The Hidden Role of Billionaires in North Carolina Politics
Recent trends suggest that North Carolina politics aren’t what they once were. In a debate between gubernatorial candidates at Raleigh, the incumbent governor Pat McCrory (R) announced his support for traditional values, limited government, lower taxes, balanced budgets, and a reduction in business regulation. While the novelty of such declarations may be overstated, by comparison to the rhetoric of Donald Trump McCrory is likely to seem well mannered if scripted, the kind of conservatism long familiar in North Carolina. Today, however, the state is viewed by hopeful Democrats as a “swing state” on the basis of the election of 2008 in which Barrack Obama won by a slim majority. In a state that voted for John F. Kennedy in 1960, but for George H. Bush in 1992, recent polls forecast a decisive victory for Hillary Clinton, who’s anticipated to be the first woman elected to the presidency. But if the recent study by Jane Mayer is any indication of where North Carolina and the nation are heading, it may be too soon for Democrats to celebrate. Mayer’s book, Dark Money: The Hidden History of the Billionaires Behind the Rise of the Radical Right (2016), spends the better part of a chapter uncovering the influence of undisclosed billionaire donors in political action groups that have played an ever larger role in North Carolina over the past two decades.
Mayer’s Dark Money draws with a broad brush the history of this disturbing drift in political affairs all across the U.S., but perhaps because of its very breadth, it overlooks some aspects of the state’s history that can put the conservatism of the billionaires into a North Carolina perspective. Mayer’s caste of players begins with the Koch family—heirs to the fortune of Fred Koch, the founder of Koch Industries, the Texas engineer who developed refining technology used in the U.S. oil industry. Charles and David Koch, who inherited the Koch fortune and continue to operate Koch Industries—the second largest privately owned company in the United States—emerge in the post-Nixon era as the architects of “the Koch network.” Over a period of some forty years they assembled an interlocking web of foundations, think-tanks, research, advocacy, and legal action groups. Dedicated to a radical free market, anti-government ideology, according Mayer, the Kochs and their supporters consist primarily of sole proprietary owners, buccaneering capitalists in financial, fossil fuel, and government contracting industries with a direct interest in controlling government policies. By 2004 this small collection of super rich donors began to hold regular summit meetings to develop a secretive and largely unexposed front. Eventually a whole new type of pseudo popular-based citizen action movement began to emerge. Drawing on the work of political scientists and economists, Mayer argues that the Koch network has become an oligarchy—a limited collection of the superrich who have sought to exert a direct control over government in U.S. through political surrogates funded through a dark money labyrinth.1
It is easy to overlook the circumstances that over the years have both inspired and frustrated hopes among progressive reformers in North Carolina. Distinctive among southern states for its geography, its pattern of growth and development, and its demographic makeup, North Carolina prior to 1900 offered a patchwork of rural communities devoted to agriculture, yet with burgeoning industries and growing cities. Sectional diversity within a slowly developing state meant that politics were defined by clashing local interests with raging resentment toward powerful players. The antebellum South was known for its plantation oligarchs who ruled in state governments to promote their interests. Small farmers in North Carolina were often highly resistant and with greater success at exerting a countervailing influence. Progress in nineteenth century terms meant the development of education, of highways, railroads and other means to knit together markets separated by rural isolation—as well as how to bring the state’s democracy towards the recognition of its people. Yet, by the late 1850s a sharp cleavage between progressive developers and the defenders of state’s rights gave way before the sectional demagogues who looked at the anti-slavery movement and proclaimed a coming racial Armageddon. Secession and the Confederate States of America were hailed as the cure.2 The capitulation to racial fear led to the ensuing social cataclysm known as the American Civil War, by far the most destructive single disaster in the nation’s history.
