Dark Money: The Hidden History of the Billionaires Behind the Rise of the Radical Right

Dark Money: The Hidden History of the Billionaires Behind the Rise of the Radical Right

by Jane Mayer

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Overview

Dark Money: The Hidden History of the Billionaires Behind the Rise of the Radical Right by Jane Mayer

NATIONAL BESTSELLER
ONE OF THE NEW YORK TIMES 10 BEST BOOKS OF THE YEAR

Who are the immensely wealthy right-wing ideologues shaping the fate of America today? From the bestselling author of The Dark Side, an electrifying work of investigative journalism that uncovers the agenda of this powerful group.

In her new preface, Jane Mayer discusses the results of the most recent election and Donald Trump's victory, and how, despite much discussion to the contrary, this was a huge victory for the billionaires who have been pouring money in the American political system.

Why is America living in an age of profound and widening economic inequality? Why have even modest attempts to address climate change been defeated again and again? Why do hedge-fund billionaires pay a far lower tax rate than middle-class workers? In a riveting and indelible feat of reporting, Jane Mayer illuminates the history of an elite cadre of plutocrats—headed by the Kochs, the Scaifes, the Olins, and the Bradleys—who have bankrolled a systematic plan to fundamentally alter the American political system. Mayer traces a byzantine trail of billions of dollars spent by the network, revealing a staggering conglomeration of think tanks, academic institutions, media groups, courthouses, and government allies that have fallen under their sphere of influence. Drawing from hundreds of exclusive interviews, as well as extensive scrutiny of public records, private papers, and court proceedings, Mayer provides vivid portraits of the secretive figures behind the new American oligarchy and a searing look at the carefully concealed agendas steering the nation. Dark Money is an essential book for anyone who cares about the future of American democracy.

National Book Critics Circle Award Finalist
LA Times
 Book Prize Finalist
PEN/Jean Stein Book Award Finalist
Shortlisted for the Lukas Prize

Product Details

ISBN-13: 9780307947901
Publisher: Knopf Doubleday Publishing Group
Publication date: 01/24/2017
Edition description: Reprint
Pages: 576
Sales rank: 17,809
Product dimensions: 5.20(w) x 7.20(h) x 1.30(d)

About the Author

Jane Mayer is a staff writer for The New Yorker and the author of three bestselling and critically acclaimed narrative nonfiction books. She co-authored Landslide: The Unmaking of the President, 1984–1988, with Doyle McManus, and Strange Justice: The Selling of Clarence Thomas, with Jill Abramson, which was a finalist for the National Book Award. Her book The Dark Side: The Inside Story of How the War on Terror Turned into a War on American Ideals, for which she was awarded a Guggenheim Fellowship, was named one of The New York Times’s Top 10 Books of the Year and won the J. Anthony Lukas Book Prize, the Goldsmith Book Prize, the Edward Weintal Prize, the Ridenhour Prize, the New York Public Library’s Helen Bernstein Book Award for Excellence in Journalism, and the Robert F. Kennedy Book Award. It was also a finalist for the National Book Award and the National Book Critics Circle Award. For her reporting at The New Yorker, Mayer has been awarded the John Chancellor Award, the George Polk Award, the Toner Prize for Excellence in Political Reporting, and the I. F. Stone Medal for Journalistic Independence presented by the Nieman Foundation at Harvard. Mayer lives in Washington, D.C.

Read an Excerpt

CHAPTER ONE

Radicals: A Koch Family History

Oddly enough, the fiercely libertarian Koch family owed part of its fortune to two of history’s most infamous dictators, Joseph Stalin and Adolf Hitler. The family patriarch, Fred Chase Koch, founder of the family oil business, developed lucrative business relationships with both of their regimes in the 1930s.

According to family lore, Fred Koch was the son of a Dutch printer and publisher who settled in the small town of Quanah, Texas, just south of the Oklahoma border, where he owned a weekly newspaper and print shop. Quanah, which was named for the last American Comanche chief, Quanah Parker, still retained its frontier aura when Fred was born there in 1900. Bright and eager to get out from under his overbearing old-world father, Fred once ran away to live with the Comanches as a boy. Later, he crossed the country for college, transferring from Rice in Texas to attend the Massachusetts Institute of Technology. There, he earned a degree in chemical engineering and joined the boxing team. Early photographs show him as a tall, formally dressed young man with glasses, a tuft of unruly curls, and a self-confident, defiant expression.

