi, April 4 : Tata Group chairman Ratan Tata and corporate lobbyist Niira Radia were Monday questioned by parliament's Public Accounts Committee (PAC) in its search of the scam-tainted money trail in the 2G spectrum allocation by former communications minister Andimuthu Raja.
2G scam: Tata candid, Radia evasive before PAC
New Delhi, Apr 4 : Tata group head Ratan Tata and corporate lobbyist Niira Radia were quizzed by Indian Parliament's Public Accounts Committee (PAC) on Monday in connection with the 2G spectrum allocation scam.
Tata, Radia face PAC over 2G scam
New Delhi, Apr 4 : Tata group head Ratan Tata and corporate lobbyist Niira Radia appeared before Indian Parliament's Public Accounts Committee (PAC) on Monday in connection with the 2G spectrum allocation scam.
2G scam: Ratan Tata appears before PAC
New Delhi, Apr 4 : Industrialist Ratan Tata appeared before the Parliament's Public Accounts Committee (PAC) today for questioning in connection with the 2G spectrum scam.
2G scam: Tata, Radia appear before PAC
New Delhi, April 4 : Tata group chairman Ratan Tata and corporate lobbyist Niira Radia Monday appeared before parliament's Public Accounts Committee to testify in the probe into alleged financial irregularities in the allocation of 2G spectrum.
2G scam: Ratan Tata, Radia to appear before PAC
New Delhi, Apr 4 : Industrialist Ratan Tata and corporate lobbyist Niira Radia are scheduled to appear before Parliament''s Public Accounts Committee (PAC) today in connection with the alleged irregularities in the allocation of 2G spectrum.
Tata, Radia likely to appear before PAC Monday
New Delhi, April 3 : Tata group chairman Ratan Tata and corporate lobbyist Niira Radia are expected to appear before parliament's Public Accounts Committee (PAC) Monday to answer queries on the alleged irregularities in the allocation of 2G spectrum, an official source said Sunday.
Niira Radia tapes case: SC to hear Tata petition from Apr 19
New Delhi, Apr 1 : The Supreme Court will start from April 19 the regular hearing of the petition filed by industrialist Ratan Tata in the Niira Radia tapes conversation case.
Supreme Court to hear Ratan Tata plea to stop Radia tapes
New Delhi, Apr 1 : The Supreme Court will hear Tata Group chairman Ratan Tata'' plea to stop further publication of the contents of corporate lobbyist Niira Radia tapes today.
2G Scam: PAC to quiz Tata, Ambani, Radia
New Delhi, Mar 28 : Industrialists Ratan Tata and Anil Ambani are expected to be quizzed by the Indian Parliament's Public Accounts Committee (PAC) over the 2G telecoms spectrum scam, said statements from their companies on Monday.
Public Accounts Committee summons Nira Radia, Tata
New Delhi, Mar 28 : Corporate lobbyist Niira Radia and Tata Group Chairperson Ratan Tata have been summoned by the Public Accounts Committee on April 4 in connection with its probe into the 2-G Spectrum allocation scam.
Parliamentary panel summons Radia, Tata on 2G
New Delhi, March 28 : The Public Accounts Committee (PAC) of parliament has issued summons to corporate lobbyist Niira Radia and Tata Group chairperson Ratan Tata for April 4 to discuss their alleged role in the 2-G spectrum allocation case.
Ratan Tata won't review his retirement decision
Jamshedpur, Mar 4 : Tata group chief Ratan Tata will not review his decision of retirement from the job next year.
Ratan Tata to review Tata Steel expansion project
Jamshedpur, Mar 1 : Tata Sons Chairman Ratan N Tata will review the progress of the ambitious expansion project of the sole operational Indian plant of Tata Steel here today.
2G scam: CBI grills Tata big fish
New Delhi, Feb 24 : A close aide of Ratan Tata and director of the Tata Group R K Krishna Kumar was quizzed by the Central Bureau of Investigation (CBI) for over six hours here on Thursday over the 2G spectrum scandal.
Radia Tapes: Ratan Tata seeks comprehensive probe
New Delhi, Feb 24 : Expressing his dissatisfaction over the government's "lackadaisical approach" in investigating leakage of tapes of telephonic conversation of corporate lobbyist Niira Radia with him and others, Tata group chairman Ratan Tata sought a comprehensive inquiry into it.
Chief Minister's denial of letter from Tata raises new set of ...
