Economy

Exposing America's Billionaire Welfare Ranchers

America's .01 percent like the Kochs and the Hiltons are collecting massive subsidies from the federal government.

Americans love ranchers: Gritty ranchers, mom-and-pop ranchers, renegade ranchers — especially those who raise livestock on the vast open prairies of the West through a mixture of hard work and rugged independence. But there’s another side to the ever-popular rancher mythology— a side the media doesn’t cover and the public never sees. The Koch brothers, Ted Turner, the Hilton family and nine other powerful ranchers share an uncommon privilege: giant public subsidies, unknown to U.S. taxpayers.

It’s the other side of the Cliven Bundy story, the other side of the Wright brothers saga—the bronc-riding, ranching family at the center of the New York Times photographic essay published this March. 

That “other side” of those stories is the federal grazing program that enables the Wrights to run their livestock on public lands for cheap; allows ranchers to have thousands of protected wild horses removed from public lands at public expense. It’s also the program that earned Cliven Bundy the title of "welfare rancher."

Bundy didn’t earn it by failing to pay his grazing fees. The welfare rancher label applies to all ranchers who hold permits to graze the vast public spaces of the West, both delinquent and not. It includes the Wright brothers; the ranchers in Iron and Beaver counties in Utah complaining that wild horses eat too much; and 21,000 others. 

They are all welfare ranchers subsidized by US taxpayers, and you know who are the biggest welfare ranchers of all, grazing livestock on the hundreds of millions of acres of public grass and forest land, all assisted by public subsidies paid for by US taxpayers? 

Billionaires that populate Forbes rich lists. 

The .01 percenters. They are the nation’s biggest welfare ranchers, according to numerous environmental and policy groups; and it’s time they brought some attention to themselves, and the federal grazing program they’re exploiting to waste as much as $1 billion a year of taxpayer money while causing long-term damage to one of the public’s most treasured assets. 

Fifteen years ago, two percent of public lands ranchers controlled fifty percent of permitted grazing acreage, according to John Horning of WildEarth Guardians. 

Today, Horning says, that elite group of mega-rich owners has consolidated its hold on federal grazing property even further through grazing leases attached to the larger-than life ranches they inherit or buy outright. 

Along with that comes all kinds of perks paid for by taxpayers: the USDA’s wildlife services, which killed four million endangered and predator species in 2013 to help livestock operators. The costly and wildly ineffective Wild Horses and Burros Program which operates to the benefit of welfare ranchers. Numerous programs that work to undo the grazing damage that welfare livestock causes. And let’s not forget the bank loans that an estimated 45% of public lands ranchers obtain, using their grazing leases as collateral, and which heighten the value of their primary ranching property. 

Only 2.7 percent of the nation’s ranchers hold such leases. That’s a lot of costly benefits flowing to a small segment of the livestock industry. That two percent of them hold more than fifty percent of the acreage under that program? Never mind that two of the recipients love to attack all welfare programs that benefit the bottom tier of the economic pyramid. It’s the antithesis of rugged independence. It’s undemocratic, too. 

Their faces are absent from rancher stories. Some of that is media laziness. The other part is inconvenience. It takes a lot of digging to identify any public lands ranchers with precision. Why? Because the Bureau of Land Management and US Forest Service (which administer most federal grazing leases) have record-keeping systems that are the antithesis of transparent. There is no central database. Finding out who’s doing what on federal lands requires identifying all the various LLCs that ranchers establish to hide who they are, then tracking down leases in 10 Western states. 

The BLM, for its part, isn’t eager to help. Call any BLM specialist and identify yourself as media, and they send you to a media representative. Most I reached out to didn’t return phone calls—not promptly, anyway. You want sensitive information? You’ll be stuck sending out Freedom of Information Act requests. I sent one in last April. It’s still outstanding. 

Paul Rogers of the San Jose Mercury News, in 1999, spent nine months collecting information on 26,000 grazing leases in order to write a comprehensive article (“Cash Cows”) on the money pit that was the federal grazing program at that time. Many of the same players then are still in the game, but the process of keeping tabs using real records is so arduous that no environmental groups do it. 

The way I came up with the names in list of 12 ranchers below was by interviewing multiple groups that work to reform public lands grazing and cross-checking names against news reports online. The estimates provided of leased acreage were provided by Jon Marvel, founder of Western Watersheds Project. Net worth figures and list rankings come from Forbes; the rankings of richest land owners from the Land Report 100. 

It’s not an exact science, but one thing is clear: the public is being lulled by stories about bronc riders like the Wright brothers and outliers like Cliven Bundy while ignoring the big picture: a handful of cattle rustlers—rich ones—whose hands are deep in the public’s pockets, along with all the other smaller permittees. 

And that’s what the new West is like. It’s still rough and tumble. But if you don’t have a big-ass ranch, a huge fortune and public assistance, you’d best just head for the hills.

