Wednesday, February 21, 2007
WHAT'S NEW IN PUBLIC AFFAIRS
The conversation continues regarding lobbying and ethics laws. As analysts dissect the new rules, it's clear that the winners will be grassroots lobbyists, contract lobbyists with expertise (rather than access), groups without registered lobbyists, fundraisers and, of course, lawyers hired to explain what all these changes mean. Not surprisingly, media coverage has centered on companies and legislators looking for loopholes in the new regs. If you're tired of all the talk about lobbying, look at the growth of Web-based campaigns that encourage investors to join forces to encourage (lobby for? changes in management practices at big corporations. Read "Web Warriors" in the Red Herring, a publication about the business of technology, for details. These stories and more in this edition of the Public Affairs News Monitor.
HEADLINES AT A GLANCE
"Congress Finds Ways of Avoiding Lobbyist Limits"
"Grassroots Campaigns Poised to Gain from Ethics Rule Changes"
"Web Warriors"
"Majority Formalizes K St. Ties"
"Members Earmarking Without Earmarks"
"Bytes to Paper to Bytes to Paper to Bytes"
"Business Seeks to Defeat Bill on Unions"
"House Election Reform Agenda Is Slim"
UPCOMING CONFERENCES
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National PAC Conference
February 26-March 1, 2007 - Miami Beach, FL
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April 12, 2007 - Washington, DC
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Public Affairs News Monitor may be reproduced in hard copy form or electronically for internal circulation to Public Affairs Council member companies and associations.
"Congress Finds Ways of Avoiding Lobbyist Limits"
New York Times (02/11/07) P. A1; Kirkpatrick, David D.
Congress recently passed legislation limiting the influence of lobbyists on lawmakers, barring them from treating lawmakers to free meals, trips, stadium seats, or discounted travel on private jets. However, these rules are already being circumvented as lobbyists contribute to lawmakers political action committees, which turn around and fund expensive events and trips for lawmakers. Rather than allowing lobbyists to foot the bill for a dinner, the rules seem to have increased the demand for expensive events and fundraisers. In some cases, lawmakers have stopped holding such events, but other party campaign committees have not, and critics argue that not only will lavish events continue, but campaign contributions will increasingly be from lobbyists. However, lobbyists and lawmakers need to remain cautious about events and spending, as some events could appear illegal if lobbyists or their employers directly paid for those events. Meanwhile, politicians could also find themselves afoul of the rules if they are using campaign funds for personal entertainment and recreation, though the political action committees can spend funds without restriction.(www.nytimes.com)
"Grassroots Campaigns Poised to Gain from Ethics Rule Changes"
The Hill (02/06/07) Vol. 14, No. 15, P. 9; Holzer, Jessica
Organizations with the ability to run "grassroots" campaigns stand to benefit from separate House- and Senate-backed ethics legislation that prohibits trips and gifts from lobbyists, as well as a Senate provision to extend the waiting period that former congressional staff and lawmakers must endure before they lobby their old colleagues. "There's been an evolution over a 10-year stretch in which relationship lobbying has become relatively ineffective," notes Federalist Group Managing Director Stewart Hall. "The members don't want their actions seen as being affected by relationships with special interests." The decline of old-fashioned lobbying has encouraged lobbying firms to give themselves over to major public-relations conglomerates with strong grassroots operations, while business for independent grassroots firms has been booming as traditional lobby firms seek alliances. Trade associations and credit unions are also taking steps to support grassroots campaigning. There is no federal requirement for lobbyists to disclose grassroots campaigns, which complicates the tracking of their growth. Such a provision was removed from an ethics reform package by the Senate last month. (www.thehill.com)
"Web Warriors"
Red Herring (02/05/07) Vol. 4, No. 4, P. 37; Schachter, Ken
Small investors are waging war on executives through Web-based campaigns. A notable example is management consultant Eric Jackson, who conveyed a message to Yahoo shareholders via a Web video that called for a change in management, among other things. If his efforts succeed, Jackson could rally an army of investors to put pressure on Yahoo! by tapping social media sites and blogs instead of relying on SEC filings, proxy fights, and media coverage, which are the usual weapons of choice. Web campaigning is a tactic previously dominated by hedge funds. The use of 13D letters filed with the SEC is a strategy being adopted by more and more institutions because of the tremendous success it has yielded for hedge funds, according to 13D Monitor founder Ken Squire. "It's an investment strategy that's currently very successful," he notes.(www.redherring.com)
"Majority Formalizes K St. Ties"
Roll Call (02/15/07); Newmyer, Tory
Democrats opened up lines of communication with K St. lobbyists this year, and lawmakers hope that the channels of communication will lead to wider agreement among opposing groups, like labor and businesses. Democrats continue to meet with Third Way, a centrist think tank, and lobbyists regarding the "100 hours" agenda. One lobbyist stated, "The pivot to regular order means that everybody is really focused on how to start putting together the coalitions to get things done, and how to find ways to work with the business community so there isn't a constant battle." However, labor and business groups are still expected to argue over minimum wage hikes, health care, trade, and unionizing. Unlike previous meetings of the so-called Monday Group, Third Way meetings do not have fundraising or lobbying angles to them; these meetings are focused on information sharing. (www.rollcall.com)
