16.Buchanan, “Third Century Movement” document; Buchanan, “Private, Preliminary, and Confidential” document; Buchanan, “Plans, Steps, and Projections” post, March 3, 1973, BHA.
17.Buchanan, “Third Century Movement” document; Buchanan, “Private, Preliminary, and Confidential” document; Buchanan, “Plans, Steps, and Projections” post. Whether from whimsy or knowledge of the original, Buchanan was enlisting John Birch Society language in planning the mission.
18.Buchanan, “Third Century Movement” document.
19.List of attendees, Foundation for Research in Economics and Education Conference, October 4–5, 1973, BHA; Buchanan, “Notes for LA Meeting,” October 5, 1973, BHA; see also Edwin Meese III, With Reagan: The Inside Story (Washington, DC: Regnery Gateway, 1992), 32–33.
20.Buchanan, “Notes for LA meeting.” Corporations’ failure to grasp what the men of the right took to be their real interests was a cause of private anger. “The one thing I am looking forward to in the Communist takeover of America, is the liquidation to the American businessman,” the architect of the GOP right said that year, furious at their “timid, herd-like” conduct; William A. Rusher to Jack Kilpatrick, August 3, 1973, box 48, Rusher Papers.
21.Joseph G. Peschek, Policy-Planning Organizations: Elite Agendas and America’s Rightward Turn (Philadelphia, PA: Temple University Press, 1987), 35. A wealth of ICS material, including participants and activities, can be found in box GO97, Program and Policy Unit, series V, Ronald Reagan: Governor’s Papers, Ronald Reagan Presidential Library, Simi Valley, CA.
22.Institute for Contemporary Studies, Letter 1, no. 1 (December 1974), a newsletter in box GO97, Reagan Papers, as are all the other items in this note; ICS, introductory brochure, c. 1974; ICS [typescript prospectus, n.d.]; A. Lawrence Chickering to Don Livingston, September 11, 1973; ICS, minutes of special meeting, December 4, 1973; ICS, minutes of special meeting, May 14, 1974. Indeed, a focus on economics enabled the rise of the right, finds Mark A. Smith, The Right Talk: How Conservatives Transformed the Great Society into the Economic Society (Princeton, NJ: Princeton University Press, 2007).
23.Peschek, Policy-Planning Organizations, 35.
24.Buchanan to Donald A. Collins, April 15, 1970, BHA; Institute for Contemporary Studies, introductory brochure, c. 1974, box GO97, Reagan Papers; ICS, minutes of special meeting, May 14, 1974, box GO97, Reagan Papers. On California Rural Legal Assistance and the wider OEO-backed legal challenge Reagan and his corporate allies faced, see Gourse, “Restraining the Reagan Revolution.”
25.The effort was run through the Foundation for Research in Economics and Education (FREE), a nonprofit set up by Buchanan during his brief time at UCLA. On FREE, see Armen A. Alchian, “Well Kept Secrets of Jim’s Contributions to Economic Ph.D.s of the University of California, Los Angeles”; http://publicchoice.info/Buchanan/files/alchian.htm; a Buchanan CV from 1980 lists him as an ongoing vice president and board member; BHA.
26.Steven M. Teles, The Rise of the Conservative Legal Movement: The Battle for Control of the Law (Princeton, NJ: Princeton University Press, 2008), 90, 102.
27.Buchanan to J. Clayton La Force, May 9, 1973, BHA; Manne to Buchanan, May 17, 1971, BHA.
28.Edwin McDowell, “Bringing Law Profs Up to Date on Economics,” Wall Street Journal, July 23, 1971, 8.
29.Teles, Rise of the Conservative Legal Movement, 106–7, 110–11, 121, 124; Walter Guzzardi Jr., “Judges Discover the World of Economics,” Fortune, May 21, 1979, 62; O’Connor, “Financing the Counterrevolution,” 166–67.
