Who are billionaire brothers George and David Koch, and why did Wisconsin Gov. Scott Walker take a call from "David Koch" – actually a liberal prankster – who recorded a conversation that may prove embarrassing to Governor Walker?
The Kochs are one of the major business forces fighting unions. A big part of their effort has been funding the campaigns of conservative, union-fighting gubernatorial candidates like Walker, John Kasich in Ohio and Rick Perry in Texas – to the tune of $1.2 million in the last election, including donations from company employees and subsidiaries.
Collectively, the Koch group was Walker's second-largest contributor last year, just behind realtor and developer interests. They've also founded and are major funders of the tea party-related "Americans for Prosperity," which just launched a $342,200 ad campaign in support of Walker.
Walker’s 20-minute conversation with someone he thought was a top campaign donor with a strong philosophical and financial interest in fighting unions may be an embarrassment to the new Wisconsin governor. (Did he really mean it when he said he’d “thought about” hiring outside agitators to disrupt pro-union demonstrators who’ve packed the Capitol building in Madison for more than a week? Or when he joked about taking a baseball bat to his political opponents?)
Walker’s talk with “David Koch” – actually Ian Murphy, editor of BuffaloBeast.com – is certainly a distraction as he tries to stare down minority Democratic lawmakers hiding out across the state line in order to avoid a vote on Walker’s bill to fix what he calls the state’s budgetary crisis. And it’s “suspicions confirmed” for critics who charge that the governor’s agenda goes well beyond budget reform to union busting.
But did that friendly chat with the man he thought was David Koch break or skirt laws having to do with campaign finance and special favors for political allies?
“If Wisconsin law forbids coordination with political donors similar to federal law, Gov. Scott Walker is not just in political trouble, but in legal hot water,” said David Donnelly, national campaigns director for the Public Campaign Action Fund, in a statement.
To raise the question itself is political. The Public Campaign Action Fund’s major donors are public employee unions and the liberal group MoveOn.org. Also, pro-union and other liberal causes certainly have their financial angels as well – billionaire financier and philanthropist George Soros, for example.
Wichita, Kan.-based Koch Industries, with estimated revenues of $100 billion, is one of the largest privately-held corporations in the United States, with major involvement in energy-related businesses, including the refining and distribution of petroleum products, chemicals, and fertilizers. One of its subsidiaries is the Georgia-Pacific pulp and paper company. The company was founded in 1925 by Fred Koch, father of George and David.
In recent years, their political targets have been the cap-and-trade climate bill, the health-care reform act, and the economic stimulus package.
Company officials have had to fend off suggestions that Koch might benefit from a provision in Walker’s budget bill that would allow the governor to sell off publicly-owned power plants in Wisconsin without first soliciting bids.
“The power plant assertion is one more example of many baseless falsehoods and speculation made by a vested interest that gets picked up and repeated over and over in the media,” said Philip Ellender, president of government and public affairs for Koch Cos. Public Sector LLC, in a statement.
While “only the Kochs know precisely how much they have spent on politics,” according to a lengthy report in New Yorker magazine last summer, tax records show that various Koch entities have made more than $200 million in political donations over the years, most of it to Republicans.
The Kochs behind-the scenes political efforts include regular gatherings with like-minded influential organizations and individuals.
“The Kochs and their firm are the central figures in an informal alliance of business executives, conservative theorists, and government officials who for several years have met twice annually to strategize over how best to advance an ambitious libertarian agenda,” according to the nonpartisan advocacy group Common Cause. “They favor dramatically lower personal and corporate income taxes, less government oversight of industry, particularly environmental regulations, and minimal public assistance for the needy.”
In January, Common Cause (which is generally aligned with liberal causes) asked the Justice Department to investigate whether the two justices should have recused themselves from consideration of a major campaign finance reform case last year, the Citizens United decision, which lifted the ban on corporate spending in elections.