The Daily 202: Koch network donors growing nervous about losing their majorities in the midterms
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| Koch network donors growing nervous about losing their majorities in the midterms | |||||||||
Charles Koch delivers welcoming remarks on Saturday at his network's seminar in California. (Photo by The Seminar Network)
THE BIG IDEA:
INDIAN WELLS, Calif.—The daughter of a Nebraska trucking magnate urged a ballroom of deep-pocketed donors gathered here Sunday to reach deeper into those pockets to protect the electoral gains that the Koch network has made in recent years.
“This midterm is going to be hard,” said Gail Werner-Robertson. “We need everybody to help. We can’t lose the progress that you all have fought so hard for. So I would tell everybody to get ready to fight. Get ready to double down.”
Turning to billionaire industrialist Charles Koch, she quipped: “I’m happily helping my dad spend my inheritance and moving much of it your direction.”
Werner-Robertson is one of 550 members of the Koch network who have come to a resort outside Palm Springs for a three-day seminar, each of whom commits to contribute at least $100,000-per-year to Koch-linked groups. This is their biggest gathering since the Koch brothers began convening like-minded donors twice annually in 2003.
Last year, network officials announced that they would spend from $300 million to $400 million on politics and policy in the 2018 cycle. This weekend they said it will be at the top end of that range. That’s up from $250 million spent on politics in the 2016 elections.
Interviews with donors and leaders of the Koch network reveal widespread excitement about what got accomplished at the federal and state levels in 2017, as well as trepidation and anxiety about what might happen in November 2018. While someone like Justice Neil Gorsuch will make the courts friendlier to business for decades, there’s fear that many other victories – such as deregulation and tax cuts – are far more fragile.
Tim Phillips speaks at an Americans for Prosperity event in South Carolina. (Richard Shiro For the Washington Post)
Tim Phillips, the president of Americans for Prosperity, the main political arm of the network, has been straightforward about the challenges ahead. Pointing to Democratic victories in Virginia last November and a Wisconsin special election earlier this month, he explained: “The left is energized. There’s no question about that. It’s prudent for folks to understand that and to acknowledge that. … It’s not just marches and such. It’s showing in some of the recent elections.”
Managing expectations, Phillips notes the magnitude of defeats that previous presidents have suffered during their first midterm election – from Barack Obama in 2010 to Bill Clinton in 1994 and Ronald Reagan in 1982.
“With politics, history is a great indicator. It just is,” he said. “Americans are more skeptical than they used to be of government and of Washington, D.C. That’s a healthy thing … but it means we have to do a really good job of explaining that there are some good things happening that actually improve people’s lives.”
This is a different kind of challenge for the Koch network, which scaled up during the Obama era. AFP got to ride the anti-Obama wave in 2010. Now the group is bracing for the impact of an anti-Trump one. “In 2010, we explained the ill effects of Obamacare. It’s the reverse now,” said Phillips. “Our job is to explain why these tax reforms are benefitting a lot of people. … This year we’ll be explaining the benefits of policies in many cases. That’s probably the biggest challenge. You’re going against the tide. You’re going against history. … Regardless of the president, it’s a challenge.”
The network pointedly declined to support Donald Trump in the 2016 election, eyeing his brand of populism warily, but many alumni of the Koch network now hold top jobs inside the administration. And the president has not followed through on his campaign rhetoric related to soaking the rich.
The Koch network has pursued a pragmatic approach that ensures its leaders have a seat at the table and enough juice in the White House to shape the outcome on issues from immigration and infrastructure to health care and tax policy. (I have a story on the front page of today’s newspaper with Michelle Ye Hee Lee about how the Kochs have learned to thrive in the Trump era. Read it here.)
President Trump attends a discussion about improving prisoner reentry, which included leaders of the Koch network, at the White House on Jan. 11. (Matt McClain/The Washington Post)
Now the network’s donors realize that their fortunes are tied to Trump, at least to some degree. His policies have been better than they expected, but his personal behavior has been worse. There’s quiet exasperation and palpable concern that the president’s reality-TV antics and racially charged statements could wind up generating a backlash that taints their brand and sets back their cause.
