Koch and Western Carolina University

{{#badges:Koch Exposed}} At Western Carolina University (part of the University of North Carolina system), negotiations over a $2 million gift from the Charles Koch Foundation became public before an official agreement was signed. The gift to accept Koch's fund and create a new campus center was fast-tracked for approval despite nearly unanimous opposition from the Faculty Senate.

This gift would eclipse previous gifts from Koch to WCU, totaling $76,500 from 2009-2014. IRS tax forms reveal little about these grants other than earmarks to the WCU Business school and the Public Choice Society.

In a chronologically organized post that included her own emails, WCU English professor Laura Wright notes the gift was initiated by the Charles Koch Foundation--according to Prof. Ed Lopez--who took the lead in negotiating the gift agreement.

Dr. Lopez has held prior affiliations with Koch-funded policy organizations, including the Bastiat Society, Public Choice Society, the Association for Private Enterprise Education, and the John Locke Foundation. Virtually all of Dr. Lopez's recent speaking events since 2012 were hosted by Koch-supported university departments or policy think tanks.

As of March 31, 2016, no grant agreement has been made public, and the WCU general counsel was drafting an agreement with the Koch foundation.

Koch Funding to WCU, 2009-2015

Koch foundations gave $76,500 to WCU. According to data compiled by Greenpeace USA, using Koch Family Foundations IRS tax filings:

• 2009: $12,000
• 2010: $0
• 2011: $12,000
• 2012: $14,000 to "AFIE Department" in College of Business
• 2013: $12,000
• 2014: $10,500 for "Public Choice Society" + $16,000 for "Western Carolina University"
• 2015: $0

2015 WCU Gift Proposal to Charles Koch Foundation

The proposed gift would total $3.4 million, with $2 million coming from the Koch foundation and a $1.4 million match from WCU in the form of existing tenured professors whose focus would be shifted to conform to the mission of the campus center. In taking the gift, WCU would create the Center for the Study of Free Enterprise (CSFE), directed by Dr. Lopez.

The proposed mission for the CSFE was unclear, with differing descriptions by Dr. Lopez in public and private. As Smoky Mountain News reported on Feb. 10, 2016:

"In the publicly shared vision for the Center for the Study of Free Enterprise, Lopez describes its mission as this: “to provide sound policy analysis and thought leadership pertaining to economic development,” a mission that squares with WCU’s own mission to advance economic development in the region.

"But in private communications with the Koch Foundation, Lopez has portrayed the center as a medium to advance free enterprise policies in society and recruit students to the free enterprise school of thought."

The proposed deal included a $45,000 raise for Professor Lopez, to reflect adding three months to his (technically) nine-month annual employment schedule. As summarized by reporter Becky Johnson for Smoky Mountain News in her Dec. 9, 2015 report:

"• $128,000 a year in operational costs funded solely with Koch money, including guest speakers, policy forums, financial support for student and faculty research and travel to conferences.

•$550,000 a year in salaries and staff support, with $250,000 coming from the university in the form of pre-existing professor positions that will count as its “match.” The remaining $300,000 in salaries and staffing from Koch money would pay for Lopez’s raise, a tenured professor position, administrative support, student interns and $20,000 in bonuses to spread around to professors from various disciplines who contribute to the free enterprise center activities."

"Deliverables" and other Unpublished Provisions

Dr. Ed Lopez told Koch of his “ideal scenario” to alter the WCU administration's own position and “recruit free enterprise individuals,” to both Koch-funded and university-funded positions.

Further reporting on Dr. Lopez's emails revealed more promises to Koch that were hidden from the public and from WCU faculty. From reporter Becky Johnson: "Missing from the on-campus version were detailed examples of so-called “deliverables” being promised to the Koch Foundation in exchange for $2 million in funding.

"The list of deliverables sent to the Koch Foundation highlighted the cultivation of students into the free enterprise discipline, including developing a 'pipeline of students' exposed to free enterprise teachings and 'cultivating students’ long-term interest and participation in the larger community of free enterprise scholars, implementers, activists and related professions.' "

Before the center was formally approved, professor Ed Lopez posted job descriptions for positions created by Koch’s unfulfilled gift. Professor Lopez shared the job descriptions with the Koch foundation before publishing them, according to his emails.

