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july 2010 THE QUARTERLY NEWSLETTER OF KOCH COMPANIES Expansive mood Earlier this year, Georgia-Pacific credits the financial strength and risk- “We’re taking that chance for two announced that it intends to invest taking mentality of GP’s owner, reasons,” Luetters said. “First, because roughly $500 million in new tissue- Koch Industries. we believe things will get better. And papermaking technology. ABCs of OSB second, because we’re confident these On May 25, Georgia-Pacific closed assets can do well even when things Oriented strand board, or OSB, is an are tough.” on the $400 million acquisition of engineered structural panel. It is made oriented strand board facilities from by arranging compressed wood strands Steve Feilmeier, Koch Industries’ CFO, ’s Grant Forest Products, Inc. in perpendicular layers and bonding agrees, comparing this purchase with GP's growth continued when it closed them together with resin. the acquisition of Farmland’s in July on the acquisition of Parsons Much like ply- plants and terminals seven & Whittemore’s Alabama River and wood, OSB is years ago. Alabama Pine pulp mills in Perdue Hill, commonly used “A down market in the Ala., along with other related assets. in both residential fertilizer industry enabled Details and commercial us to put capital to work construction for at a time when few others The Grant Forest Products acquisition sub-flooring, roof were willing,” Feilmeier included Canadian facilities in Earlton sheathing and ex- said. “Those assets and Englehart, Ontario, as well as plants terior sheathing. are now very strong in Allendale and Clarendon, S.C. Oriented strand board being manufactured at According to GP’s newly acquired plant in Allendale, S.C. performers for us.” industry sources, About 350 employees already work at Stars in Alabama three of those facilities. Another 50 OSB panel production in North Amer- are expected to work at the Clarendon ica jumped from about 750 million As a result of the Parsons & Whit- plant when it opens. square feet in 1980 to 25 billion square temore transaction, GP is now the feet in 2005. “This is our biggest acquisition since largest market pulp producer in North becoming a Koch company in late That growth came to a screeching halt as America and fifth-largest worldwide. 2005,” said Mark Luetters, president of a result of the global recession. “Our vision is to become the leading, Georgia-Pacific Wood Products. “It’s a In fact, the timing of the Clarendon global supplier of cellulose-based prod- strategic, long-term investment. opening is largely dependent on the ucts,” said Pat Boushka, GP Cellulose “These are world-class facilities and North American housing market, which president. “This acquisition advances very complementary assets. From a has seen a dramatic drop in new home us towards our vision while creating strategic point of view, they are a very construction. more value for our customers.” good fit with our current wood prod- Calculated chance In addition to its Atlanta headquarters, ucts operations.” Luetters calls the acquisition a “calculat- GP Cellulose has commercial offices in Luetters believes GP’s size and liquidity ed chance” in light of today’s depressed Hong Kong; Montevideo; Shanghai; helped make the deal possible. He also construction market. and Zug, Switzerland.