“I’m not a fan of his style of doing things,” said Bill O'Neill, the retired president of Leaseway Transportation, during a cocktail reception Sunday night. “I think it hurts him and hurts some of the causes he supports. I think his style gets in the way, but I’ve been trying to look beyond that.”
O’Neill, who lives in the suburbs of Cleveland, said it’s good that Republicans passed the biggest overhaul of the tax code in a generation because, if they had not, the midterms would have turned more on Trump’s tweets and the daily drama that emanates from 1600 Pennsylvania Avenue than policy.
“What I hope is that this election is not totally about the personality of the president, but unfortunately often it is,” he said. “People should judge instead on if the country is better off or worse off. [The network] has to be able to illustrate how the things that are happening really do help.”
The retail magnate Art Pope, a power broker in North Carolina conservative politics, said he is “very concerned” about what is surely “going to be a tough election.” But he takes some solace that the economy is much better in 2018 than it was in 2010. He also thinks voters see Trump’s brand as distinct from congressional Republicans, which he thinks will insulate down-ballot candidates from the president’s unpopularity.
“Running against Bill Clinton didn’t work for Republicans in 1998, when he was being impeached,” said Pope. “It’s going to be a persuasion election. We need to persuade people that they have benefitted from Republican policies.”
Trump greets John Cornyn, Kevin McCarthy and Paul Ryan at the White House. (Jabin Botsford/The Washington Post)
The Seminar Network, backed by a mix of ultrarich conservatives and libertarians who prefer to wield their influence outside the party structure, has in many ways supplanted the Republican National Committee, which will gather at a more modest hotel later this week in Washington for its winter meeting.
It’s why ambitious GOP politicians flock to these twice-annual confabs. Rep. Marsha Blackburn (Tenn.), who is running for Senate, appeared on an after-dinner panel Saturday night with Sen. John Cornyn (Texas) and Sen. Thom Tillis (N.C.). Arizona Gov. Doug Ducey and Nevada Attorney General Adam Laxalt, who is running for governor, will be featured on a “rising stars” panel this afternoon. Mark Meadows, the chairman of the House Freedom Caucus, and Matt Bevin, the governor of Kentucky, are also here.
The network spent $20 million last year on ads to promote the GOP tax overhaul. This weekend, leaders said they are prepared to spend up to another $20 million to improve the popularity of the new law. “I’m delighted that the network is going to help us tell the story,” said Cornyn, the No. 2 Senate Republican. “Shame on us if we don’t make it an issue.”
Paul Ryan sent a video greeting that aired during a Sunday session. “Your network has been instrumental for allowing us to reach so many milestones that have long been talked about, but until this year, have not been achieved,” the speaker of the House said in a three-minute message. “We would not be in this unique position if not for the hard work and devotion from everyone in the Koch network.” (Reflecting their influence, the Kochs last year killed a border-adjustment tax that Ryan wanted as the main mechanism to pay for tax cuts elsewhere.)
The people who come to these seminars prefer to be described as political “investors,” rather than donors, because they’re looking for a good return on what they see as “investments” in various candidates and causes.
Leaders of the network already expect that tough choices will need to be made if the headwinds stay this strong. Some candidates may get cut loose as part of the triage process.
“We are going to be there for our champions,” said James Davis, who directs the communications operation for the Koch network, as he sipped a Red Bull. “Given the landscape in ’18, when you have so many House and Senate races, if you are not a champion, it’s going to be hard to support you.”
Frayda Levin of New Jersey, who used to own and manage a book distribution business, was an early member of the Koch network and sits on the AFP board of directors. She’s been involved long enough to keep the dark political environment in perspective.
“The network has been through disappointments before,” Levin said. “2012 was devastating, and we recovered, and we rebuilt and we won again two years later. … Anybody who claims to be able to predict how Trump’s behavior affects the election does not know what they’re talking about.”