Chennai, Feb 16 : Opposition AIADMK General Secretary J Jayalalithaa today said Chief Minister and DMK leader M Karunanidhi's hasty denial of the letter from Ratan Tata, reportedly hand-delivered to him by Niira Radia, raises a new set of questions.
Karunanidhi denies receipt of Tata letter from Nira Radia
Chennai, Feb 13 : Tamil Nadu Chief Minister and DMK President M Karunanidhi denied having received a a letter from Corporate Lobbyist Nira Radi written by Industrialist Ratan Tata as claimed by Opposition leader J Jayalalithaa of the AIADMK.
Karunanidhi denies getting letter from Ratan Tata
Chennai, Feb 13 : Tamil Nadu Chief Minister and DMK president M. Karunanidhi Sunday denied receiving a letter from industrialist Ratan Tata, delivered by corporate lobbyist Niira Radia in 2007.
Tata flies in superhornet F-18
Bangalore, Feb 10 : With an unsatiable penchant for the flying machines, Tata Group Chairman Ratan Tata will not miss an opportunity, given a change to fly in a fighter aircraft.
Ratan Tata co-pilots Boeing fighter at air show
Bangalore, Feb 10 : Tata Group chairperson Ratan Tata Thursday co-piloted the Boeing fighter F/A-18 Super Hornet at the eighth edition of the AeroIndia military-cum-civil aviation trade expo here.
Ratan Tata to fly F/A-18 Super Hornet at Aero India
By Praful Kumar Singh, Bangalore, Feb 10 : Tata Group chairman, Ratan Tata, who is a keen aviation enthusiast, is not a man to miss Aero India and will fly in Boeing's fighter jet F/A-18 Super Hornet on Thursday at the biennial event.
Centre tells Supreme Court it is concerned over Tata, Radia tapes ...
New Delhi, Feb 1 : The Union Government today informed the Supreme Court that it was taking seriously the issue of leakage of Niira Radia and Ratan Tata conversation tapes.
Oil is the core of the Koch business empire, and the company’s lobbyists and officials have successfully fought to preserve the industry’s tax breaks and credits, and to defeat attempts by Congress to regulate greenhouse gases.
But Koch’s diversified interests, and thus its lobbying activities, extend far beyond petroleum. Koch companies trade carbon emission credits in Europe and derivatives in the U.S. They make jet fuel in Alaska from North Slope oil, and gasoline in Minnesota from the oil sands of Canada. They raise cattle in Montana and manufacture spandex in China, ethanol in Iowa, fertilizer in Trinidad, nylon in Holland, napkins in France and toilet paper in Wisconsin.
According to the most recent Forbes magazine rankings, Koch had $100 billion in revenues in 2009 — on a par with corporate giants like IBM or Verizon — and stood a close second to Cargill Inc. on the list of the largest private US companies. The firm has 70,000 employees, and a presence in 60 countries and almost every state.
Koch’s decision to pour millions into lobbying Washington has put them high on the list of corporations whose lobbyists work the corridors of the nation’s capital. Last year, Koch Industries ranked in the top five — roughly on a par with BP and Royal Dutch Shell — in lobbying expenses among oil and gas companies, according to the Center for Responsive Politics.
These totals do not include the work of the trade associations that Koch uses to represent its interests in Washington. There’s a major industry group called the National Petrochemical & Refiners Association, and obscure organizations like the green-sounding National Environmental Development Association’s Clean Air Project, whose membership lists Koch and two of its subsidiaries (Georgia-Pacific and Invista) with a dozen industrial giants like ExxonMobil Corp., General Electric Co. and Alcoa Inc.
Koch’s lobbyists are known on Capitol Hill for maintaining a low profile. There are no former U.S. senators or House committee chairmen on the payroll. The firm had 30 registered lobbyists in 2010, many of whom are Washington insiders with previous experience as congressional staffers or federal agency employees.
Gregory Zerzan is a good example. Zerzan was a senior counsel for the House Financial Services Committee before serving as an acting assistant secretary and deputy assistant secretary at the U.S. Treasury Department during the George W. Bush administration. Zerzan then worked as counsel and head of global public policy for the International Swaps and Derivative Association before joining Koch Industries as a lobbyist.
Koch clout is augmented by campaign donations to parties and candidates for federal office — $11 million in the last two decades, according to the Center for Responsive Politics — and generous gifts from three family foundations to universities and conservative organizations and interest groups.
