Charles Koch’s Disturbing High School Economics Project Teaches ‘Sacrificing Lives for Profits’

Damian Gadal / CC-BY-2.0

Charles Koch is known for being CEO of industrial giant Koch Industries and a chief financier of the massive conservative political operation he runs with his brother David. In recent years, student activists and investigative journalists have exposed another of Koch’s hats: mega-donor to hundreds of colleges and universities, often funding free-market-focused academic centers housed at public and private schools alike. One Koch-funded program is advocating cutthroat economics to grade school students, even sacrificing lives for profits.

Anti-tax industrialist billionaires like Charles and David Koch stand to gain a lot by financing higher education programs tailored to their ideologies. Richard Fink, the Kochs’ right-hand man for decades, laid out their “Structure of Social Change,” the plan they devised in the late 1970s to shape society with their libertarian ideals. The plan begins with funding academic programs that favor laissez-faire economics, resulting in academic papers promoting the free market and chastising regulation and taxation. Next, think tanks they fund repackage the academic work into more easily digestible policy proposals that “citizen activists” (actually Koch-funded “social welfare” groups like Americans for Prosperity) use to pressure lawmakers.

From 2005 to 2014, the Charles Koch Foundation doled out nearly $108 million to colleges and universities. The school that has accepted the second highest total from the Charles Koch Foundation from 2005 to 2014 is Florida State University, whose economics department entered into a 2008 agreement that gave the foundation a say in its curriculum and hiring decisions, as Dave Levinthal of the Center for Public Integrity reported. One part of the 2008 agreement, which proposed a $6.6 million budget to be funded by the Charles Koch Foundation and unnamed “Donor Partners,” established a “Program for Excellence in Economic Education” within the Gus A. Stavros Center for the Advancement of Free Enterprise and Economic Education, part of the economics department. Annual reports confirm these funding arrangements.

The 2008 Koch agreement also funded professorships, postdoctoral fellowships, an undergraduate program and administrative costs for the “Program for the Study of Political Economy and Free Enterprise,” part of the Stavros Center as well.

The Stavros Center promotes “Common Sense Economics,” a free-market-focused book coauthored by the director of the Stavros Center, James Gwartney, and accompanying course materials for economics teachers all the way down to the kindergarten level. The center, along with programs at other colleges and universities, hosts workshops for teachers who want to offer Common Sense Economics courses at their schools; one such workshop occurred on February 4-5 of this year, hosted by the Excellence in Economic Education program.

Under “Readings Reflective of Common Sense” on the “Fun Readings” page of the Common Sense Economics website, one probably not-so-fun selection sticks out. “Sacrificing Lives for Profits,” written by Common Sense Economics coauthor Dwight Lee, actually argues that we’d all be better off if companies cut corners, even risking customers’ lives, in the name of profit: 

“The charge that sways juries and offends public sensitivities … is that greedy corporations sacrifice human lives to increase their profits. Is this charge true? Of course it is. But this isn’t a criticism of corporations; rather it is a reflection of the proper functioning of a market economy. Corporations routinely sacrifice the lives of some of their customers to increase profits, and we are all better off because they do. That’s right, we are lucky to live in an economy that allows corporations to increase profits by intentionally selling products less safe than could be produced. The desirability of sacrificing lives for profits may not be as comforting as milk, cookies and a bedtime story, but it follows directly from a reality we cannot wish away.”

Lee gives the example of expensive safety features in cars. With cheaper, less safe cars, he argues, consumers would be free to spend more money on (overpriced) education and (overpriced) health care, ignoring compelling economic arguments for free education and single-payer health care, both of which might have a chance if it weren’t for the extremely low tax policies he no doubt supports. The longer life expectancy that comes with more education and health care, he thinks, far outweighs the occasional traffic death due to dangerous automobiles, yet he apparently overlooks the fact that the healthiest, most highly educated individual could die in an instant from poorly manufactured brakes or shoddy paneling.

Dwight Lee is a senior fellow with the O’Neil Center for Global Markets and Freedom in Southern Methodist University’s business school, which has held discussions featuring sweatshop proponent Benjamin Powell of Texas Tech University. SMU, based in Dallas, Texas, received almost $586,000 from the Charles Koch Foundation from 2005 to 2014, and the school just announced a $3.5 million grant from the foundation, along with $3.5 million more from Rick Perry mega-donor and Ted Cruz supporter Darwin Deason, to found a criminal justice reform center. As it turns out, the O’Neil Center has teamed up with the Libre Institute, part of the Kochs’ effort to engage Latino voters, to run free enterprise teaching programs.