30.Henry G. Manne to Buchanan, March 26, 1976, BHA; Teles, Rise of the Conservative Legal Movement, 103–7.
31.Saloma, Ominous Politics, 75; Teles, Rise of the Conservative Legal Movement, 103–7, 110–15, 121, 124; O’Connor, “Financing the Counterrevolution,” 166–67.
32.Teles, Rise of the Conservative Legal Movement, 107–8, 114, 116–17. As Fortune magazine noted, “the lessons [Manne’s program taught] could make a big difference when business cases come to the courtroom”; Guzzardi, “Judges Discover,” 58.
33.Saloma, Ominous Politics, 75; Henry G. Manne, preface to The Attack on Corporate America, by University of Miami Law School, Law and Economics Center (New York: McGraw-Hill, 1978), xi–xv; Teles, Rise of the Conservative Legal Movement, 100. “Manne is solely interested in raising money,” Buchanan grumbled to Tullock while visiting Manne’s program, such that good conversation was rare; Buchanan to Tullock, February 13, 1976, box 11, Tullock Papers.
34.Teles, Rise of the Conservative Legal Movement, 104–5.
35.Eugene B. Sydnor Jr. obituary, Virginia House of Delegates, January 14, 2004, http://lis.virginia.gov/cgi-bin/legp604.exe?041+ful+HJ208; “Sydnor Recalls Birth of Constitution Agency,” Richmond News Leader, February 5, 1966; Kim Phillips-Fein, Invisible Hands: The Making of the Conservative Movement from the New Deal to Reagan (New York: W. W. Norton, 2009), 156–62. The memorandum can be found in Powell’s papers and online. For Powell’s early antiunionism, see Lewis Powell to James J. Kilpatrick, February 14, 1961, Powell Papers. For his delight when Kilpatrick became nationally syndicated, “help[ing] to right the imbalance in national editorial comment which has existed for far too long,” see Powell to Kilpatrick, March 7, 1965, Powell Papers.
36.Teles, Rise of the Conservative Legal Movement, 3; see also Benjamin C. Waterhouse, Lobbying America: The Politics of Business from Nixon to NAFTA (Princeton, NJ: Princeton University Press, 2015).
37.Alliance for Justice, Justice for Sale: Shortchanging the Public Interest for Private Gain (Washington, DC: Alliance for Justice, 1993), 6; see also ICS, minutes of special meeting, December 4, 1974, box GO97, Reagan Papers.
38.Project on the Legal Framework of a Free Society, Law and Liberty 2, no. 3 (Winter 1976), BHA.
39.McDowell, “Bringing Law Profs Up to Date,” 8; Henry G. Manne to Robert LeFevre, May 2, 1974, box 7, LeFevre Papers, University of Oregon. Most “financiers of libertarian causes have been big businessmen” with a deep “personal interest in these ideas,” notes an insider’s history of the movement. Charles Koch and, later, his brother David became the “biggest financiers”; Brian Doherty, Radicals for Capitalism: A Freewheeling History of the Modern Libertarian Movement (Philadelphia, PA: PublicAffairs, 2007), 16.
CHAPTER 9: NEVER COMPROMISE
1.See the discussion of his long quest in Charles G. Koch, Creating a Science of Liberty (Fairfax, VA: Institute for Humane Studies, 1997), 2–7.
2.The story of the long legal fight, central to family lore, is best told in Schulman, Sons of Wichita, 27–35.
3.Ibid., quote on 33.
4.Gordon Tullock, “The Welfare Costs of Tariffs, Monopolies and Theft,” Western Economic Journal 5 (1967): 224–32; for elaboration, Tullock, Rent Seeking (Brookfield, VT: Edward Elgar, 1993).
5.Ironically, Schulman believes Koch would have lost in a fair trial because he and his partner had learned about the process as employees of Universal Oil before setting off on their own. Schulman, Sons of Wichita, 31, 34.