According to IRS records, the Koch foundations are essential donors (having given $3.4 million from 2007 through 2009) to the Americans for Prosperity Foundation, a nonprofit known for its support of the Tea Party movement. Among the organizations that have each received a million dollars or more over the last five years from Koch foundations are the Cato Institute, the Heritage Foundation, and two conservative think tanks at George Mason University in Virginia: the Institute for Humane Studies and the Mercatus Center.
The Kochs primarily donate to conservative candidates and causes but have given more than $1 million in the last decade to the liberal Brookings Institution. And among politicians they supported last year was Andrew Cuomo, a Democrat elected governor of New York with $87,000 from the Koch family.
The emergence of “the Koch web — political action, campaign giving, funding of groups engaged in political action and campaigns, conferences to expand political and policy influence — is a striking phenomenon,” said Norman Ornstein, a scholar at the conservative American Enterprise Institute.
The Center asked Koch Industries and its lobbyists in Washington, in a dozen emails and telephone calls over more than two weeks, to comment on the firm’s lobbying efforts. Koch’s representatives declined the opportunity.
But in a March 1 column in The Wall Street Journal, Charles Koch defended his and his company’s practices. “As a matter of principle our company has been outspoken in defense of economic freedom,” Koch wrote. “This country would be better off if every company would do the same. Instead, we see far too many businesses that paint their tails white and run with the antelope.”
ETHANOL
The Koch brothers are renowned as free market libertarians. But as a major trader in energy and financial markets, Koch Industries also knows how to hedge.
As its corporate officials and publicists decried ethanol as a costly government boondoggle, the Kochs bought four ethanol plants in Iowa in recent months, with a combined annual capacity of 435 million gallons. In Washington (where ethanol tax subsidies cost the Treasury some $6 billion annually) Koch representatives lobbied Congress on ethanol and other biofuel subsidies.
“New or emerging markets, such as renewable fuels, are an opportunity for us to create value within the rules the government sets,” Flint Hills Resources President Brad Razook told his employees in the January company newsletter.
Koch Industries’ status as an ethanol player goes beyond its new Iowa plants. Koch blends ethanol and gasoline nearby, in its Minnesota refinery. By its own account, the company’s subsidiaries, Flint Hills and Koch Supply & Trading, currently buy and market about one-tenth of all the ethanol produced in the United States.
The Kochs seem to have recognized that their actions might seem hypocritical and in a January 2011 newsletter the company tried to explain things to employees who have been “scratching their heads and wondering: what is going on?”
“After all, ethanol production is heavily subsidized, mandated and protected,” Koch Industries acknowledged, “while Koch companies openly oppose such government programs.”
Realism had won out. The company has the “capabilities necessary to be successful in the ethanol industry,” the newsletter explained. The new ethanol plants “fit well geographically with several other FHR assets, including fuel … terminals, a widespread distribution network that includes Iowa, and the Pine Bend [Minnesota] refinery.”
“We are not going to place our company and our employees at a competitive disadvantage by not participating in programs that are available to our competitors,” Razook assured Koch employees.
The company has a history of pragmatism in commercial affairs. Koch was a pioneer importer of Russian oil to the United States, including a 2002 shipment of Russian crude that Koch sold to the U.S. government to help fill the U.S. Strategic Petroleum Reserve. And though it opposes a cap-and-trade solution to global warming for the United States, Koch makes money trading emissions credits under a similar program in Europe.
Nor is ethanol the only form of corporate welfare Koch Industries supports. As it ventures into biofuel production, and uses alternative fuels to power its plants, the company has its lobbyists working “to expand the [tax] credit for renewable electricity production” made from biomass.
Georgia-Pacific, the company reported in 2008, was responsible for more than 10 percent of all the renewable biomass electricity generated in the U.S.
TOXIC SUBSTANCES
Koch’s efforts to limit regulation of toxic substances illustrate the breadth of its lobbying operation.
In 2004 Koch Industries purchased Invista, a subsidiary of DuPont, known for manufacturing Lycra, Stainmaster carpets and other textiles and fabrics. In 2005, as part of the same corporate diversification and expansion strategy, Koch Industries bought the giant wood and paper products firm, Georgia-Pacific, adding Brawny paper towels, Angel Soft toilet paper, Dixie cups and dozens of factories and plants to its holdings.
Koch has since worked, on Capitol Hill and in various regulatory proceedings, to dilute or halt tighter federal regulation of several toxic byproducts that could affect its bottom line, including dioxin, asbestos and formaldehyde, all of which have been linked to cancer.
