Billionaire campaign donor David Koch, heir to a fortune and a political legacy created by one of the driving forces behind the John Birch Society, makes no secret of his enthusiasm for Wisconsin Gov. Scott Walker.
“What Scott Walker is doing with the public unions in Wisconsin is critically important. He’s an impressive guy and he’s very courageous,” Koch explained in a recent conversation reported by the Palm Beach Post. “If the unions win the recall, there will be no stopping union power.”
That’s no surprise. What is surprising is that Koch now appears to be bragging about how he and his brother Charles are using their vast fortune to fund an independent campaign aimed at “helping” Walker. Even in an era when billionaires such as the Kochs are emerging as key financiers of super PACs and other campaign vehicles, Koch’s admission will raise eyebrows — and questions about whether inappropriate coordination by a candidate, his campaign and a supposedly independent group might be the stuff of “scandal.”
Like their father before them, David Koch and his brother Charles are longtime champions of extreme right-wing causes. And Walker’s militant anti-labor policies coupled with a willingness to cut funding for public education and public services have made him a hero of conservative hardliners like the Kochs. At the same time, Walker’s extremism has inspired a movement to recall him from office, which recently filed petitions with more than 1 million signatures calling for an election to remove the governor.
The governor has already spent a fortune trying to block the recall drive, with millions of dollars in television advertising, as well as expensive legal efforts to block a new vote. Both have been strikingly unsuccessful so far, at least in part because Wisconsin has steadily lost jobs since Walker’s budget was enacted — a dismal record that has caused a loss of confidence in the governor and his agenda.
Even as Walker struggles to explain why Wisconsin is shedding jobs while the rest of the country is gaining them, conservative groups funded by Charles and David Koch, such as Americans for Prosperity, are filling the state’s television airwaves with ads that claim Walker’s policies are “working.” According to Reuters, “a $700,000 advertising campaign sponsored by Americans for Prosperity, a foundation funded by conservative billionaire brothers Charles and David Koch of oil and gas conglomerate Koch Industries, hit the Wisconsin airwaves, the latest phase of its ‘Stand with Walker’ campaign.”
These ads are supposedly independent expenditures by a not-for-profit organization that operates under tax rules established to benefit the work of “religious, educational, charitable, scientific, literary, testing for public safety, to foster national or international amateur sports competition, or prevention of cruelty to children or animals organizations.”
It’s illegal for “independent” groups operating under the Internal Revenue Service code as a 501(c)(3) organization to participate directly or indirectly in any political campaign.
The IRS is explicit in this regard: “Under the Internal Revenue Code, all section 501(c)(3) organizations are absolutely prohibited from directly or indirectly participating in, or intervening in, any political campaign on behalf of (or in opposition to) any candidate for elective public office. Contributions to political campaign funds or public statements of position (verbal or written) made on behalf of the organization in favor of or in opposition to any candidate for public office clearly violate the prohibition against political campaign activity. Violating this prohibition may result in denial or revocation of tax-exempt status and the imposition of certain excise taxes.”
Similar, though slightly less strict, rules apply to campaigning by other so-called “501” groups that the Kochs have funded.
So, while David Koch’s stated enthusiasm for Scott Walker was not surprising, his explanation of how that enthusiasm is being expressed politically was.
According to the Post, Koch said of Walker: “We’re helping him, as we should. We’ve gotten pretty good at this over the years. We’ve spent a lot of money in Wisconsin. We’re going to spend more.”
The Post added: “By ‘we’ he says he means Americans for Prosperity, which is spending about $700,000 on an ‘It’s working’ television ad buy in the state.”
Walker’s defenders, a group that now officially includes the Koch brothers (thanks to David Koch’s pronouncement), will surely suggest that the billionaire is merely expressing his right to fund independent activities that just happen to be “helping” Walker.
But it is notable that, during last summer’s Wisconsin state Senate recall campaigns, the Republican Party of Wisconsin issued statements pointing out that “coordination between … political campaigns and independent groups is specifically outlawed.”
Such coordination might be denied by the parties involved. But, argued the Republicans, reasonable people should recognize coordination as a “scandal.”