Lawyer claims IRS and Administration have tried to intimidate Koch Industries

May 25, 2013 — The chief lawyer for Koch Industries said Friday that government targeting of conservative political groups is nothing new to the Wichita-based company.

Chief legal counsel Mark Holden said the White House, as early as August 2010, was deliberately trying to politically intimidate Koch Industries.

Holden said that although he had no direct evidence that the White House had any involvement in targeting Koch for IRS tax scrutiny, he pointed to what he described as a “disturbing” comment about taxes and Koch Industries made by one of President Obama’s political advisers, Austan Goolsbee, at a White House briefing in August 2010.

Because the IRS is admitting that it deliberately targeted conservative political groups for extra tax scrutiny, it is worth raising questions about whether the events are connected, Holden said.

Holden has publicly criticized the Goolsbee comments before.

“Some of what I do here reminds me sometimes of the movie ‘Groundhog Day,’ where I have to do the same things over and over,” Holden joked.

But Holden said he isn’t joking in bringing up the Goolsbee situation again. He said that when he looks at what Goolsbee said in 2010 and puts it alongside what President Obama was saying about the Kochs in the same month, and puts that alongside the fact that the IRS recently admitted it targeted conservative groups for extra scrutiny, he sees, at minimum, a “disturbing” pattern of government intimidation.

The Eagle called the White House for comment about Holden’s comments on Friday. The White House press office asked that the newspaper’s request for a response be outlined in writing, which it was.

By early evening, the White House had not responded.

“I am not suggesting anyone broke the law,” Holden said, and he pointed out that the White House later said that no one had tried to access tax information.

But he said the Obama administration used the Kochs to scare their own supporters into donating more to the campaign. And he said what they did went further than that. He said he and Koch Industries officials believe that “everyone, whether Democrat or Republican, conservative or liberal or independent or agnostic,” should be concerned at the pattern of behavior exhibited by the national government in how it handled not only the Kochs but the conservative groups it targeted for extra scrutiny. At minimum, he said, the government used scare tactics to intimidate White House opponents.

Many Americans believe many of the same things the Kochs do about politics and government, Holden said.

“They go after the Kochs, who have resources,” Holden said. “We’re not asking for empathy or sympathy — we’re big boys and we can take it. But you’ve got people who are small business owners, common citizens, who also want their grievances redressed by the government. It sends a message (of intimidation) to them as well.”

The Goolsbee situation, which Holden brought up again on Friday, was first reported in September 2010 by the Weekly Standard.

A few days before, in August, Goolsbee, a senior economic adviser to President Obama, was reported to have said the following:

“So in this country we have partnerships, we have S corps, we have LLCs, we have a series of entities that do not pay corporate income tax. Some of which are really giant firms, you know Koch Industries is a multibillion dollar business. So that creates a narrower base because we’ve literally got something like 50 percent of the business income in the U.S. is going to businesses that don’t pay any corporate income tax. They point out (in the report) you could review the boundary between corporate and non-corporate taxation as a way to broaden the base.”

First of all, Holden said Friday, Koch Industries follows federal law and pays a great deal of money in taxes. Koch Industries earns billions of dollars a year and employs 48,000 people in the U.S. (and another 12,000 people in 60 other countries). “We pay the taxes we are obligated to pay,” he said.

But Holden said one reason he became concerned about what Goolsbee was reported to have said is that by law, tax records are confidential. Goolsbee’s comments raised the thought that Goolsbee or the White House had broken that confidentiality illegally, and reviewed the tax records.

In light of what is now being revealed about the IRS scrutiny of other political opponents of President Obama, Holden said, it makes him wonder whether these events are part of a pattern of behavior by a national government unhappy with criticism.

Goolsbee’s comments did prompt an investigation by the U.S. Department of the Treasury, Holden said. Several Republican senators demanded that it be done, and it was done, Holden said.

But the results of that investigation are not known, Holden said. He used the Freedom of Information Act to ask for the file. But the federal government refused his request.

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