‘Market-Based Management’ or MBM is a business philosophy developed by Charles Koch in the early ’80’s in response to environmental regulations and federal oversight of the petrochemical industry that began to take hold under President Carter.
It was reactionary politics; the GOP and President Reagan were all too happy to get on board.
They gutted, as best they could, any sort of regulatory oversight of the oil, gas, transportation and shipping industries - and Wall Street.
They were even against air traffic controllers negotiating for safer working conditions and a shorter work week.
Reagan famously fired 11,345 striking air traffic controllers, compromising public safety in favor of market-based principles, ironically invoking the powers of the federal government in doing so.
‘Market-Based Management’ was conceived to benefit the oil and gas industry as an extension of the libertarian values Fred Koch picked up as one of the founders of the John Birch Society, whose ultra conservative ethos espoused ‘limited government’ and an anti-socialist paranoia.
Fred C Koch came into his fortune in Stalin’s Russia, beginning in 1928, by helping Russia build oil refineries and sharing a process to ‘crack’ their low grade crude oil.
‘Cracking’ refers to a molecular process in crude oil refinement that was developed by another petroleum innovator and competitor of Fred’s (Koch took this other man’s work as his own and amassed a fortune. A model that would later become the blueprint for many budding billionaires in a myriad of industries).
Fred returned to the United States and went on to found the company that would become the oil and gas industry behemoth, Koch Industries.
Two of Fred’s four sons would go on to become the most powerful players behind the scenes in Republican politics for almost forty years now, whether they care to admit it or not.
David Koch passed away in 2019 but his legacy lives on in the activist wing of the GOP, not to mention his brother Charles’ outsized influence in every aspect of Republican politics.
Ron DeSantis is among the latest ultra-conservative the Koch’s vast sums have backed.
The ‘Citizens United’ ruling was a victory that opened the flood gates for dark money’s influence on politics.
MBM’s core principle revolves around the assertion that self-regulation would serve capitalism more effectively than government oversight.
Of course this is akin to letting the fox guard the hen house: the environmental calamities that have resulted in the decades since are a direct result of this doctrine and the business practices it inspires.
If capitalism developed its own cancer it would be MBM. Instead we’re left with a capitalism that causes cancer and sees it as a cost of doing business.
The more you can marginalize and disenfranchise the communities that suffer most from these practices, the more you can protect your profits.
In that way, this whole process becomes a study in vertical integration, as the folks who routinely support Republican politicians are the ones in the states with the most environmental damage and industrial pollution.
Not to mention the free market capitalism that turned their once thriving factory towns into secondary markets for the pharmaceutical industry and the creation of an opioid epidemic that feeds on what is left of their rusty bones.
A form of avarice mixed with evil, and the inability to see human life as more valuable than profit.
The Sackler family, who along with the Kochs had their names all over Fifth Avenue museums, while poor, mostly rural people were dying as a direct result of their market-based management style and family-founded company, Purdue Pharma.
The makers of OxyContin, which earned the Sacklers the title of “most evil family in America,” probably single-handedly created several generations of drug-addicted Americans.
Destroying countless lives and families without a second thought or ounce of remorse.
MBM has also led to myriad untold worker abuses, as it created a cutthroat-everyman-for-himself-reality within companies and between management and staff.
Companies threw safety regulations out the window, choosing profits over worker safety.
Staff were cut, allowing tasks and equipment that used to be handled by several workers to be manned at times by only one employee.
We saw this repeatedly in the oil & gas and transportation industries.
Train company owners pushed for and saw track and rail car safety measures shoved aside - in an effort to streamline efficiency and build profits - over the objections of the men and women who operated this equipment and knew better than anyone the risks involved.
Workers were ignored in favor of the bottom line.
This, of course, continues to this day and was a central reason for the recent threatened strike by railroad workers that the Biden administration stepped in to avert at the 11th hour.
Obviously the issues of the rail workers need to be addressed and any bargaining between them and the rail company owners needs to be done in a way that makes it fair to the workers, without the American economy being threatened by a shut down of railways.
The enormous influence of the rail companies on both sides of the aisle but particularly within the GOP is dangerous.
Perhaps if any good can come out of the environmental and possible public health catastrophe that occurred recently in East Palestine, Ohio, it can be a brighter spotlight on the rail worker’s concerns and the dangers they face along with the American public.
Sadly, it should not have taken such an awful event to bring these issues to light.
President Obama enacted regulations to make braking systems faster on rail cars - this was, not surprisingly, repealed by the Trump administration.
Trump could be the poster boy for a lack of regulations and capitalism’s corrosive effect on the human spirit if left unchecked.
As a result of his deregulations, rail workers would routinely cut corners and staffs were thinned to bare bones skeleton crews - in favor of profit margins and stock buybacks.
This is to say nothing of environmental catastrophes.
