15. Unexpected Twist of Capitalists Working for Communists
Fred C. Koch (1900 – 1967), the paterfamilias of the Koch dynasty, founded the Winkler-Koch Engineering Company with an MIT classmate in 1925, and went into the oil business. Business in the US was not good for the senior Koch and his partner early in their career. They lost a series of patent infringement lawsuits to bigger oil companies, and things got that so bad that they gave up on making it in America, and decided to seek their fortunes overseas. So they headed to the Soviet Union, where they helped Joseph Stalin modernize the country’s oil industry. Koch and his partner built fifteen thermal cracking units to turn crude oil into gasoline, and trained Soviet engineers. Fred finally had a change of heart and became a radical anticommunist after Stalin reneged on their deal, purged his soviet trainees, and deprived him of promised payments.
Joseph Stalin was not the only totalitarian dictator helped by Fred C. Koch. He worked with American Nazi William Rhodes Davis, who had personal ties with Adolf Hitler. Shortly after things went sour for him in Communist Russia, Fred headed to Nazi Germany, where he built the Hamburg Oil Refinery, the Third Reich’s third biggest refinery. Fred came to like and admire the Nazis, as seen in a 1938 letter he wrote: “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“. The Hamburg refinery built by Fred C. Koch was a big help to the Nazis as they swept through Europe, until it was finally taken out of action by Allied bombing in 1944.
