On February 7, 2015, Evan Halper writes in the Los Angeles Times:
When a small green-energy firm in Connecticut feared that entrenched competitors would box it out of the electricity business, it turned to a surprising, some might say shocking, ally — a nonprofit legal group with ties to the conservative Koch brothers.
It is an unusual alliance. Fuel Cell Energy, the maker of a costly next-generation technology that converts hydrogen into power, depends on the very government subsidies and price supports against which Charles and David Koch and their network of allied groups typically campaign.
But Cause of Action, a small group of lawyers funded by the Koch network, has taken up the green-energy firm’s case free of charge.
The fuel cell company is not the only one. The litigants on whose side Cause of Action has gone to court — all pro bono — include a wind farm in Oregon, a marine conservation activist on the Monterey coast and a Northern California lesbian couple eager to give birth through artificial insemination.
One thing those cases have in common is that the legal challenges oppose policies pushed by the Obama administration: government involvement in energy markets in the cases of Fuel Cell Energy and the wind farm, strict enforcement of wildlife protections in the Monterey dispute, and robust medical-safety regulations by the Food and Drug Administration challenged by the couple.
The clients are “the little guys who are hobbled more than helped by certain agency decision making,” the group’s 31-year-old executive director, Daniel Epstein, wrote in an email. “If taxpayer dollars are going to be spent, they should be spent in a merit-based, transparent and competitive manner that does not reward political cronies.”
Critics of the group call it a sophisticated charade, saying the lawyers trawl for clients like Fuel Cell, whose cases enable them to pursue a Koch brothers agenda in the guise of helping individuals or small firms that liberals might find sympathetic.
“It is an intentional effort to camouflage the actual force behind” the lawsuits, said Karen Skelton, an advisor to California-based Bloom Energy, a dominant firm in the hydrogen energy industry on the opposite side in the Fuel Cell case. “It is designed to be misleading,” she said.
Fuel Cell’s suit, which a judge last year ruled should go to trial, seeks to invalidate a pact between Bloom and the state of Delaware. That agreement set up the country’s first industrial-scale production of electricity from hydrogen fuel cells, using a factory the state subsidizes. Fuel Cell calls the arrangement a corrupt insider deal.
Big oil, gas and coal firms more often associated with the Koch network also have an interest in the outcome. Large renewable-energy firms, like Bloom, have potential to drain customers away from them. They also compete for a limited pool of available subsidies for energy.
The litigation leaves a cloud of uncertainty over efforts to promote hydrogen-generated electricity, industry analysts said. That could discourage venture capitalists from investing and other states from launching programs like Delaware’s.
“For those interests defending the market share of coal and petroleum products, this is a very low-cost stealth effort to disrupt the development of potential competitors,” said Skelton, a former political director to former Vice President Al Gore. (Skelton is the daughter of Times columnist George Skelton.)
Epstein takes exception. “If we win,” he said, Fuel Cell, “a green-energy company in Connecticut, gets to apply for taxpayer money.”
“That doesn’t help the people who are anti-renewable. We take these cases because we want fairness.”
Epstein previously worked as an attorney for the Charles Koch Foundation as well as the House Oversight and Government Reform Committee when it was chaired by Rep. Darrell Issa, the Vista Republican known for relentlessly attacking President Obama. He does not deny the group is strategic in choosing clients to represent.
“It is important that clients are sympathetic,” Epstein said. “Part of the battle is in the court of public opinion.”
That thinking also led Cause of Action to launch a crusade in California on behalf of the would-be manufacturer of an inflatable car.
The firm’s client, XP Vehicles,argued that it could build a cheaper, more practical, hyper-efficient vehicle than California-based Tesla Motors Inc. Energy Department attorneys dismissed that claim, calling the idea of a blow-up car ludicrous. But the litigation is proving potentially embarrassing to the administration and its allies as it scrutinizes major Obama campaign supporters whose companies got the grant money the inflatable-car project did not.
Like most groups funded by the Koch network, the specific sources of Cause of Action’s money are not disclosed. Tax records show that by 2013, its operations were mostly funded by $4.35 million from Donors Trust, a nonprofit group through which the Kochs and their allies distribute tens of millions of dollars without needing to disclose the sources of the funds.
Asked why the donors want to be anonymous, Epstein invoked a precept of the medieval Jewish philosopher Maimonides, who wrote that the highest form of charity is help given “without the expectation of public acknowledgment for one’s good deeds.”
“I suspect this sentiment motivates a lot of our donors,” Epstein wrote.
California Common Cause suspects otherwise.
It opposed Cause of Action’s work on behalf of a small oyster farm located in Northern California’s Point Reyes National Seashore. The farm’s owner attracted potent political liberal and Democratic supporters, including Sen. Dianne Feinstein, when the government decided not to renew its lease.
Cause of Action’s involvement “was about big money pushing to privatize public lands,” said Helen Grieco, an organizer with California Common Cause. “This was not just about a tiny oyster farm.”
Whatever its goals, Cause of Action’s tactics in that fight ultimately made some of its allies uncomfortable. The oyster farm dropped its affiliation with the group after the lawyers demanded to see unused footage from an unflattering PBS news report about the dispute.
But that fracas has not deterred the group from pursuing high-visibility cases. Nor will the insinuations by opponents that it works as a stalking horse for the Koch brothers’ broader political agenda, said Epstein.
“We do not litigate to end government spending or end all regulation,” he wrote. “We litigate to protect the process.”
http://www.latimes.com/nation/la-na-cause-action-20150207-story.html
Underlying this story’s political batter, is the undeniable fact that extracted taxpayer income is being used to SUBSIDIZED business corporations in various developing fields. What is most disturbing is that, in addition to instances of political favoritism, is that the result of taxpayer infused investment further the narrow ownership interests of the founders of any particular business corporation on the receiving end.