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Trump’s nominee for ambassador to Chile has deep ties to the Kushner family. Andrew Gellert is the son of George Gellert, a close friend and frequent business associate of Jared Kushner’s father, Charles. Their joint endeavors include the heavily indebted 666 Fifth Avenue, which has struggled to find investors since the younger Kushner took on his White House role. (Bloomberg)
Rod Rosenstein, deputy attorney general, speaks during a House Judiciary Committee hearing. (Andrew Harrer/Bloomberg)
THERE’S A BEAR IN THE WOODS:
-- The “memo” crafted by staffers for House Intelligence Chairman Devin Nunes (R-Calif.) highlights a decision by Deputy Attorney General Rod Rosenstein to continue surveillance of Trump campaign associate Carter Page this spring, or during the Trump administration. The New York Times’s Nicholas Fandos, Adam Goldman and Sharon Lafraniere report: “The renewal shows that the Justice Department under President Trump saw reason to believe that [Page] was acting as a Russian agent. But the reference to Mr. Rosenstein’s actions in the memo … indicates that Republicans may be moving to seize on [Rosenstein's] role as they seek to undermine the inquiry. … Republicans could potentially use Mr. Rosenstein’s decision to approve the renewal to suggest that he failed to properly vet a highly sensitive application for a warrant to spy on Mr. Page.”
-- Trump has made clear that he would like to see the controversial memo released. Ashley Parker, Rosalind S. Helderman, Josh Dawsey and Carol D. Leonnig report: “Trump’s directive was at odds with his own Justice Department, which had warned that releasing the classified memo written by congressional Republicans would be ‘extraordinarily reckless’ without an official review. Nevertheless, White House Chief of Staff John F. Kelly relayed the president’s view to Attorney General Jeff Sessions — although the decision to release the document ultimately lies with Congress. … Trump, appearing frustrated and at times angry, has complained to confidants and aides in recent weeks that he does not understand why he cannot simply give orders to ‘my guys’ at what he sometimes calls the ‘Trump Justice Department.’ …
“The president has told close advisers that the memo is starting to make people realize how the FBI and the Mueller probe are biased against him, and that it could provide him with grounds for either firing or forcing Rosenstein to leave. … Mueller has also asked about Trump’s repeated outbursts against his attorney general, including a moment in late July when Trump nearly ousted Sessions out of anger at the Russia probe. … Shortly after [Sessions recused himself], Trump issued a directive to [then-Chief of Staff Reince] Priebus: Go to Sessions and secure his resignation, according to two people with knowledge of the episode. But Priebus hesitated, declining to outright ask Sessions to quit and instead working to manage Trump’s anger, those two people said. In the following days, Republicans rallied to Sessions’s defense, and Trump backed off.”
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| Congressional Republicans divided over protecting Mueller from being fired by Trump |
-- Republicans in Congress are divided on whether to protect Mueller from being fired by Trump. Sean Sullivan reports: “The GOP discord came just days after the revelation that Trump sought Mueller’s ouster last June, prompting Democrats to make a renewed pitch for Congress to shore up the special counsel’s standing. It underscored the growing split in the Republican Party between Trump loyalists and others who are becoming increasingly concerned with the president’s actions”:
- Sen. Lindsey Graham (R-S.C.) highlighted his proposal to protect Mueller, which was originally unveiled with Sen. Cory Booker (D-N.J.) in August, and would require a panel of judges to review any decision to fire a special counsel. “Everybody in the White House knows it would be the end of [Trump’s] presidency if he fired Mr. Mueller,” Graham said on ABC’s “This Week,” adding that he’d be “glad to pass it tomorrow.”
- Sens. Thom Tillis (R-N.C.) and Christopher A. Coons (D-Del.) have offered a similar plan — and Sen. Susan Collins (R-Maine) said it “wouldn’t hurt” to pass a measure along those lines. “It would certainly not hurt to put that extra safeguard in place, given the latest stories."
- But prominent House lawmakers are cooler on the idea. “I don’t think there’s a need for legislation right now to protect Mueller,” House Majority Leader Kevin McCarthy (R-Calif.) said. He said Trump and his team “have fully cooperated” with the investigation.
- Rep. Trey Gowdy (R-S.C.) said he supports Mueller “100 percent.”“I told my Republican colleagues, ‘Leave him the hell alone,’ and that’s still my advice,” Gowdy said.
Paul Manafort leaves the federal courthouse in Washington.(Jacquelyn Martin/AP)
-- A MUST-READ ON PAUL MANAFORT --> “The Plot Against America,” by Franklin Foer on the cover of The Atlantic: “When Paul Manafort officially joined the Trump campaign … he represented a danger not only to himself but to the political organization he would ultimately run. A lifetime of foreign adventures didn’t just contain scandalous stories, it evinced the character of a man who would very likely commandeer the campaign to serve his own interests, with little concern for the collective consequences. Over the decades, Manafort had cut a trail of foreign money and influence into Washington, then built that trail into a superhighway. … His indictment in October after investigation by [Mueller] alleges money laundering, false statements, and other acts of personal corruption.