WCU Faculty Senate Involvement

24 of the 27 Faculty Senate members voted to oppose the CSFE, releasing a report of their concerns to WCU administrators on Oct. 28, 2015. Points of agreement affirmed the right of economics professors to design curricula and teach at their own discretion, and the opportunity of a campus center to focus on a narrow field of study.

Concern for Academic Freedom

The Faculty Senate report emphasized Charles Koch's controversial history in academia: "The Charles Koch Foundation has previously set forth explicit expectations in line with their political views in exchange for monetary gifts to universities, thereby constraining academic freedom by influencing and interfering with the development of new knowledge. Although the proposal developer at WCU insists that the ideological views of the Foundation will not influence the proposed Center, accepting a monetary gift from a source that passionately believes in a fundamental socio-economic postulate without opening that postulate up for investigation appears counterintuitive. By their own admission, the Foundation primarily supports research programs that analyze the impact of free societies on economic policy in a select number of academic programs where it believes it is best positioned to make societal change. Because the developer anticipates renewed funding after the initial five-year period contingent upon satisfactory performance as determined by the Foundation (note that the performance criteria have not been made transparent), it has tangible motivation to produce research findings that may serve to perpetuate the large stream of funding required to maintain the Center. Furthermore, any research conclusions consistent with the Foundation’s ideological perspective may be considered fruit from the poisoned tree, and therefore dismissed by reputable scientific communities."

In a radio interview with WCQS, Faculty Senate chair David McCord provided specific examples of concern. McCord noted Koch's direct influence in hiring faculty at Florida State University. At George Mason University, McCord was told by the Faculty Senate that Koch was given final sign off on research it funded. "There's a degree of intrusion, not just with academic freedom but with academic integrity of the institution. This particular set of donors has repeatedly and extensively overstepped all normal boundaries," Prof. McCord emphasized.

Concern over Partisan Atmosphere in North Carolina University Leadership

Smoky Mountain News reported that the "conservative ties" of the Center for the Study of Free Enterprise raised questions over partisan actions taken by University of North Carolina Board of Governors, some of whom were appointed by the current Republican governor, Pat McCrory. The CSFE's approval "comes amid statewide debate in the university system over liberal ties of private funders for other academic centers of study. The UNC Board of Governors shut down the privately funded Center on Poverty, Work and Opportunity at UNC-Chapel Hill, led by a professor who has been critical of Republican lawmakers. The Board of Governors also shut down the Institute for Civic Engagement and Social Change at North Carolina Central University and the Center for Biodiversity at East Carolina University — which were criticized for promoting liberal agendas."

Former University of North Carolina president Tom Ross was removed from his position by the UNC Board of Governors in early 2015. The shake up in UNC leadership was widely regarded as political, building on the history of millionaire Art Pope's attempts to change the higher education landscape in North Carolina.

Concern over WCU's History with BB&T

Some professors noted Dr. Lopez's role as the "BB&T Distinguished Professor of Capitalism." Many universities signed a widely-criticized gift agreement with BB&T requiring professors to assign the Ayn Rand novel, "Atlas Shrugged."

BB&T's former CEO, John Allison, is an associate of Charles Koch who served as president of the Cato Institute after retiring from BB&T. In his time at Cato, Allison discussed his controversial deals with universities that assigned Rand's novels at his behest in a panel event at the Cato Institute, featuring Jay Schalin of the Pope Center.

Other Concerns

• WCU prioritizing the CSFE above other opportunities, considering that the proposed mission of the center is fulfilled by current university functions: "It seems apparent that all of these activities are currently taking place and the new Center would not be adding value, a requirement stipulated in Policy 105 5.1.1."
• WCU's reputation: "As we enter a new phase of WCU’s history, with a necessary focus on inclusion and a more diverse faculty and student body, the negative reactions associated with the Koch Foundation may well outweigh the positive reactions also associated with it."
• An "absence of peer-review" in CSFE research: "the proposal does not undergo external disciplinary peer review. There is also no mechanism for systematic peer review of the Center once it is operating..."