By the turn-of-the century North Carolina’s progressive paradox had become a defining characteristic. A state that was famous for its political mavericks, a sectional leader in industrial growth and public education, it was also known for its violent prejudice and Jim Crow segregation. Haunted by race exploitation and the appeal of popular demagogues, the state’s poorest citizens often migrated elsewhere in search of better opportunities. Yet for a time in the years after World War II it seemed that a progressive leadership had set the state on the road toward a more inclusive democracy. The values of a liberal era exemplified by such figures as UNC president Frank Porter Graham and Governor Terry Sanford were on the ascendant. Small farmers, workers, African Americans, women and other marginal groups advanced finally toward participation in its governance. Mayer is able to sum it up in brief but overlooks that important twentieth century turning point without which the more recent developments that she chronicles would have been far less likely. The collapsing consensus of the 1960s, upheavals associated with the Vietnam War, the ranting ultra-patriotism of George Wallace, along with Richard M. Nixon’s “southern strategy” had the effect of re-galvanizing conservatives once more in the old rhetoric. From 1970 to 2010, through the forty year period in which according to Jane Mayer, “a coterie ultra-rich of activists set out to influence U.S. politics,” it was North Carolina Senator Jesse Helms who came to represent the new political style. In a recent biography, Righteous Warrior: Jesse Helms and the Rise of Modern Conservatism, William Link provides a complimentary perspective to that of Mayer, showing how Jesse Helms exemplified the crusading militancy of the new conservatism and its bruising tactics. For millions within and outside the state, Helms became a popular symbol, the colorful “Senator No!”—at a time when the nation as a whole was drifting toward the right. Along with Mayer, however, historians have tended to overlook one of the most painful lessons given in the fact that Helms was indeed the beneficiary of the corrupt Nixon machine, which drew money from organized crime as well as foreign governments, funding electoral practices that included dirty tricks and race-baiting power-plays.3 By the 1980s, critics who once thought of North Carolina as a progressive leader now saw the state ruled by a business plutocracy that lived with a progressive myth. The hidden strategy of the Helms campaign, perpetuated by surrogates working behind the scenes, enabled the candidate to polish the image of a new evangelical conservatism that was in reality anointed in cash.4 It was an evolutionary step towards what Mayer reveals in the money-driven world of an emerging billionaire oligarchy that has shaped contemporary politics.
All of this may bring us at little closer to understanding the recent history in North Carolina. And in spite of appearances, the outrageous and perverse demagoguery of Donald Trump—the combination of threats, brinkmanship, character assassination, and the shameless exploitation of race and religion—even the intervention of the FBI on behalf of a candidate, are really nothing new even in North Carolina. But the direct influence of this powerful oligarchy through secret funding, as Mayer demonstrates, has had a huge impact that has gone under the radar for most of its citizens. What’s crucial about this is the level of development of this network and the extent of its influence both in Washington and in North Carolina.
Mayer for example offers a convincing explanation for why, in spite of the broad popularity of Barack Obama and the clear electoral majorities he achieved in 2008 and 2012, he nevertheless ran into repeated failures in the attempt to enact a legislative agenda. According to Mayer, President Obama failed to understand the influence and the extent of the massive amount of dark money flowing into congressional and state assembly races across the U.S., an influence so pervasive that “the Kochtopus” was able to rival the Republican Party itself, pushing it further to the right. As a result, legislation sought by Obama was forestalled or watered down in a variety of areas—healthcare reform, limitations on greenhouse gas emissions to roll back climate change, progressive tax reform, and regulatory laws to limit speculation and bolster the economy.5 But the influence of dark money did not stop with the immediate work of Congress or the states. The Kochs and their supporters were able to influence the wider climate of opinion through strings attached to philanthropic gifts to universities and academic programs, producing thousands of “free market scholars” at literally hundreds of campuses across the country.6
Mayer’s book indeed shows that North Carolina also provided one of the most revealing instances of the influence of dark money. The state produced its own billionaire, Art Pope, whose discount store empire made him a major contributor and a full partner in the Koch network. Pope led the way in the creation of the John Locke Foundation in North Carolina in 1990, which is dedicated to the same free market, pro-business ideology. Then in 2004, Pope joined with the Kochs and their many supporters by participating in the creation of Americans for Prosperity, a billionaire funded group that yet purports to be a grassroots activist organization. Mayer demonstrates, however, the AFP is not only dedicated to the same libertarian, anti-regulatory approach to government, it has also funded candidates and participated in direct mail assaults on Democratic candidates while operating under the federal tax code as a 501(c)4 “social welfare” organization. Art Pope, who played the lead role in funding a new free market libertarian group called the Civitas Institute in 2005, also served on the board of directors of AFP.
