movement, which was aimed squarely at breaking up the kind of opaque and powerful business enterprises that he’d spent his life creating. The government eventually split Standard Oil into multiple competing firms.
But all the bad blood over Rockefeller seemed to have dissipated by the 1960s. At that time, the United States was the nation of the oil gusher. America was the biggest oil producer and seemed to have a limitless supply of the geological treasure. Oil was the primary energy source of America’s industrial economy, and it became the raw material of its economic growth. Dark crude oil was an embodiment of America’s special place in the world and its unrivaled economic supremacy. During this era, the United States developed a deep dependency on its oil companies. The well-being of the economy itself and the price of oil became intertwined. Ten of the eleven recessions after World War II were preceded by a spike in oil prices. This dependence, predictably, created deep resentments. Public sentiment turned against the oil industry decisively in the 1970s, but this time it wasn’t necessarily the fault of a robber baron like Rockefeller.
This time the villain was the public demand itself, coupled with an unprecedented exercise of power by oil-producing nations in the Persian Gulf. Demand for oil in the United States had quietly surpassed the level of available supplies, leaving the nation reliant on imports to make up the difference. In 1973, a cartel called the Organization of Petroleum Exporting Countries, or OPEC, imposed an embargo that unleashed unprecedented chaos in oil markets. By the time the whole mess had settled in 1974, oil prices had risen from $3 a barrel to $12 a barrel.
Oil prices would fall again during the 1980s, but the psychological wound never healed. Americans knew that their economy was now held hostage by oil. The stability of the 1950s and 1960s was gone. Oil prices could spike overnight, a concept that no one had ever really thought of before. The concept of oil price spikes would soon become embedded in Americans’ vocabulary, and with it a new way of seeing oil companies. These firms were now seen as predatory. The well-being of oil companies and the American people were at odds by 1988. Oil companies embodied the opposite ideal of the old maxim, which claimed that “what was good for our country was good for General Motors, and vice versa.” Instead, what was good for oil companies came at the expense of everyone else.
Most people suspected that the oil companies were screwing them in one way or another, so it only made sense that oil companies would be the central target of Ken Ballen’s investigation. This was a message that was delivered to Ballen in no uncertain terms by Senator Daniel Inouye of Hawaii, who was chairman of the Senate Indian Affairs Committee and a friend of Senator DeConcini’s. As chairman of the committee, Inouye had authority over the special investigative team that DeConcini had put together. Inouye therefore had some measure of authority over Ballen, and he made it clear to Ballen that the investigation was meant to uncover wrongdoing on behalf of the oil majors like Exxon or Mobil. Instead, Ballen found himself working with the oil majors in order to entrap Koch Industries, which no one had ever heard of. It was a politically risky move, in Ballen’s eyes, but that’s where the evidence in the case was leading him.
Ballen’s case grew stronger after he took a trip to Boston. He’d received a tip that there was a whistle-blower in Boston who might be able to shed light on Koch Oil’s alleged theft. The whistle-blower was in a good position to know about it. His name was William “Bill” Koch, and he was brothers with Koch Industries’ CEO.
Ballen learned that Koch Industries was a family-controlled company, founded in 1940 by a man named Fred Koch in Wichita, Kansas. Fred Koch had four sons. Three of the sons worked for the family company until 1967, when Fred Koch died. At that point, all hell broke loose. The second-oldest son, Charles, was left in charge of the firm. In that role, he oversaw his younger twin brothers, David and Bill. It became clear that Bill didn’t want to take orders from his older brother Charles, and so Bill left the company in 1983. Then he sued David and Charles, claiming that they had ripped him off by underpaying him for his share of the family business.
What interested Ballen