January 2018History

How an academic economist in Northern Virginia fueled the Koch Brothers’ plan to undo democracy

An academic historian – Duke University’s Nancy MacLean is one, with highly praised books to her credit – is always looking for a stealth bomb. History as we look at it today is pretty regular, follows patterns populated with lots of ordinary folks, seldom pivots on individuals great or, um, wickedly great. But when the historian can unearth someone pivotal who has previously lurked in obscurity, sizzle can occur.

As we also know, research in any area that singles out an obscure but powerful individual influence on the outcome of big events and trends is like breaking the glass and pulling the alarm. Here come the defenders.

MacLean brought the account of her latest -- and quite controversial -- book, Democracy in Chains, to a largely friendly audience at the AFL-CIO headquarters Dec. 19. She has had to fend off outraged disputation from the libertarian right, mainly economists, because of her chosen stealth bomb – the economist James M. Buchanan (1919-2013). Buchanan, as she makes clear early in the study (a National Book Award nominee), is no wicked eminence but a catalyst who by her account focused self-aggrandizing men of great wealth on a path to power that is profoundly antidemocratic. And he was a Nobel laureate, no less.

“James McGill Buchanan was not a member of the Virginia elite,” MacLean recounts in her opening chapter. “Nor is there any explicit evidence to suggest that for a white Southerner of his day, he was uniquely racist or insensitive to the concept of equal treatment. And yet, somehow, all he saw in the Brown decision was coercion. And not just in the abstract. What the court ruling represented to him was personal. Northern liberals — the very people who looked down upon Southern whites like him, he was sure — were now going to tell his people how to run their society.”

Big money, of course, is potential power in any situation. Despite Buchanan’s reticent presence and the seething of his defenders, Buchanan appears to have been a unique catalyst because of Charles and David Koch, two dynastically super-rich men who by MacLean’s account seized on the public-choice aspects of Buchanan’s work and brought him to their academic satrapy at George Mason University. From his discussions of state sovereignty and federal overreach the Kochs spun a conspiracy about as immense as they get because they were so rich. Instead of accumulating social and political power indirectly through oligarchic reproduction of consumerist practices, the Kochs struck right for the prize – political domination at as many levels as they could seize, local, state and federal.

Much of that story is known, including through the New Yorker writer Jane Mayer’s Dark Money. Buchanan’s persona and role is the “hidden figure” that MacLean brings forward as the generator of the intellectual framework the Kochs adapted to their purposes. Her subtitle is the explainer: The Deep History of the Radical Right’s Stealth Plan for America. Buchanan is her stealth man for the stealth plan.

For elite libertarians like the Kochs – as for the former Virginia governor of the 1950s, C.W. Darden, later president of the University of Virginia when Brown v. Board was handed down – the long-term problem was not black children in schoolrooms with white children but the looming threat of the 14th Amendment guaranteeing equal protection under the law. Brown indicated the courts might take it seriously.

As MacLean puts it, Buchanan told his boss Darden “He could win this war, and he would do it with ideas.” For the Koch brothers, intellectual wannabes, this was an irresistible path, and what followed as “the utterly chilling story of the ideological origins of the single most powerful and least understood threat to democracy today: the attempt by the billionaire-backed radical right to undo democratic governance.”

The reaction against MacLean’s book from the libertarian Right, particularly those economists with ties of varying fealty to the Chicago school, indicates how important Buchanan and the metastatizing myth of “public choice” has been to the trade – an exchange-practices rubric for the broader mantra of “freedom” set against a bureaucratizing social world. More significantly, “freedom” and “public choice” form a Potemkin storefront for the real drug sold in the back room, which is power over others for those already favored by fortune. That back room is where the Koch brothers, poster boys for dynastic privilege, deploy the strategies that will help them keep it at the expense of the lesser, and less deserving, sorts. As Sam Tanenhaus said of MacLean’s thesis, “What looked like a redneck eruption was in fact financed by northern capitalists nursing their own hatred of the New Deal.”

But what’s the goal? The “long game” attack program and strategy, as MacLean persuasively argues, aims to shift the public’s postwar, post-New Deal consensus that government was best suited to manage the economy to a consensus that only the private sector has the qualities and skills to manage the economy. Coupled with that, the Right’s goal is to steadily reduce the scope of public control of government and of democracy with the tools we are, in fragments, becoming familiar with. Voter suppression, an array of federal and state laws forbidding public interference with private markets and crippling the power of unions in the public and private sectors, and a fundamental constitutional change that would require a balanced federal budget are part of the tool kit, but because they are deployed separately and covered spottily by media, the overall coherence of the strategy is easily overlooked. Even the slapdash tax bill just signed by Trump has a “perverse example” role – Congress can’t avoid running up a trillion and a half more debt; stop us before we spend again (with a balanced budget amendment).

As MacLean told an interviewer in Salon:

This [tax bill] is so much more than a big giveaway of money to the rich. There will be huge automatic cuts to Medicare, Social Security and Medicaid that will come directly from the Republican decision to run up the deficit with these tax cuts. When you combine this with the push for a constitutional convention, at which the No. 1 agenda item will be a balanced budget amendment -- put those things together, and this is a long-term stealth project to privatize Social Security and Medicare.”

