Exclusive: Charles Koch and his company launch 'end the divide' ad campaign
WICHITA, Kan. — Working to soften his partisan image, conservative billionaire Charles Koch's industrial conglomerate this week will launch a television and digital advertising campaign that calls for Americans of all political stripes to “end the divide” as he seeks broader support for his free-market ideas and defends his corporate brand.
The advertising, which starts Friday, aims to “get a national conversation going,” Koch told USA TODAY. “Let’s stop attacking people we disagree with and trying to silence them. Let’s instead try to find common ground and learn from each other so we can innovate.”
The campaign comes as Koch and his aides work to retool parts of his vast policy and political empire and direct more money and effort toward public policy and social change. The network recently launched a new arm, dubbed Stand Together, which has set attacking poverty and boosting educational quality as early goals. And Koch officials have disbanded an opposition-research unit that gathered information about liberal groups, Democratic candidates and others.
Koch expressed skepticism this week about Republican Donald Trump's presidential bid, but said he’s not retreating from national and state politics. He calls the changes part of the "normal review" that his network and company alike undergo periodically to remain nimble and competitive.
‘“The world is changing,” he said. “We’ve got to change at least as fast as the world, hopefully faster.”
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The new 60-second commercial initially will air on news programs and expand to sports and entertainment shows, said Steve Lombardo, who oversees communications and marketing at Koch Industries. It opens with images contrasting a stately white mansion with a trash-strewn neighborhood as a narrator talks of a country “divided between success and failure, with government and corporations picking winners and losers.”
It goes on to hit themes Koch has pursued for years, arguing that the criminal-justice system is rigged against the poor and that government regulation thwarts business growth. Print versions of the ads will appear in several national newspapers Monday.
A new website, EndTheDivide.com, highlights what company officials say are their efforts to “promote equal justice and a free and open society,” such as the company’s decision to stop asking potential employees about their criminal histories on job applications.
Koch officials say they also are expanding a range of efforts, including a “principled entrepreneurship” program that encourages high school students to start small businesses. That project will expand to more than 50 additional schools this fall in cities from Phoenix to Detroit.
Lombardo would not disclose how much Koch Industries will spend on the new campaign, but it comes as Koch and his company continue a multi-year, public relations effort to define a family and company best known — and often vilified — for their role in electing Republicans to Congress and state legislatures.
A review by Kantar Media/CMAG, which tracks TV advertising, pegs Koch Industries’ spending to promote the company at $28.7 million since the start of 2014. The new advertising will not displace an existing “We are Koch” campaign that has featured Koch employees and products, Lombardo said.
Koch, who spent years shunning the spotlight, said he now has given about 40 interviews, as he works to promote his latest book, Good Profit.
Democrats have made it clear that they will not back off their criticism of the billionaire, particularly as Koch groups ramp up their activity in this year’s high-stakes Senate races. Republicans, who took control of the chamber in 2014, are defending 24 seats this year, compared with 10 for Democrats. Koch groups already have pumped more than $15.4 million in ads to shape a handful of Senate races and have reserved another $30 million in advertising for August and September.
Americans for Prosperity, its main grass-roots arm, has built a standing army of activists and now employs more than 450 people in 35 states, up from fewer than 100 in 2010. Its biggest force is in Florida, a presidential and Senate battleground in November, where it now has 16 field offices and a staff of 75.
Democratic strategists say targeting Charles Koch and his brother David Koch will be a winning strategy this fall with voters, who are increasingly aware of the brothers’ outsized influence in Republican politics.
"Voters know the GOP is the party of billionaires and big corporations, and that view is further cemented each time the Kochs spend for Republicans,” said Shripal Shah, a spokesman for Senate Majority PAC, a super PAC working to flip control of the Senate to Democrats.
Dark Money: The Hidden History of the Billionaires Behind the Rise of the Radical Right, a book by New Yorker staff writer Jane Mayer released in January, has intensified the spotlight on the brothers. In the book, which chronicles the big sums the Kochs and other deep-pocketed conservatives spent to influence legislative fights on the Affordable Care Act and climate change, Mayer said she found clues that the Kochs had mounted a private investigation into her in retaliation for her 2010 magazine article that detailed their growing influence on elections.
Asked whether that was the case, Koch told USA TODAY this week: “I have no knowledge of it. I don’t believe it’s true. And that’s not the way we do things.”
In an email, Mayer said that "a private investigative firm run by Howard Safir, the former commissioner of police in New York City, was absolutely hired in an effort to discredit me on behalf of the Kochs. Both the Kochs and Safir have declined to respond to questions from the New Yorker about this, but others have confirmed it.”
Last November, Politico uncovered the existence of what it described as the Koch's 25-member intelligence-gathering unit, which helped track the activities of groups on the left. It operated within Freedom Partners Chamber of Commerce, the umbrella group for the network’s activities. The unit's staff included a former CIA analyst, Politico reported.
In the interview with USA TODAY, Koch cast the decision to reorganize the group as a move to improve efficiency.
He said the operation had grown too “isolated” from the rest of the network and pursued activities that weren’t “cost effective,” such as dispatching staffers to monitor candidates’ political rallies. “We just didn’t learn that much, beyond what you can learn from the Internet,” he said of the on-the-ground tracking. Koch aides said staffers still engage in candidate research but are integrated into other divisions of the organization.
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It’s hard to determine how much the additional scrutiny and criticism has affected the financial picture for Koch Industries, one of the nation’s largest private companies. The company, with interests in everything from oil refining and ranching to consumer products, such as Dixie Cups and Brawny paper towels, is largely owned by two shareholders, Charles and David Koch, who are each worth $44.3 billion, according to Forbes. Its books aren't public.
Charles Koch said the political blow-back is not hurting his bottom line. “I’m sure some people … say, ‘OK, we don’t want to buy Koch products’ and other people say, ‘I want to go buy their products,’ " he said.
“We’re in a lot of commodity businesses, and they go up and down with the commodities. But we’re doing all right.”