Smoky Mountain News' Becky Johnson interviewed several professors who made additional statements: But Dr. Bruce Henderson, a psychology professor, questioned why WCU wants to pursue a center focusing on just one economic and political system — especially when WCU doesn’t even offer an economics major. [...] Henderson said allocating two full time tenured positions to the free enterprise center — even if they were already in WCU’s budget — is still expending university resources. 'In the 21st century, tenure track positions are the most valuable and scarce resources a university has,' Henderson said."'

Response to Concerns from WCU Administration

In a Jan. 27, 2016 Chancellor's Report, WCU Chancellor David Belcher acknowledged each of the concerns in the Faculty Senate report. Beyond an updated budget, no new references were offered to address other concerns. Belcher dismissed concerns that the center's work would not be held to an academic standard of peer-review, and declared his confidence in the Koch foundation's respect for academic freedom.

In regard to Faculty Senate questioning "need," for the center based on similar study and research opportunities at other parts of the university, Belcher stated, "I do not see the Center’s work, as proposed, to be redundant, but rather to be an expansion or extension of current activities."

Policy 104

In response to WCU faculty concerns, administrators agreed to put Policy 104 into effect. The policy was created in 2008 in response to the controversial BB&T grants that required professors to assign Ayn Rand's Atlas Shrugged to all of WCU's business students.

Blue Ribbon Committee Established to Determine Oversight of Koch-funded Operation

In February, 2016, the WCU administration announced it would involve concerned faculty to establish an advisory committee to ensure curricular balance at the Koch-funded Center for the Study of Free Enterprise (CSFE). Smoky Mountain News reported that a Blue Ribbon Committee would help chose the permanent advisors for the CSFE, who in turn would "ensure [CSFE] doesn’t stray into the realm of one-sided political advocacy."

In a post on the university website, WCU spokesman Bill Studenc listed the members of the blue ribbon committee who would work to create a permanent advisory board for CSFE: "The implementation advisory board will consist of: David Shapiro from Health and Human Sciences; Wes Stone from the Kimmel School; Damon Sink from Fine and Performing Arts; Dale Carpenter, dean of the College of Education and Allied Professions; Kathleen Brennan and Chris Cooper from Arts and Sciences; Bill Yang representing Faculty Senate; Martin Tanaka from the Institutional Review Board; Andrea Moshier from the Office of Research Administration; Bill Richmond, Ed Lopez and Darrell Parker, dean, of the College of Business; Heidi Buchanan from Hunter Library; and Brandon Schwab, associate provost."

Pope Center Requests Emails of Professors Critical of Koch Gift

After two months of public controversy over the proposed center, Jay Schalin of the John William Pope Center for Higher Education Policy filed an open records request for emails of professors who criticized the proposed center. In response, English professor Laura Wright published her own emails and wrote up a timeline of the controversy.

Professor Wright noted the ties between the Charles Koch Foundation and the Pope Center, which collaborate on higher education finance and share numerous relationships. She then pointed out an ironic statement by the Charles Koch Foundation's John Hardin, who previously decried open records requests against professors:

"Jay Schalin has submitted a public records request for my email so that he might do the very thing that John Hardin criticizes: “cherry pick” from my correspondence to tell a “pre-meditated” story about me and my colleagues who have chosen to speak out against our institution’s acceptance of Koch money. As Hardin notes, “When this [a freedom of information request] happens on a college campus, a professor or administrator’s private correspondence can be weaponized against them and the school.” In this case, my correspondence will not be weaponized against WCU, I don’t think (as the Koch Foundation doesn’t want to alienate the school), but it will certainly be used against me to serve whatever ends Schalin, the Pope Center, and the Charles Koch Foundation deem appropriate."

Reporter Jane Stancill confirmed that the Charles Koch Foundation itself requested the same emails that the Pope Center requested.

The Pope Center was founded by Art Pope, who has served on the boards of organizations founded by the Kochs and coordinates political spending at Charles Koch's Freedom Partners donor summits. Inside Higher Ed has reported on the revolving financial, personnel and governance relationships between Koch, Pope, and the BB&T Bank: "She also posted the 100 pages of emails requested by the John William Pope Center for Higher Education Policy: those with references to Koch, BB&T Bank (which has backed free-market-education initiatives on many campuses in the South) and Ayn Rand, whose books are required reading on other campuses that have made deals with BB&T and Koch to establish free-enterprise centers or programs."

