Archive for February, 2014

Not Their Finest Hour

Friday, February 28th, 2014 by Geoffrey Lyons

THE “SPECIAL RELATIONSHIP” between the U.S. and U.K. is defined by many shared characteristics, the most salient being a common tongue and a commitment to democracy.  Such a bond is more than just quaint: similarities make it easy for one country to learn from the mistakes of the other.  Noah Webster, for example, famously purged American spelling of much of its inherited inconsistencies.

Yet last month, when “The Transparency of Lobbying, Non-party Campaigning and Trade Union Administration Bill” became an Act of Parliament (law), the U.K. proved that it hasn’t learned a thing about the ongoing blunder that is U.S. lobbying law.

The law, apparently modeled on HLOGA, establishes a registrar to enforce lobbying registration and imposes limits on campaign spending for non political parties (trade associations, faith groups, etc.). Critics have been quick to pounce.  The measure has already earned a negative reputation as the “gagging law” for its arbitrary restrictions on the freedom of association, the same alarm that’s still being sounded on this side of the Atlantic.  The EU Observer calls it “misdirected,” and predicts that it will “further cleanse the political sphere not of corruption, but of the public itself.”

The Nottingham Post’s reaction to restrictions on non-party campaigning, which is the most contentious part of the law and which will be enforced in the run-up to elections–”crazy.”   “The run-up to elections is just the time we want to have our say. That is the time we want to have debates in public space about what matters to us down our streets and in our playgrounds and workplaces.”  Ekklesia, a Christian political think tank, is even more indignant, predicting the law will  “gravely damage democracy and human rights.”

How can such flawed legislation achieve Royal Assent?  The EU Observer summarized it beautifully, writing that proponents must rely on the “transforming [of] a democratic right such as lobbying…into an object of suspicion.”  Congress has been there, done that, and active citizens are still facing the consequences.  It’s a shame that Parliament has opted for a similar fate.

Wage War

Thursday, February 27th, 2014 by James Cameron

PRESIDENT OBAMA HAS called the proposed federal minimum wage hike “giving America a raise,” but whether the legislation succeeds or not, lobbyists are likely to enjoy a windfall.  Raising the minimum wage from its current rate of $7.25/hr to $10.10/hr is a centerpiece of congressional Democrats’ 2014 legislative agenda, and groups on both sides of the issue have already spent millions of lobbying dollars to influence lawmakers on the fence.  With recent news that a vote on the legislation will be put off, lobbying campaigns for both sides are heating up.

The Hill reports that Senate Majority Leader Harry Reid has delayed a vote on the legislation as support for the hike has waned among vulnerable congressional Democrats. A coalition of labor unions and liberal advocacy groups has hailed the move, saying that it gives them time to mount a national grassroots lobbying campaign to drum up support for the legislation.

Vowing to fight the bill are numerous retail, restaurant, and service organizations. The American Hotel & Lodging Association, which overhauled its lobbying team last year, strongly opposes a minimum wage hike, claiming that it would inhibit companies’ ability to hire more workers.

Complicating the issue is the difficulty of sifting through a myriad of reports from disparate sources to piece together an accurate picture of the hike’s potential impact. Although it seems likely that the Congressional Budget Office’s recent report that the hike could cost as many as 500,000 minimum wage jobs but increase earnings for more than 16.5 million workers is accurate and nonpartisan, data from other sources may be suspect. The New York Times reports that some nonprofits and think tanks that publish economic reports on legislation are in fact funded (often secretly) by groups with a significant stake in the legislation. The Employment Policies Institute, for example, has published academic reports warning that raising the minimum wage would adversely impact poverty, unemployment, and the economy. But the Times also notes that the group is run by a PR firm that also represents the restaurant industry, which strongly opposes the wage hike. Just as lobbying has gradually moved underground and become more opaque, so too are groups attempting to influence policy in nebulous and indirect ways, as the current fight over the minimum wage illustrates.

