Scott Walker Is King of Kochworld
Feb 7, 2015 5:50 AM EST
The Wisconsin governor's strong ties to Koch activists and donors could prove lucrative if he runs for president.
On a sunny Saturday in September 2009, with Wisconsin in the throes of tea party fervor, conservative starlet Michelle Malkin fired up a crowd of thousands at a lakefront park in Milwaukee with rhetoric about White House czars and union thugs and the “culture of dependency that they have rammed down our throats.”
Milwaukee County Executive Scott Walker, a Republican candidate for governor, casually attired in a red University of Wisconsin Badgers sweatshirt, stepped to the podium to amplify the message. “We're going to take back our government,” he shouted, jabbing the air with a finger. The attendees whooped and clapped. “We've done it here, we can do it in Wisconsin and, by God, we're going to do it all across America.”
In a way, the event was Scott Walker's graduation to the political major leagues. The audience had been delivered up by Americans for Prosperity, a tea party organizing group founded by Charles and David Koch, the billionaire energy executives whose fortune helps shape Republican politics. With Americans for Prosperity, the brothers had harnessed the tea party's energy in service of their own policy goals, including deregulation and lower taxes. And in Walker, they’d found the perfect instrument to help carry them out. The rally was one of the first times they’d joined forces.
“What Scott Walker is doing with the public unions in Wisconsin is critically important.”
The relationship between the Kochs and Walker was cemented during Walker's bitter war against public unions that led to a recall election in 2012. During the tense weeks of standoff at the capitol in Madison, it was the Kochs' tea party troops who provided the main counterforce to the tens of thousands of union activists protesting the governor, in a battle Walker eventually won.
As the struggle raged, Walker’s alliance with his benefactors was embarrassingly satirized when a liberal blogger posing as David Koch (whom at that point Walker had never met) kept him on the line for 20 minutes, making the governor look like a lapdog to the powerful industrialist.
This year, the relationship may evolve in unpredictable ways. With three tough statewide election victories under his belt, Walker, 47, is poised to pursue the 2016 Republican presidential nomination. The Kochs have pledged to marshal some $900 million to spend on a fight for the presidency, and although they may not wade directly into the GOP primary muck, their ties to Walker appear stronger than to anyone else considering a run. While the older brother, Charles Koch, has a personal affection for Kentucky Senator Rand Paul, the most libertarian-leaning potential candidate of the bunch, Paul doesn’t hold the same appeal for the Kochs' donor friends. Another high-profile contender, former Florida Governor Jeb Bush, hasn't attended the high-profile donor summits the Kochs host near Palm Springs, Calif., though he was invited this year.
While Tim Phillips, the president of Americans for Prosperity, said that his group won’t endorse a candidate in the primaries, his praise for Walker is effusive. “The difference Scott Walker has made with his policy achievements is as transformative as any governor anywhere in a generation,” he said in an interview. “That's why his appeal flourishes for activists and for donors.”
The Kochs and Walker now share a donor pool—a moneyed set that isn't the establishment Bush is counting on. One Koch stalwart solidly in Walker's corner is Stanley Hubbard, a billionaire Minnesota broadcast executive.
Hubbard supplied a quick assessment of the center-right 2016 field: Bush may be a great guy, but his last name is Bush. New Jersey Governor Chris Christie “blew himself up” with, among other things, his preference for luxury travel. “I am actively encouraging Scott to run, and I know of many other people who are very positive about Walker running,” he said in an interview.
Walker and the Kochs saw their political fortunes supercharged by anger over President Barack Obama's health care law. Charles and David Koch founded Americans for Prosperity in 2003, and it has become the largest organization in a network of Koch-backed activist groups that, as nonprofits, aren't required to reveal donors or detail how they spend their money. The Wisconsin chapter has been around since 2005. The group's mission is to promote a government that collects fewer taxes and regulates less. As the tea party movement grew in the aftermath of Obama’s election, the Kochs positioned Americans for Prosperity as the tea party's staunchest ally.
Walker’s rough edges fit with the movement’s populism. Tea partiers liked Walker “because he's for real,” said Mark Block, who ran AFP's Wisconsin chapter during Walker's first run for governor. “He has a plain-spoken way that is totally relatable. He says what he's going to do and does it.”
Americans for Prosperity's national leaders, based in Arlington, Va., had already been paying attention to the then-Milwaukee County executive, an elected official who gave back part of his salary amid a fiscal crisis and reduced the number of county employees to close the budget hole.
They wanted to take Walker statewide and invited him to their many Wisconsin rallies and events—some attended by 10,000 fed-up voters—throughout 2009 and 2010. At a March 2010 AFP gathering with Walker at a Wisconsin Dells resort, Phillips praised the crowd as the reason the Democratic stronghold was finally breaking red. He added with a smile: “I think I ought to be an honorary Wisconsinite, being a part of this in some small way.”