6.Charles G. Koch, The Science of Success: How Market-Based Management Built the World’s Largest Private Company (Hoboken, NJ: John Wiley & Sons, 2007), 12; Mayer, “Covert Operations”; Schulman, Sons of Wichita, 42, 48.
7.Fred C. Koch to James J. Kilpatrick, November 4, 1957, box 29, acc. 6626-b, JJK Papers; Schulman, Sons of Wichita, 21–22; J. Allen Broyles, The John Birch Society: Anatomy of a Protest (Boston: Beacon Press, 1964), 49, 58.
8.Schulman, Sons of Wichita, 21–22; Roy Wenzl and Bill Wilson, “Charles Koch Relentless in Pursuing His Goals,” Wichita Eagle, October 14, 2012.
9.Koch, The Science of Success, 5–12; Wenzl and Wilson, “Charles Koch Relentless”; Mayer, “Covert Operations”; Glassman, “Market-Based Man.”
10.“America’s Richest Families,” U.S. News & Worl
d Report, August 14, 1978; I came across this clipping because a young libertarian had circled Koch’s standing and saved the listing in his papers. He got on the payroll. Roy A. Childs Papers, box 5, Hoover Institution Archives.
11.Charles G. Koch, “Tribute,” preface to The Writings of F. A. Harper, vol. 1: The Major Works (Menlo Park, CA: Institute for Humane Studies, 1978), 1–3; Charles G. Koch, Creating a Science of Liberty (Fairfax, VA: Institute for Humane Studies, 1997), 2.
12.F. A. Harper, Why Wages Rise (Irvington on Hudson, NY: Foundation for Economic Education, 1957), 6–7, 71, 81–83, 94, 113, 119.
13.F. A. Harper, “Shall the Needy Inherit Our Colleges?” The Freeman, July 1957, 31.
14.Harper, Why Wages Rise, 6–7, 71, 81–83, 94, 113, 119.
15.F. A. Harper, Liberty: A Path to Its Recovery (Irvington on Hudson, NY: Foundation for Economic Education, 1949), 108–10, 124.
16.Koch, “Tribute,” 1–3.
17.Robert LeFevre to Jack Kilpatrick, April 23, 1956, with attachments, box 54, LeFevre Papers; Kilpatrick to LeFevre, April 26, 1956, ibid.; LeFevre to Kilpatrick, July 1, 1954, and July 6, 1954, ibid.; LeFevre to Kilpatrick, July 6, 1954, with attachment, ibid. On LeFevre and the school, see Doherty, Radicals for Capitalism, 312–22.
18.Doherty, Radicals for Capitalism, 318; Schulman, Sons of Wichita, 89–96.
19.See “Wichita Collegiate School,” Wikipedia, http://en.wikipedia.org/wiki/Wichita_Collegiate_School. On the founder’s manifesto, see Robert Love, How to Start Your Own School: A Guide for the Radical Right, the Radical Left, and Everybody In-Between Who’s Fed Up with Public Education (New York: Macmillan, 1973), especially 9, 31. On Love, see J. Allen Broyles, The John Birch Society: Anatomy of a Protest (Boston: Beacon Press, 1964), 40, 49, 59–60. Robert Welch, the Birch Society’s founder, argued in 1963, with the Civil Rights Act pending, that segregation was “surely but slowly breaking down” naturally “wherever Negroes earned the right by sanitation, education, and a sense of responsibility, to share such facilities” (italics added); Claire Conner, Wrapped in the Flag: A Personal History of America’s Radical Right (Boston: Beacon Press, 2013), 101.
20.For the bizarre tale, which led to the theocratic Christian right and an early iteration of today’s racist and anti-Semitic “alt-right,” see Michael McVicar, “Aggressive Philanthropy: Progressivism, Conservatism, and the William Volker Charities Fund,” Missouri Historical Review 105, no. 4 (2011), 201.
