USA TODAY International Edition
Pence pursues backing from Koch allies for tax-cut plans
Gathering of wealthy donors focuses on political impact of passing reform
Vice President Pence NEW YORK on Friday sought to rally the wealthy donors aligned with the conservative Koch brothers to use their political muscle to pressure Congress to pass sweeping tax cuts, as the administration steps up its lobbying for a tax overhaul.
“To get this tax cut across the line, to give the American people the tax relief that they need, we need every ounce of your energy and enthusiasm,” Pence told billionaire industrialist David Koch and about 100 donors who gathered at the St. Regis Hotel in midtown Manhattan for a strategy session on policy fights in Congress and next year’s midterm elections.
“This is the moment,” Pence said. “Now is the time.”
The Koch network, one of the most powerful forces in Republican politics, already has spent more than $10 million this year on its campaign to pass the tax plan, running ads targeting vulnerable Democratic incumbents, sending activists door-to-door in key states and having donors dial Republicans on Capitol Hill, pressuring them to speed a tax plan through Congress this year.
“It’s the most significant federal effort that we have every undertaken,” said Tim Phillips, president of Americans for Prosperity, the largest group in the sprawling network.
In all, the groups in the Koch political empire plan to spend close to $400 million in the 2018 election cycle on policy and political battles in Congress and statehouses around the country, far exceeding the $250 million the network spent in 2016.
Pence’s presence at the gathering, his first public appearance before the network since assuming the vice presidency, underscores the growing urgency of the White House and their allies to chalk up a legislative victory, particularly after the GOP-controlled Senate failed repeatedly in the long-promised efforts to repeal the 2010 Affordable Care Act.
Koch strategists and their contributors warned that the Republicans who control Congress face a voter and donor backlash if they fail to deliver tax cuts.
Chris Wright, a Denver-based oil and gas executive who is active in the network, said he was “hugely nervous” that Congress would falter on taxes.
“This is the crux issue of the first two years of the Trump presidency,” Wright said. “If tax reform gets done, that animal spirit, the growing incentive will lead to a growing economy that will help the Republicans massively in the midterm elections,” he said.
The elected officials who huddled with donors Friday sounded alarms, too.
If the tax overhaul “crashes and burns,” said Texas Republican Sen. Ted Cruz, the party “could face a bloodbath” in the 2018 midterm elections for Congress. “We have the potential of seeing a Watergate-level blowout,” he said, referring to the 1974 election that swept more than 90 new lawmakers into office.
“The left is energized . ... They are showing up, and if conservatives stay home, that’s a recipe for a Speaker Pelosi and Speaker Schumer,” Cruz said, referring to the Democratic leaders in the House and Senate.
The tax plan aims to bring about the biggest overhaul to the U.S. tax code in decades and proposes broad cuts, including mea- sures to abolish the federal estate tax and lower the corporate tax rate to 20% from 35%, which backers say would make the United States more globally competitive.
But some of its provisions pose political difficulties for Republicans.
Among them: a plan to eliminate the federal deduction for state and local taxes. Some GOP lawmakers from districts in New York and New Jersey with concentrations of high-income households oppose the measure because their constituents rely on the tax deductions to ease the high costs of living in those communities.
Sen. Tim Scott, R-S.C., another Republican who met with donors Friday, acknowledged that Republican control of the White House and the Senate is no guarantee that Republicans will reach agreement.
“The House is like a football team with a couple of coaches on the sidelines and a great quarterback,” Scott told the donors. The Senate, he said, is like “a track team. Everybody is running their individual race.”
The network counts more than 600 contributors who commit to giving at least $100,000 a year to support Koch priorities. But many give millions annually to back a broad range of issues, from supporting free-market programs at universities to anti-poverty programs in cities such as Dallas.
Friday’s session was a smaller gathering to delve into political strategy ahead of the midterm elections, when the president’s party typically loses seats in Congress.
Although the Kochs did not back President Trump during the 2016 campaign, the network has long ties to Pence and has collaborated closely with the White House in recent months on several key issues, including the effort to overhaul the tax code. A former top Koch aide, Marc Short, is now the White House’s top liaison with Congress. And earlier this month, Phillips of Americans for Prosperity attended a small gathering of conservative leaders at the White House.
During the 2016 campaign, Trump openly mocked his Republican rivals on Twitter for courting Koch donors.
On Friday, Pence made it clear that those tensions had faded.
“Whatever differences some in the room may have had in the campaign of 2016, the president sent me here today to thank you for your strong support of our agenda this year, in 2017.”