In 2013, a Kansas statehouse member from Wichita pushed a bill to remove the renewable-energy mandates. He was Republican Dennis Hedke, the chairman of Moxley’s Energy Committee. Hedke was a geophysicist who did consulting work for regional oil and gas companies, and his fixation on repealing the renewable-energy mandates seemed odd to Moxley, who supported the new coal plant in 2009 but also saw the benefits of wind and solar power. “Wind power has turned out to be less expensive than about any other source for Kansas,” Moxley said. “I think the renewable [energy mandates]—that part has been generally good for everybody.”
The Kansas statehouse held a number of hearings on global warming. The heavy hitters lined up to testify. Moxley broke these experts into two groups: the “true believers,” who thought man-made climate change was an impending environmental crisis, and the “naysayers,” who said that the science was in doubt and the problem of climate change was being promoted by hysterical liberals. The true believers were brought in by the wind industry lobbyists, who were just starting to get a foothold in Topeka. The naysayers were brought in by Koch-funded groups, including Americans for Prosperity, the Heartland Institute, the Beacon Hill Institute, the Kansas Policy Institute, and the Kansas Chamber of Commerce.
The hearings transfixed Moxley because he didn’t know if he was a naysayer or a true believer. He was a staunch Republican, and therefore inclined to distrust Al Gore and the EPA. But just like Bob Inglis, Moxley got a scientific schooling in carbon emissions, and it changed his thinking. He gradually came to believe that the naysayers did not have a serious case. “I’m open to good science, but those guys were just throwing dust in the air and not making a case,” Moxley recalled. He turned against them completely when it was proved that one of the climate skeptics had shown legislators a chart on the Earth’s climate that conveniently omitted the last hundred years, when temperatures began to escalate.
While the arguments over global warming were unconvincing to Moxley, Koch Industries was using other tools to help legislators come around to its point of view. Moxley started to hear stories from his colleagues about a changing political landscape.
During primary elections in rural districts, Koch Industries and its various political arms were dropping $50,000 into local primary races. This was a pittance by national political standards, but it amounted to a shock-and-awe campaign in towns like Larned, Kanapolis, and Great Bend. Koch Industries was expert at coordinating with other conservative groups, Moxley said, such as the National Rifle Association, the pro-life group Kansans for Life, the state Chamber of Commerce, and, of course, Americans for Prosperity.
Moxley observed a recurrent strategy. He said that Koch handpicked a candidate in a primary election, told that candidate to stay home, and then scorched the earth beneath their opponent with negative messages in the form of postcard mailings, advertisements, and door-knocking campaigns. Such efforts intensified in 2012 and wiped out incumbents who seemed resistant to Charles Koch’s political vision.
“The bottom line is, they flipped the [Kansas] senate from pretty traditional Republican kind of thinking to ‘Koch’ kind of thinking. And it’s pretty dramatic. We’re still living with it,” Moxley said. He grew disdainful of a new breed of state legislators who showed up in Topeka and seemed more concerned with toeing a line set out by Koch Industries than they did with thinking for themselves.
“They’re like numbskulls. All they’re going to do is take orders from the Chamber and Koch and so on,” Moxley said. “They’re not thoughtful. They’re not people that read the newspaper or have a history background. They just do what Koch wants done.”
Koch’s efforts in Kansas were part of a multistate campaign to push back renewable-energy subsidies. Koch’s primary targets were so-called renewable energy standards that required states to buy wind and solar power. Koch characterized these mandates as a form of crony capitalism. The Heartland Institute, which Koch funded, helped write a bill to repeal such standards. The bill was then taken up by ALEC, the Koch-funded conference of state legislators, and then introduced in more than a dozen states between 2013 and 2014.
ALEC’s efforts bore fruit. Ohio repealed its renewable standard, as did West Virginia. In Kansas, the fight lasted for years. Moxley repeatedly voted against the bill to repeal the renewable-energy mandates, as did a handful of other Republicans and many Democrats. But the financial power behind the bill was too strong to resist. In 2015, a version of the bill finally passed, removing the mandates and making the renewable-energy standards voluntary. This was only a partial victory for Koch. Wind power continued to gain ground in Kansas in part because it was so cheap. The utility companies were already meeting their renewable standards whether they were mandatory or not. Still, Koch had managed to achieve an effect in Kansas and other states that was similar to what it had done in Washington. It politicized the issue of renewable energy. It had stained the efforts to stoke competition in the energy industry as a form of government corruption, and it drew a red line that Republican politicians could not cross.
Moxley ended up leaving the Kansas legislature in 2016, when he decided not to seek reelection. “I kind of aged out,” he said. But his time in the conservative Kansas statehouse changed his thinking about human-induced climate change. He was more worried about it than before. He went back to his ranch in Council Grove, installed a large set of solar panels, and now only pays for electricity off the grid for about five months in the winter. About a year after he left politics, Moxley began to recover from the experience.
“I was just walking across the yard, and broke out in a whistle,” he said.
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By 2014, a sense of mastery infused the corporate culture at Koch Industries. The company was thriving, even during an era of almost unprecedented volatility in the global energy business and weak economic growth in the United States. A geyser of cash flowed from Koch’s oil refineries, thanks to the Eagle Ford Shale play and the continued profitability at Pine Bend. Profits were soaring in Koch’s massive network of nitrogen fertilizer plants, thanks to the collapse of natural gas prices. Business was strong and profits were rising at Georgia-Pacific, thanks to a recovery in the housing market. The company’s success seemed like the proof of concept for Market-Based Management. Koch Industries seemed to have its hand in everything—paper towels, gasoline, clothing, corn, derivatives trading—and somehow it succeeded even as different markets rose and fell.
Charles Koch and his team had also proven that they could master the art of politics. The Obama revolution was crippled. The days of a permanent liberal majority and a new New Deal were in the past. It was true that Obama had been reelected in 2012, but his governing power was hemmed in by a Congress that slid further into Republican control with each election. Koch’s chosen congressional candidates gained more seats in the midterms of 2014. Across the states, Koch’s political network was more powerful than ever. The greatest legislative threat to Koch’s business—greenhouse gas regulation—was relegated to the fringes of American political life. Charles Koch had faced a political movement that he considered to be dangerous to America’s future, and he had largely prevailed.
As always, Charles Koch had his eye on the far future. The vast majority of profits that flowed from Koch’s operations were recycled right back into the company. Koch Industries initiated an acquisition spree that was only paralleled by the wild growth strategies of the 1990s. During 2013 and 2014, Koch Industries spent billions of dollars to amass new assets and enter new lines of business. It acquired companies in an impossibly diverse array of industries: from steel, to glass, to greeting cards.