this issue… Decision time pg 4 100-year-old Knight pg 7 2010 EH&S winners pg 6 Perspective: Rich Fink pg 8 Postal Pipeline

As a GP employee, the article entitled This has increased the abundance and “Watching the Office” in the April issue diversity of wildlife on their property, of Discovery caught my attention. benefiting both wildlife and their The average use per square foot livestock operation, as well as plant at the Koch tower in Wichita was given health, water quality, and general as 169 kBtus. rangeland health. How does that compare Carter Smith with the Georgia-Pacific Executive director tower in Atlanta? Parks & Wildlife Department Austin, Texas Pablo G. Dopico R&D group leader On May 15, Dave Robertson, president and COO of Georgia-Pacific Chemicals Koch Industries, spoke at the commencement exer- Decatur, Ga. cises for his alma mater, Emporia State University. Less than a week later, Robertson received this letter The GP tower (which is 10 years from a father whose twin daughters have both gradu- older and 44 stories taller) is averag- ated from ESU. ing 300 kBtus; however, the U.S. EPA Koch company employees can learn more about prefers to use overall ratings rather important issues affecting all of us by visiting I attended the ESU graduation com- than kBtus when comparing buildings. http://kcief.khc.local/. While at home, visit www.kochind.com and click on Viewpoint. mencement and wanted to say I The Koch tower has a rating of 93, which means it especially enjoyed and appreciated is more energy-efficient than 93 percent of all office your address. buildings in the United States. Thank you very much for your support According to Stacy Shirley, chief engineer for the man- of Science Olympiad in . Our Your speech was agement company responsible for GP’s headquarters homeschooled kids have benefitted a welcome breath in Atlanta, that building has a rating of 63. greatly from this program. of fresh air. I That is well above the national average of 50, and up feel this coun- eight points from last year’s rating. Further improve- Chris Hall try needs more ment is expected this year. Mary Beth Doty people standing Margie Hubbard up for hard work, High Plains Home Educators Thanks in part to Flint Hills Resources, creativeness and Garden City, Kan. my daughter, Ashley Alexander, now has our country’s way. a bachelor’s degree in Business Admin- Thank you for istration from Texas A&M University On May 26, Matador Ranch was honored with a Lone your words and – Corpus Christi. Star Land Steward Award from the Texas Parks and enthusiasm. Our Wildlife Department. Following are comments by Dave Robertson, KII’s president and I want to thank Flint Hills Resources for that agency’s executive director. children need the CEO. Photo courtesy of Dick Garvey, its promotion of post- same country University Photography. high school education The Matador we inherited. Ranch is unique, in our community. David Gonzales in part simply Flint Hills’ dedication Owner, Achieve Rehab because of its to young adults in our Great Bend, Kan. community is priceless. sheer size and the commit- Letters and other submissions become the property of Koch Ashley’s college years ment and scale Industries, Inc., and may be reproduced in whole or in part, were a wonderful including your name, for any purpose and in any manner. of the steward- Letters may be edited for length or clarity. growing experience ship occurring that you made pos- on the ranch. July 2010 | Volume 16 | Number 3 sible. Thank you again Discovery for promoting and They are man- Editorial Board Questions? Comments? aging nearly Philip Ellender Contact: Rod Learned supporting education Koch’s Matador Ranch is spread across five Texas counties. Rich Fink 316.828.6136 for my daughter and 130,000 acres Jeff Gentry [email protected] of important wildlife habitat using in- Dale Gibbens the youth of Corpus Christi. Mary Beth Jarvis Publication Design: novative and beneficial practices such as Kayla Knight Jim Mahoney Koch Creative Group Katherine Alexander prescribed burning, rotational grazing Dave Robertson Corpus Christi, Texas and brush management. www.kochind.com ©2010, Koch Industries, Inc. Koch is an EOE. M/F/D/V 2 International News

Paris - Queen Noor of Jordan with Imran Jaferey, vice president Shanghai - produces spandex fiber in Monterrey - Water damage from Hurricane Alex of water and wastewater, Koch Membrane Systems. Shanghai, Foshan and Lianyungang. was extensive.