Dioxin is released from incinerators, hazardous waste treatment, pesticide manufacturing, paper plants and other sources. With 165 manufacturing facilities across the United States, Georgia-Pacific “has a significant interest in and will be significantly impacted,” by the EPA’s decisions on dioxin, Koch officials told the agency in April 2010.
Hundreds of workers would have to be hired, and trucks and earth-moving equipment leased or purchased. And “of the limited number of hazardous waste landfills operating in the United States, very few are willing to accept dioxin-containing soil,” the company noted.
“Treatment and disposal of dioxin-containing soil is already a challenging, expensive and capacity-limited problem that would only get worse if additional volumes were generated.”
It’s been three decades since the environmental catastrophes at Love Canal, N.Y., and Times Beach, Mo., introduced the American public to the dangers of dioxin. But in the EPA hearing at the Washington Hilton last July, toxicologist John M. DeSesso, a consultant speaking on behalf of Georgia-Pacific, told the agency that the scientific studies on common levels of exposure are still inconclusive. He urged further study.
The Environmental Working Group and a number of public health organizations, meanwhile, chastised the EPA for dragging its feet, and reminded the agency panel that another arm of the federal government, the U.S. National Toxicology Program, and the World Health Organization have already classified dioxin as a known human carcinogen.
“Twenty-five years after publishing its first assessment of dioxin … the EPA has yet to establish a safe daily dose for human exposure” for “one of the most-studied of all chemical pollutants,” the EWG told the panel. “It is EPA’s responsibility to address this problem with resolve … without regard to pressure from special interests who stand to benefit financially from weak standards and regulations.”
It isn’t just dioxin that has drawn Koch’s interest. On Capitol Hill, and in regulatory proceedings, Koch lobbyists and officials have resisted tighter government regulation of a gallery of toxic and carcinogenic substances, like asbestos, formaldehyde and benzene.
“GP strongly disagrees with the [National Toxicology Program] panel’s conclusion to list formaldehyde, a natural component of every cell in the body, as a human carcinogen,” wrote Traylor Champion, the firm’s vice president for environmental affairs, in a February 2010 letter.
“Costly control requirements are being mandated on sources that have insignificant levels of HAP (hazardous air pollutants) emissions,” a Georgia-Pacific environmental health and safety manager, James Eckenrode, complained to the EPA in November 2008, when it sought to apply tougher air pollution standards on the firm’s manufacture of resins and formaldehyde.
Through its Flint Hills Resources subsidiary, Koch Industries operates a refinery near Fairbanks, Alaska. “Refineries in Alaska are geographically isolated from the rest of the U.S. market such that benzene extraction and sale into the petrochemical market would be infeasible,” the company argued in 2006, when the EPA proposed new clean air limits on benzene. “Benzene reductions to levels proposed in this rule would either require extensive and economically prohibitive capital upgrades at our facility or would result in a significant reduction in gasoline production.”
When Koch Industries purchased Georgia-Pacific, it inherited a titanic liability regarding asbestos. Georgia-Pacific had used asbestos to make gypsum-based drywall products, and starting in the 1980s the firm became a target for more than 340,000 claims by plaintiffs who said they suffered lung and other diseases, including mesothelioma, a deadly cancer. By 2005, the company was spending $200 million a year and had to build a $1.5 billion reserve fund for asbestos liabilities and defense costs.
In a 2008 Koch Industries publication, General Counsel Mark Holden griped that “many of those claims are an outright abuse of the legal system … that often involve people who are not sick … all because of over-zealous litigators and a legal system that gives them perverse incentives.”
The number of new claims has dropped with tougher federal safety standards. But in the 110th Congress Koch lobbyists still sought to sway members on legislative proposals intending to restrict the use of asbestos and improve public knowledge, even Senate Resolution 462, which called for a “National Asbestos Awareness Week.”
GLOBAL WARMING AND LOW CARBON FUEL STANDARDS
It’s in the Kochs’ commercial interest to preserve America’s reliance on carbon-based energy sources. Despite recent diversification, Koch remains a major petrochemical company with refineries in North Pole, Alaska; Corpus Christi, Texas; Rosemount, Minn., and Rotterdam in the Netherlands; an array of chemical plants; a coal subsidiary (the C. Reiss Coal Co.) and 4,000 miles of pipelines.