Subsidies are ALWAYS justified on the basis of how much new jobs will be created. But when will our leaders and the people of this nation wake up and realize that job creation is not enough justification for taxpayer subsidies that further the monopoly ownership interests of corporations that are narrowly owned and controlled and that are non-inclusive in ways that would create employee ownership?
What we need is for the Federal Reserve to stop monetizing unproductive debt, including bailouts of banks “too big to fail” and Wall Street derivatives speculators, and begin creating an asset-backed currency that could enable every child, woman and man to establish a Capital Homestead Account or “CHA” (a super-IRA or asset tax-shelter for citizens) at their local bank to acquire a growing dividend-bearing stock portfolio to supplement their incomes from work and all other sources of income. The CHA would process an equal allocation of productive credit to every citizen exclusively for purchasing full-dividend payout shares in companies needing funds for growing the economy and private sector jobs for local, national and global markets. The shares would be purchased on credit wholly backed by projected “future savings” in the form of new productive capital assets as well as the future marketable goods and services produced by the newly added technology, renewable energy systems, plant, rentable space and infrastructure added to the economy. Risk of default on each stock acquisition loan would be covered by private sector capital credit risk insurance and reinsurance back by the government, but would not require citizens to reduce their funds for consumption to purchase shares. ALL subsidized loan guarantees would have the stipulation that the companies benefiting from the loan infusion demonstrate NEW owners be created among their employees and others in which ownership shares are purchased on credit wholly backed by projected “future savings” in the form of new productive capital assets.
We need to lift ownership-concentrating Federal Reserve System credit barriers and other institutional barriers that have historically separated owners from non-owners and link tax and monetary reforms to the goal of expanded capital ownership. This can be done under the existing legal powers of each of the 12 Federal Reserve regional banks, and will not add to the already unsustainable debt of the Federal Government or raise taxes on ordinary taxpayers. We need to free the system of dependency on Wall Street or the accumulated savings and money power of the rich and super-rich who control Wall Street. The Federal Reserve System has stifled the growth of America’s productive capacity through its monetary policy by monetizing public-sector growth and mounting Federal deficits and “Wall Street” bailouts; by favoring speculation over investment; by shortchanging the capital credit needs of entrepreneurs, inventors, farmers, and workers; by increasing the dependency of with usurious consumer credit; and by perpetuating unjust capital credit and ownership barriers between rich Americans and those without savings. The Federal Reserve Bank should be used to provide interest-free capital credit (including only transaction and risk premiums) and monetize each capital formation transaction, determined by the same expertise that determines it today––management and banks––that each transaction is viably feasible so that there is virtually no risk in the Federal Reserve. The first layer of risk would be taken by the commercial credit insurers, backed by a new government corporation, the Capital Diffusion Reinsurance Corporation, through which the loans could be guaranteed. This entity would serve to seed the new policy direction and would fulfill the government’s responsibility for the health and prosperity of the American economy.
Our political leaders, academia, and the media fail to understand that our financial system has resulted in a fundamental imbalance between production and consumption. We have ignored the systematic income inequalities that persist and grow exponentially due to the steady progress of tectonic shifts in the technologies of production, shifting productive input from labor to the non-human factor of production––productive capital, as generally defined as land, structures, human-intelligent machines, superautomation, robotics, digital computerized automation, etc. Productive capital assets are OWNED by individuals and, respecting private property principles, those individuals are entitled to the earnings generated by such assets.
The significant problem has been the systematic denial of participation as capital owners on the part of the majority of consumers. While the wealthy ownership class has essentially rigged the financial system to their benefit, and by that is meant to continually concentrate ownership of productive capital among the richest Americans, the majority of Americans have been and are dependent on JOB CREATION. Yet, none of our political leaders, academia or the media addresses this inbalance with the richest Americans entitled to income growth associated with productive capital ownership and the majority facing further job losses and degradation due to technological advancement.
Ordinary Americans of so-called “middle-class position” have used consumer debt financing as a means of bettering their life with an abundance of consumer products and services. The government has used income redistribution via taxation and national debt to prop up the economy with monies spent on supporting a massive military-industrial complex comprised of a small group of owners and millions of “employed” and various social programs to uplift the American majority’s life and prevent their decline into poverty––supported by government dependency.
The ONLY way out of this mess, if we are to not become a complete socialist or communist communal state governed by an elite class, is to embrace growth managed in such a way that EVERY American is empowered to acquire over time a viable wealth-creating, income-producing capital estate and pay for their acquisition out of the FUTURE earnings of the investment. Such is the precise means that the richest Americans continually advance their wealth and thus, income.
We need leaders who will put this issue before the national debate stage, and we need the media to put forth the questions whose answers will provide the financial mechanism specifics to reverse the ever dominant OWNERSHIP CONCENTRATION. Such concentration and the economic power that result is taking control of our representative government, with productive capital ownership channeled through plutocratic finance into fewer and fewer hands, as we continue to witness today with government by the wealthy evidenced at all levels.
We are absent a national discussion of where consumers earn the money to buy products and services and the nature of capital ownership, and instead argue about policies to redistribute income or not to redistribute income. If Americans do not demand that the holders of the office of the presidency of the United States, the Senate, and the Congress address these issues, we will have wasted the opportunity to steer the American economy in a direction that will broaden affluence. We have adequate resources, adequate knowhow, and adequate manpower to produce general affluence, but we need as a society to properly and efficiently manage these resources while protecting and enhancing the environment so that our productive capital capability is sustainable and renewable. Such issues are the proper concern of government because of the human damage inflicted on our social fabric as well as to economic growth in which every citizen is fairly included in the American dream.