In 1927, Fred, who was an inveterate tinkerer, invented an improved process for extracting gasoline from crude oil. But as he would later tell his sons bitterly and often, America’s major oil companies regarded him as a business threat and shut him out of the industry, suing him and his customers in 1929 for patent infringement. Koch regarded the monopolistic patents invoked by the major oil companies as anticompetitive and unfair. The fight appears to be an early version of the Kochs’ later opposition to “corporate cronyism” in which they contend that the government and big business collaborate unfairly. In Fred Koch’s eye, he was an outsider fighting a corrupt system.

Koch fought back in the courts for more than fifteen years, finally winning a $1.5 million settlement. He correctly suspected that his opponents bribed at least one presiding judge, an incompetent lush who left the case in the hands of a crooked clerk. “The fact that the judge was bribed completely altered their view of justice,” one longtime family employee suggests. “They believe justice can be bought, and the rules are for chumps.” Meanwhile, crippled by lawsuits in America during this period, Koch took his innovative refining method abroad.

He had already helped build a refinery in Great Britain after World War I with Charles de Ganahl, a mentor. At the time, the Russians supplied England with fuel, which led to the Russians seeking his expertise as they set up their own oil refineries after the Bolshevik Revolution.

At first, according to family lore, Koch tore up the telegram from the Soviet Union asking for his help. He said he didn’t want to work for Communists and didn’t trust them to pay him. But after securing an agreement to get paid in advance, he overcame his philosophical reservations. In 1930, his company, then called Winkler-Koch, began training Russian engineers and helping Stalin’s regime set up fifteen modern oil refineries under the first of Stalin’s five-year plans. The program was a success, forming the backbone of the future Russian petroleum industry. The oil trade brought crucial hard currency into the Soviet Union, enabling it to modernize other industries. Koch was reportedly paid $500,000, a princely sum during America’s Great Depression. But by 1932, facing growing domestic demand, Soviet officials decided it would be more advantageous to copy the technology and build future refineries themselves. Fred Koch continued to provide technical assistance to the Soviets as they constructed one hundred plants, according to one report, but the advisory work was less profitable.

What happened next has been excised from the official corporate history of Koch Industries. After mentioning the company’s work in the Soviet Union, the bulk of which ended in 1932, the corporate history skips ahead to 1940, when it says Fred Koch decided to found a new company, Wood River Oil & Refining. Charles Koch is equally vague in his book The Science of Success. He notes only that his father’s company “enjoyed its first real financial success during the early years of the Great Depression” by “building plants abroad, especially in the Soviet Union.”

A controversial chapter is missing. After leaving the U.S.S.R., Fred Koch turned to Adolf Hitler’s Third Reich. Hitler became chancellor in 1933, and soon after, his government oversaw and funded massive industrial expansion, including the buildup of Germany’s capacity to manufacture fuel for its growing military ambitions. During the 1930s, Fred Koch traveled frequently to Germany on oil business. Archival records document that in 1934 Winkler-Koch Engineering of Wichita, Kansas, as Fred’s firm was then known, provided the engineering plans and began overseeing the construction of a massive oil refinery owned by a company on the Elbe River in Hamburg.

