The Koch Brothers Say No to Tariffs

Summary

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Episode Overview

Podcast: The Political Scene | The New Yorker
Episode: The Koch Brothers Say No to Tariffs
Date: June 18, 2018
Host: David Remnick
Guest: Jane Mayer

In this episode, David Remnick interviews New Yorker staff writer Jane Mayer about the political activities and influence of Charles and David Koch—famously known as the Koch brothers. Despite being staunch Republican donors and free-market advocates, the Kochs are opposing the Trump administration's recent turn toward trade protectionism, specifically tariffs on imported goods, and are launching a $30 million campaign against these policies ahead of the 2018 midterm elections. The conversation illuminates the paradoxes of the Kochs’ relationship with the Trump presidency, their vast political machine, and their lasting impact on Washington.

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Key Discussion Points & Insights

1. The Koch Brothers vs. Trump’s Tariffs

• Core Disagreement with Trump:
  The Koch brothers oppose any kind of tariffs, believing they harm both their businesses and the wider U.S. economy.

  • Jane Mayer: “They're against any kind of tariffs. They think that it's deleterious to their business and to the country's economy.” [02:41]

• $30 Million Anti-Tariff Campaign:
  The Kochs are planning to spend up to $30 million to oppose the Trump administration’s tariff policies.

  • Jane Mayer: “They've talked about spending millions, as much as $30 million.” [03:07]

• Messaging Strategy:
  The campaign will appear in ads from Koch-backed groups such as Americans for Prosperity, a Hispanic group, and a veterans’ group, focusing the messaging on the impact of tariffs on consumers and lower-income Americans—not on Koch Industries.

  • Jane Mayer: “You will see ads that will say that these tariffs are going to hurt poor people and consumers. They don’t go out there and say these tariffs are going to hurt Koch Industries...they talk about how the tariffs are going to hurt the little people.” [03:19]

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2. Koch Influence in the Midterm Elections

• Maintaining Power in Congress:
  The main objective is to support Republican candidates to control Congress and stave off any legislation that would regulate carbon pollution or address global warming, closely tied to Koch business interests.

  • Jane Mayer: “The most important for them is to keep the country from doing anything that would put a tax on carbon pollution and take action against global warming because their whole business is tied up in carbon, in fossil fuels.” [04:05]

• Political 'Machine':
  The Koch network acts like a powerful political apparatus, often as influential—or more so—than the Republican Party itself, using its resources to “primary” politicians who don’t align with their agenda.

  • Jane Mayer: “…they use this political muscle...to scare Republicans into following their agenda. And they threaten those that might not by saying, 'we'll run somebody against you in a primary.'” [04:33]

• Strategic Bipartisanship:
  While supporting mostly Republicans, the Kochs occasionally back Democrats aligned with their business interests.

  • Notably, they have supported Democrats in Arkansas and those aiding in deregulatory initiatives like the rollback of Dodd-Frank. [04:33]

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3. The Koch-Trump Relationship: An Uneasy Alliance

• Reluctant Non-Support in 2016:
  The Kochs viewed the Trump/Clinton election as choosing “between a heart attack and cancer.”

  • David Remnick: “If I remember, they described the campaign of Clinton vs. Trump as having to decide between a heart attack and cancer...” [05:50]

• Lack of 2016 Presidential Support:
  Though they had a massive war chest ($889 million), they did not support Trump’s candidacy directly, allocating funds elsewhere.

  • Jane Mayer: “...they didn’t put money behind Trump.” [07:45]

• Disagreements Beyond Tariffs:
  Major policy divides with Trump exist on trade and immigration, both critical to the Koch worldview.

  • Jane Mayer: “They have differences with him on trade and on immigration. Those are two major areas.” [07:45]

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4. Areas of Alignment: Taxes, Deregulation, and Anti-Regulatory Agendas

• Support for Tax Reform:
  The Kochs played a significant role in supporting Trump’s 2017 tax cuts, spending $20 million to push it through.

  • Jane Mayer: “They are huge supporters of his one achievement in office legislatively, which is the tax bill...This is their idea of heaven.” [08:24]

• Blocking the Border Adjustment Tax:
  The Kochs successfully stopped a proposed border adjustment tax that would have offset tax cuts by raising new revenue.