Some of America's biggest welfare ranchers:

David and Charles Koch (Koch Industries)

The brothers hold a half-dozen grazing permits on public land in Montana to go with its 300,000-acre Matador Ranch there. The brothers are tied for fourth place on Forbes 2014 400 Richest People in America list (net worth: $ 42 billion each). The Koch family ($ 89 billion) is #2 on Forbes Richest Families list; Koch Industries is #2 on Forbes America's Largest Private Companies list, ($ 115 billion in sales).

J.R. Simplot Corp.

The largest U.S. public lands ranching entity (with an estimated 2 to 3 million acres of allotments in CA, ID, NV, OR and UT) is #63 on Forbes 2014 list of America's Largest Private Companies ($ 5.8 billion in sales). In 2014, the family was #29 on Forbes list of America’s Richest Families (net worth: $ 8 billion).

Bruce McCaw (McCaw Cellular)

McCaw was #382 on Forbes 400 list of America’s Richest People in 2005 (net worth: $ 925 million). Through his 9 sprawling ranches, he controls a significant number of public grazing leases in ID and possibly NV. One of them (Camas Creek ranch) includes 272,000 acres of Federal grazing allotments in Idaho's Camas Prairie. Grazing permitted to his other ranches could easily double or triple that to a million acres or more.

Barrick Gold

The Canadian mining company is one of the two largest public lands ranchers in NV, ranking 771st on Forbes Global 2000 list of the World’s Biggest Public Companies in 2014, (sales: $ 12.56 billion). Like many other large public lands ranchers, Barrick buys ranches to secure water rights.

Southern Nevada Water Authority (SNWA)

The supplier of drinking water to Las Vegas is a large NV public lands rancher with an estimated 1 million acres of public grazing allotments. Like Barrick Gold, it, buys up private ranches to gain their water rights.

W. Barron Hilton (Hilton Hotels)

The hotel heir dropped off Forbes Billionaires list (ranked #459 in 2011) as well as its list of the 400 Richest Americans (#144 in 2010), with a net worth of $ 2.5 billion. He died in 2013.

Though records are hard to pin down, Hilton's heirs inherited a ranching operation in the CA-NV border area, which has been known to have vast public lands grazing allotments permitted to it.

Mary Hewlett-Jaffe (Hewlett-Packard)

Jaffe holds the largest BLM public lands grazing permit in central ID and is among the top 15 public lands ranchers in the state (estimated at under 200,000 acres that are said to be in extremely degraded condition, according to sources).

James Barta (Sav-Rx.com)

Barta is not on any Forbes rich lists, but owns one of the largest cattle ranching operations in the U.S., according to his attorneys. Barta holds grazing permits to nearly 900,000 acres of public grazing allotments in connection with two properties: White Horse Ranch (in OR) and Soldier Meadows (in NV). Barta may have additional NV grazing leases through two other ranches in NV, according to Jon Marvel, founder of Western Watersheds Project.

T. Wright Dickinson

Though not on any Forbes list, the Dickinson family is a large public lands rancher, with  grazing permits estimated at more than a half million acres of CO, UT and WY public lands under its LLC, Vermillion Ranches. Dickinson is a former County commissioner and proponent of county efforts to gain control of federal lands, according to the Denver Post.

Stan Kroenke (Kroenke Group) & Ann Walton Kroenke (Walmart)

With just two of his ranches (in MT and WY) totaling 664,000 acres (not including public grazing allotments), Kroenke is one of the ten top land owners in the U.S. In 2014, he ranked #89 on Forbes list of the 400 Richest Americans, #247 on its Billionaires list, and #5 on its list of Richest American Sports Team Owners (net worth: $ 5.8 billion). His wife, Ann Walton Kroenke (net worth: $ 5.6 billion), was #261 on Forbes Billionaires list and #11 on its list of America’s Richest Women.

Family of Robert Earl Holding (Sinclair Oil and hotels)

Forbes ranks the family #87 on its 2014 list of America’s Richest Families (net worth: $ 2.7 billion). With 400,000 acres of land, the family is the 19th largest private land owner in the US, according to the 2014 Land Report 100. This includes land that Forbes reported “may be the largest ranching operation in the Rocky Mountains.” Public grazing leases are associated with some of the family’s WY and possibly MT holdings, according to Jon Marvel, founder of Western Watersheds. 

Ted Turner

He's the second largest U.S. land owner (2 million acres in 6 states), is estimated to hold grazing leases in MT and NM (estimated at as much as 300,000 acres), and owns the world's largest bison herd. Forbes ranked him #296 on its 2014 list of the 400 Richest Americans and #818 on its global Billionaires list (net worth: $ 2.2 billion).

This article was originally published on The Daily Pitchfork.

See more of Vickery Eckhoff's work at http://dailypitchfork.org.

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