“But Manafort’s role in Mueller’s broader narrative remains carefully guarded, and unknown to the public. And his personal corruption is less significant, ultimately, than his lifetime role as a corrupter of the American system. That he would be accused of helping a foreign power subvert American democracy is a fitting coda to his life’s story.”
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| Lawmakers agree a DACA deal requires compromise, but the question is on what |
THE LATEST ON IMMIGRATION:
-- Both Republicans and Democrats said immigration negotiations should focus on a path to citizenship for “dreamers” and on efforts to bolster border security, and not on decreasing legal immigration. David Nakamura reports: “Democrats have voiced fierce opposition to [the White House’s plan], which featured a path to citizenship for 1.8 million dreamers in exchange for $25 billion for his border wall and sharp cuts to family immigration visas. Though Democratic leaders have grudgingly offered wall funding, they have accused the president of leveraging the dreamers as ‘ransom’ to severely constrict legal immigration, calling it a wish list for ‘anti-immigration hard-liners’ and ‘white supremacists.’Congress members, including some Republicans, said Sunday that the negotiations have gone too far afield ahead of a March 5 deadline after which 690,000 [DACA recipients] could begin to lose their protections from deportation.”
-- The odds of an immigration bill's success with House Republicans largely come down to one person: Trump, writes Paul Kane, “It used to be the political assumption that if [Paul Ryan (R-Wis.)] brought a bill to the floor that did not have the support of the Republican majority, he risked an internal uprising that threatened his speakership. But now, there’s a corollary to the Hastert Rule … It’s the Trump Rule. Even on the divisive issue of immigration, Ryan is guided by whether [Trump] supports legislation, and that will be enough for him to bring it to the House floor. … Rather than the old threats of deposing Ryan, or his predecessor John [Boehner], the most conservative faction of House Republicans would be hard-pressed to complain if the speaker put legislation on the floor that had Trump’s blessing — and, with his backing, there is a good chance that Trump would bring on board a majority of House Republicans.”
Sen. Chuck Schumer (D-N.Y.) speaks to reporters on Capitol Hill. (Andrew Harnik/AP)
-- The immigration fight has deepened the divide between Trump and Sen. Chuck Schumer (D-N.Y.), who previously believed cutting a deal with the president was his best chance at protecting “dreamers.” But after the government shutdown, [Schumer's] faith has been broken. Michael Scherer and Ed O’Keefe report: “‘Unless [Trump] realizes that the kind of deal I offered is good for him, it’s better that he stays away,' Schumer said in an interview last week, sipping seltzer by a crackling fire in his Capitol office … ‘If he disappears, we still, I think, have a very good chance to pass things, as long as he doesn’t mess it all up, which could very well happen.’”
“[The] episode also publicly exposed a divide among Senate Democrats and created the greatest challenge of Schumer’s one-year tenure as minority leader. His most vulnerable members, facing difficult reelection bids … were unwilling to keep the government closed over immigration. Activists, meanwhile, were enraged … That divide is likely to complicate Schumer’s role in this year’s midterm elections[.]"
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| The arguments for and against Medicaid work requirements |
TRUMP'S AGENDA:
-- Republican lawmakers in a half-dozen states are launching fresh bids to expand Medicaid — in exchange for adding work requirements. Jeff Stein reports: “Ten states have already filed requests for such waivers, and the Trump administration has approved a Kentucky plan to add work requirements and premiums to its program. [If successful], the efforts could make hundreds of thousands of Americans newly eligible for health coverage, while also opening the door to Medicaid changes that could kick some current beneficiaries out of the program and reduce its benefits to recipients — broadening the program’s reach into red states but with a decidedly conservative bent. ‘All of a sudden, we’re seeing some flexibility that allows us to do it our way, and that gives it a much better chance,” said Wyoming state Sen. Ogden Driskill, a Republican who helped defeat Medicaid expansion in a close vote in 2015. ‘Without the heavy hand of the government forcing it down our throats, many of us will take a much deeper look at it.’”