21.Glassman, “Market-Based Man”; Institute for Humane Studies, The Institute’s Story (Menlo Park, CA: Institute for Humane Studies, n.d., but pre-1975), 7, 15, 23. On the IHS-Volker-Buchanan connection, see John Blundell to Buchanan, October 30, 1986, BHA; and Doherty, Radicals for Capitalism, 407. The Koch-funded Center for Independent Education from its start worked with the IHS, formally affiliating in 1973; see Everett Dean Martin, Liberal Education vs. Propaganda (Menlo Park, CA: Institute for Humane Studies, n.d.), 17. Documentation of the IHS’s work can be found in box 26 of the Hayek Papers, Hoover Institution Archives.
22.Mont Pelerin Society, “By-Laws,” rev. ed., February 1966, box 122, Tullock Papers; Newsletter of the Mont Pelerin Society 4 (October 1973): 11, also no. 7 (March 1975): 15, and no. 10 (March 1976): 13, all box 122, Tullock Papers. The Charles Koch Foundation’s seminars on Austrian economics, the Institute for Humane Studies’ conferences on property law and union power, and the Center for Independent Education’s cases against public schools, not to mention Henry Manne’s Law and Economics program, all built their followings through the society’s newsletter’s pages.
23.See, for example, Ludwig von Mises, The Anti-Capitalistic Mentality (New York: D. Van Nostrand, 1956).
24.Schulman, Sons of Wichita, 77, 106. Murray Rothbard explained, in one of his Koch-funded treatises, that some corporations benefited from government-granted privileges and therefore should be considered the enemy as much as organized labor or government itself, but businesses that were crimped by cartels and rejected regulation, “especially those remote from the privileged ‘Eastern Establishment,’” were “potentially receptive to free-market and libertarian ideas”; Justin Raimondo, An Enemy of the State: The Life of Murray N. Rothbard (Amherst, NY: Prometheus Books, 2000), 203. Such entrepreneurs were, in fact, remaking America’s model of capitalism in this era, as shown in the formative case of Walmart by Bethany E. Moreton, To Serve God and Wal-Mart: The Making of Christian Free Enterprise (Cambridge, MA: Harvard University Press, 2009).
25.Koch, Science of Success, 80.
26.Schulman, Sons of Wichita, 94. Koch’s idol, Ludwig von Mises, applauded Ayn Rand for having “the courage to tell the masses what no politician told them: you are inferior and all the improvements in your conditions which you simply take for granted you owe to the efforts of men who are better than you.” Jennifer Burns, Goddess of the Market: Ayn Rand and the American Right (New York: Oxford University Press, 2009), 177.
27.Wenzl and Wilson, “Charles Koch Relentless.”
28.Doherty, Radicals for Capitalism, 442–43. James Buchanan likewise complained that Friedman pronounced on policy “as if he has a direct line to God.” James Buchanan to Rutledge Vining, March 8, 1974, BHA. He also disassociated himself from the Chicago School under Friedman’s leadership. James Buchanan to Warren J. Samuels, December 13, 1974, BHA. Those in the Austrian economics program funded by Koch at George Mason argued that Chicago School economics was incapable of adequately refuting the support for “interventionist policy” coming from such leaders of the discipline as Joseph Stiglitz, Paul Krugman, and Lawrence Summers. Peter J. Boettke and David L. Prychitko, “Introduction: The Present Status of Austrian Economics: Some (Perhaps Biased) Institutional History Behind Market Process Theory,” in The Market Process: Essays in Contemporary Austrian Economics (Northampton, MA: Edward Elgar, 1994), 16n7.
29.James Glassman, “Market-Based Man,” Philanthropy Roundtable (2011), www.philanthropyroundtable.org/topic/excellence_in_philanthropy/market_based_man.
30.John Blundell, “IHS and the Rebirth of Austrian Economics: Some Reflections on 1974–1976,” Quarterly Journal of Austrian Economics 17 (Spring 2014): 93.
31.Ibid., 101–2.