Quotes from WCU Faculty

“Is this a curricular or enrollment driven decision? If not, if it is just an opportunity because Charles Koch has offered some money, then there is no denying it is a political entity.” - Dr. Brian Railsback, English professor & former dean

“I think there are very clear strings attached. The research that comes out of these centers is then cited by politicians who use this scholarship to argue a special agenda that is the Koch’s agenda.” - Dr. Laura Wright, English Department head

"A lot of my colleagues — smart, energetic, engaged colleagues — are frustrated by what they perceived as substantial glossing over of faculty concerns. There is a temptation to check out, but we need to engage rather than disengage. That is our job, we need to be the guardians of the mission of the university." - Dr. David McCord, Faculty Senate Chair and Psychology Professor

"From my personal point of view, the reallocation of the significant university funds to establish the center may not be prudent given the recent UNC system-wide review of university centers." Dr. Bill Yang, Electrical Engineering Professor

"“If I were starting a department of any kind, I certainly would not hire three faculty members from the same perspective. Why would we want to hire three ‘free market’ economists rather than an internationalist, a behavioral economist and a Keynesian or a demographer? If we want to give our students a broad, flexible education that will serve them a lifetime, indoctrination in one perspective is not what they need.” - Dr. Bruce Henderson, Psychology professor and supporter of Koch gift

"The mission of the center as proposed is to conduct sound research,” Lopez said. “Engaging in abstract research, it plays a role of guiding the subsequent discussion among the intellectual class and ultimately among the political debate. It can provide important input." - Dr. Ed Lopez, Economics professor and negotiator of Koch gift to WCU

"It seems to me that every person or organization that donates funds to a university has an objective to influence the performance and outcomes of the university.” - Dr. Scott Huffman, Chemistry professor

Quotes from WCU Administration

Provost and Chancellor David Belcher: "There will no strings attached with any gift that might come from the Charles Koch Foundation — no strings attached at all."

"In this case, because there are many concerns that the gift might result in an infringement of academic freedom, I am going to go ahead and involve an ad hoc committee just to assure and reassure people. Because there is so much concern about this I will appoint an ad hoc review committee and let them be involved."

When asked by WCQS if the final donor agreement would be made public, Chancellor Belcher answered, "Honestly, I don't know. We will certainly share anything we can with the community at large." Chancellor Belcher acknowledged the reality of an economic squeeze on all universities since the 2008 economic recession, citing WCU's participation in a broader trend of soliciting private funding. Belcher explicitly affirmed the ongoing need for faculty involvement as the deal with Koch moves forward.

WCU Trustee Chair Ed Broadwell: "We respect their views. However, the Board of Trustees believes that an essential role of a university is to create a forum for exploration of diverse schools of thought. To do anything less undermines a core value of Western Carolina University as stated in its strategic plan: to provide a learning environment committed to the free and open interchange of ideas."

"I’ve received comments from people that are both pro and con. But even the 'con' was more along the line of, ‘Here are my concerns; I trust you, but I want you to be aware.’ I think in the long run, it doesn’t hurt us, but I’d be disingenuous if I said there were not people out there who have concerns."

WCU Trustee Phil Drake "The donors are not trying to control what we teach, how we teach, the style we teach. They are trying to build a focus on creating entrepreneurship. Their conservative beliefs should not impact whether we take that contribution."

WCU Trustee Bryant Kinney "Free enterprise is how we do business in this country. It is what makes our country great."

WCU Trustee Tom Fetzer "This is not indoctrination, but this is about exposing students to a set of values which they may or may not choose to embrace."

Quote from UNC System President Margaret Spellings

"It should have no strings attached. It ought to be a gift that is very beneficial to this institution overall and for the long haul, and I’m confident that Chancellor (David) Belcher has negotiated that arrangement with this particular entity and it will mean great things for scholars and students at this particular institution."