-- The Trump administration has considered nationalizing the 5G network to combat China’s growing influence in wireless infrastructure. Axios’s Jonathan Swan, David McCabe, Ina Fried and Kim Hart report: “[Obtained] documents say America needs a centralized nationwide 5G network within three years. There'll be a fierce debate inside the Trump administration — and an outcry from the industry — over the next 6-8 months over how such a network is built and paid for. … The source said the internal White House debate will be over whether the U.S. government owns and builds the network or whether the carriers bind together in a consortium to build the network, an idea that would require them to put aside their business models to serve the country's greater good.”
-- Trump suggested openness to remaining in the Paris climate accord, even as he questioned the science of climate change. “The Paris accord, for us, would have been a disaster,” Trump said in an interview with Piers Morgan on the British television network ITV. “Would I go back in? Yeah, I’d go back in. I like, as you know, I like [French President] Emmanuel [Macron.]” But Trump also cast doubt on climate science, saying, “There is a cooling, and there’s a heating. I mean, look, it used to not be climate change, it used to be global warming. That wasn’t working too well because it was getting too cold all over the place.” (Bloomberg)
-- Some veteran State Department employees are accusing the Trump administration of retaliating against them for their past work for the Obama administration. CNN’s Elise Labott reports: “The situation has got so serious that several officials tell CNN they have retained attorneys after repeatedly trying unsuccessfully to raise concerns about being assigned to low-level jobs in Foggy Bottom such as answering Freedom of Information Act requests ... Secretary of State Rex Tillerson has made clearing a backlog of FOIA requests a priority and reassigned staff to what State Department spokesperson Heather Nauert has called ‘an all-hands on deck’ effort to clear the backlog. … But many of those assigned to the ‘FOIA Surge’ effort resemble a band of misfit toys, including several ambassadors returning from overseas and senior career and civil service members who were detailed to other agencies. Others worked in offices created by Obama as policy priorities, which the Trump administration has announced it intends to close.”
-- Trump’s expected infrastructure proposal could lead to a battle among states for a relatively small amount of federal funding. Politico’s Lauren Gardner reports: “Instead of the grand, New Deal-style public works program that Trump's eye-popping [$1 trillion] price tag implies, Democratic lawmakers and mayors fear the plan would set up a vicious, zero-sum scramble for a relatively meager amount of federal cash — while forcing cities and states to scrounge up more of their own money, bringing a surge of privately financed toll roads, and shredding regulations in the name of building projects faster."
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| Steve Wynn resigns as RNC finance chair after sexual misconduct allegations |
THE #METOO MOVEMENT:
-- Sen. Susan Collins (R-Maine) called on Republican candidates to return campaign contributions from casino mogul Steve Wynn, who resigned as RNC finance chair amid allegations of sexual misconduct. Sean Sullivan reports: “[Collins] said that if Republicans ‘have accepted contributions recently from him that have not been spent,’ they should give those back. … ‘I don’t even think it’s a close call to return the money,’ Collins said. She said she was ‘very pleased’ that Wynn stepped down from his RNC position and called the allegations against him ‘very serious.’ … ‘We should do of ourselves what we ask of the Democratic Party, if these allegations have merit,’ Sen. Lindsey O. Graham (R-S.C.) said ... ‘I don’t think we should have a double standard for ourselves.’”
-- Sen. Marco Rubio (R-Fla.) fired his chief of staff over allegations of “improper conduct.” Sean reports: “Rubio said in a written statement that he had ‘sufficient evidence to conclude’ that his chief of staff, Clint Reed, ‘had violated office policies regarding proper relations between a supervisor and their subordinates.’ He further concluded that this led to actions that ‘amounted to threats to withhold employment benefits.’ The Florida senator said he had ‘taken steps to ensure that those impacted by this conduct have access to any services they may require now or in the future’ and will be notifying appropriate congressional administrative offices on Monday.”