Although the Congressional battle over “America’s raise” has been delayed for now, the lobbying fight over the wage hike has just begun. With heavy hitters like Wal-Mart still out of the fray, the battle is likely to get even more intense before it’s over.

The Book Behind Current Lobbying Law

Friday, February 21st, 2014 by Geoffrey Lyons

THE LATEST EDITION of The Nation has as its cover story a detailed expose of what it calls “the shadow lobbying complex,” an issue explored at great length in this blog.  While reading the article and delighting in its infographics, this blogger decided that a brief timeline of modern disclosure laws would make for an interesting post.

And so I began with the summer of 1935, when Rep. Denis Driscoll (D-Pa.) received 816 telegrams from constituents pleading him to oppose a measure that would break up the utility trust companies, which were then being run by a handful of remarkably wealthy men.  The telegrams would have made for an impressive case study in lobbying from the bottom up, or “grassroots lobbying,” except for one important detail: the constituents behind the telegrams were completely fabricated.  The whole thing was a sham, conjured together and funded by the utility companies.

This incident and the broader debate surrounding the Wheeler-Rayburn Utility Holding Company Act set the gears in motion for modern disclosure law, which today is ridiculed as an utter failure.  Were I actually to have posted a timeline of lobbying disclosure, I might have used just five dates:

  1. 1946: The Federal Regulation of Lobbying Act is passed as a late response to the utility company debate
  2. 1991: the GAO exposes the law’s shortcomings
  3. 1999: The Lobbying Disclosure Act (LDA) is passed as a second try
  4. 2006: Jack Abramoff reports to prison, proving LDA a failure
  5. 2007: The Honest Leadership and Open Government Act (HLOGA) is passed as a third try, a significant amendment to LDA that adds criminal sanctions and stricter reporting requirements

Yet this would appear a very lopsided timeline, with  nearly half a century separating the first two dates.  Did nothing relevant transpire between the passage of The Federal Regulation of Lobbying Act and the GAO report that deemed it a failure?

In fact, something did.  In 1977, a book was published that would become the basis for the GAO’s report.  According to The Nation, the report found that “10,000 lobbyists listed in an industry guidebook had failed to register. Of those who had, as many as 94 percent failed to complete their registration forms as required by law.” This “industry guidebook” just happens to be Washington Representatives, a Lobbyists.info publication entering its 37th year.  If one accepts The Nation’s claim that the GAO report was the “impetus” for LDA, and former Rep. Charles Canady’s (R-Fla.) assertion that the Washington Representative’s finding “underscored” the need for LDA, then to a significant extent Washington Representatives is responsible for LDA.  The innumerable ironies that come packed with this are too rich and detailed for this blog.  Needless to say it’s a fascinating discovery.

Candy Gets No Love From Washington

Friday, February 14th, 2014 by Geoffrey Lyons

THE CANDY HEART: to a smitten valentine, it means love; to a sugar farmer, it means profit.  What, pray, does it mean for “Big Candy”?

Considering the retail statistics, which put candy well in front of flowers and jewelery (yet slightly behind cards) as one of the most commonly purchased Valentines Day gifts, the candy industry is just as much a winner on the 14th as the sugar that coats its products.

So why are candy lobbyists (yes, they exist) making a fuss on what for them should be a day of celebration?  The heavy snowfall certainly didn’t help.  Many who would have happily purchased candy yesterday instead took up the shovel, bravely straining their back against nature’s caprice.

But weather is only part of the story. Candy is mostly cranky because of the farm bill.  Even with confectionary sales on the rise and profit margins of over 12% through 2013, the candy industry despises the fact that sugar prices are still being propped up by cushy subsidies, tariffs, and production quotas.  A recent House amendment that sought to chip away at this antiquated policy lost by slim margins in both the House and Senate.   According to the LA Times:

…the House amendment would have passed easily if not for opposition from 74 lawmakers from states with no sugar growers, as well as 30 House members from California who have no sugar growers or refiners in their districts. That’s a testament to the lobbying muscle of sugar growers…

As evidenced by its name, the Coalition for Sugar Reform vocally opposes current policy, which it claims costs billions of dollars every year.  The chairman of the coalition, Larry Graham of the National Confectioners Association, said in a statement that “the impact of sugar policy is felt everywhere, from local food manufacturers to the grocery store aisle to the kitchen table. Now is the time to make a change.”