32.There is an excellent literature on the recession of the 1970s as the prompt for a determined corporate mobilization to affect the political process. The works that have most shaped my understanding include Thomas Ferguson and Joel Rogers, Right Turn: The Decline of the Democrats and the Future of American Politics (New York: Hill & Wang, 1986); David Vogel, Fluctuating Fortunes: The Political Power of Business in America (1989; repr., Washington, DC: Beard Books, 2003); Bruce Schulman, The Seventies: The Great Shift in American Culture, Society, and Politics (New York: Free Press, 2001); Kim Phillips-Fein, Invisible Hands: The Making of the Conservative Movement from the New Deal to Reagan (New York: W. W. Norton, 2009); Judith Stein, Pivotal Decade: How the United States Traded Factories for Finance in the Seventies (New Haven, CT: Yale University Press, 2010); Benjamin C. Waterhouse, Lobbying America: The Politics of Business from Nixon to NAFTA (Princeton, NJ: Princeton University Press, 2015); and Meg Jacobs, Panic at the Pump: The Energy Crisis and the Transformation of American Politics in the 1970s (New York: Hill & Wang, 2016).
33.On the fracturing of the “business movement” into a state of “every man his own lobbyist,” see Waterhouse, Lobbying America, quote on 232, also 250–51.
34.Charles Koch, “The Business Community: Resisting Regulation,” Libertarian Review, August 1978, reprint found in box 5, Roy A. Childs Papers, Hoover Institution Archives, Stanford University.
35.George H. Pearson to Buchanan, December 31, 1975, BHA; “Austrian Economic Theory & Analysis,” program, Virginia Seminar, October 18–19, 1975, box 26, Hayek Papers; Buchanan to George H. Pearson, March 22, 1976, BHA, with attached schedule; Buchanan to Edward H. Crane III, November 30, 1977, BHA; Buchanan to G
ordon Tullock, February 25, 1971, box 11, Tullock Papers; Tullock to Buchanan, March 2, 1971, box 11, Tullock Papers; George Pearson to Buchanan, October 22, 1975, and March 25, 1976, BHA; James M. Buchanan, Better than Plowing and Other Personal Essays (Chicago: University of Chicago Press, 1992), 71–72.
36.George H. Pearson to Buchanan, January 8, 1971, October 22, 1975, and March 25, 1976, BHA. Among the Koch-funded center’s other publications on the subject was Murray N. Rothbard, Education, Free and Compulsory: The Individual’s Education (Wichita, KS: Center for Independent Education, 1972).
37.Charles G. Koch to Buchanan, February 19, 1977, BHA; also Pearson to Buchanan, October 22, 1975, BHA.
38.William E. Simon, A Time for Truth (New York: McGraw-Hill, 1978), 230.
39.In his most recent book, Koch includes Lenin among the thinkers who “made tremendous impressions on me.” Charles G. Koch, Good Profit (New York: Crown Business, 2015), 13.
40.Raimondo, Enemy of the State, 23, 28, 179; Doherty, Radicals for Capitalism, 45, 59–60, 243–45; Murray N. Rothbard, The Betrayal of the American Right (Auburn, AL: Ludwig von Mises Institute, 2007), 69, 73–77.
41.Raimondo, Enemy of the State, 211–17.
42.Rothbard, The Betrayal of the American Right, 202; also Raimondo, Enemy of the State, 224–39.
43.Ibid., 214–17.
44.Koch, “The Business Community.”
45.Raimondo, Enemy of the State, 217.
46.Doherty, Radicals for Capitalism, 392–96; Hazlett, Libertarian Party, 84–89.
47.Edward H. Crane III, “Libertarianism,” in Emerging Political Coalitions in American Politics, ed. Seymour Martin Lipset (San Francisco: Institute for Contemporary Studies, 1978), 353–55.
48.Raimondo, Enemy of the State, 218. Buchanan worked with Cato from its founding to his death; see obituary at www.cato.org/people/james-buchanan.
Democracy in Chains Page 38