Quotes from Charles Koch Foundation

"What makes the American university system extraordinary is that this type of private support is entirely commonplace. Here in North Carolina, colleges and universities have accepted more than $24 billion in donations from various sources over the past decade. The numbers are even more staggering nationally. Last year, institutions of higher learning raised a record-breaking $38 billion in private support, coming from alumni, companies, and charitable foundations like the Charles Koch Foundation."

Other CSFE Donors

Just after the CSFE was approved, the Sylva Herald reported that the center planned to solicit the John Templeton Foundation for additional funds.

Years before the CSFE was proposed, BB&T Corp gave a controversial $1 million grant to WCU to endow a professorship, on the condition that Ayn Rand's Atlas Shrugged would be required reading for all students in the College of Business.

Other Academic Critics

The controversy got the attention of the Center for Engaged Scholarship, a group of professors publishing research "to challenge the wrong ideas of the right-wing and to generate new ideas that can contribute to progressive change." President Fred Block, Research professor of sociology at UC Davis, commended local reporter Becky Johnson for revealing hidden provisions of the Koch negotiations with Dr. Ed Lopez. "The project is to use a two million dollar donation from one of their foundations to tilt faculty recruitment in favor of free market economists on the campus of West Carolina University," wrote Prof. Block.

Hank Reichman of the American Association of University Professors (AAUP) republished a local op-ed on the Academe Blog, with a comment on the difficulty of assessing donor agreements with schools.

SourceWatch Articles

• Koch Brothers
• Koch Family Foundations
• Americans for Prosperity
• Freedom Partners
• Cato Institute
• Heritage Foundation
• Koch Universities
• Koch Network
• Knowledge and Progress Fund
• American Encore
• DonorsTrust
• Donors Capital
• 60 Plus
• Generation Opportunity

Additional References

• Rob Schofield, Proposed Koch-funded “free enterprise” center at UNC system school sparks controversy, NC Policy Watch, Nov. 19, 2015
• Jane Stancill, Western Carolina considers center funded by Charles Koch Foundation, Raleigh News & Observer, Nov. 20, 2015
• Julie Ball, Funding from Charles Koch Foundation raises concerns at WCU, Asheville Citizen-Times, Nov. 23, 2015
• Alex Kotch, Charles Koch gave $90 million to influence higher ed in the South, Facing South, Institute for Southern Studies, Dec. 3, 2015
• Sandra Houts; Ralph Wilson, Letters: Readers don’t buy argument for partnering, Asheville Citizen-Times, Dec. 16, 2015
• Dave Levinthal, Koch Brothers Supersize Higher Ed Spending, co-published by the Center for Public Integrity with TIME Magazine, Al Jazeera America and Yahoo News, Dec. 15, 2016
• Jay S. Gertz, Letter: Says Kochs out to promote their idea of economic freedom, Asheville Citizen-Times, Dec. 22, 2015
• Yves Smith, Koch Brothers’ Culture Grab: Latest Donation, to Western Carolina University, for “Center of Study of Free Enterprise” Despite Faculty Vote “No”, Naked Capitalism, Jan. 12, 2016
• Mark Jamison, Proposed Koch gift to WCU a bad idea, Smoky Mountain News, Jan. 13, 2016, reposted to Angry Bear Blog on Jan. 17, 2016
• On Second Thought with Celeste Headlee, Higher Ed For Sale, Georgia Public Broadcasting, Jan. 11, 2016, at minute 09:25.
• Mark Jamison, WCU should stay away from Koch money, influence, Smoky Mountain News, Feb. 10, 2016
• Mark Jamison, Market economics not relevant to all our human endeavors, Smoky Mountain News, Mar. 9, 2016
• Editorial, ‘We the people’ means everybody, even Koch and Pope, The Sylva Herald, Mar. 16, 2016

