Koch brothers kick donor network into high gear for midterms

INDIAN WELLS, Calif. — Billionaire businessmen Charles and David Koch have directed their network of conservative activists and donors to dramatically expand its political reach ahead of this year’s midterm elections in an effort to preserve Republican majorities in the House and Senate. 

More than 500 donors affiliated with the Koch network of conservative activist groups gathered at the five-star Indian Wells Resort and Spa in the California desert, half an hour southeast of Palm Springs, last weekend to strategize about their legislative and electoral efforts for 2018.

Republicans face a daunting political climate in 2018, particularly in the House, where retirements will cut into their ranks and history suggests they will lose seats as the party in power. Many of the donors at the retreat expressed alarm over the political energy they’ve seen on the left.

{mosads}But the GOP will have one of the most powerful and well-funded political organizations in the world on its side.

The Koch network plans to shell out $400 million this cycle to elect Republican candidates and promote conservative causes — 60 percent more than it spent during the 2016 presidential cycle.

“My challenge to all of us is to increase the scale and effectiveness of this network by an order of magnitude, by another tenfold on top of all the growth and progress we’ve already made,” Charles Koch said in remarks to the donors, who were invited to the soiree if they gave $100,000 or more to the network in 2017. “If we do that, I’m confident we can change the trajectory of this country.”

Donors at the retreat were eager to take up the challenge.

“The midterm is going to be hard. … We can’t lose the progress we’ve fought so hard for,” Gail Werner-Robertson, who pledged $1 million of her father’s fortune to the network, told Koch at one of the sessions here. “I’m telling everyone to fight and double down.”

The Koch network notably stayed on the sidelines of the presidential race between Donald Trump and Democratic nominee Hillary Clinton in 2016, but many of the individual donors have since warmed to the president.

There is still widespread frustration among some donors and activists over what they view as an endless stream of needless controversy around the White House. There is concern over the possibility that President Trump, whose job approval rating is historically low for a first-term president, could be a drag on the party in the midterms.

“As a Republican, I’m significantly concerned,” said John DeBlasio, a Koch network donor from Illinois. “It’s a little ways away. Economically things are humming along, and that’s good, but there’s a palpable fear in the electorate of Trump and his approach, and people take action by looking to hedge their bets.”

The Koch network donors are also alarmed by Trump’s anti-trade and anti-immigrant rhetoric. They are wary that he will look to enact new tariffs on imports or new taxes to pay for an infrastructure plan.

Still, most donors at the retreat were willing to put aside their quarrels with the president because they view his first year in office as a resounding success, albeit with a major assist from the GOP-controlled Congress.

Conservatives are thrilled by the confirmation of Neil Gorsuch to the Supreme Court and the scores of young justices Trump has appointed to the circuit and district courts.

They’re cheering the administration’s assault on the regulatory state and believe that 2018 will be another banner year for loosening the government’s control over businesses.

And there is a growing sense that the GOP tax bill could potentially save the party’s electoral prospects, as companies continue to give out bonuses and pay raises and workers see their take-home pay rise when the tax cuts take effect in February.

“I did not support candidate Trump in 2016 and I was very critical of him,” said Art Pope, a North Carolina businessman and philanthropist. “I did vote for Donald Trump in the end, but since he’s become president with the Republican Congress, I think the policies his administration has enacted with the Congress have been really good for the American people.”

Still, Republicans harbor no illusions about the challenges they face in the midterm elections. Democrats currently have a double-digit lead in generic ballot polling in the House.

“It will be a very challenging environment at the federal and state level to protect those who have made these victories possible,” said Tim Phillips, the president of the Koch-backed group Americans for Prosperity.

Democrats need a net gain of 24 seats to win a majority in the House. Many conservatives at the Koch summit admitted in private that they believe Republicans will lose the House in 2018.

“I could make the case for losing 18 seats and no more or I could make the case for losing 28 seats,” said Rep. Mark Meadows (R-N.C.), the chairman of the conservative House Freedom Caucus. “At this point it’s a long way off and it depends on what we do between now and November.”

That means selling the GOP’s tax overhaul to a skeptical public. The tax bill was enormously unpopular at the time of its passage, but Republicans see the tide turning in their direction. The Koch network will plow $20 million into a public relations campaign aimed at convincing voters on the merits of the overhaul.

“We’ll have to continue to combat the misinformation and the naysayers that want this to fail,” said Senate Majority Whip John Cornyn (R-Texas). “Shame on us if we don’t make it an issue.”

And donors at the Koch network said there’s an urgency to achieve more legislative achievements before the midterms, although they’ve given up hope that the Republican Congress will repeal and replace ObamaCare.

The Koch network is supportive of immigration reform that includes a pathway to citizenship for those brought to the country illegally as children, although they are frustrated by the White House proposal to cut back on immigration overall.

They’re hopeful that the White House proposal on immigration was just a starting point for negotiations. Meadows put the likelihood of Congress passing immigration reform at 80 percent.

And there are scores of regulations that Republicans still intend to roll back. GOP lawmakers here said they could also pass a prison reform package — which has long been a priority of the Koch network — in the next few months.

If Republicans can notch some more legislative victories, donors at the conference said they believe voters will be open to giving them another term in power.

“We’ll take more seats in the Senate and hold the House … we may lose a few but not more than that,” said Doug Deason, a Texas businessman.

Donors were unbowed when told that the president’s party historically loses seats in the first midterm election cycle.

“That’s just history,” said Jill Lynch, a donor from Iowa. “Nothing seems to be going the way it’s gone.”