France – Queen Noor of Jordan at- INVISTA not only maintains offices in the world,” said Jeff Gentry, president tended an April 26 awards ceremony in Beijing, Shanghai, Guangzhou and the of INVISTA, “but especially in the Paris where Koch Membrane Systems Hong Kong Special Administrative Re- Asia-Pacific region where economic was honored as the Water Technology gion. It has several plants and ventures growth continues to be promising. Company of the Year by the Interna- in mainland China, especially along the “In China, for example, we will be add- tional Association. industrialized coast. ing even more spandex capacity later That award – voted on by IDA mem- These include manufacturing sites in this year.” bers, among others – is given to “the Shanghai that make spandex, nylon BCF Gentry notes that all of INVISTA’s company which has made the most and airbag fiber, and a fiberfill facility businesses are seeing increased demand. significant contribution in the field of in Suzhou, Jiangsu Province. Spandex That demand, combined with improved water technology.” is also made at facilities in Foshan, margins, is reflected in the company’s KMS was chosen for its commit- Guangdong Province, and Lianyungang, much-improved performance. Jiangsu Province. ment to the design, manufacture and “In fact,” notes Gentry, “June was commercialization of MegaMagnum® INVISTA has an office in Taipei, probably our best month in more than reverse osmosis elements and pressure Taiwan, and operates a textile research two years.” vessels. A single MegaMagnum unit center in Tao Yuen County in Taiwan. Mexico can process 2 million gallons of water That center is close to an apparel manu- – Although Hurricane Alex was not a significant factor in efforts to deal per day. facturing plant. with the Gulf oil spill, the Category 2 “We have invested heavily over the last Although INVISTA recently signed storm did bring torrential rainfall to 10 years, developing outstanding tech- an agreement to divest its bedding- portions of northern Mexico. products business in China, the nologies and improving our manufac- Floodwaters there caused significant company’s overall direction in Asia turing capabilities,” said , damage to the homes of six employees is one of growth. president of KMS and executive vice who work at INVISTA’s nylon and president of Koch Industries. To the north, INVISTA has sales and LYCRA® fiber production facility in “We are very pleased to accept this administrative offices in South Korea Monterrey. award, which recognizes our success and Tokyo and Osaka, Japan. In Siga, Damage to that facility was slight, but and the difficult task of driving technol- central Japan, a co-owned plant makes ™ the area’s infrastructure – especially its ogy change in this market.” spandex and T400 fiber. roads – will require extensive repairs. Asia-Pacific – When most people think To the south and west, INVISTA has Following the storm, INVISTA promptly about INVISTA’s presence in Asia, they offices in Thailand, , Australia and made financial donations to a local relief immediately think of China. After all, Singapore, where the company has a agency and area fire departments, and INVISTA has built, bought or expand- spandex venture facility in the Tuas also arranged the donation of 20 com- ed assets worth hundreds of millions district of western Singapore, and an puters to damaged schools in the area. intermediate chemical plant at Sakra on of dollars there since becoming a Koch Meanwhile, INVISTA employees in company in 2004. Jurong Island. It has also added a nitric- Monterrey, Queretaro and Mexico City Even so, few people realize just how acid production at the Sakra site. raised the equivalent of nearly $6,000 extensive INVISTA’s presence in the “We are working to capture profitable so their affected co-workers could buy Asia-Pacific region has become. growth opportunities everywhere in new furniture. 3 Decision time

After wrestling with the worst recession But these actions further undermined 3.7 percent rate in the first quarter. in a lifetime, many governments are true prosperity. That compares with growth rates of now facing an even bigger economic With the government directing the 5.1, 9.3, 8.1 and 8.5 percent in the first challenge: what to do next. economy, resources went to satisfying four quarters following the next-worst While the issues are complex, the political desires rather than the desires recession since World War II. debate over next steps essentially boils and values of individual consumers. On the other hand down to two schools of thought: Of course, since there was no cash on So, if individuals and businesses have First, there are those who urgently insist hand for those programs, governments decided it’s wise to trim their spending we need to spend more – even if it requires borrowed and central banks created and pay down debt, what are govern- borrowing money – in hopes of stimulat- even more money to fund these efforts. ments doing? Just the opposite. ing something better. What then? In fact, additional deficit spending by On the other side are those who insist Many families and businesses are now the U.S. government has more than we must get in the habit of spending less slowly paying down their debts and offset any private sector improvements. and paying down debts to avoid making spending less, especially for things that things even worse. Keep in mind, this additional govern- aren’t essential. That’s why sales of new ment spending is financed with bor- Everyone agrees that the consequences homes and automobiles (overbuilt due rowed money. Most governments were of a wrong decision could be enormous. to easy money and government subsi- already running serious deficits before What happened dies) have slumped. they tried to stimulate any recovery. For years, individuals, businesses and When the U.S. government tried to According to the International Mon- governments lived far beyond their stimulate sales of etary Fund, means. They borrowed excessively at those products advanced econo- government-induced, artificially low (through the mies – like those interest rates and then went on spending “cash for clunk- of the United sprees. ers” program and States, Japan and first-time home Europe – now All that spending appeared to be great