Thursday, November 20, 2008

"Lobbyist-Bashing by Obama Doesn't Dim Industry's Boom Forecast"

From Bloomberg News
By Jonathan D. Salant and Kristin Jensen

Nov. 20 (Bloomberg) -- Lobbyists Heather and Tony Podesta took over a Denver restaurant during the Democratic National Convention in August to host a party for lawmakers and other power brokers. Their guests wore Barack Obama buttons. The Podestas were wearing a label of their own: a scarlet ``L.'' 

The tags were an allusion to President-elect Obama's demonization of lobbyists throughout the campaign, even banning them from raising money for him or making contributions. 

Now, with Obama ready to take office in January, lobbyists aren't quavering with fear. Many view the changed political landscape in Washington as a potential boon for their firms, which will be called upon to help clients navigate Congress and a new administration. 

``We're not worried,'' said former Democratic Representative Vic Fazio of California, now a senior adviser at the law and lobbying firm Akin Gump Strauss Hauer & Feld LLP. ``We will do well.'' 

Obama has a number of people affiliated with lobbying firms on his transition team, and yesterday, former Senate Majority Leader Tom Daschle accepted an offer to be secretary of Health and Human Services. Daschle, who will lead the new administration's effort to revamp the U.S. health-care system, works for Alston & Bird LLP. 

Daschle has been able to serve as an Obama campaign adviser because he wasn't registered as a lobbyist, though his firm earned $3.5 million this year lobbying for the health industry, including companies such as Woonsocket, Rhode Island-based CVS/Caremark Corp. and Birmingham, Alabama-based HealthSouth Corp. The health industry accounted for 60 percent of the firm's lobbying revenue during the first nine months of 2008. 


Fazio and other prominent members of the influence-peddling community said the lobbyist-bashing by Obama, 47, and Republican nominee John McCain, 72, hasn't had a lasting impact. It is one thing to rail against lobbyists in a campaign and another to curb their influence in practice, they said. 

``Both men are sophisticated enough to know lobbyists play a vital First Amendment role in our governmental process,'' said former Republican Representative Robert Walker of Pennsylvania, now chairman of Wexler & Walker Public Policy Associates, a Washington lobbying firm. 

During the campaign, both Obama and Arizona Senator McCain criticized the influence of lobbyists and the interests they represent. 

`Status Quo' 

``When we come together, our voices are more powerful than the most entrenched lobbyists, or the most vicious political attacks, or the full force of a status quo in Washington that wants to keep things just the way they are,'' Obama said at a rally in Florida on Nov. 3, the day before the election. 

After winning, Obama announced that lobbyists would be prohibited from contributing to his transition committee, and that they couldn't serve as advisers on any issues where they had been paid to represent a company's interests. 

Even so, firms such as Walker's, which was paid $6 million to lobby in the first nine months of 2008, and Patton Boggs LLP, which received $29.8 million, report an increase in business from companies and other interest groups. 

With the election past, ``people are a lot nicer to me,'' said Gerry Sikorski, a former Democratic lawmaker from Minnesota who runs the government section at Holland & Knight LLP, which was paid $11.1 million. ``I know I'm not a better person today than I was Nov. 3.'' 

Lobbyists expect the demand to continue. 

`Respected People' 

``People will want to hire knowledgeable and respected people in Washington who have a lot of insight and knowledge about the players and the ability to fashion appropriate outreach to decision makers,'' said Fazio, whose firm was paid $26.9 million to lobby during the first nine months of 2008, second only to Patton Boggs in revenue, according to the Center for Responsive Politics, a Washington-based research group. 

There also will be a new demand for Washington veterans who aren't registered to lobby but nonetheless wield influence because of their knowledge of the White House and Capitol Hill such as Daschle, said former Democratic National Committee National Chairman Joe Andrew. 

``What you will find is a return of the Washington lawyer, someone who is not a lobbyist but has legitimate substantive experience,'' said Andrew, who isn't registered to lobby, though his law firm, Sonnenschein Nath & Rosenthal LLP, was paid $5.1 million in 2008. 

Internet Grassroots 

Still, the lobbying industry recognizes that it will have to function in a new environment. For one thing, lobbyists will face competition from the Internet, which Obama's campaign showed can be a powerful tool to generate grassroots support for candidates or issues. Lobbyists will be pressured to demonstrate that their position has broad support or to show why a lawmaker should support their client's position in the face of a grassroots uprising for the other side. 

``You're going to have traditional lobbying side by side with e-lobbying side by side with new transparency side by side with diverse groups and interests and causes,'' Sikorski said. ``It'll be a new field for all of us to work in.'' 

Besides, said Nick Allard, a partner at Patton Boggs, lobbyist-bashing isn't a recent phenomenon. 

``Lobbyists have been around at least since the Garden of Eden, when the serpent persuaded Eve that knowledge was a good thing,'' Allard said. ``Look at what reward the serpent got.''

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