Just a little reminder of this under-publicized fact:
Here is a better historical fact, one that the Kochs don't like to repeat in public: the family's initial wealth was not created by the harsh, creative forces of unfettered capitalism, but by the grace of the centrally planned economy of the Soviet Union. The Koch family, America's biggest pushers of the free-market Tea Party revolution, would not be the billionaires they are today were it not for the whim of one of Stalin's comrades.
The sky was the limit -- until the free market rained on Fred's [Koch's] parade.
See, Fred was living through the Roaring Twenties, a time of big business, heavy speculation and zero government regulation. Much like today, cartels were free to form and free to fix -- and so they did. Sensing a threat to their royalty-revenue stream from Winkler-Koch's superior refining technology, the reigning oil cartel moved in to teach the young Koch how the laissez-faire business model worked in the real world.
"[W]hen he tried to market his invention, the major oil companies sued him for patent infringement. Koch eventually won the lawsuits (after 15 years in court), but the controversy made it tough to attract many U.S. customers," according to Hoover's Company Records service. Just like that, Winkler-Koch Engineering found itself squeezed out of the American market. They had a superior product at a cheaper price, but no one to sell it to.
Luckily, there was one market where opportunity beckoned and innovation was rewarded: the Soviet Union.
Read the full, detailed article at
Alternet. It explains how the unregulated capitalism of 1920s America basically crushed Koch's small startup business. The big boys were not going to let him break into the market. And there were no regulations in place to prevent this abuse and rigging of the market.
So Winkler and Koch went to the Soviet Union and started building refineries for Stalin's government. And this is where Koch earned the money to start his empire.