With campaign finance laws neutralized by the U.S. Supreme Court’s Citizens United decision, billionaire donors ramped up their efforts in 2010. Conservative candidates swept the field that year in North Carolina, creating the first Republican electoral majority in both houses since Reconstruction. By February of 2011 the same sources orchestrated a highly secretive legal action campaign using advanced computer software for the redistricting of both houses, producing a plan that was ratified that summer. In the election that followed in 2012 the Republican Party once more swept the field. But now as a result of congressional redistricting, the state’s representation in Congress shifted to a 9 to 4 Republican majority. The same strategy was employed elsewhere across the U.S., but with extraordinary success in North Carolina.
In the final weeks of the current election the attack ads and direct mail assaults accumulate, with billionaire Donald Trump managing to rivet popular attention on his candidacy. And it is often remarked that we have never seen an election quite like this one. But if Jane Mayer’s Dark Money is any indication, what’s new in North Carolina politics may leave most of its citizens in the shadows. With little public exposure of their role, Art Pope, the Kochs and their allies brought about a major reorganization of the political infrastructure.
Cracking up and repacking representative districts step by step, the operation called REDMAP effectively realigned voter constituencies. Real communities of interests were in some cases isolated or pushed to the margins, while rotten boroughs that represent the power elite were constructed. Such changes in the political infrastructure mean that long term trends have been underwritten, and none can foretell what the result will be through years ahead. Republican victories in 2012 put Pat McCrory in the governor’s mansion, installing Art Pope in the role of state budget director for the revolutionary year of 2013. With statewide expenditures slashed, teachers in some cases took actual pay cuts, teacher’s assistants were fired, and workmen’s compensation benefits were cut. Environmental protections were rolled back, with tax cuts for the wealthy and a greenlight for fracking, while short-circuiting Obamacare by opting out of its Medicaid provisions. Jane Mayer opened with the observation by Charles Lewis of the Center for Public Integrity: “The Kochs are on a whole different level…. They are the Standard Oil of our times.”7 If Mayer is right, what’s really new in North Carolina politics may be with us for a long time to come.
© copyright 2016
1 Jane Mayer, Dark Money: The Hidden History of the Billionaires Behind the Rise of the Radical Right (N.Y.: Doubleday, 2016), 26-29, 200, 230, 275, 278-279.
2 William Link, North Carolina: Change and Tradition in a Southern State, (Wheeling, IL.: Harlan Davidson, 2009), 178, 183, 188-190.
3 John L. Godwin, Black Wilmington and the North Carolina Way: Portrait of a Community in the Era of Civil Rights Protest (Lanham: MD. University Press of America, 2000), 216-217, 221-222, 226, 228-233, 252-254, 286-287; Anthony Summers, The Arrogance of Power: The Secret World of Richard Nixon (N.Y.: Viking 2000), 320-321, 395-399, 401, 406-407; Barry Sussman, The Great Cover Up: Nixon and he Scandal of Watergate (Arlington, VA.: Seven Locks, 1992), 68, 76-77, 79-87, 98-99, 102-105, 192-193.
4 William A. Link, Righteous Warrior: Jesse Helms and the Rise of Modern Conservatism, (N.Y.: St. Martins, 2008), 278-280, 284-285, 301-303.
5 Mayer, Dark Money, 170-171, 175-176, 214-216, 332, 349-351, 370-371, 374-375.
6 Mayer, Dark Money, 364.
7 Jane Mayer, Dark Money, 4-5.