for buyers tax cred- have public debts the economy, which grew at a rapid rate its), sales briefly that are averaging because of artificial stimulation. But what rose, but then more than 110 was growing even faster was a mountain dropped after percent of gross of debt and bad investments. Conse- the programs quently, when the economic meltdown expired. domestic prod- began in 2008, its effects were fierce. “The federal budget appears to be on uct. (Emerging The drop in de- economies, such As the recession spread from the mand for goods an unsustainable path.” as India and United States to Europe and beyond, and services - Ben Bernanke China, are below credit downgrades and defaults reached created a decline 40 percent.) record levels. The global financial sys- in industrial Chairman, U.S. Federal Reserve tem appeared to be near collapse. production that At some point, a nation will have no reasonable hope Home values, prices, stock was seen around the world. In Japan, in- of repaying its debts. The inevitable values, currency rates, interest rates dustrial production dropped 40 percent result is some sort of default, whether and fixed income assets collapsed. from its early 2008 peak. Even China through outright bankruptcy, a restruc- Unemployment rates began to soar, ag- suffered. turing of payments or devaluation of grevated by government barriers to the Since so much of the world’s economy the currency. mobility of employment. depends on consumer spending, this What now? Governments in the European Union newly frugal behavior has meant a and the United States reacted by slow-growth economic environment. Michael Hofmann is chief risk officer for pouring trillions of euros and dollars The U.S. economy grew at an annual Koch Industries. He also serves on the into “relief” and “stimulus” programs rate of just 2.4 percent in the second Economic Advisory Council of the U.S. intended to restart the economy. quarter of this year, following a revised Federal Reserve Bank in Kansas City.

4 Hofmann and his team have spent of cutting spending and repaying debt. In come with the liabilities incurred by the several months analyzing the global the United Kingdom, newly elected Prime current generation.” economic situation and assessing the Minister David Cameron and his coalition Hofmann agrees: “While painful and government are doing the same. risks involved with doing business in slow in the short term, it is essential this environment. Britons have been told that a difficult that we allow our economy to adjust. period of “new austerity” is unavoidable The good news, he says, is that the “If politicians try to intervene and global recession appears to have bot- if there is to be any hope of cleaning prevent or postpone this necessary tomed out…for now. up their dire fiscal mess. (Government spending in the United Kingdom – as adjustment, we run the serious risk of “In general, the Asia-Pacific region a percentage of GDP – is even higher not just a double-dip recession, but a fared better than the rest of the world,” than that of hapless Greece.) true depression.” Hofmann said. “By comparison, Europe But, if we prevent further damage and is in much worse shape begin to reverse the and the United States is harm already done, he somewhere in between.” “The larger the government says, we should be able However, Hofmann’s to achieve positive long- near-term expectations gets, the lower your growth rate term growth rates. are sobering. He thinks becomes.” the economies of the “It's important to real- United States and Europe - Michael Hofmann ize that prosperity is are likely to be in a rela- Chief Risk Officer, Koch Industries dependent on economic tively weak, slow-growth freedom. As citizens, are mode for several years. we going to advocate for economic freedom, or Hofmann says recover- bigger government and ies following serious lower well-being?” housing busts and credit crunches typi- Fundamental differences cally take four or five years as banks and Taking action households focus on the hard work of Daniel Tarullo, a member of the U.S. If you are a Koch company employee rebuilding their finances. Federal Reserve’s board of governors, in the United States and are concerned believes Europe’s experience “is another The process for a government to get out about government debt and overspend- reminder, if one were needed, that every of debt is even harder, especially in a ing, you should let your elected officials country with sustained budget defi- slow-growth environment. know about your concerns. cits and rising debt ... needs to act in a Debt binge timely manner to put in place a credible One effective way to speak up is by visit- In Europe, assistance to Greece and program for sustainable fiscal policies.” ing the Koch Companies Issues Educa- other nations has already cost Euro- That sort of thinking does not sit well tion Forum at http:kcief.khc.local/. pean taxpayers far more than expected, with those urging the government to Click on “Want to get more involved?” causing some to balk at any notion of spend even more borrowed money on for an easy way to directly contact your taking on further debt to bail out over- further “stimulus” for the shaky econo- elected officials. extended economies. my. They say we haven’t spent enough. Whenever and wherever possible, it’s The government of disagrees Many who might have agreed with that important to put your words into action with taking a conservative approach, policy a few years ago now disagree. at the ballot box. Always exercise your rights to vote and to make your voice and suggests that even more must be “There is nothing progressive about a heard by policymakers. done – if necessary – to preserve the government who consistently spend European Monetary Union. more than they can raise,” insists Lord If you’re not registered, get registered In the midst of all this disagreement, Myners, a high-ranking member of today. The U.S. general election is less there are some encouraging signs. Britain’s former Labour government. than three months away, on Nov. 2. Ireland’s government, for example, has And, he adds, there is “certainly nothing Your future depends on being an edu- already settled down to the painful task progressive that endows generations to cated and motivated citizen.

