The activities of conservative donors Charles and David Koch have become a dominant focus of American politics, but their Wichita, Kansas-based conglomerate has remained largely in the background – until now.
Koch Industries, which produces goods ranging from Angel Soft toilet paper to iPhone parts, is adopting a more visible strategy to neutralize critics on the left and promote a warm, patriotic image of its multinational empire.
It represents a rare foray into the spotlight by one of the world’s largest privately held companies, whose varied industries include oil refining, ranching, fertilizer production and paper products. Despite its reach, however, it has become known primarily for the polarizing brothers at its helm.
In coming weeks, Koch Industries plans a fresh round of television ads casting itself as an all-American company with a diverse workforce – part of the first nationwide marketing campaign it has ever undertaken. The corporation is considering spots similar in concept to a Web video currently on its YouTube page, in which military veterans who work at Koch Industries compare the values of the armed forces to those of the company.
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“Loyalty, duty, respect, selfless service, honor, integrity and personal courage,” says one worker, a former infantry officer. “I felt like that transition in terms of the culture between the Army and Koch Industries would actually be a great fit.”
At the same time, the company is adopting a more confrontational approach in the political arena, seeking to undermine its antagonists on the left. In an organized effort on Capitol Hill this week, Koch Industries’s Republican allies will shine a spotlight on a group of Democratic donors who finance a network of prominent liberal groups.
The efforts are part of a newly aggressive posture by Koch Industries, which has usually only engaged publicly when the Kochs or the company have been criticized.
“We’ve been responding to attacks by politicians and political groups for more than four years,” said Mark Holden, senior vice president and general counsel for Koch Industries, in a rare interview last week. “If our responses and our efforts to set the record straight have become more visible, we think that’s a good thing.”
Part of the strategy includes the company’s first-ever national ad campaign, themed “We Are Koch.” The initial spot, which went up in June, described Koch Industries as “proudly built on American values and skill,” employing 60,000 workers in the United States.
It is set to be followed this fall by ads featuring employees extolling the virtues of working for the company, which had annual revenue last year of about $115 billion, according to Forbes magazine. The commercials are intended to help recruit applicants for 3,500 openings that Koch Industries has nationwide, said Melissa Cohlmia, managing director of corporate communications.
The company’s decision to air a marketing campaign suggests that the political attacks on the Koch brothers may be hampering its recruitment efforts, said Malcolm Harris, a professor of finance at Friends University in Wichita and a longtime observer of Koch Industries.
“I’m sure they’re worried about that spilling over to the image of the company,” he said.
Last year, Koch Industries acquired Molex, an Illinois-based company that produces electronic components for products such as iPhones. “To acquire a company like that, you have to forge relations with a whole new set of employees,” Harris said. “If the only thing they know is what they hear in the political arena, that’s going to be difficult.”
Holden disputed that notion, saying the ads are aimed at spotlighting jobs available because of Koch’s continued growth. “We have not been impacted by the political attacks in our recruiting, hiring, or retention, nor have our businesses been impacted,” he said.
Where the toll has been felt, Holden said, is by the Kochs personally, who have faced harassment from opponents, including death threats.
The vitriol has affected Koch’s employees as well, Cohlmia said.
“The collateral damage is something important that should be spoken about,” she said, adding: “We know the family, we know the businesses. And they are very good people. So the effect of that on us as employees, it’s very hard.”
Yet the Kochs show little sign of backing down from political battles. The latest salvo comes Monday afternoon, when Senate Democrats have scheduled a floor debate and vote on a constitutional amendment giving lawmakers more leeway to rein in the free-wheeling era of political spending that has taken hold since the Supreme Court’s 2010 Citizens United decision.
The debate over the long-shot measure is expected to feature more denunciations of the Koch brothers, whom Senate Majority Leader Harry Reid has incessantly pummeled in floor speeches this year. Recently, he accused the industrialists – each worth about $42 billion, according to Forbes – of running “a cult of dark money,” citing their stewardship of a network of conservative advocacy groups that do not reveal their financial backers.
GOP lawmakers allied with the Kochs’ plan to fire back by pointing to the Democracy Alliance, an invitation-only donor group that functions as a hub for wealthy liberal contributors. The group’s roughly 100 members – whose names it does not disclose – have helped underwrite a cadre of influential groups such as the Center for American Progress and Media Matters for America, as well as pro-Democratic super PACs.
“The hypocrisy is stunning,” Sen. Ted Cruz, R-Texas, an outspoken opponent of the constitutional amendment, said in an interview Friday. “Senate Democrats have long been funded by a group of billionaires bent on maintaining their power, yet they pretend to be outraged” by the spending of the Koch brothers and their allies.
In advance of Monday’s floor debate, Senate Republican staffers circulated a chart showing the reach of Democracy Alliance, with the donor group represented as a circle surrounded by seven concentric rings of smaller circles, one for each of the roughly 170 organizations supported by its members. Among them are advocacy groups such as Common Cause, Public Citizen and People for the American Way, which have been at the forefront of efforts to restrict the influence of wealthy interests on politics.
“I think it’s important that people understand – whatever the Kochs and our network may be accused of or said to be doing – that the other side is doing much more of it, and has been doing it for a much longer time,” Holden said.
“A lot of these groups that the Democracy Alliance funds don’t disclose their donors, which is their right, and I’m supportive of that, but then they turn around and attack us, claiming that the groups we support are dark money groups, because they don’t disclose their donors,” Holden added. “So it seems dishonest and the height of hypocrisy.”
Gara LaMarche, president of Democracy Alliance, rejected the comparison, noting that the group does not make contributions itself. Instead, its members are required to donate at least $200,000 a year to groups it vets and recommends.
The alliance “is an advice organization,” LaMarche said. “No money flows through us.”
Many of the organizations backed by alliance members disclose the names of their top donors in annual reports posted online, although some allow contributors to give anonymously, as well.
The fact that rich donors on the left are helping finance groups working to reduce the impact of money in campaigns is “slightly ironic, but it’s not hypocritical,” LaMarche said.
“Our donors are trying to bring about a world in which their wealth counts for less in politics,” he added.
Over the last nine years, alliance members have donated an estimated $500 million to organizations on the left, according to officials. The Koch-backed political network, by comparison, raised at least $407 million in the two-year 2012 election cycle, an investigation by The Washington Post and Center for Responsive Politics found.
This year, groups allied with the Kochs aim to spend $290 million on television ads and on-the-ground organizing, putting the coalition on track to be the biggest player in midterms. Its main organ, the free-market advocacy group Americans for Prosperity, now has more than 500 field operatives in 35 states – nearly triple its 2012 levels – and has run $50 million in ads, largely against vulnerable Democrats.
“Charles Koch and David Koch are going to keep doing what they do and how they do it,” Holden said, adding that attacks are “not going to slow them down. It’s probably even deepened their resolve.”