The refinery was a highly unusual venture for Koch to get involved with at that moment in Germany. Its top executive was a notorious American Nazi sympathizer named William Rhodes Davis whose extensive business dealings with Hitler would eventually end in accusations by a federal prosecutor that he was an “agent of influence” for the Nazi regime. In 1933, Davis proposed the purchase and conversion of an existing German oil storage facility in Hamburg, owned by a company called Europäische Tanklager A.G., or Eurotank, into a massive refinery. At the time, Hitler’s military aims, and his need for more fuel, were already well-known. Davis’s plan was to ship crude petroleum to Germany, refine it, and then sell it to the German military. The president of the American bank with which Davis dealt refused to have anything to do with the deal, because it was seen as supporting the Nazi military buildup, but others extended the credit. After lining up the American financing, Davis needed the Third Reich’s backing. To gain it, he first had to convince German industrialists of his support for Hitler. In his effort to ingratiate himself, Davis opened an early meeting with Hermann Schmitz, the chairman of I.G. Farben—the powerful and well-connected chemical company that soon after produced the lethal gas for the concentration camps’ death chambers—by saluting him with a Nazi “Heil Hitler.” When these efforts didn’t produce the green light he sought, Davis sent messages directly to Hitler, eventually securing a meeting in which the führer walked in and ordered his henchmen to approve the deal. On Hitler’s orders, the Third Reich’s economic ministers supported Davis’s construction of the refinery. In his biography of Davis, Dale Harrington draws on eyewitness accounts to describe Hitler as declaring to his skeptical henchmen, “Gentlemen, I have reviewed Mr. Davis’s proposition and it sounds feasible, and I want the bank to finance it.” Harrington writes that during the next few years Davis met at least half a dozen more times with Hitler and on one occasion asked him to personally autograph a copy of Mein Kampf for his wife. According to Harrington, by the end of 1933 Davis was “deeply committed to Nazism” and exhibited a noticeable “dislike for Jews.”

In 1934, Davis turned to Fred Koch’s company, Winkler-Koch, for help in executing his German business plan. Under Fred Koch’s direction, the refinery was finished by 1935. With the capacity to process a thousand tons of crude oil a day, the third-largest refinery in the Third Reich was created by the collaboration between Davis and Koch. Significantly, it was also one of the few refineries in Germany, according to Harrington, that could “produce the high-octane gasoline needed to fuel fighter planes. Naturally,” he writes, “Eurotank would do most of its business with the German military.” Thus, he concludes, the American venture became “a key component of the Nazi war machine.”

Historians expert in German industrial history concur. The development of the German fuel industry “was hugely, hugely important” to Hitler’s military ambitions, according to the Northwestern University professor Peter Hayes. “Hitler set out to create ‘autarchy,’ or economic self-sufficiency,” he explained. “Gottfried Feder, the German official in charge of the program, reasoned that even though Germany would have to import crude oil, it would be able to save foreign exchange by refining the products itself.”

In the run-up to the war, Davis profited richly from the arrangement, engaging in elaborate scams to keep the crude oil imports flowing into Germany despite Britain’s blockade. When World War II began, the high-octane fuel was used in bombing raids by German pilots. Like Davis, the Koch family benefited from the venture. Raymond Stokes, director of the Centre for Business History at the University of Glasgow in Scotland and co-author of a history of the German oil industry during the Nazi years, Faktor Öl (The oil factor), which documents the company’s role, says, “Winkler-Koch benefited directly from this project, which was designed to help enable the fuel policy of the Third Reich.”

Fred Koch often traveled to Germany during these years, and according to family lore he was supposed to have been on the fatal May 1937 transatlantic flight of the Hindenburg, but at the last minute he got delayed. In late 1938, as World War II approached and Hitler’s aims were unmistakable, he wrote admiringly about fascism in Germany, and elsewhere, drawing an invidious comparison with America under Franklin Roosevelt’s New Deal. “Although nobody agrees with me, I am of the opinion that the only sound countries in the world are Germany, Italy, and Japan, simply because they are all working and working hard,” he wrote in a letter to a friend. Koch added, “The laboring people in those countries are proportionately much better off than they are any place else in the world. When you contrast the state of mind of Germany today with what it was in 1925 you begin to think that perhaps this course of idleness, feeding at the public trough, dependence on government, etc., with which we are afflicted is not permanent and can be overcome.”

When the United States entered World War II in 1941, family members say that Fred Koch tried to enlist in the U.S. military. Instead, the government directed him to use his chemical engineering prowess to help refine high-octane fuel for the American warplanes. Meanwhile, in an ironic turn, the Hamburg refinery that Winkler-Koch built became an important target of Allied bombing raids. On June 18, 1944, American B-17s finally destroyed it. The human toll of the bombing raids on Hamburg was almost unimaginable. In all, some forty-two thousand civilians were killed during the long and intense Allied campaign against Hamburg’s crucial industrial targets.

Fred Koch’s willingness to work with the Soviets and the Nazis was a major factor in creating the Koch family’s early fortune. By the time he met his future wife, Mary Robinson, at a polo match in 1932, the oilman’s work for Stalin had put him well on his way to becoming exceedingly wealthy.