5 EH&S Excellence Atlanta was the host site for KII’s that you are serving as role biggest-ever Environmental, Health models, helping others fol- and Safety Conference in May. A re- low in your footsteps.” cord 350 EH&S professionals attended And the winners are… the event, which included an awards ceremony honoring six teams from five Georgia-Pacific, which different Koch companies. had two EH&S winners In his opening remarks, Charles Koch, in 2009, continued its KII’s chairman and CEO, stressed not winning tradition with two only the necessity of EH&S excellence, more winners this year. but the op- Flint Hills Resources, (L-R) Jim Mahoney (KII), Lucinda Legel and Lowell Miller-Stolte (FHR - Pine portunities that INVISTA and Koch- Bend), Sheryl Corrigan (FHR - Wichita) and Charles Koch. FHR was one of six 2010 EH&S Award winners. excellence can Glitsch also were repeat create. winners. Koch Fertilizer Canada won Koch-Glitsch uses the new facility to for the first time. measure mass transfer efficiency and the “If we can hydraulic capacity of the “internals” the become clearly Allen Lasater, who is now the president company designs for processing plants. superior in all as- of Koch’s Reiss Remediation business, pects of EH&S,” helped plan this year’s conference. “We recognized right away that this project required more expertise than we said Koch, “we Lasater, an 18-year Koch company had,” said Randy Hardy, project leader will be able to employee, likes the fact there are no succeed where automatic wins (such as one per com- for Koch-Glitsch. “So we reached out others can’t. This pany) or limits on the number of times to several other Koch companies for the will enable us to a company can win. He believes this knowledge that we needed. grow and pro- approach is more in keeping with our “I think that’s a pretty good example vide superior job MBM culture. of principles six and eight (knowledge This year’s conference and awards opportunities.” ceremony were held in Georgia-Pacific’s “We’ve always emphasized Market- and humility) in action.” Koch outlined hometown, Atlanta. Based Management® when choosing Once Koch-Glitsch received that valu- three sets of winners,” Lasater said. “But I think able input, they were able to design the initiatives for achieving even higher this year we really stressed our Guiding standards of EH&S excellence. pilot plant in a way that went beyond Principles in a more explicit way. the EH&S standards typical in the The first involved building understand- “These awards provide very specific, mass transfer industry. ing and commitment to the new vision real-life examples of what EH&S excel- for Compliance and EHS excellence. “Our team made decisions to go lence looks like and how we can em- beyond current environmental rules,” That vision is currently being rolled out ploy our Principles for greater success. to all Koch companies. said Hardy, “which enabled us to not “Koch-Glitsch, in particular, provided only reduce boiler emissions but elimi- The second initiative was culture- an example everyone can learn from.” nate a number of potential leaks.” based, with a heightened focus on the MBM® Guiding Principles. That focus New kid in town requires commitment from every em- Koch-Glitsch won for the enhanced 2010 EH&S Award Winners ployee in every role. knowledge sharing Koch Fertilizer Canada – Brandon, Manitoba Third, Koch that helped make emissions reduction stressed the im- its new pilot plant portance of better a reality. Flint Hills Resources () – Rosemount, Minn. knowledge sharing Pine Bend asphalt hydrogen sulfide reduction That structure, and more effective completed in March Georgia-Pacific Consumer Products LP – Atlanta, Ga. risk management of this year, was the Improved sustainability of transportation resources systems. “We need first new addition to increase our rate Georgia-Pacific containerboard mill – Brewton, Ala. to the 100-acre Significant opacity reduction of learning and Wichita campus improvement.” Wichita – Koch-Glitsch uses this award-winning R&D since the tower Koch-Glitsch – Wichita, Kan. Charles Koch con- unit to test distillation and heat transfer processes. building opened Enhanced knowledge sharing during pilot plant construction cluded his remarks in 1992. It is also INVISTA – Camden, S.C. by saying: “I congratulate all the award believed to be the largest pilot plant of Reduced energy intensity performance winners today. This achievement shows its type in the world. 6 Looking Back

Noteworthy

