Reid escalates feud with Koch brothers

Greg Nash

Senate Majority Leader Harry ReidHarry ReidOvernight Finance: Puerto Rico bill clears panel | IRS chief vows to finish term | Bill would require nominees to release tax returns Wasserman Schultz fights to keep her job Overnight Defense: Pentagon chief fears sequestration's return MORE (D-Nev.) on Tuesday accused the Koch brothers of unlawful business practices in an effort to portray the conservative billionaires as election-year bogeymen.

Reid charged that Charles and David Koch, who are tied for fourth place on the Forbes list of 400 richest people in the United States, violated the Foreign Corrupt Practices Act, citing a 2011 report by Bloomberg Markets magazine.

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“These are the same brothers whose company, according to a Bloomberg investigation, paid bribes and kickbacks to win contracts in Africa, India and the Middle East,” Reid said on the Senate floor. “These are the same brothers who, according to the same report, used foreign subsidiaries to sell millions of dollars of equipment to Iran, a state sponsor of terrorism.”

Representatives of the Kochs’s business empire fired back quickly in what has become an escalating battle between the top Democrat in Congress and the press-shy business titans.

A lawyer for Koch Industries said the allegations in the Bloomberg article have been subsequently debunked and did not result in any legal penalty.

“Nothing has ever come of any of the allegations that Mr. Reid referred to,” said Mark Holden, general counsel of Koch Industries.

"Sen. Reid's allegations are false," he added. 

Philip Ellender, the president of government and public affairs at Koch Companies Public Sector LLC, said Reid was lashing out at the Kochs because of political differences.

“We are disappointed that Sen. Reid is attacking private citizens rather than the problems facing this nation. It is no wonder that Americans have lost faith in Congress,” he said in a statement.

Patrick Pexton, the ombudsman for The Washington Post in 2011, at the time questioned the paper for republishing the Bloomberg report.

“I think the story lacked context, was tendentious and was unfair in not reporting some of the exculpatory and contextual information Koch provided to Bloomberg,” Pexton wrote in October 2011.

It was the third attack Reid leveled at the Koch brothers on the Senate floor in the past week, and Democratic strategists say the intent is to make the Kochs the new faces of the GOP.

The Nevada Democrat, a former amateur boxer, is known for lambasting his political enemies.  

In 2008, Reid said he “can’t stand” Sen. John McCain (Ariz.), who was then the GOP presidential nominee. Four years later, he repeatedly ripped Mitt Romney and, without proof, claimed the 2012 Republican standard-bearer hadn’t paid taxes in 10 years.

Reid’s salvos at the Kochs have angered Republican senators who feel he is unfairly picking on private citizens.

Sen. Lindsey Graham (R-S.C.) has threatened to begin demonizing liberal donors.

Other Senate Republicans say the harshness of Reid’s jabs are a sign that Democrats feel under increasing political pressure because of millions of dollars in ads the Kochs have funded in Arkansas, North Carolina and other Senate battlegrounds.

National Republican Senatorial Committee Chairman Jerry Moran (Kan.) rebuked Reid last week for targeting the Kochs and compared him to former Wisconsin Sen. Joseph McCarthy (R). Democrats countered that Moran’s defense only showed how much the GOP political operation is beholden to the Kochs’s patronage.

Democrats used a similar political tactic in 2012 when they compensated for President Obama’s soft approval ratings by making the election more of a choice between him and Romney than a referendum on the president.

“The Koch brothers click because when you look at the policies they want to enact they are policies that benefit the wealthiest: getting rid of minimum wage, lobbying against paycheck fairness,” said a senior Senate Democratic aide.

Democrats succeeded in 2012 by painting Romney as an emissary for the wealthy elite who had little in common with ordinary voters. Romney played into the strategy by making disparaging comments about 47 percent of Americans and building an elevator for his four-car garage.

But this year — just like in 2010 — Obama’s numbers are low and there is no clear household name bogeyman. In 2010, Republicans won 63 House seats in the midterms and cut into the Senate Democratic majority.

“The dynamics in a non-presidential year are quite different. Mitt Romney was an absolutely delightful candidate to run against,” said Mike Lux, a Democratic strategist. “He represented so much what we as Democrats opposed with the 47-percent statement.

“It is always helpful in politics to personify issues to use people as the example of what’s going on with a given issue, and the Koch brothers are a great example,” he added.

“The idea is to create the impression that Republicans are getting their money from a sinister and questionable source, people who violate campaign finance laws and trade with the enemy,” said Ross K. Baker, a political science professor at Rutgers University who previously served in the Senate as a senior fellow and scholar-in-residence.

Reid has flipped to the same page of the playbook to make the November election a choice between Obama and the Koch brothers instead of a referendum on the unpopular ObamaCare law.

Last week, Reid ripped the Koch brothers as “un-American” and accused them of “trying to buy America” in separate floor speeches.

He followed up in a lengthy speech devoted to the Koch brothers Tuesday, when hearings and votes were canceled because of snow.

“What is un-American is when shadowy billionaires pour unlimited money into our democracy to rig the system to benefit themselves and the wealthiest 1 percent,” he said. 

Senate Democratic aides say polling consistently shows that many voters feel they are living in a two-tiered economy that has left them behind and benefited the rich disproportionately.

Obama and Reid have embraced economic inequality as their campaign theme of 2014, and holding up the Koch brothers as the wealthy patrons of the GOP fits snugly into that strategy, say Senate Democratic aides.

Brad Dayspring, the NRSC’s communications director, on Tuesday accused Democrats of hypocrisy by noting several vulnerable Democratic senators have accepted money from the Koch Industries political action committee.

“Man, the Senate Majority Leader sure is grumpy. Wonder why? Oh, right — his majority is slipping away,” Dayspring wrote in a memo to reporters.

He pointed to data compiled by the Center for Responsive Politics, which tracks fundraising, showing the campaigns of Sens. Mark Pryor (D-Ark.) and Mary Landrieu (D-La.) and the leadership PAC of Sen. Mark Begich (D-Alaska) have accepted money from Koch Industries PAC in recent years.

This story was posted at 3:10 p.m. and updated at 9:18 p.m.