Part 3: Mises Board of Directors

Koch Partner Donors

At least two members of LVMI board of directors are members of Koch’s secretive donor network.

As of 2016, the Mises Institute Board of Directors includes Bob Luddy, an attendee of at least two Koch donor summits (2010 and 2014), and CEO of CaptiveAire. In 2007, Luddy founded a chain of private schools, called Thales Academy, which teaches “free market economics” from Ludwig von Mises. Curriculum is available for pre-Kindergarten through grade 12, and between 2015-2016, the state of North Carolina paid Thales over 120 tuition scholarships of up to $4,200 each.

Luddy has served on the board of the John Locke Foundation, the Civitas Institute, and he chairs Civitas Action, all founded and largely funded by Koch-network donor Art Pope. Luddy himself contributed considerably, alongside Koch’s DonorTrust and Americans for Prosperity. According to an investigation by the Institute for Southern Studies, Luddy was the largest donor behind the Pope/Americans for Prosperity funded effort to segregate Wake County Schools in 2009. Luddy also funds Koch’s Cato Institute through the Luddy Charitable Foundation, including $50,000 in 2016.

Mises board member Andrew “Judge” Napolitano, has attendeed of at least one of Koch’s donor summits (2011).

University Endowments, For-Profit Education, and Private Military

The Rothbarian position is anarcho-capitalist in the extreme, exceeding even Ludwig von Mises’ own statist reservation, namely that the state should only exist for the purpose of national defense. Rothbard (regarded by the Mises Institute to have been Mises’ intellectual heir) advocates the privatization of the military and the police. This allows Rothbard to argue for the rejection of the state entirely, ultimately making a moral argument that the state is inherently coercive, and immoral in any form.

It is relevant to note the ties between industries LVMI board members run, and those industries that LVMI scholars propose be privatized, including for-profit education, higher-ed/pension investments, and private defense companies. With the acquisition of Molex, which holds significant interests in the defense industry, Koch Industries joins several others in their donor network who stand to profit from military contracts and defense privatization.

Mises board member Hunter Lewis (owner of AgainstCronyCapitalism.org) and his Harvard roommate founded of Cambridge Associates, a global investment firm whose focuses include university endowments and foundations, acting as:

an investment advisor to American research universities and colleges representing over three-quarters of U.S. higher education endowment assets, other non-profits, international organizations, and families.

Universities that are Cambridge clients include Harvard, Yale, MIT, Bryn Mawr College, and Swarthmore.

A 2017 Cambridge Associates report rejects policy proposals that have called for university endowments to “shift more endowment wealth to current student beneficiaries” and “reduce the reliance on student revenue, and thus the cost of a college education.” Cambridge Associates argues that this would “deplete endowments to a degree that they provide less support to future generations of students.”

Cambridge Associates handles investments for several high profile clients, including, the Bill and Melinda Gates Foundation, The Rockefeller Foundation, Mayo Clinic, the World Wildlife Federation, and the Knight Foundation. Cambridge provides research to Bloomberg and the Wall Street Journal. Lewis himself has held high level positions at numerous nonprofits, including the National Environmental Trust, Worldwatch Institute, the World Wildlife Fund, and the Rockefeller Brothers Fund.

Beginning in the 1990’s, Cambridge Associates also shifted focus on pension investments, counting the NFL Pension Fund as a client.

Mises Institute board member Steven Berger is the Vice Chair and co-founder of Weld North, a private equity firm whose primary acquisitions are for-profit digital K-12 “education services,” including assessment and performance analytics for teachers and students. After its 2016 acquisition of Compass Learning, Weld North was described as “one of the largest providers of digital curriculum to K-12 schools.”

Berger co-founded Weld North with his former Harvard roommate, and former Kaplan CEO, Jonathan Grayer. Berger is also a member of the Dean’s Council at the (Koch funded) Harvard Kennedy School. Before that, Berger worked for Lehman Brothers for sixteen years.

In 2015, the Charles Koch Foundation announced a donation of $2,930,000 to Program on Education Policy and Governance, for research in “Education Entrepreneurship,” including:

support for masters and doctoral candidates at Harvard focused on education entrepreneurship and school reform in the United States. . . support for postdoctoral research fellowships at PEPG and for visiting scholars.. .

The mission of PEPG is:

produce rigorous research, organize national and international conferences on issues ranging from school choice to public opinion on education policy, publish its nationally acclaimed journal Education Next, and sponsor its research colloquia lecture series

Gary Schlarbaum, former Managing Director of Morgan Stanley, is a portfolio manager at Global Capital Management, an investment firm that provides services to ”high net worth individuals. . . banking or thrift institutions, pension and profit sharing plans, pooled investment vehicles, charitable organizations, corporations, [and] state or municipal government entities.” Schlarbaum also sits on the board of the Pennsylvania Trust, an investment firms that manages investments of “foundations, endowments, and other institutions.” He is also on the board of the Independent Institute.

Daniel Ajamain is the current chair of the ABC Group, and, prior to that, acted as “chief financial officer of two Carlyle Management Group companies (Aerostructures and U.S. Marine Repair). He also spent 15 years with General Dynamics and Lockheed Martin in a broad range of operations and financial management positions.”

According to LVMI’s 2015 990, their aggregate revenues from foreign sources is $360,238.