The Big Ripoff–by Timothy P. Carney There is a popular perception in the United States that big business is locked in a death struggle with big goverment. A best seller: M.A. Knight (1883-1956). FLEXERAMIC® structured packings. These two philosophical opposites, we are told, are mortal enemies. The truth, as Carney repeatedly points Centennial celebration out, is almost exactly the opposite. Today, most big businesses are eager to When Maurice A. Knight graduated War I, a serious recession in 1921 (at the “jump into bed” from Buchtel College in Akron, Ohio, time it was called a depression) and the with big govern- many of his classmates pursued jobs in Great Depression. ment rather than that state’s booming rubber industry. Knight managed to survive by innovating promote free But Knight was more interested in the new product lines such as laboratory markets. possibilities of stoneware, especially the sinks, stoneware piping and hospital The reason is kind used in chemical manufacturing. fixtures (introduced in the late 1920s), simple: big gov- In 1910, Knight risked everything by and PYROFLEX® membranes for tank ernment can pre- buying a local pottery firm. His vision linings (developed in the mid-1930s). vent competition, was to produce a better kind of chemi- New horizons provide subsidies cal stoneware. and guarantee the David Koch’s respect for this technol- markets that allow Competitors ogy led to the 1981 purchase of several corporatism to flourish. One hundred years ago, Knight’s prima- Knight assets. These were later merged Big government can also threaten and ry competition was vitrified stoneware into Koch Chemical Technology Group. bribe businesses in order to achieve imported from England and Germany. Since then, Koch Knight has opened sales policy goals. Although cheaper and easier to get, do- offices in Canada, Australia and Brazil, It is interesting to note that this book mestic stoneware of that era was crude and acquired additional manufacturing was written when George W. Bush was by comparison, and much less durable. capacity in East Canton, Ohio, and a president and Republicans still had a fabrication facility in Baytown, Texas. majority in both houses of Congress. Most U.S.-made vessels were thick and heavy, and relied on glazes to Koch Knight is now one of the world’s “The truth,” writes Robert Novak in his withstand chemicals. largest manufacturers of ceramic and introduction to Carney’s book, “is that heat transfer packings. It also engineers, this is a bipartisan affliction transcend- Knight had excellent technical knowl- manufactures and installs industry- ing party and ideological lines.” edge of both clays and chemical pro- leading membrane, brick and mortar cesses. He was soon making vessels that acid-proof systems. were fully vitrified, glaze-free and tough The company’s centennial celebration TheWashington Examiner recently enough to be cast in large sizes. was held July 10 in Canton. More than published an article entitled: “What if Setbacks all businessmen were as dedicated to 80 employees and their guests were free markets as the Kochs?” At first, customers were skeptical. Some invited to the event, as were customers insisted on trial runs of anywhere from and local officials. The article includes an in-depth Q&A six months to two years. with Rich Fink, whose editorial appears Mike Graeff, president of Koch Knight, on page eight of this issue of Discovery. Meanwhile, Knight had to rely on sales spoke at the celebration. Go to http://kcief.khc.local/ and of common pottery items such as jugs, “We’ve got a truly talented group of people look under New Posts to read the story. jars and butter crocks to pay the bills. here who really know what they are doing The quality of KNIGHT-WARE®, which and know how to create value for our was marketed as “acid-proof” and “guaran- customers and for Koch,” Graeff said. “Governments never learn. Only teed satisfactory,” eventually won over the “I’m confident we’ve got even more in- people learn.” skeptics. Business quadrupled in five years. novation and growth ahead of us.” - Milton Friedman Then came a series of setbacks: World www.kochknight.com Too True Too 7 Rich Fink Perspective Executive vice president - Koch Industries, CEO - Koch Companies Public Sector, LLC

