June 4, 2018 / 5:06 PM / 6 months ago

Free trade puts Republican megadonors on collision course with Trump

WASHINGTON (Reuters) - Groups backed by powerful Republican donors Charles and David Koch said on Monday they will champion free trade and oppose tariffs with a multimillion-dollar campaign that puts them on a collision course with President Donald Trump.

The embrace of free trade principles by major Republican donors comes as Trump pursues aggressive measures against trading partners from China to Canada and U.S. allies in Europe, in line with his campaign pledge to pursue better trade deals.

An infusion of money into media, grassroots mobilization, lobbying and policy analysis into the domestic debate on free trade could embolden Republican candidates in the November congressional elections to part ways with the president on the issue.

Republican lawmakers, already grumbling about some of Trump’s trade initiatives, outright condemned the Commerce Department announcement last week on impending tariffs on steel imports and aluminum to be imposed on the European Union, Canada and Mexico.

In a statement, the Koch-backed groups said they would push Trump to lift those steel and aluminum tariffs, the recent tariffs on solar panels and washing machines as well the proposed tariffs for imports from China.

“The Trump administration has taken some incredibly positive steps for the American economy, but tariffs will undercut that progress and needlessly hamstring our full economic potential,” said Tim Phillips, president of Americans for Prosperity, a Koch advocacy group.

The groups said they would advocate that Trump reduce or eliminate trade barriers by modernizing the North American Free Trade Agreement (NAFTA) and returning to the negotiating table on the Trans Pacific Partnership (TPP).

Congress should abolish farm subsidies on crops, commodities and crop insurance and end subsidies for green energy as well as repeal the “buy America” requirement and the Jones Act, which requires goods shipped between U.S. ports to be carried on ships that are domestically owned.

The Koch-funded Freedom Partners Chamber of Commerce and the LIBRE Initiative are also involved in the initiative.

The billionaire Koch brothers have been a force in American politics since the 1980s. Their influence has largely been powered by a fortune centered on Koch Industries, the second-largest privately held company in the United States with annual revenues of more than $115 billion from interests in energy, chemicals and other sectors.

During the 2016 presidential campaign, the Kochs kept their distance from Trump. Charles Koch spoke out against Trump’s proposed Muslim registry, invoking a comparison to Nazi Germany.

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The Koch network did not actively campaign against Trump in the 2016 Republican presidential primary or pour money into his campaign against Democrat Hillary Clinton. By contrast, the Koch network spent more than $120 million in the unsuccessful 2012 effort to defeat President Barack Obama.

After the 2016 election, however, the Kochs found common ground with the new Republican president on issues including rolling back federal regulations and pulling out of the Paris global climate accord.

“This campaign makes a clear statement: Trade is a major priority for our network. We will work aggressively to educate policymakers and others about the facts,” said James Davis, executive vice president of Freedom Partners.

Reporting by Doina Chiacu and Caren Bohan; editing by Jonathan Oatis

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