Billionaire manufacturing magnate Charles Koch has for decades used his enormous wealth and political power to install elected officials, government administrators, and regulators who will keep the business interests of Koch Industries and other giant, heavily polluting companies in mind.
But Koch is also dipping into the judicial arena. One of his protegés has been nominated by President Trump and is poised to join the second-most powerful court in the United States, and Koch’s premier political spending group wants to make sure it happens.
In 2016, the Charles Koch Foundation (CKF) and a mystery donor combined to give $30 million to the George Mason University (GMU) law school, renaming it after the late, conservative Supreme Court Justice Antonin Scalia. Koch’s foundation put in $10 million, and the remaining $20 million, it was later discovered, was administered by Federalist Society officials through a 501(c)(4) nonprofit, BH Fund.
The grant established 12 new law professorships—nearly all the hires had ties to the conservative Federalist Society—and founded two ideological law school centers, the Center for Liberty and Law and the Center for the Study of the Administrative State. The founder and director of the latter center was Neomi Rao, who had been a law professor at GMU since 2012. She previously clerked for the most conservative Supreme Court justice, Clarence Thomas, and was associate counsel and special advisor to President George W. Bush. She has never been a judge.
Rao took a leave of absence from George Mason in 2017 when President Donald Trump appointed her as director of the White House Office of Information and Regulatory Affairs (OIRA), Trump’s “regulation czar.”
The dean of the GMU law school told another donor to her center, corporate lobbyist and longtime Koch ally C. Boyden Gray, that he hoped to lure her back to GMU with a $1.5-million professorship, funded by Gray, according to an email unearthed by GMU alumna Allison Pienta. “This chair would help me to entice Neomi to return home to Scalia Law after she dismantles the administrative state while serving at OIRA,” he wrote in a May 2017 letter to Gray. Gray gave another $3 million to the center, and it was renamed in his honor.
But instead of returning to the law school, Rao may be headed to the powerful D.C. Circuit Court of Appeals to fill the seat vacated by the newest Trump-appointed Supreme Court justice, Brett Kavanaugh. Rao’s GMU center hosted a conference in 2016 that featured Kavanaugh, a fellow Federalist Society member, as keynote speaker.
Rao’s judgeship nomination is perhaps the crowning achievement of the Antonin Scalia Law School’s initiative to reshape the federal judiciary. In 2017, the law school’s Law and Economics Center, which CKF had been funding for years, drew up a funding proposal for the center’s “Federal Judges and Attorneys General Initiatives.”
‘Reshaping’ the Federal Bench
“The election of Donald Trump presents a historic opportunity for a new president to reshape the federal judiciary, reform the regulatory state, promote economic growth, and restore constitutional federalism,” reads the proposal.
The program educates newly appointed judges on economics and other issues so they will “be more likely to make sound decisions that support the rule of law and the free enterprise system.” The new Federal Judges Initiative will “cover topics expected to be highly relevant to the current presidential administration’s policy agenda, such as the economics of health care and health financing, financial services regulation, environmental and energy regulation, health and safety regulation, privacy, labor and employment law, and telecommunications regulation.”
As of 2017, over 5,000 judges and 700 state attorneys general had participated in at least one Law and Economics Center program. In the 2018 fiscal year, the Law and Economic Center requested over $1.7 million for its Judicial Education Budget.
“Rao’s transition from the Koch-funded Antonin Scalia School of Law to her nomination to the second-highest court in the country is exemplary of Koch’s successful strategy of leveraging George Mason University to exert influence on the judicial branch for decades to come,” Samantha Parsons, a GMU graduate and director of campaigns at the activist group UnKoch My Campus, told Sludge. “Her nomination should serve as a warning of the anti-democratic agenda we can expect throughout our nation’s judicial system should George Mason University succeed in its goals to facilitate the education and placement of hundreds of new federal judges under Trump’s presidency.”
In December, when Trump nominated Rao, Koch’s most prominent political advocacy organization, Americans for Prosperity, endorsed her for the judgeship. But Rao has since encountered some bumps in the road. Republican Missouri Sen. Josh Hawley said he has “deep concerns,” telling Axios that she may not be sufficiently anti-abortion.
At a recent Senate committee hearing, Iowa Republican Sen. Joni Ernst expressed concerns over Rao’s 1994 essay on date rape, which alleged that women who are raped while drunk are partially to blame for being raped. Rao’s OIRA has stalled issuing an employer guidance on sexual harassment for 15 months, a process that normally takes no longer than 90 days, as David Dayen reported for The Intercept.
Americans for Prosperity will fund digital advertising and grassroots efforts in an attempt to sway public opinion in favor of Rao this week, according to Axios. On Tuesday morning, the Facebook ad archive listed six AFP ads in favor of Rao, which began running on Monday. Each ad targets one Republican senator, including Ernst and Hawley, urgin Facebook users to tell their senator to vote for Rao’s D.C. Circuit Court nomination. Additional targeted senators are Ted Cruz (Texas), Marsha Blackburn (Tenn.), James Lankford (Okla.), and Ben Sasse (Neb.). The Google ad archive did not list any recent AFP purchases.
Americans for Prosperity did not reply to Sludge’s request for comment.
‘Regulatory Obstruction’
The American Constitution Society says OIRA, which is part of the Office of Management and Budget, “has embraced politicized regulatory obstruction as its raison dêtre” under Rao. In OIRA’s 2018 report, entitled “Cutting the Red Tape,” Rao writes, “we are working to push back the expansion of the administrative state, which has placed undue burdens on the public and impeded economic growth.”
Under Rao’s leadership, OIRA, has approved sweeping environmental deregulation by the EPA. Koch Industries, which Charles Koch runs, is a giant manufacturing conglomerate with subsidiaries that refine and transport oil, create paper products, and produce chemicals. The company is among the country’s biggest air and water polluters and has paid hundreds of millions of dollars for environmental violations. Koch and his brother David are lifelong libertarians who have fought taxes and regulations for decades.
“Rao has never seen a regulation she didn’t hate, and as a judge would dismantle 40 years of environmental and social progress,” Brett Hartl, government affairs director at the Center for Biological Diversity, said in a statement to Buzzfeed News. “Her confirmation would be the most damaging and regressive yet by Trump after Kavanaugh and Gorsuch.”
GMU is by far the biggest recipient of grants from the Charles Koch Foundation (CKF), which gives tens of millions of dollars each year to free-market higher education programs. Since 2005, CKF and the Charles Koch Institute have donated nearly $129 million to GMU, including over $34 million for the free-market Mercatus Center, according to Sludge’s analysis. Another free-market-focused GMU center, the Institute for Human Studies, has received $8.7 million.
The university has come under fire for allowing the CKF to impact hiring decisions. In the case of Florida State University, CKF was even allowed to control economics curricula.
AFP isn’t the only Koch-linked group to spend money to influence the judiciary. The Center for Media and Democracy reports that Donors Trust, a donor-advised fund that wealthy conservatives including Koch use to score tax deductions and potentially anonymize their donations to nonprofits, has bankrolled right-wing groups such as the Judicial Crisis Network and its sister organization, the Judicial Education Project, which spent millions of dollars on ads supporting the Supreme Court confirmation of Neil Gorsuch. Donors Trust also funds the Federalist Society and, as Sludge recently reported, several Southern Poverty Law Center-designated hate groups.