Buchanan’s seminal role in this long game was, MacLean said, made clear when she found records – as Tanenhaus says, “Buchanan’s voluminous, unsorted papers” -- at the Koch brothers’ “intellectual base camp” at GMU. She likened it to the Civil War episode when a Union soldier stumbled across a packet of battle plans in an abandoned Confederate encampment – plans that, in the hands of even as inept a commander as McClellan, enabled the Union’s pyrrhic victory at Sharpsburg/Antietam. The Kochs had brought a willing Buchanan to GMU to run a think tank on public choice economics. “We have all felt the force” of that move, according to MacLean. The record showed, she said, “the endgame of all this [Koch activity] is enchaining democracy – making institutions incapable of responding to the popular will—especially in respect to taxes and spending.” This retrogressive social formation aims for an oligarchy modeled on the US in 1900 with no labor or class rights, she said.

The methodology had some pilot episodes before Charles Koch, and then his sibling, entered the story. Buchanan’s career path had taken him to Chile as Pinochet consolidated power after the overthrow of the Allende government. There, he designed the constitution that privatized public goods such as social security and public education, creating long-term constraints on the country that endured well past the brutal reign of Pinochet’s coup.  MacLean’s portrait of Buchanan as willing co-conspirator with the infamous general was disputed hotly by a claque of economists in the libertarian public choice camp, but his role mirrored that of many Chicago economists under the spell of Milton Friedman who were portrayed in similar Global South interventions in Naomi Klein’s Shock Doctrine.   Buchanan brought the privatization ethos to the forefront, fueled by the complementary argument that big government was by its nature the hive of self-interested elites who reproduced their rule on the taxpayers’ dime. Unions and politicians are reframed as “parasites and predators;” all who depend on public provision are “a nation of moochers.”

Buchanan began his career at UVA as the willing partner of the all-powerful Byrd machine, providing the states’-rights rationale for the near-apartheid condition of Virginia in the 1950s. Despite his steady climb in esteem and reach within his own sector of the economic right, Buchanan’s tightly-controlled libertarian think tank of an economics department at Jefferson’s university came under fire as the school attempted to better itself among major research universities. The high hopes invested in the Goldwater campaign were dashed by his crushing defeat in 1964 and Buchanan was exiled to UCLA, where he was appalled by student activism, then to a transitory but congenial spot at Virginia Tech as it, too, tried to winch itself up among state universities. Finally, the Kochs installed Buchanan at GMU, where MacLean found his unsorted posthumous papers in the abandoned mansion that was the think tank’s first home; the post-Buchanan foot soldiers of the Koch’s “Mercatus Center” had moved on to a lavish new campus headquarters and “gave no thought to the fate of the historical trail they left unguarded” at the old place. So MacLean, a self-described “archive rat,” had the historian’s dream in hand – a first-time look at an untouched, unsorted mass of significant material.

Through his career, Buchanan was developing what was in fact a significant insight – that governments as institutions behaved in self-interested ways mirrored in the private sector – coupled with a personal disdain for law as regulation. He missed or ignored the corollary, that governments in a capitalist system adopt a parallel to capitalist practices in order to manage a capitalist private sector on behalf of a wider public. As we know, government within capitalism has a fatal family resemblance that reflects a too-close relationship with private financial power. The public still loses.

To the mind of Buchanan and his cohorts in the self-assured right-wing economics sphere, the public was not losing enough – it appeared to them to have some control over the private property and private doings of the wealthy, including their relationship to their workers. That, they believed, was the result of politicians actually responding to the needs and desires of their voters. Buchanan and his colleagues were shocked by this, and have sought to reverse it for several generations now.

As the arches of this ideology were fashioned in academia and tested in Chile and elsewhere, the Republican Party accepted Lyndon Johnson’s ruefully proffered 1965-66 gift of the South and made its new home where myth smothers information. As MacLean put it, the “GOP is a delivery vehicle for an agenda” for irreversible change in the “relationship of people to government.” And the Koch project’s “secret sauce” that has brought the party into alignment with the bogus “freedom” agenda is “primarying” GOP incumbents who don’t drink all of the Kool-Aid. From her vantage at Duke, MacLean said, she witnessed the tactic firsthand, close up, in the blitzkrieg takeover of the North Carolina state house in the past decade.

The result is “an electoral stronghold in 30 states” and the endgame, she argues, is building toward a constitutional convention that will seek a balanced budget amendment. The thirty-odd amendments to the Constitution have all in the past come through Congressional action. But 36 states can call for one, as well – as MacLean pointed out, a path to change that was originally omitted from the US Constitution but was added at the insistence of none other than Virginia founder George Mason. Students at GMU, incensed by its reputation as “the Pentagon of conservative academia” (the Wall Street Journal) have spread a movement called “unKoch my Campus” throughout an academic sphere often vulnerable to rich right-wing donors and the pursuits they demand for their dollars.

The stealth comes in because the goals are profoundly undemocratic, and if they were known to a wider public they would perish like the class-war skullduggery they are. In several speeches to small groups of colleagues and foundation paymasters, Buchanan specifically cautioned that secrecy would be an essential part of the project.

Post-Buchanan, the Kochs and their weaponized wealth are proving sure-footed. In a new introduction to Dark Money’s 2017 paperback edition, Jane Mayer traces how the Kochs first fought, then moved smoothly into the orbit of, Trump as he moved from long shot to president – still focused on the strategies or effects that they share, such as reducing trust in government and institutions, voter suppression and enhanced property rights.

MacLean’s view is that the idea of a constitutional convention should be fended off at all costs, despite the contention by some on the Left that such a body would not go rogue but could be managed in a way to, for instance, reverse 2010’s pernicious Citizens United decision.

It’s imperative to “derail this train,” she said at the AFL-CIO book talk--  “… this is all hands on deck. Their [the Kochs] aim would be a totally unsustainable society” so “the days of silos [on the Left] are over.”

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