  • Jane Mayer: “They stopped him from achieving the mechanism that he had originally intended to pay for those tax cuts...But guess what? The Kochs were against it and they killed it.” [08:24]

• Long-term Impact:
  The result is growing deficits, which enables future arguments for cutting government spending—a core Koch aim.

  • Jane Mayer (on the outcome): “And they’re going to create a lot more pressure to keep cutting government spending. And that’s what the Kochs want.” [09:40]

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5. Koch Influence on Trump Administration Personnel

• Staff Connections:
  Senior Trump administration officials, such as Betsy DeVos (Secretary of Education), Mike Pompeo (Secretary of State), and Mike Pence (Vice President), have strong Koch ties.

  • David Remnick: “You’ve got Betsy DeVos...Mike Pompeo...Mike Pence...they all have pretty close ties to the Kochs, right?” [09:40]
  • Jane Mayer: “Really close ties.” [09:59]

• Appointees at Key Regulatory Agencies:
  Daniel Jorjani, a Koch insider, is now the top lawyer at the Department of the Interior; Scott Pruitt, backed by Kochs, led the EPA.

  • Jane Mayer: “Daniel Jorjani…right hand man to Charles Koch. And he’s now the top lawyer in the Interior Department…Scott Pruitt…political career was funded from the start by the Kochs.” [10:08]

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6. Changes Within the Koch Organization

• David Koch’s Retirement:
  David Koch has stepped down due to failing health, but sources indicate Charles Koch pushed him out.
  • Jane Mayer: “He was given a push out the door by his older brother...David Koch really hadn’t wanted to go, but...Charles has been pushing him out for some time.” [11:06]

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7. Kochs’ Overall Success Under Trump

• Summary Assessment:
  Despite policy differences on tariffs and immigration, the Kochs have achieved significant victories under Trump—especially regarding environmental deregulation and tax policies.
  • Jane Mayer: “Tariffs and immigration are not such central questions to them as environmental policy and tax policy and other regulatory policy. And on those areas, Trump for them is a dream come true.” [11:44]

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Notable Quotes & Memorable Moments

• Jane Mayer on Koch Messaging:
  “They don’t go out there and say these tariffs are going to hurt Koch Industries and we who are the ninth richest men in America…they talk about how the tariffs are going to hurt the little people.” [03:19]

• On the Koch Political ‘Machine’:
  “They use this political muscle...to scare Republicans into following their agenda...most of the people on the Hill, face it, want to get reelected. So they go along.” [04:33]

• On the 2016 Election:
  David Remnick: “They described the campaign of Clinton vs. Trump as having to decide between a heart attack and cancer, I think is how they put it.” [05:50]

• Kochs’ Ideological Goal:
  “They want to shrink the government down to… the size that it was during Calvin Coolidge’s period. Calvin Coolidge is their favorite president.” [06:15]

• Overall Gain:
  “Trump for them is a dream come true.” [11:44]

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Key Timestamps

• 01:16–01:48: Episode theme and introduction
• 02:41: Jane Mayer outlines Koch opposition to tariffs
• 03:07: Scope and methods of anti-tariff campaign
• 04:05: Kochs’ core focus on blocking climate/carbon regulations
• 04:33: The Koch political machine’s tactics explained
• 05:50: Kochs’ view of 2016 election—a choice between "heart attack and cancer"
• 07:45: The Kochs’ allocation of funds in 2016
• 08:24: Koch support of tax reform and regulatory rollback
• 09:40: Koch ties among top officials in the Trump administration
• 10:08: Details on Koch-backed appointees
• 11:06: David Koch’s retirement and family dynamics
• 11:44: Jane Mayer’s summary of the Kochs’ accomplishments under Trump

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Conclusion

This episode provides a concise yet penetrating look at the Koch brothers’ ongoing influence over Republican and national politics, shining particular light on their differences with Trump over tariffs—and how, despite these, they have shaped some of the administration's most consequential legislative and regulatory outcomes. The conversation underscores the enduring power of money and coordinated influence in American politics.

Transcript

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[Dorothy Wickenden]

I'm Dorothy Wickenden. On today's Politics and More podcast, David Remnick talks to the New Yorker's Jane Mayer about Charles and David Koch. Despite being two of the Republican Party's biggest and most powerful donors, the Koch brothers plan to spend $30 million in the run up to the midterm elections, opposing Trump administration tariffs on imported goods.

