The Wrong Crowd

Election '04

Ralph Nader's run for the presidency of the United States has brought him some strange right-wing bedfellows, such as Citizens for a Sound Economy, who hope his candidacy will lead to the election of George Bush by drawing votes from John Kerry. CSE has been working hard to place Nader on the presidential ballot in Oregon, and will do so too in Wisconsin and other states, according to press accounts describing them as a conservative anti-tax organization. Such a description is a little like saying Pat Robertson and Jerry Falwell are Christian ministers.

We reveal much more about Citizens for a Sound Economy in our new book Banana Republicans: How the Right is Turning America into a One-Party State.
To understand CSE, you have to know a little about their founding benefactors Charles G. and David H. Koch who each has a net worth of $4 billion apiece, earning them separate spots in the Forbes list of the 50 richest people in America. Like their father, Fred Koch, an oil-and-gas entrepreneur who was a founding member of the far-right John Birch Society in 1958, they have used their wealth in concert with a handful of other extraordinarily wealthy individuals to build a political machine that spreads their ideas about law, culture, politics, and economics throughout the political and media establishment. The Kochs are part of a network of conservative benefactors that support industry-friendly think tanks, experts, and subsidized media that repeat, embellish, and reinforce their core message that corporations are good while government regulations, labor unions, environmentalists, liberal Democrats, and anything else that might restrict corporate behavior are bad. They have lavished tens of millions of dollars on "free market" advocacy in and around Washington. According to their filings with the Internal Revenue Service, they gave away more than $9 million in 2001 alone, almost all of it to conservative groups such as the libertarian Cato Institute (which Charles co-founded in 1977), Citizens for a Sound Economy (which David helped launch in 1986), the American Legislative Exchange Council, the Reason Foundation, Heritage Foundation, Landmark Legal Foundation, and Young America's Foundation.
Citizens for a Sound Economy describes itself as an organization of "grassroots citizens dedicated to free markets and limited government," but according to internal documents leaked to the Washington Post in January 2000, the bulk of its revenues ($15.5 million in 1998) came not from its 250,000 members but from contributions of $250,000 and up from large corporations. CSE is co-chaired by former Republican Majority Leader Dick Armey and C. Boyden Gray, a Washington attorney who served as counsel to former president George H.W. Bush. The Koch Family Foundations continue to provide some of CSE's funding, but the bulk of its income now comes from corporations including Allied Signal, Archer Daniels Midland, DaimlerChrysler, Emerson Electric Company, Enron, General Electric, Johnson & Johnson, Philip Morris, and U.S. West. Other funding comes from the same conservative foundations that finance other conservative think tanks: Castle Rock, Earhart, JM, Olin, Bradley, McKenna, and Scaife.
CSE's activities have ranged from a major press and public relations campaign to defeat the Clinton administration's 1993 proposal for an energy tax to filing "friend of the court" briefs in 1999 that sought to declare the Clean Air Act unconstitutional. It produces more than 100 policy papers each year, delivering them to every single congressional office, while also distributing its message via direct mail, advertising, placements of op-ed pieces and outreach to journalists that generates thousands of news articles in print, radio and television. CSE argues that "environmental conservation requires a commonsense approach that limits the scope of government," acid rain is a "so-called threat [that] is largely nonexistent," and global warming is "a verdict in search of evidence." CSE also engages in "grassroots" lobbying, sending out activists to collect signatures on petitions for its various causes.
Although tax-exempt nonprofit organizations are supposed to refrain from endorsing specific legislation or candidates, CSE has intervened in elections on occasion, as in 1999 when it worked during the primary election to defeat Joseph Negron, a Republican running for the Florida state assembly. CSE ran a series of television ads blasting Negron, funded by $460,000 from major corporate donors including rent-a-car companies and Associated Industries of Florida, which represents 10,000 Florida businesses and opposed Negron's position on tort reform. "Our political department orchestrated the whole thing," said Jon L. Shebel, the president of Associated Industries. "We called CSE and said here's the plan, can you do something? They did TV. We did radio, direct mail and all the analytical work."
On other occasions as well, CSE has acted as a conveyor belt for the views of its funders. In 1998, it launched a project to derail a multibillion-dollar plan by the U.S. Army Corps of Engineers to restore the Florida Everglades. In news releases and other publicity materials, CSE claimed that the project would cost every household in Florida $120 and cost the state nearly 3,000 jobs. Shortly after launching the project, CSE received $700,000 in contributions from Florida sugar companies, which stood to lose thousands of acres of land if the federal plan went into effect. As the Washington Post reported in January 2000, this was only one of several occasions on which CSE has taken money from specific corporate interests while lobbying on their behalf. It received more than $1 million from Philip Morris while opposing cigarette taxes, and another $1 million from the U.S. West phone company while it pushed a deregulation plan that would let U.S. West offer long-distance service. CSE president Paul Beckner dismissed warnings about global warming as "junk science," shortly before receiving $175,000 from ExxonMobil to fund its work on "global climate" issues. Another $380,000 came in from Microsoft while CSE was lobbying in Congress to limit the Justice Department's budget for antitrust enforcement against the software giant.

The Center for Media and Democracy investigates and follows the work of corporate front groups including CSE through our Disinfopedia website at There you can find out the latest and help us report and keep tabs on CSE and other corporate fronts. You never know what they might be up to, even helping their sworn nemesis Ralph Nader.

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