"Members Earmarking Without Earmarks"
Roll Call (02/07/07) Vol. 52, No. 76, P. 1; Ackley, Kate; Stanton, John
The majority of appropriations bills for fiscal 2007 have had virtually all congressionally mandated "earmarks" removed, yet Members of Congress and those who lobby for funding for specific projects are eyeing executive branch agencies. Members on the Appropriations and authorizing committees have considerable clout to ensure that these agencies underwrite their favored initiatives. An anonymous appropriations lobbyist reported that members as well as staffers have been contacting agency officials to shield their 2007 earmarks. A source in the Senate Appropriations Committee said that at this juncture there have been no reports of Senate legislators wielding influence over the spending of money, yet that person noted that Appropriations Chairman Sen. Robert Byrd (D-WV) was unhappy "about turning over the power of the purse" to the executive branch and that the committee would aggressively oversee the spending process. Still, Senate aides privately admitted that their offices would probably get in touch with agencies to emphasize their desire that funds earmarked in appropriations bills approved in 2006 are funneled into those particular projects.(www.rollcall.com)
"Bytes to Paper to Bytes to Paper to Bytes"
Baltimore Sun (02/04/07) P. 11A; Morain, Dan
Senators' refusal to send campaign donation reports over the Internet has created a situation in which they can delay public disclosure of the identities of their contributors, sometimes until after an election. An abundance of senators seeking the presidency by tapping funds they raised as senators has brought the practice into sharper relief. Critics say lawmakers are intentionally delaying campaign donor disclosure to benefit themselves without violating the letter of the law, and there is certainly no shortage of modern technology used by senators in other campaign donation matters. Senate Rules Committee Chair Sen. Dianne Feinstein (D-Calif.) supports legislation that requires senators to file campaign contribution reports electronically. The FEC has called for this revision for at least a decade.(www.baltimoresun.com)
"Business Seeks to Defeat Bill on Unions"
Wall Street Journal (02/14/07) P. A13; Cummings, Jeanne
A House bill that would make it easier for unions to organize is facing stiff opposition from business groups, who are raising millions of dollars in an effort to defeat the measure. The Employee Free Choice Act is a priority of labor leaders, who were a key Democratic ally in the last election. The bill would allow workers to form unions by signing pro-union cards instead of holding elections, which labor leaders say is necessary because workers have faced retaliation in some workplaces as balloting approaches. Labor groups also see the bill as way to halt the decline in union representation, which fell to 13 percent last year, down from 20 percent in 1983. However, the Coalition for a Democratic Workplace, the U.S. Chamber of Commerce, retailers, the Center for Union Facts, and the National Federation of Independent Business all plan to fight the bill by airing television ads in several states and specific House districts in an effort to target both Democrats and Republicans. "We will make sure that there is some pain associated with voting for this," says the coalition's Todd Harris. The Center for Union Facts has already spent between $2 million and $3 million on ads opposing the bill. Opponents say the bill would make it too easy for workers to organize. David French of the International Franchise Association, another group opposed to the bill, says owners "could wake up one day, and they'd be organized. This is so efficient for unions, it makes it possible to organize on a very small scale." The bill is likely to pass the House, where it has bipartisan support, but passage in the more evenly divided Senate is problematic, as Republicans could block it with a filibuster.(www.wsj.com)
"House Election Reform Agenda Is Slim"
Roll Call (02/06/07); Murray, Matthew
An aggressive House election reform agenda does not seem to be in the cards, as Democratic leaders have no immediate plans to overhaul 527s or institute other big campaign finance amendments beyond investigating e-voting machine reliability and lobbyists' disclosure of bundled campaign contributions, according to a House leadership aide. The issues with 527s and major campaign finance reforms will likely be resolved by the Democratic Caucus prior to considering other election reform proposals, but certain election experts and good government organizations strongly doubt that substantial changes will be implemented before the 2010 midterm elections. "It'll be much harder to pass any legislation that changes how you fund presidential races now that the 2008 presidential campaigns have begun," noted Federal Election Commission Chairman Robert Lenhard. Democracy 21 President Fred Wertheimer agreed with other reformers that there would have to be reforms in place by year's end before the start of the presidential primaries. "Our goal is to see 527 reform legislation passed in 2007," he declared. Last week, Rep, Marty Meehan (D-Mass.) hinted that the deep divisions among party leaders sparked by 527s has created hesitation on the part of House Democrats to address reform measures in 2007. "We're trying to get a consensus on [527s], so it's no longer controversial," he explained. "If the Democratic leadership decided to embrace it, we could probably pass it alone." (www.rollcall.com)
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