Once the ACCF’s study was published, Koch Industries carried out the next phase of its echo chamber system. The study was quickly promoted by a think tank called the Institute for Energy Research, which sent out a press release on August 13 that highlighted the study’s findings. The IER was an outgrowth of the Institute for Humane Studies, the libertarian think tank cofounded by Charles Koch.IV By 2009, the IER was funded by Koch Industries and other companies, and a former Koch Industries lobbyist named Wayne Gable sat on IER’s board of directors.
After the study was promoted by the IER, it was then recycled by another Koch Industries–affiliated think tank. This one was called the American Energy Alliance, and it was essentially the political action arm of the IER. The AEA was organized under the tax code in a way that it could be directly involved in politics, while the IER was organized as an “education” foundation that could not lobby or get involved in political campaigns. Where the IER was high minded, the AEA was something more of a street brawler. The AEA was headed by a former Koch Industries lobbyist named Thomas Pyle, who remained in close contact with his former colleagues at Koch’s lobbying shop.
The AEA produced a series of political radio advertisements that were based on the new ACCF findings, along with other statistics that highlighted the potential economic threat of a cap-and-trade bill. A narrator in one of the radio ads intoned: “This tax will further cripple our already struggling economy—costing more American jobs. . . . Higher taxes and more job losses—what could Congress be thinking?” A corresponding fact sheet for the ad cited the ACCF for this claim. The AEA political ads were targeted in a way that benefited from keen knowledge of how the Waxman-Markey bill was then working its way through the Senate. Lindsey Graham of South Carolina was a particular target. “Why would Senator Lindsey Graham support a new national energy tax, called cap and trade?” one advertisement began. Citing the ACCF study, the advertisement claimed that “cap and trade . . . could significantly increase electricity bills, gas prices, and cost American jobs.”
In all of these statements and advertisements, the same set of numbers were used again and again: More than two million jobs lost. Electricity prices would be 50 percent higher by 2030. These facts were also carried into Congress in the form of direct testimony. When the Senate Finance Committee sought to learn more about the economics of climate change, the committee invited Margo Thorning to testify. The ACCF study was submitted as evidence beforehand.
“It’s pretty clear the costs outweigh the benefits,” Thorning told the committee. Chairman Max Baucus, the conservative Democrat from Montana, pointed out that the ACCF findings were far more negative than most. “You’re a bit of an outlier,” Baucus said.
“We tried our best to build in realistic assumptions,” Thorning had said earlier.
Inside Koch Industries, the ACCF report was seen as a tremendous victory. Koch’s point of view had been carried out into the world in real force—in press releases, Senate testimony, think tank discussions, and political attack ads. And Koch’s name wasn’t anywhere to be seen.
Koch Industries wasn’t the only company to use these tactics. ExxonMobil also funded third-party groups that sought to raise doubts about the science behind climate change and to fight the cap-and-trade bill. But Greenpeace, the environmental activist group that fought hard to limit air pollution, found that Koch Industries fought to undermine the scientific consensus around climate change for longer, and more fiercely, than even Exxon. A 2010 Greenpeace analysis of spending on climate-denial groups between 2005 and 2008 found that Koch Industries and its affiliates spent $24.9 million to support such groups, almost triple Exxon’s $8.9 million in spending.V And Koch was more uncompromising than Exxon, whose lobbyists made it known that Exxon might support some sort of carbon emissions plan, such as a carbon tax.
The efforts to undermine popular support for a cap-and-trade bill were effective. In late 2009, 57 percent of Americans believed there was strong evidence that global warming was real, according to a poll from the Pew Research Center. While this was a majority, it was a slimmer majority than in 2008, when 71 percent of Americans believed it. In 2006, 77 percent believed it.
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As the Senate debated, Koch Industries applied yet more pressure. While punishing Congressmen who voted for Waxman-Markey, then tarnishing the bill through its echo chamber, Koch employed another tactic. This tactic was informed by the insight that Abel Winn had derived from his study of beating holdouts: When there’s competition, that completely blew the problem away. . . . Everybody behaved much better. Koch Industries would intensify competition among lawmakers by promoting competitors to challenge them.
In 2009 and 2010, Koch Industries’ political network created new Republican candidates, seemingly out of nowhere, who rose up and challenged sitting congressmen and senators. Koch’s chosen candidates attacked the incumbents from the right, claiming that the Republican Party was insufficiently conservative and too accommodating of the Obama agenda. The overwhelming message was that compromise with Democrats must end.
Bob Inglis was more surprised than anyone to find himself challenged by one of Koch’s candidates. Inglis earned an 84 percent rating from the American Conservative Union, which tracked lawmakers’ votes. He discovered that voting in line with the union 84 percent of the time was not enough. Inglis was seen as a holdout against Koch’s agenda because he stubbornly continued to advocate for controlling greenhouse gas emissions.
Inglis’s competition came in May, and it arrived in the form of a prosecuting attorney from Spartanburg named Trey Gowdy. Inglis and Gowdy had been longtime allies and even friends. Inglis heard the news about Gowdy’s candidacy one morning when a friend called and told him. He collapsed back into bed. Gowdy was a formidable opponent. Koch Industries gave no money to Inglis during that campaign cycle, but contributed at least $7,500 to Gowdy. Americans for Prosperity promoted Inglis’s town hall meetings to Tea Party activists so that they could arrive to protest, but there is no evidence that AFP directed such actions against Gowdy or questioned his conservative credentials. Gowdy, in turn, proved that he would support Koch Industries’ most important policy concern in the summer of 2009.
Inglis and Gowdy met at a candidate forum to debate the issues that summer, held under a large tent next to a highway. The moderator was a conservative talk-radio host. There were two other candidates with Inglis and Gowdy, but Inglis considered Gowdy to be his only true competitor.
The moderator asked all the candidates if they believed climate change was man-made and then added: “Would you support a bill that taxes carbon emissions?”
This drew a hearty laugh from the crowd. They knew exactly how painful Inglis’s squirming must be. Inglis took the microphone and proceeded to alienate almost the entire audience:
“I do believe that humans contribute to climate change. And, actually, let me strike that. I don’t believe it. It’s not an article of faith for me. My faith tells me to look at the data. The data says that’s happening. And that’s why I have a proposal that’s not cap and trade.” He explained the details of a carbon tax bill and how it would be “revenue neutral” by cutting taxes on wages.