[Jane Mayer]

Hello.

[David Remnick]

Hey, Jane. How you doing?

[Jane Mayer]

Good. How are you?

[David Remnick]

Good.

[Jane Mayer]

Are we rolling? We are great.

[David Remnick]

Now, I've called up Jane Mayer because for years Jane has been reporting on the political activities of the Koch brothers, Charles and David Koch of Koch Industries. They're among the biggest donors in conservative politics, spreading a free market and libertarian view of the world. And their influence in Washington can hardly be overstated. So Donald Trump's big pivot toward trade protectionism is the very last thing they want to see. Trump seems determined to spark a trade war and imposing tariffs not only on China and Mexico, but Canada and Europe, too. Charles and David Koch have now launched a campaign against those policies right as the midterm elections give voters a referendum on The Trump presidency. Jane, the Kochs have been free trade boosters for decades. How are they reacting to Trump's behavior at the G7 and his recent round of tariffs?

[Jane Mayer]

Well, they're against any kind of tariffs. They think that it's deleterious to their business and to the country's economy. So they're playing, planning to spend a lot of money to oppose his policy of imposing tariffs. And so it's one of the areas that they differ from him on. And they know how to make a lot of noise when they need to. They'll spend as much money as they can.

[David Remnick]

How much are they spending on this anti tariffs campaign?

[Jane Mayer]

They've talked about spending millions, as much as 30 million.

[David Remnick]

In what form will the spending take? Can I spot a Coke advertisement on television? If I look carefully, you very well.

[Jane Mayer]

May be able to look for ads from Americans for Prosperity. And there are a number of other allied groups that they fund. They have a Hispanic group that they fund. They have a veterans group, Concerned Veterans for America. You will see ads that will say that these tariffs are going to hurt poor people and consumers. They don't go out there and say these tariffs are going to hurt Koch Industries. And we who are the ninth richest men in America, which is what the two Koch brothers are, they talk about how the tariffs are going to hurt the little people.

[David Remnick]

Now, what does this mean for the midterm elections? Where are the Kochs going to put their money when it comes to November?

[Jane Mayer]

They are going to mostly do what they usually do, which is try to control Congress with their money. And so the most important for them is to keep the country from doing anything that would put a tax on carbon pollution and take action against global warming because their whole business is tied up in carbon, in fossil fuels.

[David Remnick]

The party in power almost always loses some seats in a midterm. Where are they going to concentrate?

[Jane Mayer]

They're going to put a lot of money behind Republican candidates and every now and then there'll be a Democrat. There are a few straggler Democrats that they have always funded. They're Democrats where they've got some of their businesses are located, like in Arkansas. They've backed Democrats in the past and Democrats who support the policies that they support, they'll back. So they've done that recently with one who was supporting the gutting of the Dodd Frank financial regulation bill. What they've been able to do is create an apparatus that's a. It's like a political machine. And there's a piece by a couple scholars at Harvard who Describe it as a machine that is as powerful, if not more powerful than the Republican Party at this point. And so what they do is they use this political muscle. They've got to scare Republicans into following their agenda. And they threaten those that might not by saying, we'll run somebody against you in a primary. They call it, we'll primary you. And so the Republicans want to toe their line so that they don't have a primary opponent who's really well funded who might knock them out. And most of the people on the Hill, face it, want to get reelected. So they go along.

[David Remnick]

Well, let's remind ourselves what the Kochs did during the election campaign. If I remember, they described the campaign of Clinton versus Trump as having to decide between a heart attack and cancer, I think is how they put it. Now they have Trump was tariffs. The main reason that they thought this was a disease.

[Jane Mayer]

It's part of it. The truth is that they are radical right libertarians. They want to shrink the government down to, you know, the size that it was during Calvin Coolidge's period. Calvin Coolidge is their favorite president. And they realized that Trump is not one of them. He's not a libertarian. He's not an ideologue. He's a new, different kind of breed. He's not someone they can control particularly. He doesn't necessarily share their beliefs. And if anything, he kind of aggrandizes himself as president and makes a show of a display of power as president. That none of that is their kind of politics.

[David Remnick]

No, they want to Silent Cal. Trump is not silent Cal, but they had to.

[Jane Mayer]

He is not silent Cal, but they.

[David Remnick]

Had to know this was coming. Of all the positions that Trump has ever taken, the one he's been pretty clear about from the start is what he's doing now on trade, isn't it?

