Billionaire Charles Koch — who again sits atop Forbes’ annual list of World’s Richest People list — plays a significant role in American business and politics.
His words are few and far between. So, when Koch sat down with the Wichita Business Journal to discuss his empire and the cronyism that continues to cripple American capitalism, people listened.
“I think one of the biggest problems we have in the country is this rampant cronyism where all these large companies are into smash-and-grab, short-term profits, and that’s true even at the local level,” Koch explained.
Companies have created an environment in which entering an industry comes at a serious cost that off-sets innovation and economic development. Cab drivers can pay anywhere from $100,000 or $300,000 to get a medallion to drive a taxi, while hairdressers must pay for a two-year education for a license to style hair.
Koch freely admits the subsidies in place are ideal for large companies like his because they make more money through a marketplace that is difficult to enter.
“But for the country as a whole, it’s horrible. And, for disadvantaged people trying to get started, it’s unconscionable in my view. I think it’s in our long-term interest, in every American’s long-term interest, to fight against this cronyism. When a company is not being guided by the products they make and what the customers need, but by how they can manipulate the system — get regulations on their competitors, or mandates on using their products, or eliminating foreign competition — it just lowers the overall standard of living and hurts the disadvantaged the most. We end up with a two-tier system. Those that have, have welfare for the rich.”
As an expert in many facets of life, Koch now says his No. 1 focus is “to change the national conversation from name calling to a real debate on what policies will best create opportunities to improve [Americans'] own lives.”
Koch values integrity and would rather pursue the interest of a strong America than going after what makes the most sense financially for his company.
“Yeah, we want hope and change, but we want people to have the hope that they can advance on their own merits, rather than the hope that somebody gives them something. That’s better than starving to death, but that, I think, is going to wreck the country. Is it in our business interest? I think it’s in all our long-term interests. It’s not in our short-term interest. And it’s about making money honorably.”
Forty-seven years have passed since Koch took the reigns as CEO of the country’s second-largest private company, Koch Industries, whose headquarters were intentionally set in Wichita.
Koch understands that he is under public scrutiny for his involvement with conservative political advocacy group Americans for Prosperity and remains unapologetic for helping fund an organization that has the intent to affect policy that would increase opportunity for all Americans.
He was excited to mention a new partnership with Discovery Channel personality Mike Rowe. The two household names are working together to convince young people that a four-year degree is not their only option for success, despite messages that private loan companies and colleges continue to push in order to ensure a hefty crop of incoming students every fall.
A subsidized education does not buy influence in an industry, whereas a high-paying job as an electrician can make a difference.
“They become wealthy because they are satisfying a real need, not because somebody subsidized them and pushed them into things they can’t really make a contribution in,” Koch said.
The allegations Koch and his brothers have faced through the years can be frustrating, especially when he rarely speaks out against the way his family is portrayed.
Koch knows his most recent words in the February interview will indict more name-calling, some of which will certainly be unpleasant but he is on a mission that cannot be stopped.
“Somebody has got to work to save the country and preserve a system of opportunity… There doesn’t seem to be any other large company trying to do this so it might as well be us,” added the untouchable Koch.