Meanwhile, Koch Industries began to turn on the cash spigots. In July 2010, the first of two contributions from Koch Industries' political action committee arrived in Walker's campaign coffers. The $43,000 it ultimately gave him doesn't sound like much, but it was his largest out-of-state contribution.
The company has also been a top donor to the Republican Governors Association, and that group spent $5 million attacking Walker's Democratic opponent, Tom Barrett, in a torrent of 2.9 million mailers and series of eight different television ads.
Walker began battling with public employees soon after he was elected, submitting a budget in February 2011 that cut public pensions and sharply limited the collective bargaining rights of many state employees. Koch reinforcements quickly arrived.
A bus caravan of Walker's friends at Americans for Prosperity disgorged thousands of supporters, carrying signs saying “Your Gravy Train Is Over … Welcome to the Recession” and “Sorry We're Late Scott. We Work for a Living” into the mass of union activists gathered at the steps of the capitol. It all played out for a cable network audience, with pundits pointing to Walker as the new tip of the spear in a long Republican fight against the labor unions that have helped elect Democrats over the decades.
The AFP's support wasn't just a big pep rally. After the governor won the budget battle and his opponents began their effort to recall him, the group deployed hundreds of volunteers to knock on doors and call into voters' homes to spread Walker's message that his pension cuts and union reforms were helping solve the state's budget crisis. The group bought television and digital ads echoing the “It's Working!” theme—a phrase Walker also frequently used.
“We're helping him, as we should,” David Koch told the Palm Beach Post in February 2012. “What Scott Walker is doing with the public unions in Wisconsin is critically important. He's an impressive guy, and he's very courageous.”
All of this outside assistance was “hugely beneficial” to Walker, said Matt Seaholm, AFP's Wisconsin director throughout the state budget battle and much of the aftermath. The governor's approval rating was climbing. “No one else was getting the message out like we were,” Seaholm said. Walker prevailed in the rematch with Barrett in June 2012, actually beating him by a wider margin than he had the first time.
Two months later, Walker strode onto stage at a hotel in Washington, where several thousand AFP national donors and activists rose to their feet to greet him and give him an award for his work to curb union power. “Maybe consider this being the most valuable player in the nation for the advancement of freedom and prosperity,” said then-AFP Foundation Vice Chairman Art Pope, as he gave Walker a bust of George Washington.
Of course, all of this fawning had a flip side. Back in the tense weeks of February 2011, Walker took a call. It was David Koch on the line, or so he thought.
Walker breathlessly babbled about his union showdown strategy. “Koch”—it turned out to be a liberal blogger on the line, recording everything—chimed in with a warning: “Now you're not talking to any of these Democrat bastards, are you?”
At one point, talking about confronting the legislators, the blogger impersonating Koch offered a suggestion.
“Koch”: Bring a baseball bat. That’s what I’d do.
Walker: I have one in my office; you’d be happy with that. I have a slugger with my name on it.
Since then, Walker has gotten to know the real David Koch, and has become a familiar face among the brothers' crowd, having attended several of their twice-a-year elite gatherings. The winter event is always near Palm Springs, and the one later in the year typically is held in Vail, Colo., or another ski town.
At those, he has solidified connections that will pay dividends if he decides to run for president. Billionaire Diane Hendricks, president of a roofing company in Wisconsin, is a million-dollar donor to the Koch network, and is smitten with Walker.
There's footage of Walker and Hendricks—who has given his campaign more than $530,000 over the years—chatting and embracing the January after he was first elected. In a clip that made its way into numerous anti-Walker ads, she asks when Wisconsin would become “completely red” so that politicians like him could “work on” unions. She said she was ready to help the cause. He said his plan was to “divide and conquer” unions by starting with the public sector. He did just that a couple of weeks later.
With deep pockets like Hendricks and Hubbard already in his corner, Walker is likely to a be financial force if he competes for the 2016 Republican nomination. While no one will have nearly as much money as Bush—who aims to raise $100 million just in the first three months of this year—Fred Malek, who has raised money for Republican presidential candidates for four decades, predicted Walker would have more than enough money at his disposal. After all, he has already shattered records in his home state, raising about $83 million over his three elections.
Malek isn't endorsing anyone, but he has gotten to know the Wisconsin governor in his capacity as chief fundraiser for the Republican Governors Association. Walker and his wife were guests at Malek's Northern Virginia home on a recent visit to Washington. “He is like the low-key guy next door, and he lacks any pomposity. At the same time, he has a story to tell about how he has the guts to stand up to unions and prevail,” Malek said in an interview, explaining why he has seen donors react well to Walker.
At the Koch donor summit last month, a trio of Republican senators who want to be president, Marco Rubio, Ted Cruz and Rand Paul, shared a stage to debate economic and foreign policy. By the time they arrived, Walker had already come and gone; a day earlier as its opening speaker, he'd had the donors all to himself.