-- In case you missed it: The New York Times’s Maggie Haberman and Amy Chozick reported that Hillary Clinton chose to keep an adviser on her 2008 campaign despite complaints of repeated sexual harassment:“Mrs. Clinton’s campaign manager at the time recommended that she fire the adviser, Burns Strider. But Mrs. Clinton did not. Instead, Mr. Strider was docked several weeks of pay and ordered to undergo counseling, and the young woman was moved to a new job. Mr. Strider, who was Mrs. Clinton’s faith adviser, was a founder of the American Values Network and sent the candidate scripture readings every morning for months during the campaign, was hired five years later to lead an independent group that supported Mrs. Clinton’s 2016 candidacy, Correct the Record, which was created by a close Clinton ally, David Brock. He was fired after several months for workplace issues, including allegations that he harassed a young female aide.”
-- Interns in the Kansas statehouse are required to sign confidentiality agreements about what goes on in lawmakers’ offices. Hunter Woodall and Lindsay Wise report for the Kansas City Star: “Employment law experts who reviewed the document … criticized it as a potential shield to discourage student interns from reporting sexual harassment. They also said it might violate the First Amendment. … Behavior toward interns in the Capitol became a focal point in state politics last fall after a former Democratic staffer revealed that during the 2016 session, female interns had been asked to serve as designated drivers for male lawmakers who had been drinking.”
-- “Can Woody Allen Work in Hollywood Again?” by the New York Times’s Melena Ryzik and Brooks Barnes: “His film distributor, Amazon, the presenters of his musical ‘Bullets Over Broadway,’ and colleagues are now grappling with renewed scrutiny of allegations that Mr. Allen molested his adopted daughter Dylan Farrow in 1992 when she was a child. Mr. Allen has steadfastly denied the claims and was not charged. But at a moment when women’s voices and stories have been amplified as never before, Ms. Farrow’s account carries more force — as even defenders of Mr. Allen are starting to acknowledge."
Chinese President Xi Jinping and President Trump.(AP)
GOOD READS FROM ELSEWHERE:
-- Bloomberg, “All Signs Point to Big Democratic Wins in 2018,” by Greg Giroux: “An analysis by Bloomberg Government of historical data, election maps and public polling points to sweeping Democratic gains in the November election. … Since the end of World War II, the party in control of the White House has, on average, had a net loss of 26 House seats in midterm elections. Democrats can win control of the House with a net gain of 24 seats in November. … Adding to that, Trump’s approval rating at this stage of his presidency, 36 percent, is lower than any of his predecessors going back to Harry Truman, according to Gallup polling data. The less popular the president, the more seats his party tends to lose.”
-- Politico Magazine, “Can Joe Kennedy Beat the State of the Union Curse?,” by John A. Farrell: “This year’s opposition response to the State of the Union address has two elements to lift it from its status as a star-crossed, sometimes futile exercise: One, the president’s name is Donald Trump; two, the responder is named Kennedy. … Here’s how the Democrats’ rising star could come out on top.”
-- The New York Times, “The Follower Factory,” by Nicholas Confessore, Gabriel J.X. Dance, Richard Harris and Mark Hansen: “The real Jessica Rychly is a Minnesota teenager with a broad smile and wavy hair. She likes reading and the rapper Post Malone. But on Twitter, there is a version of Jessica that none of her friends or family would recognize. While the two Jessicas share a name, photograph and whimsical bio … the other Jessica promoted accounts hawking Canadian real estate investments, cryptocurrency and a radio station in Ghana. … All these accounts belong to customers of an obscure American company named Devumi that has collected millions of dollars in a shadowy global marketplace for social media fraud. These accounts are counterfeit coins in the booming economy of online influence, reaching into virtually any industry where a mass audience — or the illusion of it — can be monetized.”
-- The New York Times, “Indian Slavery Once Thrived in New Mexico. Latinos Are Finding Family Ties to It,” by Simon Romero: “Their captive forebears were Native Americans — slaves frequently known as Genízaros (pronounced heh-NEE-sah-ros) who were sold to Hispanic families when the region was under Spanish control from the 16th to 19th centuries. Many Indian slaves remained in bondage when Mexico and later the United States governed New Mexico. The revelations have prompted some painful personal reckonings over identity and heritage. But they have also fueled a larger, politically charged debate on what it means to be Hispanic and Native American.”
-- The Atlantic, “The Devastating Paradox of Pakistan,” by Mark Mazzetti: “How Afghanistan’s neighbor cultivated American dependency while subverting American policy.”
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