Robinson, a twenty-four-year-old graduate of Wellesley College, was tall, slender, and beautiful, with blond hair, blue eyes, and an expression of amusement often captured in family photographs. The daughter of a prominent physician from Kansas City, Missouri, she had grown up in a more cosmopolitan milieu. Koch, who was seven years older than she, was so smitten he married her a month after they met.

Soon, the couple commissioned the most fashionable architect in the area to build an imposing Gothic-style stone mansion on a large compound on the outskirts of Wichita, Kansas, where Winkler-Koch was based. Reflecting their rising social status, the estate was baronial despite the flat and empty prairie surrounding it, with stables, a polo ring, a kennel for hunting dogs, a swimming pool and wading pool, a circular drive, and stone-terraced gardens. Some of the best craftsmen in the country created decorative flourishes such as wrought-iron railings and a stone fireplace carved with a whimsical snowflake motif. Within a few years, the Kochs also purchased the sprawling Spring Creek Ranch near Reece, Kansas, where Fred, who loved science and genetics, bred and raised cattle. Family photographs show the couple looking glamorous and patrician, hosting picnics and pool parties, and riding on horseback, dressed in jodhpurs and polo gear, surrounded by packs of jolly friends.

In the first eight years of their marriage, the couple had four sons: Frederick, known by the family as Freddie, was born in 1933, Charles was born in 1935, and twins, David and William, were born in 1940. With their father frequently traveling and their mother preoccupied with social and cultural pursuits, the boys were largely entrusted to a series of nannies and housekeepers.

It is unclear what Fred Koch’s views of Hitler were during the 1930s, beyond his preference for the country’s work ethic in comparison with the nascent welfare state in America. But he was enamored enough of the German way of life and thinking that he employed a German governess for his first two sons, Freddie and Charles. At the time, Freddie was a small boy, and Charles still in diapers. The nanny’s iron rule terrified the little boys, according to a family acquaintance. In addition to being overbearing, she was a fervent Nazi sympathizer, who frequently touted Hitler’s virtues. Dressed in a starched white uniform and pointed nurse’s hat, she arrived with a stash of gruesome German children’s books, including the Victorian classic Der Struwwelpeter, that featured sadistic consequences for misbehavior ranging from cutting off one child’s thumbs to burning another to death. The acquaintance recalled that the nurse had a commensurately harsh and dictatorial approach to child rearing. She enforced a rigid toilet-training regimen requiring the boys to produce morning bowel movements precisely on schedule or be force-fed castor oil and subjected to enemas.

The despised governess ruled the nursery largely unchallenged for several years. In 1938, the two boys were left for months while their parents toured Japan, Burma, India, and the Philippines. Even when she was home, Mary Koch characteristically deferred to her husband, declining to intervene. “My father was fairly tough with my mother,” Bill Koch later told Vanity Fair. “My mother was afraid of my father.” Meanwhile, Fred Koch was often gone for months at a time, in Germany and elsewhere.

It wasn’t until 1940, the year the twins were born, when Freddie was seven and Charles five, that back in Wichita the German governess finally left the Koch family, apparently at her own initiative. Her reason for giving notice was that she was so overcome with joy when Hitler invaded France she felt she had to go back to the fatherland in order to join the führer in celebration. What if any effect this early experience with authority had on Charles is impossible to know, but it’s interesting that his lifetime preoccupation would become crusading against authoritarianism while running a business over which he exerted absolute control.

Fred Koch was himself a tough and demanding disciplinarian. John Damgard, David’s childhood friend, who became president of the Futures Industry Association, recalled that he was “a real John Wayne type.” Koch emphasized rugged pursuits, taking his sons big-game hunting in Africa and filling the basement billiard room with what one cousin remembered as a frightening collection of exotic stuffed animal heads, including lions and bears and others with horns and tusks, glinting glassy-eyed from the walls. In the summer, the boys could hear their friends splashing in the pool at the country club across the street, but instead of allowing the boys to join them, their father required them to dig up dandelions by the time they were five, and later to dig ditches and shovel manure at the family ranch. Fred Koch cared about his boys but was determined to keep them from becoming what he called “country-club bums,” like some of the other offspring of the oil moguls with whom he was acquainted. “By instilling a work ethic in me at an early age, my father did me a big favor, although it didn’t seem like a favor back then,” Charles has written. “By the time I was eight, he made sure work occupied most of my spare time.”