Academic Freedom References

• 1940 Statement of Principles on Academic Freedom and Tenure, American Association of University Professors (AAUP), endorsed January 1, 1916, accessed August 7, 2016
• Protecting Academic Freedom, American Association of University Professors (AAUP), accessed August 7, 2016
• Fritz Machlup, On Some Misconceptions concerning Academic Freedom, JSTOR, originally published in the Bulletin of the American Association of University Professors, Vol. 41, No. 4 (Winter, 1955), pp. 753-784
• AAC&U Board of Directors, Academic Freedom and Educational Responsibility, Association of American Colleges & Universities (AAC&U), January 6, 2006
• Academic Freedom, American Federation of Teachers (AFT), accessed August 7, 2016.
• ACRL Board of Directors, ACRL Statement on Academic Freedom, Association of College & Research Libraries (ACRL), June 2015
• Academic Freedom, National Center for Science Education (NCSE), accessed August 7, 2016
• Constantine Sandis, Free Speech Within Reason, Times Higher Education, January 21, 2010
• Liviu Andreescu, Foundations of Academic Freedom: Making New Sense of Some Aging Arguments, Studies in Philosophy and Education, 28:499, November 8, 2009, accessed August 7, 2016 via Springerlink,
• Colin Macilwain, Time to cry out for academic freedom, Column: World View, Nature, November 18, 2015
• Colleen Flaherty, Unacademic Freedom?, Inside Higher Ed, March 1, 2016
• Valerie Strauss, Does ‘academic freedom’ protect professors who promote outrageous falsehoods?, Answer Sheet blog, Washington Post, March 7, 2016
• Academic freedom, Wikipedia, accessed August 7, 2016
• Cary Nelson, Defining Academic Freedom, Inside Higher Ed, December 21, 2016
• Terence Karran, [Academic freedom: a research bibliography http://eprints.lincoln.ac.uk/1763/], University of Lincoln Repository, January 22, 2009
• Academic Freedom, The Free Dictionary: Legal DIctionary, Farlex, Accessed August 7, 2016
• Academic Freedom at Johns Hopkins, Office of the Provost, Johns Hopkins University, May 2014, accessed August 7, 2016
• Marc Rotenberg, Academic Freedom Lecture Fund, University of Michigan, accessed August 7, 2016
• Elizabeth Nolan Brown, Academic Freedom Is On the Decline, and Here's the Data to Prove It, Hit and Run blog, Reason Foundation, May 11, 2015

Koch and Academic Freedom

• John K. Wilson, The Koch Foundation and Academic Freedom, Academe Blog, American Association of University Professors (AAUP), January 18, 2015
• Hank Reichman, On Blacklists, Harassment, and Outside Funders: A Response to Phil Magness, Academe Blog, American Association of University Professors (AAUP), April 11, 2017
• Valerie Strauss, Charles Koch Foundation’s unique definition of ‘academic freedom’, Answer Sheet blog, Washington Post, November 7, 2014
• Gale Sigal and Steve Boyd, Koch Pledge To Eudaimonia Is Not A Gift, Old Gold & Black, Wake Forest University, April 30, 2017
• James Ford and Ulrike Wiethaus, Faculty Senate at Wake Forest Explains Opposition to Koch-Funded Institute, Chronicle of Higher Education, May 12, 2017
• Kent S. Miller & Ray Bellamy, Fine Print, Restrictive Grants, and Academic Freedom: The limits to “free” in free-market foundation donations at Florida State University, American Association of University Professors (AAUP), May/June 2011
• Michael Burke, The Whitman School’s receipt of a Charles Koch Foundation grant is raising academic freedom concerns, The Daily Orange, Syracuse University, Feb. 2, 2017
• Editorial, Koch brothers’ donation to Syracuse University is a red flag for academic freedom at the expense of two of the country’s richest men, The Daily Orange, Syracuse University, Feb. 1, 2017
• Dan Berrett, Not Just Florida State, Inside Higher Ed, June 28, 2011
• Stanley Fish, Sex, the Koch Brothers, and Academic Freedom, Opinionator Blog, New York Times, May 16, 2011
• Connor Gibson, Koch Pollution on Campus: Academic Freedom Under Assault from Charles Koch's $50 Million Campaign to Infiltrate Higher Education, Greenpeace USA, September, 2014

Shared Governance References

• Shared Governance, American Association of University Professors (AAUP), accessed August 7, 2016
• How to Make Shared Governance Work: Some Best Practices, Trusteeship Magazine, Association of Governing Boards, accessed August 7, 2016