The Non-Crony Pledge

Three cheers for Koch Industries:

“We oppose ALL subsidies, whether existing or proposed, including programs that benefit us, which are principally those that are embedded in our economy, such as mandates,” wrote Philip Ellender, president Koch’s government affairs division, in a Wednesday letter to members of Congress.

Ellender singled out the wind production tax credit as particularly deleterious. But unlike that provision, some of the tax breaks included in the House package benefit activities in which Koch and its subsidiaries are heavily invested.

Koch subsidiary George Pacific, for instance, qualifies for a tax break for the production of cellulosic biofuels. Another subsidiary, Flint Hills Resources, operates biofuel production facilities that could benefit from another of the provisions.

Those tax breaks could improve Koch’s bottom line, but the company sees federal tax preferences in general as economically harmful.

“Koch doesn’t view these as ‘benefits’ even if they are in industries we’re in,” explained a source familiar with the company’s public affairs strategy. “They are wasteful and market distorting, and allow other firms to run businesses that aren’t making money any other way.”


  1. me:

    Sounds like a shareholder value lawsuit waiting to happen?

  2. Nehemiah:

    Privately held corporation, they are the shareholders.

  3. Nehemiah:

    I think they should take the tax breaks, determine the net economic benefit and plow that money into fighting against the policies themselves. Don't get me wrong, I know they do a lot of that already, but I'd like to see the elitist taxpayers subsidizing the Koch brothers political agenda. That just seems so right to me on so many levels.

  4. Matthew Slyfield:

    To be more specific, they are the only shareholders.

  5. LoneSnark:

    They should claim and aquire all the tax breaks they can get, and then specifically spend every penny (or some multiple there-of) lobbying to eliminate the tax breaks.

    Unclaimed tax breaks only encourage the continuation of the tax breaks by making them cheaper for the government to offer.

  6. Nehemiah:

    The Koch brothers and close family members are the deciders and shareholders. They do not have shareholder fiduciary requirements like publicly traded companies.

  7. Matthew Slyfield:

    True, but the Koch family holds 100% of the shares of Koch Industries, so even if such a fiduciary duty existed, the probability of a shareholder lawsuit would be vanishingly small.

  8. TJSawyer:

    This would seem to indicate a lack of awareness of Fred and Bill versus Charles and David!

  9. Craig Loehle:

    The very definition of integrity.