One of the main tenets of Charles Koch’s MBM philosophy is that it is cheaper from a business standpoint to pay fines issued after the fact from gutted federal agencies than it is to stop production and repair a potential leak or safety hazard.
The EPA was essentially hamstrung under Reagan, both Bushes and Donald Trump: it became better business for polluters to pay a fine then fix a problem before it happens.
In the case of Koch Industries, who control thousands of miles of oil and gas pipeline systems in the United States and Canada, this has been disastrous environmentally but quite beneficial to the company economically.
The fact that many of these pipelines travel across and pollute on federal lands and properties seized on behalf of Koch Industries under “eminent domain” is an awful and ironic side effect of the system their ‘free market, less government’ Cato Institute principles have created.
It is seen as more fiscally rewarding to pay federal fines after a leak occurs than to shut down a pipeline and make repairs.
The cost of taking part of their vast network (enough pipeline to stretch around the globe twice) offline is measured against the potential fines a spill would incur: the company opts to take the risk for greater rewards.
No concern for the human and environmental costs.
For men like Charles Koch, nature is to be exploited and government exists to serve business - if it must be tolerated at all.
Charles even refers to this as ‘the science of business’ and founded an institute to train others in Market-Based Management.
Of course the MBM system can only work if the federal government and its regulatory industries can be de-fanged: this is why achieving that end has been a central tenet of Republican politics going back to the dawn of Reaganism.
You can make a case that it began earlier, under Nixon, but even Nixon was in favor of the EPA, having founded the agency during his administration in 1970.
In my view, the modern libertarian, anti-government oversight conservatism, spear-headed by Charles (who founded the CATO institute in 1977) and his brother, David Koch, was a reaction to the Carter administration where environmental conservation, fuel efficiency and solar energy were among his chief initiatives.
The conservative movement was aware of the burgeoning environmental consciousness and emergence of a greener, more holistic and organic philosophy among Americans and they spent millions to try and stop it in its tracks.
To kill it in its crib - to use the parlance of Steve Bannon, himself in many ways a creation of these newly formed conservative dark arts.
This was the advent of the Heritage Foundation, the Federalist Society and a host of other Washington ‘think tanks’ designed to pump massive amounts of cash into a political system - and ideology designed to protect industry at any cost.
They bought judges and congressmen and lobbyists - and they were extremely effective for decades.
Reagan was the perfect launching point for this movement as he had the telegenic ‘aww shucks’ American cowboy iconography down cold.
Behind the scenes was a ruthless deregulatory operation that has caused lingering suffering in the United States to this day.
Reagan set the template for things to come.
Reagan’s first EPA administrator, Anne Gorsuch, essentially believed in no federal oversight of industry. Her son, Neil Gorsuch, now sits on the Supreme Court, a bought and paid for partisan of the Federalist Society.
It was no accident Justice Gorsuch was Trump’s first appointment, coming straight off the short list of names provided to then President-elect Trump personally in Trump Tower by Leonard Leo in the days after the 2016 election.
Before Trump was even sworn-in the conservative activist wing was calling the shots.
Protecting and executing the objectives of the corporations and industries that rely on Republican avarice to keep the cash flowing in; Trump was all to happy to stick out his tiny little doll fingers and grab his share.
Reagan, though more refined in temperament, was the same sort of stooge for wealthier men.
His removal of the solar panels President Carter had installed on the roof of the White House was a stunt designed to troll the former President and perhaps the first salvo in modern GOP war-like doctrine to ‘own the libs’.
A mentality that hordes show up to support, Trump’s incendiary and completely pathological criminal enterprise of a presidency.
Ignorance runs deep: when the world seems complex and scary people fall for conmen and hucksters if they can tell them what they want to hear, and most especially if they can tap into their anger and sense of disenfranchisement.
Reagan did this with his attacks on the poor and his racist invocations of ‘welfare queens’ meant to fuel resentment in working and middle-class white folks - and it worked.
They voted Reagan into office twice - he rewarded them by stealing their futures and gutting their towns.
Now Trump attempts to step back on the stage for round three, in this dystopian reality that he helped create during his first term in office.
Touching down in his private 757 airplane and handing out MAGA hats to cheering throngs of white folks in an Ohio town - that most likely will be toxic to all life for years to come.
You can say the same thing about Republican policies and politicians.
A caustic threat to all sentient beings, while acting as henchmen and handmaidens for the American oligarchy.
Vote Democratic in the next election as if your life depends on it, as it very well may - if ‘Market-Based Management’ has any say in the matter.
I'd love to see Noel take a deep dive into the greatest scam of all - drug prohibition. Once a nation is driven by fear into making laws that raise the price of a hit of heroin from that of a tablet of aspirin to $20, the mechanics are set for cartels to unleash death and destruction magnitudes greater than the drug itself could ever garner.
Truth