Former Obama Adviser Deletes Bizarre Explanation of Koch Tax Mystery

Austan Goolsbee, former economic adviser to President Barack Obama, last week deleted a confusing tweet explaining his 2010 claim that Koch Industries pays no corporate income taxes.

The claim against billionaire philanthropists Charles and David Koch “was made at the same time that top Democrats, including President Obama himself, were demonizing Charles and David Koch, the owners of Koch Industries, for giving money to Tea Party groups,” the Weekly Standard’s John McCormack writes.

“Goolsbee's remark led to a federal investigation, the results of which have never been released," he adds.

Austan Goolsbee. (Getty Images)

But now that the Internal Revenues Service has come out and admitted to targeting conservative groups during the 2012 election, Goolsbee’s mysterious command of what should have been private tax information has come under scrutiny once again.

Koch Industries lawyer Mark Holden disputed Goolsbee's smear in 2010, arguing that it simply wasn't true. But Holden wondered whether someone in the Obama White House was illegally leaking personal tax information.

McCormack provides the details:

The White House never formally explained how it came up with the claim, but an anonymous White House official told Ben Smith, then a reporter at Politico, that the claim was based on testimony to President's Economic Recovery Advisory Board and publicly available sources, such as Forbes magazine and Koch Industries' website.

Koch lawyer Mark Holden said the White House's explanation didn't make sense: "[C]ontrary to the administration official's statement on what sources were used by the administration, neither the Koch website nor Forbes' list of private companies has information regarding Koch's tax filing status.  This is confidential information."

At GOP Senator Chuck Grassley's request, Treasury inspector general J. Russell George investigated whether the Kochs' personal tax information had been leaked.

“But after the investigation was completed, George wrote in an October 2011 letter to Senator Charles Grassley that, due to confidentiality provisions of the law, he could not tell Grassley if anyone had illegally accessed Koch Industries tax returns or if the inspector general had taken any actions following his investigation,” McCormack explains.

The only members of Congress who have access to confidential tax information are the chairman of the Senate Finance Committee (Sen. Max Baucus) and chairman of the House Ways and Means Committee (Rep. Dave Camp). Neither of them has commented on the IG’s Koch report.

So until we see the IG report, the questions remains: Where did Goolsbee get his information?

The former economic adviser tried to answer that question earlier this month by tweeting the following:

@joerepublic1 there was no secret info on koch bros. It came fr/heresptimes.com/2003/12/28/Sta… but was a mistake--one of the other Koch bros.

— Austan Goolsbee (@Austan_Goolsbee) May 14, 2013

But if you click on the link provided in the now-deleted tweet, it takes you to a 2003 story about a different Koch brother who pays no corporate income tax in the state of Florida.

Yeah, it’s not about Charles and David Koch.

“Imagine if a senior Bush administration official made a false claim about George Soros's taxes during an election because he read an old article written about some guy named Jimmy Soros,” McCormack writes.

So why did Goolsbee delete the tweet? Did he delete it because it’s incredibly embarrassing to have based his Koch 2010 smear on an article about a different Koch?

Holden, the Koch lawyer, isn’t buying any of it.

Austan Goolsbee, former chairman of the Council of Economic Advisers, listens to U.S. President Barack Obama. December 17, 2010. (Getty Images)

"It is hard for me to believe what Mr. Goolsbee is saying now on Twitter, after not raising it 3 years ago when this came up, and he and the White House stated his comments about Koch not paying taxes and how it structured itself for tax purposes were based on Forbes article, our website, and PERAB testimony," Holden told the Weekly Standard.

"As you recall, when we challenged those assertions the White House said Goolsbee was 'mistaken' and 'we (White House and Goolsbee) won’t' say this again,” Holden added.

“Now after the TIGTA investigation is closed, he offers yet another reason – a 2003 newspaper article that doesn’t deal with Koch Industries or federal tax issues. Very hard to believe this and makes me wonder what he really relied upon and what is in the TIGTA report."

Until we see the IG’s report on the Koch’s taxes, we’ll never know for sure whether the Obama administration was merely smearing the brothers with a claim made up out of thin air, whether the claim was based on a 2003 report on a different Koch, or whether something much more nefarious is afoot.

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