If you truly want to make the world a And yet, despite clear lessons from the principles of liberty and personal re- better place, it helps to know the best past, many of the same misguided sponsibility that helped the U.S. become ways of reaching that goal. policies that have devastated other productive and prosperous. nations are now finding a home in Koch Industries, Inc. and Koch founda- There is too much to lose if we do not the United States. tions have spent more than 40 years and speak up – both to our elected officials millions of dollars to sponsor research History repeating itself? and at the ballot box. aimed at discovering what makes societies After decades of government growth Solutions thrive over time. and spending in the United States, we now see many disturbing parallels with Three-fourths of all Koch company What we’ve learned South America’s failures. employees live and work in the U.S. after studying both his- What happens in this country inevitably tory and theory is fairly If you look at the past 10 years of affects employees elsewhere – for better expanding government bureaucracy, simple and straight- or for worse. forward: economic spending and debt, it’s clear the U.S. is When it comes to public policy, I be- freedom and market- losing ground. As a nation, we are no based policies create the longer generating prosperity for society lieve the U.S. – not to mention much of most opportunity and as a whole. Europe – has been headed in the wrong prosperity for citizens. We will continue to lose ground until direction for quite some time. This is especially true government policymakers understand Republicans and Democrats alike have for the poor, who are far that more spending, more debt, more been fiscally irresponsible, spending better off in free societies. regulation and more centralized con- more than they should and borrowing trols of every aspect of life cannot make like there’s no tomorrow. Those who think market-based policies us better off. are all about benefiting the corporation As a nation, we are, quite literally, going at the cost of the individual or society The simple truth is that many of the bankrupt. have lost sight of the bigger picture. “new” or “progressive” policies being promoted in the U.S. are old ideas that The upcoming elections in November Economic freedom not only fosters have failed throughout history. will provide a prime opportunity to help innovation and greater productivity, it steer things in a different direction. leads to better environmental pro- Why in the world would we want to tection, health and quality of life for repeat such serious mistakes? By educating ourselves on the issues and society as a whole. The stakes voting for those candidates that support economic freedom and prosperity, we Tough lessons What’s at stake in this struggle is the have a chance to make a difference. future of the United States. Studying history also reveals a painful To solve our nation’s problems for the truth: Too many societies have under- Americans who are concerned about long term, we must remain principled mined their own prosperity by institut- our future must speak out if this course and pursue practical, thoughtful solu- ing policies that undo what originally toward economic ruin is to be reversed. tions – solutions than can actually be made them prosperous. Tea parties, for example, reflect a implemented. As our chairman and CEO, Charles spontaneous recognition by thousands Koch, wrote in his January Discovery We need our employees and all citizens of Americans that if they do not act, the to speak out about government spending. editorial, Argentina and Venezuela are government will bankrupt their families That is the best way to get policymakers modern-day examples of this. and the country. focused on the serious problems that Both of these nations allowed govern- Although our efforts to draw attention to spending and unbridled debt are creating. ment bureaucracy, spending and deficits government overspending pre-date re- to drag down their standards of living. cent tea parties Koch Industries and Koch foundations They transformed themselves from free by many years, We have a chance will continue to advocate for economic and prosperous societies into nations we certainly to make a difference. freedom and market-based policy solu- burdened by unemployment, escalating applaud citizens tions because they are proven pathways taxes and runaway inflation. becoming more engaged in key policy is- to prosperity for all. We’ve tried to help people understand sues. We encourage robust and respect- To paraphrase Winston Churchill, a and apply the lessons of history so they ful discussions. market-based approach to public policy can respond to society’s challenges with Citizens must hold lawmakers account- may not be perfect, but it beats all the better, more productive policies. able for upholding the Constitutional other alternatives that have been tried. 8