So it is not surprising that, when the Obama administration and the Democrats on Capitol Hill proposed to regulate the emission of greenhouse gases in recent years, Koch Industries responded with a fervent counteroffensive.
“Oppose government mandates on carbon reduction provisions … [and] provisions related to climate change, and oppose entire bill,” Koch lobbyist Robert P. Hall wrote, listing his goals on the 2008 lobbying disclosure form.
The firm’s lobbying expenditures soared in 2008 as Koch Industries and its subsidiaries — Georgia-Pacific, Invista, Flint Hills Resources, Koch Carbon, Koch Nitrogen — peppered the EPA and members of Congress with objections. Several worked on measures that would strip the EPA of the power to regulate greenhouse gases through the Clean Air Act.
Koch-supported groups like the National Environmental Development Association’s Clean Air Project joined the effort. In a recent meeting, five Koch representatives joined colleagues from ExxonMobil, ConocoPhillips, Eli Lilly and other NEDA-CAP members to register concerns with EPA officials over the proposed mandatory reporting rule for greenhouse gas emissions, the record shows.
Koch’s lobbying efforts on climate change are matched by a public campaign. Via three foundations — the Claude R. Lambe Foundation, the Charles G. Koch Foundation and the David H. Koch Foundation — funded and administered by Koch family members and employees, the Kochs have donated several million dollars in recent years to think tanks and groups that have sought to discredit climate science and EPA’s efforts to reduce greenhouse gases.
“Why are such unproven or false claims promoted?” the Koch Industries company newsletter, Discovery, asked in an article on global warming entitled, “Blowing Smoke.”
“Scientists have … perverted the peer review process, doing everything possible to prevent opinions contrary to the alarmist view from being heard,” the article said. Humans should adapt to global warming, not try to slow or stop it, the newsletter recommended. “Since we can’t control Mother Nature, let’s figure out how to get along with her changes.”
In early March, members of the Republican-led House Energy and Commerce Committee — many of whom had received campaign contributions from Koch employees and PACs last fall — voted to bar the EPA from regulating greenhouse gases under the Clean Air Act. Their action has been endorsed by Speaker John Boehner and Republican House leaders.
Of particular concern to Koch lobbyists in Washington, according to their disclosure forms, are measures to encourage or require the use of low-carbon fuels. These sources of energy, in their manufacture and use, contribute less than other fuels to global warming.
The Koch refinery in Minnesota is designed to process heavy “high-carbon” Canadian crude oil, and is fed by a pipeline from Canada. Koch “is among Canada’s largest crude oil purchasers, shippers and exporters,” the company says, with a trading and supply office in Calgary and a terminal in Hardisty, Alberta. Much of the oil comes from the mining of oil sands, which have a particularly heavy carbon footprint because the process releases greenhouse gases from peat lands and boreal forest, and requires a great deal of energy to heat and sweat the oil out.
“Canadian crude generates more greenhouse gas emissions” and so low-carbon standards “would cripple refiners that rely on heavy crude feedstocks,” the Koch Industries website notes. “It would be particularly devastating for refiners that use heavy Canadian crude.”
When lawmakers in Washington and states like California sought to address global warming by requiring the use of low carbon fuels, Koch Industries responded. Koch lobbyists listed the legislation as a lobbying priority on Capitol Hill. And in California, where a wide-ranging series of measures to slow climate change were launched by former Gov. Arnold Schwarzenegger, Koch joined the fight to defeat them.
A Koch subsidiary, Flint Hills Resources, donated a million dollars in support of Proposition 23, an unsuccessful attempt funded by Koch and other energy companies last year to stall implementation of the low-carbon standards and other remedial climate measures in California.
ENERGY INDUSTRY TAX BREAKS
Koch lobbyists spend much of their time, according to their disclosure reports, fighting attempts by members of Congress to curb price-gouging, windfall profit-taking and speculation in the oil industry. To this same end, Koch officials worked to dilute a 2009 Federal Trade Commission rule governing manipulation of the energy markets.
Meanwhile, Koch has lobbied to preserve some of the oil industry’s coveted tax breaks and credits.
One benefit is known as the Section 199 deduction, approved by Congress several years ago to help the hard-pressed U.S. manufacturing sector. In light of the oil and gas industry’s hearty profits, the Obama administration and members of Congress have sought to end the Section 199 subsidy for energy firms and save the U.S. Treasury $14 billion over 10 years. But Koch lobbyists and trade associations have worked to preserve the deduction.