Table of Contents

Preface to the Anchor Books Edition (2017) xi

Introduction: The Investors 3

Part 1 Weaponizing Philanthropy: The War of Ideas, 1970-2008

1 Radicals: A Koch Family History 33

2 The Hidden Hand: Richard Mellon Scaife 73

3 Beachheads: John M. Olin and the Bradley Brothers 112

4 The Koch Method: Free-Market Mayhem 146

5 The Kochtopus: Free-Market Machine 172

Part 2 Secret Sponsors: Covert Operations, 2009-2010

6 Boots on the Ground 195

7 Tea Time 203

8 The Fossils 243

9 Money Is Speech: The Long Road to Citizens United 278

10 The Shellacking: Dark Money's Midterm Debut, 2010 295

Part 3 Privatizing Politics: Total Combat 2011-2014

11 The Spoils: Plundering Congress 333

12 Mother of All Wars: The 2012 Setback 370

13 The States: Gaining Ground 410

14 Selling the New Koch: A Better Battle Plan 435

Author's Note 467

Notes 469

Index 523

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Dark Money: The Hidden History of the Billionaires Behind the Rise of the Radical Right 4.6 out of 5 based on 0 ratings. 27 reviews.
Anonymous More than 1 year ago
This book blew me away. Well written and eye opening. The extreme right and Koch brothers are in one word "despicable". Every American should read this book before they vote.
Anonymous More than 1 year ago
Lots of great informatiom and tons of resesrch combine for an enlightening account of how public politics and perception can be manipulated with cash and low morals
Anonymous More than 1 year ago
This book was so many things, I'm not sure where to start. Amazing, informative, jaw-dropping are just a few adjectives that come to mind. I view society entirely differently after reading this book and it's made me reconsider my plans for the future based on what kind of world the Koch brothers and the entire 1% have created behind the curtain. This book was a little hard to get through with all of the facts and citations but it wouldn't have been nearly as impactful without all of those things. I think everyone should read this, especially before the upcoming election. It'll make you think twice about the world and about letting a member of the 1% rule the country. And it really outlines the jeopardy that the earth is in based on environmental changes, and it shows that we really are running out of time. Extremely educational and such an eye opener. Love, love, love
Anonymous More than 1 year ago
About this country. I am disgusted. I had no idea how much was put into manipulating us for corporate profit. I am rethinking so many things. Great book.
Anonymous More than 1 year ago
Every word just leaves me in awe
Anonymous More than 1 year ago
EXCELLENT !
Anonymous More than 1 year ago
If you are disappointed in the Republican party and where it sits presently, this book will give a good source of information and how it got there and the forces that influenced that direction.
Anonymous More than 1 year ago
The author makes it clear that we, the American people could loose our Democracy because of the greed in American politics. She names, names, and spills the beans on Billionaires plan to take over American politics and make into an Oloagarcy which the riches 1 % set all the rules and the people loose all civil rights. It is a real threat to our Constitution and way of live. Their motor can be summed as, " he who has the gold rules!" Thus the end of Democracy as we know it. With the help of the NRA the US will revert to the Wild Wild West, where everyone carries gun and may the best man win. And the Billionaires will always win ! It is Asad day for America and you have been warned! We have little time left, and the odds are not in our favor. The Koch Brothers already own the Republican Party and are prepared to buy, bribe, or steal the rest. They will not stop until they own the whole government And destroy our Constitutional government. Read it and weep. For things to come can only get worse. ??It may be the begging for another civil war. The haves vs the have nots. My avise, be careful who you vote for and have plan B prepared !
Anonymous More than 1 year ago
Read this book before you vote. Very well written and researched.
nycdbbw More than 1 year ago
I thought I was informed about how dark money was affecting the political landscape, but I was wrong. This book blew me away. Careful, rational and devoid of hyperbole, Meyer's book lays plain the issue facing voters: dark money is pouring into all races, national and local, as well as schools from elementary through university level. The policies being pushed by the dark money are at odds with those most americans would choose, but americans are being told, via like funded conservative media, education and elected officials from gerrymandered districts, that theirs is the will of the country. Corrupt doesn't begin to cover it. This is a must read.
Anonymous More than 1 year ago