That statement must have been penned before the defeat of the House amendment, which effectively dashed the hopes of confectioners to make Valentines Day a twofold victory: one of both big sales and big policy changes.

Which leads us back to the candy heart: to a bachelor it means disappointment and melancholy; to a candy lobbyist it means, well, pretty much the same.

Revolving Door Spinning at Cyclone Speed

Monday, February 10th, 2014 by James Cameron

IT’S WELL KNOWN in Washington that congressional staffers tend to be underpaid and overworked. One might assume that they accept these conditions in exchange for the connections and prestige that Congress affords. Increasingly, however, the motivation is a lucrative job on K Street.

Despite HLOGA, more than 1,650 former Congressional aides have registered to lobby less than a year after leaving Congress, according to the New York Times. These freshly-minted lobbyists often return to the Hill to lobby on the very legislation that they worked on while they were staffers. The rules that intended to prevent this “revolving door” effect are so weak, particularly in the House, as to be practically nonexistent. As the Times points out, former House staffers can avoid the one-year moratorium on lobbying as long as their salaries are less than the paltry sum of $130,500.

In fact, restrictions on the revolving door have been so easily circumvented that, according to the Sunlight Foundation, the number of registered lobbyists with previous government experience actually peaked in 2009, two years after the passage of HLOGA. To make matters worse, as LobbyBlog reports, even though lobbying registrations are on the decline, there is a well-known shadow industry of unregistered lobbyists who are working as “strategic advisors” while still technically complying with current disclosure rules. It stands to reason that there are even more former staffers who are “unlobbyists” to whom the current lobbying restrictions don’t apply at all.

So why is this a big deal? The biggest concern is that staffers and members who are eyeing a cushy job on K Street will try to influence legislation to favor their future employers before they even leave Capitol Hill. Indeed, as the Times points out, staffers are often hired because of specific legislation or issue areas on which they worked, and when the turnaround from staffer to lobbyist can be measured in months or even weeks,  the current system’s potential for abuse becomes apparent.

Another Day, Another Hurdle

Tuesday, February 4th, 2014 by Geoffrey Lyons

LOBBYISTS HAVE TAKEN a lot of damage over the years.  Abramoff inflicted a wound that was salted by HLOGA.  Obama campaigned on combating special interests, and landed his first blow by way of executive order.

The obstacles these produce, both real and imagined, make the business of advocacy more challenging than it should be.  Yet lobbyists have reason to enjoy the status quo while it lasts, because things could soon get worse.

According to Karen Hinton, an advocate representing Ecuadorians in a long-standing oil pollution suit against Chevron, lobbyists could soon be vulnerable to racketeering charges by their opposition.  If Chevron wins their case on the grounds that Hinton and others are colluding in a fraudulent lawsuit, then a precedent will be set whereby “hard-hitting press releases and lobbying before Congress and government agencies by (insert you and your client) against (insert your client’s competitors or opponents) about (insert issue that financially benefits your client) could equal extortion and be a violation of the RICO statute.”

RICO stands for Racketeer Influenced and Corrupt Organizations Act.  By law, a plaintiff who wins a RICO case “…shall recover threefold the damages he sustains and the cost of the suit.”  Hinton argues that because of this “treble damages” clause, companies and trade associations targeted by RICO cases could go bust.  Pursuing this to its obvious conclusion, advocates with less to spend could be bullied out of lobbying altogether.

That would be bad indeed, and is something for which lobbyists should collectively oppose.