[Jane Mayer]

Well, right. And so this was one of the reasons they opposed him. They would have been happy with any of the other Republicans nominees, potential nominees for president in 2016, and they were ready to back any of them except Trump. And they sat on their hands on the sidelines waiting for a nominee to be chosen, and then they were going to throw their money into the race. And lo and behold, the one guy who they opposed got the nomination.

[David Remnick]

Did they give money all the same?

[Jane Mayer]

They had set aside a kitty of $889 million. The money was distributed in lesser amount to many, many Senate and congressional and gubernatorial and even lower level candidates, but they didn't put money behind Trump. But I actually feel that sort of obscures what to me, anyway, is the more important story, which is, yes, they have differences with him on trade and on immigration. Those are two major areas of difference they've got with him. But they've gotten behind him on so many other things quietly.

[David Remnick]

Like what?

[Jane Mayer]

Well, they are huge supporters of his one achievement in office legislatively, which is the tax bill that was passed recently. It reduces corporate rates from 35 to 21%. This is their idea of heaven. And they put $20 million into backing it in a national campaign, pushing to get it through Congress. And the other thing they did, which is really something that we're going to all be dealing with, the consequences for years, is that they stopped him from achieving the mechanism that he had originally intended to pay for those tax cuts, which was something called the border adjustment tax. And Paul Ryan was for it. So you've got the speaker of the House of Representatives. Trump was for it. You had the White House backing it. But guess what? The Kochs were against it and they killed it. So there's no mechanism now to make up for the gigantic deficits that the Trump tax bill is going to create. And they're going to create a lot more pressure to keep cutting government spending. And that's what the Kochs want.

[David Remnick]

Jane, my understanding is that while Donald Trump himself may be somewhat distant, especially ideologically, from the Kochs on certain issues, you've got Betsy DeVos, who's the secretary of Education, Mike Pompeo, the Secretary of State, Mike Pence, who's the vice president. Obviously they all have pretty close ties.

[Jane Mayer]

To the Kochs, really close ties.

[David Remnick]

So how have they been able to influence policy at say, the Department of the Interior or the epa, let's say.

[Jane Mayer]

Well, so in the Department of the Interior there is the top lawyer. There is a man named Daniel Jorjani, who was, I mean, he's worked for many years for Charles Koch, for his institute, for his foundation and for the Koch brothers political organization. So he's just kind of a right hand man to Charles Koch. And he's now the top lawyer in the Interior Department and over in the Environmental Protection Agency, the epa, they've got. The secretary is Scott Pruitt, who is somebody whose political career was funded from the start by the Kochs.

[David Remnick]

David Koch has stepped down. He's retired. Did he do so voluntarily or did his brother give him a little kick out the door?

[Jane Mayer]

Well, I mean, the thing is he's retiring because he's in failing health. And so it was somewhat in the.

[David Remnick]

Know, there was tension there, right?

[Jane Mayer]

Yes, but According to the two of the sources I talked to, who are very much in the know, he was given a push out the door by his older brother. And they said that it was done with a wink and a nod and a nudge and that David Koch really hadn't wanted to go, but that Charles has been pushing him out for some time.

[David Remnick]

Regardless of what happens with trade policy or in November. Isn't it your sense that the Kochs have come out pretty far ahead on these two years of the Trump presidency, despite their opposition on tariffs or immigration? They've gotten plenty out of this presidency.

[Jane Mayer]

I mean, really, tariffs and immigration are not such central questions to them as environmental policy and tax policy and other regulatory policy. And on those areas, Trump for them is a dream come true.

[David Remnick]

Jane, thanks so much.

[Jane Mayer]

Great to be with you.

[Dorothy Wickenden]

That was Jane Mayer talking to David Remnick.

[David Remnick]

Right now, we are living through some of the most tumultuous political times our country has ever known. I'm David Remnick, and each week on the New Yorker Radio Hour, I'll try to make sense of what's happening alongside politicians and thinkers like Cory Booker, Nancy Pelosi, Liz Cheney, Tim Waltz, Katanji Brown Jackson, Newt Gingrich, Robert F. Kennedy, Jr. Charlamagne, the God, and so many more. That's all in the New Yorker Radio Hour. Wherever you listen to podcasts.

[Jane Mayer]

From PRX.