Another industry tax break that drew the support of Koch representatives is the venerable “LIFO” (last-in, first-out) accounting rule. It allows energy companies effectively to raise the value of their existing inventory (and thus pay lower taxes on profits from sales) when the price of oil soars.
Under LIFO, the oil in a company’s inventory, no matter what it actually cost, is valued at the cost of the last-acquired (usually highest-cost) barrel. The LIFO rule has been a target in recent years for both Democrats and Republicans in Washington, who would like to raise revenue without raising taxes.
BUSH TAX CUTS
Koch lobbyists listed the expiring Bush tax cuts as a lobbying objective last year, and the Koch brothers were among an elite, relatively few Americans who profited when the income tax cuts for those earning more than $250,000 a year were extended in a year-end deal.
Another of the Bush tax breaks had special meaning for the Koch brothers. Charles Koch, 75, and David Koch, 70, are tied for fifth place, each with a net worth of $21.5 billion, in the latest Forbes rankings of the wealthiest Americans. Included in the deal to extend the Bush tax cuts was a proposal to reduce the federal estate tax. The Kochs have, historically, been players in an ongoing effort by wealthy families to curb or eliminate the tax on inheritances.
The final tax deal reached by the White House and Republicans in Congress in December set the estate tax at 35 percent. That makes the new rate considerably more favorable than during the Clinton (55 percent) or even the Bush (45 percent) years, and the lowest it’s been since the 1930s. If one of the patriarchs should die while the new rate is in effect, it would save the Koch family billions of dollars.
TERRORISM AND NATIONAL SECURITY
Another major preoccupation of Koch Industries lobbyists during recent sessions of Congress was the Chemical Facility Anti-Terrorism Standards, a federal effort to identify and regulate chemical facilities that could be vulnerable to terrorist attacks.
In 2009, the House passed legislation that would toughen the standards, and require manufacturers like Koch to use safer chemicals and processes to add another level of protection and minimize the effects of toxic releases from terrorist attacks or catastrophic accidents.
Koch opposed the changes, claiming they “increase cost and regulatory burden while shifting focus away from security and toward environmental considerations.” The chemical security provisions were listed as lobbying targets by Koch representatives in 2007, 2008, 2009 and 2010.
According to EPA records, Koch has four facilities that use chlorine dioxide—in Palatka, Fla.; Zachary, La.; New Augusta, Miss.; and Camas, Wash. It has an Invista plant that uses formaldehyde in LaPorte, Texas. Its Flint Hills refinery in Corpus Christi, Texas, uses hydrofluoric acid in refining gasoline.
Mandatory use of safer technology would “result in even more job losses and higher consumer prices as American manufacturers struggle to comply,” Koch contends in a statement on the chemical safety standards on its website. The House legislation would “restructure, and likely add additional cost to security programs currently in place for Koch companies’ facilities.”
FINANCIAL REGULATION
Koch pulls no punches when assigning the blame for the great financial meltdown of 2008: It was the government’s fault, not the markets.
“Almost all of these problems (and much of the current chaos) are, at their root, the result of political failure,” said Steve Feilmeier, the chief financial officer for Koch Industries, at the height of the crash.
It is not surprising, then, that Koch Industries — a major player in international trading markets — resisted increased regulation and spent heavily on lobbyists who worked to shape the 2010 Dodd-Frank Act and other vehicles for financial reform. The Koch lobbyists focused, in particular, on provisions aimed at regulating systemic risk in the financial markets, and the use of derivatives.
Koch Industries started out trading crude oil more than four decades ago, but its trading group has since branched into commodities, derivatives and other risk management products.
In that time, the market for trading derivatives and swaps in the energy industry has gone largely unregulated. And in past Congresses, Koch lobbyists labored to preserve the exemption, known as the “Enron Loophole,” that excused energy commodity contracts from regulation.
But the Dodd-Frank law gave the Commodity Futures Trading Commission and the Securities and Exchange Commission the authority to craft new rules to subject traders in the energy industry to increased regulation and transparency, capital and margin requirements, and supervision by a derivatives clearing house. Koch lobbyists worked to favorably shape the bill, and have not stopped working since it was passed.
Within a few weeks after President Obama signed the legislation, Koch lobbyist Gregory Zerzan had secured a coveted meeting with SEC Commissioner Troy Paredes, a Bush appointee, and his counsel, Gena Lai, to discuss how the government would implement the law.
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