This is an eye-opener that demonstrates that to find out who's running government, just "follow the money." The author did precisely this in uncovering the trickery, deceit, hypocrisy and treachery of the super- wealthy radical right wing. Led by the Koch Brothers, but with a cast of deplorables, they launched campaign after campaign using Orwellian newspeak to convince enough voters that they were voting for individual liberty and freedom, when what they were voting for was economic freedom and liberty for corporations and the uber wealthy to reap unimaginable profits unfettered by government regulation. These far rightists are opposed to regulatory collectivism, meaning they are anti-union, anti-environmentalists, anti-climate change, anti-anything that smacks of attempts to impinge upon their unfettered control of the economy. Of course, they favor collectivism when it involves large corporate interests that put more money into their hands. They succeed when a enough voters buy into their soundbites or otherwise don't care or, worse, remain ignorant of the plethora of facts set out meticulously that exposes the oligarchy that is holding sway over all levels and branches of government. A definite must-read.
tgDayton More than 1 year ago
Do you have the Dark Money blues? Does discovering the hidden money in politics make you angry, shocked, discouraged or numb? Or does seeing the dark money influences make you more determined to find solutions? That’s what the book evoked in me - sheer determination. Dark Money is a must read book on the insidious impact of dark money on our political choices. The question is “do we really want a handful of powerful billionaires secretly deciding what is best for 330 million Americans? The book profiles the Koch Brothers determination to secretly manipulate our electoral process for their own advantage. It shows how they did it. Mayer reveals their long game of investing money to influence votes. But “Dark money” in politics isn’t just about campaign contributions by billionaires. It’s much more. Mayer paints a graphic picture of the Koch Brothers plans to influence how we think about our national choices by buying spokesmen from our universities and supposedly “independent” think tanks. Consider this fact: Even though the Kochs didn’t back a presidential campaign last year but focused on half a dozen Senate races – they paid a private army of 1,600 political staffers in 38 states to drive votes in local campaigns. Mayer exposes the “Kochtopus” with far-reaching tentacles to pressure elected officials at the national, state, and local levels. She shows exactly how so called “grassroots” citizens groups and are secretly financed to reduce protections established to protect citizens. Take the destruction of the environment in coal country where removing protections literally results in people dying. Or take the ridiculously small fines and ineffective penalties for violating protections - a pittance compared to the enormous profits gained. We know that a level playing field is the key to real growth and that’s what systematic protections offer. Or take the manipulation of language to confuse voters -- through smearing safe and healthy protections by trying to make “regulation” into a dirty word. Our voices as voters should be heard and respected by our elected officials, but they are drowned out by the well-financed dark money megaphone. Our elected officials are supposed to represent their constituents, not their donors. Get this book for yourself and your friends and use it as a starting place to take actions to end secret money and let’s protect our democracy with open campaign financing. We must be able to identify who is pulling the strings by funding elections. To get started, check out Center for Media Democracy at www.prwatch.org/cmd. Action: End Dark Money: Tell the FEC to require the disclosure of secret donors during political campaigns. As the general counsel of Center for Media Democracy, Arn Pearson, warns: “There are a lot of different parts of the Koch machine pulling on this oar. From their think tanks up through their elected officials, they’re pushing on it. Hard.” Now it's up to us to push back. Hard.
Anonymous More than 1 year ago
I've only read the nook sample so far, but it's engrossing.
growingoldoffensively More than 1 year ago
Like to think the nux vomica brothers soiled themselves over this expose but thanks to Citizens United monied interests are the new political reality. The book goes into how, if you're clever and have enough money to be at the top of the social pecking order, buying judges, elections, congressional districts, states and making sure they stay bought is a First Ammendment right. Not changing soon either. Doubt Dark Money will change many minds. Progressives will seethe, conservatives will smile smugly in a self-congratulatory fashion at having allied with such smart people. Very readable.
Anonymous More than 1 year ago
Nice
Anonymous More than 1 year ago
Wow,
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Anonymous More than 1 year ago
Enlightning. Must read book
Anonymous More than 1 year ago
Interesting and well researched.
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Dwalin More than 1 year ago
This is a very good book. There is plenty information about the "new" republic party. After reading this you will understand why congress is in a stand still. However, this is only about the right, not the left.
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